(S) Japanese Prime Minister Fumio Kishida’s visit to the US

1. (S) Japanese Prime Minister Fumio KISHIDA visited the White House on April 10th, discussing agreements to upgrade US and Japanese military commands, boost production of military equipment, and add Japan to the AUKUS partnership, the joint program with Britain and Australia that constructs and deploys nuclear submarine and provides broader technological support. The two countries further agreed to bolster economic, climate, and space cooperation. Prime Minister Kishida reaffirmed US-Japan relations in a speech, stating that Japan will stand with the United States at “history’s turning point” when democracy is threatened. 

2. (S) Nippon Steel, a Japanese corporation, proposed a $14 billion acquisition for the Pennsylvania-based U.S. Steel, though President Biden opposed it. Prime Minister Kishida also secured a $2.9 billion deal with Microsoft in artificial intelligence. Microsoft plans to open a research facility in Tokyo, the first of its kind in Japan, and upgrade its data centers in the country to improve cloud computing capabilities.

(S) South Korea’s liberal opposition wins parliamentary elections

3. (S) The Democratic Party of Korea (DPK) secured 175 out of 300 seats in the South Korean Parliament. The party and its coalition partners hold 192 seats, falling 8 seats short of a supermajority, which would allow the coalition to override/veto the current President YOON Suk Yeol’s policies. Using this substantial majority, the DPK LEE Jae-Myung has promised to prioritize economic recovery for the average consumer. This development reflects the broader public dissatisfaction with the current conservative People Power Party (PPP) president, who was criticized for mishandling issues like the doctor’s strike, rising food prices, and an aging population. A scandal involving South Korea’s first lady accepting a luxury bag has also tarnished the PPP’s image. Consequently, PPP leader HAN Dong-hoon resigned this morning.

4. (S) This shift in political power towards the DPK, a center-left party, may affect South Korean diplomatic agendas towards North Korea. Historically, former president MOON Jae-in, who shook hands with KIM Jong-un in 2018, was from the DPK. Such a power shift can entail warmer relations with North Korea, which compares drastically with President Yoon’s tougher agenda against the DPRK. President Yoon has sought stronger ties with Japan and the United States in the wake of rising tensions with the North.

(S) Former Taiwanese Leader Ma Ying-Jeou meets with Xi Jinping

5. (S) Former Kuomintang (KMT) President (2008-2016) MA Ying-Jeou is on an 11-day visit to China, which included a visit with XI Jinping on April 10th. His meeting with Xi marks the first time a top Chinese official hosted a past or present leader of the KMT. Xi praised Ma for opposing Taiwanese independence and stated that “external forces” cannot stop “family reunion.” Meanwhile, Ma raised concerns over the aggressive Chinese posture, seeking peace for the strait by stating that war between both sides would be “an unbearable burden for the Chinese Nation.” China’s assertiveness influenced Taiwan’s recent election by pushing voters towards the Democratic Progressive Party (DPP), which has a more alarmist view of the mainland. In response, Ma’s visit aims to recultivate the KMT’s faltering support in Taiwan after losing two presidential elections.

(S) Zhao LeJi, the chairman of the National People’s Congress, visits North Korea.

6. (S) The third-highest Chinese official, ZHAO Leji, plans a three-day visit to North Korea this Thursday. Chinese Foreign Ministry spokesperson MAO Ning calls it a goodwill trip. As of now, details of the trip are being negotiated. Being a high official, Zhao’s role in state budgeting can influence the North Korean economy, which relies heavily on Chinese aid.

(S) Chinese Premier Li Qiang is expected to visit Australia in June.

7. (S) Chinese Premier LI Qiang is scheduled to visit Australia in the third week of June following the Foreign Minister WANG Yi’s visit last month. More restrictions and tariffs, such as live lobsters, are expected to be lifted during this meeting. This relaxation comes just as China removed its tariffs on Australian wine last month and is widely expected to ease tensions between the two countries after COVID-19.

(S) China announces sanctions against two U.S.-based defense companies.

8. (S) On Thursday, China imposed sanctions on General Dynamics Land Systems and General Atomics Aeronautical Systems for weapons such as Abrams tanks to Taiwan, freezing assets and banning executives from entry to China. This decision follows a previous sanction on February 16, 2023, against Lockheed Martin and Raytheon Missiles & Defense. This move suggests China’s increasing willingness to isolate Taiwan over arms deals despite the potential economic repercussions, the struggling domestic labor market, and its reliance on foreign technologies.

(S) Vietnam real estate tycoon sentenced to death.

9. (S) This morning, Vietnamese businesswoman TRUONG MyLan was sentenced to death for embezzling over $12.5 billion, equivalent to 3% of Vietnam’s GDP in 2022. This is the largest fraud case in Southeast Asia, resting at three times the 1MDB scandal’s $4.3 billion. This particular verdict for a high-profile figure over a financial crime is considered to be rare in Vietnam.

10. (S) While foreign investors have found Vietnam desirable for mitigating geopolitical risks in China, this case has eroded the investors’ trust in Vietnam’s financial system. Regionally, the financial defaults of Chinese real estate giants, such as China’s Evergrande Group, point to similar oversight problems, specifically with their ability to take out new loans following the financial regulations of the “Three Red Lines” policy. While the founder of the Evergrande Group, XU Jiayin, has not faced severe consequences, the critical importance of real estate to China’s economy constitutes about 20% of its activities.