Wynn backs China’s travel curbs to Macau

HONG KONG, Nov 19 - Casino mogul Steve Wynn said Wednesday he couldn’t tell when Macau’s slowdown might let up, but expressed confidence in its long-term fortunes and backed government measures to curb travel to the Chinese gambling city.

The chief executive of Wynn Resorts Ltd. also said he was in “sharp disagreement” with comments by a top executive at rival Las Vegas Sands Corp. suggesting the government’s actions were harming Macau’s casino industry.

Wynn, who has one resort open in Macau and a second on the way, said the government has handled “practically everything beautifully.”

“The fact that the economy and the development and expansion of Macau occurred at such a rapid rate has created a great deal of stress on the community,” Wynn said in a telephone interview with The Associated Press.

“The central government and the Macau government putting a crimp in or a slowdown in visitation was an attempt to give the community a chance to absorb the stuff that had been built,” he said.

Macau has boomed since the government started welcoming heavyweight operators like Wynn, Sands and MGM Mirage Inc. The former Portuguese enclave surpassed the Las Vegas Strip as the world’s most lucrative casino market two years ago.

But revenue growth has slowed this year as the global economic slump and new travel restrictions on mainland Chinese tourists take a toll. The government started issuing the restrictions this summer to control Macau’s rapid growth, analysts say.

Last week Sands announced it was suspending work on multibillion-dollar mega resorts in Macau amid a funding crunch and laying off as many as 11,000 construction workers as a result.

The company’s chief operating officer, William Weidner, reportedly told investors Monday that “there have been some changes in terms of the central government’s attitude toward Macau.”

Wynn said he didn’t know when Macau might turn around given the gloomy world economy.

But China’s rising middle class would help the city prosper and Wynn Resorts planned to keep developing there, he said.

“I think the market is wonderful in China,” he said. “Macau has always been a tourist kind of place and it’s broadened ... its appeal. And I think that’s going to continue.” - AP

Obama to usher in major shift in trade policy - Malaysiakini

WASHINGTON, Nov 19 - The election of Barack Obama has delivered a decisive victory to “fair traders,” mainly Democrats and their allies who for years have contended that the free-trade policies of past administrations were a recipe for American job losses and environmental degradation.

Obama’s win marks the first time in modern American history “that a candidate advocating a shift in our trade policies in a decisively pro-worker, pro-consumer, pro-environment direction has been elected president,” Public Citizen’s Global Trade Watch, an advocacy group that is critical of free trade agreements, said in a report.

On the other side, Dan Griswold, director of the Centre for Trade Policies at the pro-trade Cato Institute, was equally stark in his assessment: “We are going to see the US retreat from its longstanding leadership in the global economy.”

Obama has taken a generally mainstream Democratic position on trade. He supports expanding trade but says trade agreements must support US manufacturing jobs and include enforceable labor and environmental standards.

He has promised a tougher stance against China, telling the National Council of Textile Organisations, “I will use all diplomatic means at my disposal” to induce China to change its foreign exchange and export policies that have led to huge trade imbalances.

During the primary season, Obama and other Democratic hopefuls vied in calling for a renegotiation of the 1994 North American Free Trade Agreement with Canada and Mexico, although that was less of an issue in the general campaign.

The Global Trade Watch report said the election produced a net gain of 32 fair traders — five in the Senate and 27 in the House. With that, said the organisation’s director Lori Wallach, “we suspect a shrinking number of members of Congress will dare to pledge fair trade at home and vote for NAFTA expansions in D.C.”

Among two Republican incumbents in the House of Representatives ousted by Democrats campaigning on fair trade issues were Phil English of Pennsylvania and Robin Hayes of North Carolina, lawmakers who cast decisive votes in 2005 when the House passed the Central America Free Trade Agreement by a two-vote margin.

A moratorium could effectively sideline three bilateral free trade agreements, with Colombia, South Korea and Panama, that have been negotiated but await congressional approval. The Bush administration has been particularly strong in advocating the Colombia accord, which it says would open up that country to US exports while rewarding the Bogota government for its pro-US, pro-democracy policies.

But suggestions that Congress vote on the Colombia deal, possibly as part of an economic stimulus package during a lame-duck session, have garnered little interest among Democrats who say the Colombian government has not done enough to curb violence against union organizers and members.

Democrats and their labour advocates also say the South Korean accord does not adequately address the issue of South Korea selling some 770,000 vehicles in the United States in 2007 while buying only about 6,200 US vehicles.

The only bilateral agreement with a chance of getting congressional approval may be the one with Panama because its products do not upset US constituencies, Cato’s Griswold said.

“Obama has made it clear he understands the benefits of trade,” Griswold said, “but he has made it even more clear he will not cross important constituencies in his party such as organised labour.”

Christopher Wenk, senior director of international policy at the US Chamber of Commerce, was somewhat more optimistic, saying Democrats might be more willing to go along if it is an Obama trade agenda rather than a Bush trade agenda.

That agenda would necessarily focus more on environmental and labor protections, but he said the business community already supports an agreement reached between the Bush administration and House Democrats in May 2007, requiring that environmental safeguards and worker rights be core parts of future trade deals.

That agreement set the stage for congressional approval in late 2007 of a free trade accord with Peru. Congress previously gave grudging consent to Bush-negotiated trade agreements with Oman, Bahrain, Australia, Morocco, Singapore, Chile and the six Latin American countries of CAFTA. But last year it also refused to extend “fast track” authority, which gives the president the right to negotiate trade deals that Congress can approve or reject but cannot amend.

“If you look at history, we’ve had pro-trade presidents since FDR (Franklin Delano Roosevelt),” the Chamber’s Wenk said. “There’s absolutely no reason why we should become inward and protectionist and isolationist right now.” - AP

Big 3 US automakers running out of time

WASHINGTON, Nov 19 - The three biggest US automakers pleaded with Congress on Tuesday for a $25 billion lifeline to save their once-proud companies from collapse, warning of broader peril for the American economy as well.

Despite the automakers’ pleas, the new rescue plan appeared stalled in Congress, opposed by Republicans and the Bush administration who do not want to dip into the Treasury Department’s $700 billion financial bailout programme to come up with the $25 billion.

Rank and file Republicans and Democrats from states heavily impacted by the auto industry worked in private trying to come up with a compromise that could speed some aid to the automakers before year’s end. It was an uphill fight.

“Our industry ... needs a bridge to span the financial chasm that has opened up before us,” General Motors Corp CEO Rick Wagoner told the Senate Banking Committee. He blamed the industry’s predicament not on management failures but on the deepening global financial crisis.

Also, Robert Nardelli, CEO of Chrysler LLC, told the panel the bailout would be “the least costly alternative” when compared with damage from bankruptcy.

Under questioning from skeptical senators, both said they would be willing to consider slashing their salaries to $1 to show a willingness to sacrifice for federal help.

Sympathy for the industry was sparse, however, with bailout fatigue dominating Capitol Hill. Lawmakers bristled with pent-up criticism of the auto industry, and questioned whether a stopgap loan would really cure what ails the companies.

At the start of a grilling before his committee that lasted more than fours, Democratic Sen. Christopher Dodd told the leaders of GM, Chrysler and Ford Motor Co that the industry was “seeking treatments for wounds that I believe to a large extent were self-inflicted.”

“You’re asking an awful lot,” Dodd, the panel chairman, said at the close of the session. “I’d like to tell that you in the next couple of days this is going to happen. I don’t think it is.”

Sympathy for the industry was sparse, with bailout fatigue dominating Congress. Lawmakers bristled with pent-up criticism of the auto industry and questioned whether a stopgap loan would cure what ails the companies.

Senate Banking Committee Chairman Christopher Dodd, a Democrat, told Wagoner and leaders of Ford Motor Co and Chrysler LLC that the industry was “seeking treatment for wounds that were largely self-inflicted.”

Still, he said, “Hundreds of thousands would lose their jobs” if the companies were allowed to collapse.

Sen. Mike Enzi, a Republican, complained that the larger financial crisis “is not the only reason why the domestic auto industry is in trouble.”

He cited “inefficient production” and “costly labor agreements” that put the U.S. automakers at a disadvantage with foreign companies.

Wagoner said that despite some public perceptions that General Motors was not keeping pace with the times and technological changes, “We’ve moved aggressively in recent years to position GM for long-term success. And we were well on the road to turning our North American business around.”

“What exposes us to failure now is the global financial crisis, which has severely restricted credit availability and reduced industry sales to the lowest per-capita level since World War II.”

Failure of the auto industry “would be catastrophic,” he said, resulting in 3 million jobs lost within the first year and “economic devastation (that) would far exceed the government support that our industry needs to weather the current crisis.”

Chrysler’s Robert Nardelli sought to respond to critics who suggest the automakers seek Chapter 11 bankruptcy protection, as have some airlines that later emerged restructured and leaner.

“We just cannot be confident that we will be able to successfully emerge from bankruptcy,” Nardelli said.

Chrysler was bailed out by the federal government once before, in 1979, with $1.2 billion in loan guarantees. The company repaid the loan, plus interest, ahead of schedule. Back then, former Chrysler CEO Lee Iacocca reduced his salary to $1.

Under questioning from Democratic Sen. Jon Tester, Ford’s Alan Mulally did not join the other two executives in saying he would do the same now.

“I sure respect the intent of it, but the most important thing is that we not degrade our ability to be competitive and deliver this plan,” Mulally said.

Congressional leaders worked behind the scenes in an effort to come up with a compromise that could speed some aid to the automakers before year’s end. But the outlook seemed poor.

“My sense is that nothing’s going to happen this week,” Sen. Bob Corker, a Republican, said at the opening of the hearing.

Democratic Sen. Max Baucus of Montana said he also smelled a flameout. “I sense that nothing is going to be passed,” the Finance Committee chairman said.

Earlier, in the House of Representatives, Rep. Steny Hoyer said Congress might have to return in December — rather than adjourning for the year this week, as expected — to consider an auto bailout.

“Dealing with the automobile crisis is a pressing need. We are talking about a lot of people ... and a great consequence to our economy,” said Hoyer, the House majority leader.

The financial situation for the automakers grows more precarious by the day. Cash-strapped GM said it will delay reimbursing its dealers for rebates and other sales incentives and could run out of cash by year’s end without government aid.

In the Senate, Democrats discussed but rejected the option favored by the White House and Republican lawmakers to let the auto industry use a $25 billion loan program created by Congress in September, which was designed to help the companies develop more fuel-efficient vehicles, to tide them over financially until President-elect Barack Obama takes office in January.

“There was no indication that there was any traction” for the White House plan, Sen. Ben Nelson said after a Democratic luncheon.

The leader of the House, Speaker Nancy Pelosi, and other senior Democrats, who count environmental groups among their strongest supporters, have opposed that approach vehemently because it would divert federal money that was supposed to go toward the development of vehicles that use less gasoline.

“I don’t think that’s going very far in our caucus,” said Senate Majority Leader Harry Reid.

Instead, they want to draw the $25 billion directly from the $700 billion Wall Street bailout, which would bring the government’s total aid to the car companies to $50 billion.

A Senate vote on that plan, which also would extend jobless benefits, could come as early as Thursday, but aides in both parties and lobbyists tracking the effort privately acknowledge it does not have the support to advance. Treasury Secretary Henry Paulson renewed the administration’s opposition on Tuesday.

Even the car companies’ strongest supporters conceded that changing the terms of the fuel-efficiency loan programme might be the only way to secure funding for them with Congress set to depart for the year and the firms in tough financial shape.

Meanwhile, the chief executive of a major US bank that received $25 billion from the government’s financial bailout package said Tuesday that federal aid shouldn’t be dispensed to the ailing Detroit Three automakers — unless they become the Detroit Two.

“I think there’s one too many” automakers, Bank of America CEO Kenneth Lewis told the Detroit Economic Club during a meeting in Cobo Centre, the downtown convention centre that’s home to the North American International Auto Show each January. He added he would require consolidation if he was deciding on a bailout.

“I think the American people are suspect of just giving more money and buying more time,” he told reporters after the speech. “They want to see that the companies have in fact changed and the strategies have changed.” - AP

Slowdown saps promise of emerging auto markets - Malaysiakini

GUANGZHOU, Nov 19 — Smoke and flashing lights, dancing girls in white go-go boots — the world’s top automakers put on dazzling shows as they wooed Chinese buyers with their latest models.

But for all the flash at this year’s Guangzhou Auto Show, automakers face a dimmer outlook for global sales, even here in the world’s second-largest vehicle market.

Just as General Motors Corporation and other manufacturers are desperately looking to emerging markets to compensate for falling sales in the US, Europe and Japan, potential car buyers in China, Russia and other once sizzling markets are pulling back.

With the economy slowing in China, people are worried about their pay and job security. News about the global financial crisis and plunging markets is also undermining consumer confidence.

“I was planning to buy a Lavida two months ago, but now have just changed my mind,” said Yang Hong, a senior manager for an audio equipment company in Shanghai, referring to a popular China-market model made by Volkswagen.

“It’s not that I can’t afford it, but I think it’s not so necessary, so I can wait until next year,” Yang said.

The big automakers’ ability to weather the crisis hinges on drawing jittery customers like Yang back into dealerships, especially in China.

The urgency is particularly acute for America’s big automakers — GM, Ford Motor Corporation and Chrysler LLC — which have been battered by the US economic meltdown and are lobbying the federal government for a US$25 billion (RM88 billion) bailout that looks increasingly murky. GM has said it could run out of cash by year’s end without government aid.

“We have to recognise that the US is where the problem is now. We’re growing in these other areas,” said Robert Socia, vice president of Shanghai General Motors, one of GM’s eight joint ventures in China. “The problems in the US are finite and are attributable only to the US, and a little bit to Europe.” Socia spoke on the sidelines of the Guangzhou Auto Show yesterday.

While the company’s worldwide sales fell 11 per cent in the third-quarter, many developing country markets were still growing at double-digit rates: 15.1 per cent in Russia, 15.5 per cent in Brazil, 12 per cent in China. India grew at a more modest 5 per cent.

Sales outside North America accounted for 61 per cent of GM’s total revenues in the third-quarter of this year, up from 56 per cent a year earlier.

Rival Ford Motor Corporation is likewise looking to China for growth — 30 per cent in 2007 — it can’t expect to find back home.

“We’re serious about this market. It’s becoming really big and influential,” said Nigel Harris, general manager for sales at Changan Ford Mazda Automobile Corporation, a Ford joint venture in China.

Ditto for German automaker Volkswagen AG, whose sales through its numerous units and joint ventures climbed nearly 13 per cent in January-October to 853,800.

China’s total auto sales rose 11 per cent in the first 10 months of this year. That’s robust compared with the contractions in the US, Europe and Japan, but nowhere near the 18.5 per cent increase seen last year.

Sales fell in August and September before gaining 8.37 per cent in October, as controls on credit hit large car sales, while high gas prices dented purchases of economy models.

“Definitely the market now is slowing down,” said Yale Zhang, a Shanghai-based analyst with CSM Worldwide. He expects sales growth to fall to single digits, perhaps 8 per cent, in 2008, for the first time this decade.

Other emerging markets are also getting hit. In Brazil, automakers are slashing production as sales plunge.

In Russia, which became Europe’s biggest car market this year, dealers reportedly were turning truckloads of vehicles away, saying they have no room for them. Passenger car sales rose 41 per cent in the first half of the year, to 1.65 million cars, but have tapered off since as banks cut off loans used to finance nearly half of purchases.

Sales of passenger vehicles in India fell by 9.1 per cent in October, while commercial vehicle sales plunged 36 per cent, as high interest rates and tight consumer credit took their toll on what had been one of the world’s fastest growing automobile markets, according to the Society of Indian Automobile Manufacturers, an industry group.

“We’re looking to emerging markets to grow and thrive in. We see tremendous potential as consumers will increase their purchasing power over time,” Maureen Kempston Darkes, president of GM’s Latin America, Africa and Middle East region, said in a phone interview from Miami.

Analysts say they expect sales to rebound in many markets once credit conditions loosen. China’s own economic growth — forecast to fall to as low as 7.5 per cent next year before it regains momentum— is vital.

GM itself has invested billions of dollars in China, helping push sales there to 1.03 million units in 2007 — a 12 per cent share in a viciously competitive market.

While it lobbies for a bailout from the US government, GM plans to carry on with its plans for China.

“China is very, very important to us when you talk about the emerging markets,” said GM’s Socia. “We’re expanding very, very fast here and we’re going to continue to do that.”

GM introduced three models new to China yesterday at Guangzhou. The first, the Buick Enclave, is a luxury SUV exported from the US as part of a trade agreement between Beijing and Washington.

The powerful Cadillac CTS-V, designed to compete with the world’s fastest sport sedans, is also US-made. The third vehicle, the Cruze, debuted last month at the Paris Auto Show and will be manufactured in Shanghai, among other worldwide locations, Socia said.

Japanese automakers Toyota Motor Corporation and Honda Motor Corporation both have thriving joint ventures here with local partner Guangzhou Automobile Corporation.

Sales may have fallen for now, but the market has huge potential for growth in the long-run, says Zhang of CSM in Shanghai.

“This is still the fastest growing large auto market in the world,” he said. “As a major player, if you want to have further growth in the future you have to invest in this market.” — AP

Oil steady near 22-month low below US$55 in Asia- Malaysiakini

SINGAPORE, Nov 19 - Oil prices were steady below $55 a barrel Wednesday in Asia as investors paused to examine the extent of global economic weakness, which has sent crude down more than 60 per cent in four months.

Light, sweet crude for December delivery was up 19 cents to $54.58 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract Tuesday fell 56 cents to settle at $54.39, the lowest since January 2007.

"Market sentiment is still bearish, but not as bearish as a week ago," said Clarence Chu, a trader with market maker Hudson Capital Energy in Singapore. "Volatility has come down and the market is consolidating a bit."

Stock markets have served for the past few months as a barometer of investor perceptions about the health of the global economy. The Dow Jones industrial average rose 1.8 percent Tuesday as Hewlett-Packard Co. said fourth quarter and 2009 results will exceed analyst expectations.

Most Asian stocks, however, fell Wednesday. Japan's benchmark Nikkei index fell 1.8 percent, Hong Kong's Hang Seng index dropped 0.3 per cent and the Korea Composite Stock Price Index slid 3.2 per cent.

Oil investors have already priced in a recession in developed countries and only evidence of an especially severe or prolonged slowdown may push prices down further, Chu said.

Prices have fallen 63 per cent since reaching a record $147.27 a barrel in mid-July.

"I don't see oil falling below $50," Chu said. "It should be above $60 in a couple weeks."

Investors will be watching for signs of slowing US demand in the weekly oil inventories report to be released Wednesday by the US Energy Department's Energy Information Administration.

The report is expected to show that oil stocks rose 1.2 million barrels last week, according to the average of estimates in a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

The Platts survey also projects that gasoline inventories rose 700,000 million barrels and distillates increased 900,000 barrels last week.

In other Nymex trading, gasoline futures rose 0.24 cent to $1.14 a gallon. Heating oil gained 1.21 cents to $1.77 a gallon while natural gas for December delivery increased 0.3 cent to $6.52 per 1,000 cubic feet.

In London, December Brent crude rose 16 cents to $52.00 on the ICE Futures exchange. - AP

Palm oil prices to plunge 50% - Malaysiakini

Palm oil prices could fall by 46 percent next year due to oversupply and waning demand for biofuels, despite measures to cut production in Southeast Asia, a brokerage group has said.

CLSA Asia-Pacific Markets has slashed its forecast for palm oil prices by 46 percent in 2009 and 32 percent in 2010, from current levels of about RM1,455 per tonne.

In a report released last week, the brokerage said it expects the commodity to trade at RM1,000 per tonne next year and RM1,250 in 2010.

Prices of palm oil have plummeted by 68 percent since a March high of RM4,486 per tonne due to the financial crisis and the falling price of crude oil - which reduces demand for palm oil to supply the biodiesel industry.

Malaysia's palm oil inventory in October hit a record 2.1 million tonnes - a 14 percent increase from the previous year - due to a production surge and a slowdown in exports to China and the Netherlands.

CLSA said that the inventory build-up is much worse in Indonesia.

"The biofuels story is waning, providing less demand support. We are also sceptical about effectiveness of government initiatives to boost CPO (crude palm oil) prices," it said.

Malaysia and Indonesia, which account for 85 percent of global palm oil output, plan to replant old trees and mandate biodiesel use to cut supply and bolster prices.

However, Buddhika Piyasena from Fitch Ratings was less gloomy, saying that prices had "pretty much bottomed out" at current levels and that the risk of further losses was limited.

"We might see these levels continue in the US$450 (RM1,625) per tonne range for a while," Piyasena told AFP, noting that both the world's top producers, Indonesia and Malaysia, are implementing measures to push up prices.

Gov't vehicles to use biofuel

Deputy commodities minister Kohilan Pillay said Malaysia aims to fell some 200,000 hectares of old palm oil trees and all government vehicles will start using biofuel in the next few months.

The replanting scheme will involve trees of more than 25 years old as the yield from these trees is low at about 17 tonnes per hectare annually.

Smallholders will be given a RM1,000 incentive by the government for each hectare replanted.

"A good price for CPO is at the RM2,000 range and this is what we are aiming for," he said.

Fitch's Piyasena said that if the measures to mandate the use of biofuel in both countries are fully implemented, it could absorb up to 1.0 million tonnes of palm oil.

Obama victory spells renewed US interest - Malaysiakini

In Indonesia, many know him as 'Barry'. To others US president-elect Barack Obama is the 'Menteng Kid' for the primary school he attended while living in South-east Asia’s largest country.

MCPX

Indonesia had a little more to celebrate than its neighbours when Obama was declared elected on Tuesday. Among those who rejoiced was Israella Dharmawan, Obama's teacher during his childhood in central Jakarta.

"I remember he once wrote two stories titled 'My mother, my idol' and 'I want to be a president'," she said in a story appearing in Thursday's Jakarta Post newspaper.

Obama was six when he came to live in Indonesia in 1967 and lived there for five years with his mother, Ann Dunham, and his Indonesian stepfather, Lolo Soetoro.

"I hope to see him become a good president and keep his campaign promises," the former third-grade teacher added of the new US leader who had come across to her as "good, cheerful and easygoing as a young boy."

For Indonesia there is significance in US voters creating history by voting an African-American to the most powerful job in the world. The possibility of a member of a minority community being elected president remains remote in Indonesia, where the Javanese, the majority ethnic community, hold sway.

"This phenomena teaches us all that ethnicity, race and other labels are not important. What matters is our capability," Jusuf Kalla, the country’s vice president, was quoted as having told the Indonesian national news agency Antara following Obama’s victory.

Kalla is a leader of Golkar, the country's largest political party. But media reports note that the likelihood of him running for president in the 2009 elections are doubtful because of his origins. He is a member of the Bugis ethnic minority from the mountainous island of South Sulawesi.

Serve as an inspiration

Obama's example would not have been lost on Malaysia, Indonesia's neighbour, where the Malay majority maintains a firm grip on political power at the expense of the country's minorities, such as ethnic Chinese and Indians.

Even in Singapore - which has policies to maintain racial harmony - the political culture favours a member of the dominant Chinese community for the office of prime minister.

"The US election could inspire people from minorities in this region to think of what is possible," says Phil Robertson, chairperson of Democrats Abroad Thailand, a group of US citizens living here who campaigned for Obama, the presidential candidate of the Democratic Party.

"It could broaden people's ideas that a person from a minority could rise to the post of political power based on the ideas he or she represents," added Robertson in an interview. "Obama's victory is an inspirational moment."

The widely followed US elections offered other sober lessons too: the gulf between what passes for democracy in this region as against the robust US system.

An official response from the Philippines, a former US colony in the region with a similar polity, said it all. "Our own democracy and electoral process can be enriched by the lessons, model, and example that the last US presidential contest can offer, particularly in terms of the primacy of issues and blueprints of governance, as well as the efficiency and integrity by which the electorate's will is safeguarded," said Gabriel Claudio, political advisor to the Philippines president, in a statement.

Elections in South-east Asia's few developing democracies are plagued by fraud, questionable candidates and tension, which, at times, leads to violence before and after the elections. Suppression of the media and stifling of open and free debate also stains this region's electoral culture.

Reinvigorate multilateralism

For the 10-member Asean, the Obama victory comes after growing concern among the region's leaders that the George W Bush administration was losing interest in the regional bloc. While Bush described South-east Asia as the second front in his 'war against terrorism' after the Sept 2001 terrorist attacks on the US, Washington opted for the bilateral route rather than multilateral measures.

"After 9-11 terrorism became the main priority for the Bush administration, it wanted immediate results, which Asean is not geared to. Defence is not its strength," Robert Fitts, a former US diplomat who has served in three South-east Asian capitals, told IPS. "So it developed bilateral relations and dealt directly with the defence ministries and the police in the region and spent less energy with a multilateral body like Asean."

With the Bush doctrine in tatters, a greater engagement with Asean is expected, underscoring Obama's inclination towards multilateralism. "He wants to reinvigorate multilateralism and that includes Asean," says Fitts.

Asean includes Indonesia, Singapore, Malaysia, Thailand, Burma, Cambodia, Laos, Vietnam, the Philippines, and Brunei.

"Obama will create a new impetus for Asean-US policy," says Kavi Chongkittavorn, a senior editor and columnist on regional affairs at The Nation, an English-language daily in Thailand.

"Many Asean leaders want stronger ties with the new US administration, because they know that they stand to gain more."