Huge Vietnam smart city backed by Japan's Sumitomo moves forward
YUJI NITTA and KENTO HIRASHIMA
August 20, 2025 03:25 JST
HANOI/TOKYO -- Japan's Sumitomo Corp. will start work on a long-delayed project to build a $4.2 billion smart city outside Vietnam's capital, advancing a bet on the Southeast Asian nation's real estate sector.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Diplomat
2 hours ago
- The Diplomat
China Slowly Making Security Inroads in Southeast Asia, Report Says
While the U.S. is still the region's security partner of choice, Sydney's Lowy Institute has noted a growing divide between mainland and maritime Southeast Asia. China's efforts to build up its security engagement with the nations of Southeast Asia are starting to make progress, Sydney's Lowy Institute Analysis said in a new report, although the United States remains by far the region's most influential security player. The report, published yesterday, analyzed Southeast Asia's defense agreements, dialogues, and joint military exercises with ten countries: Australia, Canada, China, France, India, Japan, Russia, South Korea, the United Kingdom, and the United States. It noted a broad expansion of these engagements over the past decade, as Southeast Asian nations have sought to diversify their defense partnerships in a context of growing strategic competition between China and the United States. As a result, the report said, 'the landscape for defense cooperation in Southeast Asia is becoming more complex and contested.' An important part of this, as the report notes, has been China's attempts to bolster its defense engagement with the region, as a complement to its strong economic and trade ties. While this is intended to challenge the predominance that the U.S. has enjoyed since the end of World War II, Beijing's efforts have had patchy results. According to the Lowy Institute's analysis, the U.S. was the top overall defense partner for Southeast Asia, leading the region for both military exercises and dialogue mechanisms, and ranking equal first with India for the number of defense agreements signed between 2017 and 2024. China only ranks eighth overall, and sixth for the number of dialogue mechanisms, defense agreements, and combined military exercises. Beijing's efforts have been heavily weighted toward the five nations of mainland Southeast Asia (Thailand, Myanmar, Laos, Cambodia, and Vietnam), which have, in general, seen much less interest from external defense partners than the maritime region. This is likely due to China's growing maritime assertiveness, particularly in the South China Sea, which has led to a raft of new defense initiatives involving the Philippines in particular, but also with Indonesia and Singapore. This has allowed China to make more substantial inroads in mainland Southeast Asia. China is now the top defense partner for Laos and Cambodia, while also bolstering its engagement with Thailand, which saw its security engagement with its U.S. treaty ally drop after the military coup of 2014. China also remains a key defense partner of the Myanmar military, which is currently fighting to maintain its hold on power in the face of a coalition of resistance forces and ethnic armed groups. While China has made some recent gains in terms of strengthening its defense ties with Indonesia and Malaysia, the current trends point toward a possible intra-regional split within Southeast Asia into areas of relative Chinese and American defense influence. The region 'risks dividing into two camps: maritime countries with deep defense ties to the United States and its allies, and mainland countries lacking such cooperation,' Susannah Patton, the report's co-author and the Institute's deputy research director, said in a statement accompanying the report's release. However, it is also true that not all defense agreements are created equally. As the Lowy Institute report notes, U.S. and Japanese engagement tends to serve a more practical function. As an example, it cited the Acquisition and Cross-Servicing Agreement (ACSA) that the U.S. signed with Malaysia, Singapore, and Thailand in 2005. This covers logistical support, supplies, and equipment used during exercises between U.S. forces and their Southeast Asian counterparts. Chinese engagement, on the other hand, is more likely to be subordinated to diplomatic and political goals. China's defense agreements with countries such as Brunei, Malaysia, Singapore, Thailand, and Vietnam 'are mostly vague and symbolic, containing only general commitments to cooperation and dialogue.' Most of China's agreements 'lack substantive provisions for technology transfer, combined training, or intelligence sharing.' The report notes that China is also more restrained and cautious in how it engages in joint military exercises with Southeast Asian partners. 'Interoperability is conspicuously lacking in China's military exercises with regional partners, a reflection of Beijing's reluctance to expose its capabilities, and differences in systems and doctrines,' the report stated. 'China's cautious stance has in turn bred mistrust.' Elsewhere, the report's findings reflected the region's attempts to escape the U.S.-China binary by building defense partnerships with other prominent regional partners. The report notes that between 2017 and 2024, Australia, India, and Japan have 'signed more defense agreements with Southeast Asian countries than China and the United States combined.' Moreover, 'If Canada and South Korea are included, the collective figures for the middle powers dwarf those of the United States and China.' Overall, the report points to the limits of China's defense engagement with the region, and suggests that the current trend, of deepening economic integration with China alongside growing security cooperation with the U.S. and its partners and allies, is likely to continue. Given that new defense cooperation initiatives from the United States and its allies focus largely on the maritime region – unsurprisingly, given the ongoing tensions in the South China Sea – this trend also 'risks leaving mainland Southeast Asia more reliant on cooperation with China and Russia, increasing the geopolitical divide within the Association of Southeast Asian Nations,' the report stated.
Nikkei Asia
a day ago
- Nikkei Asia
Huge Vietnam smart city backed by Japan's Sumitomo moves forward
The project will feature residential areas, office buildings and shopping facilities, as seen in this artist rendering. (North Hanoi Smart City) YUJI NITTA and KENTO HIRASHIMA August 20, 2025 03:25 JST HANOI/TOKYO -- Japan's Sumitomo Corp. will start work on a long-delayed project to build a $4.2 billion smart city outside Vietnam's capital, advancing a bet on the Southeast Asian nation's real estate sector.
The Diplomat
a day ago
- The Diplomat
Southeast Asia's Tax Policy Discussion Needs Some Counterintuitive Thinking
The two most important underlying economic factors of the next decade in Southeast Asia will be taxation and demography. Most countries will face a decline in working-age adults (taxpayers) and a major increase in retirees (sappers of state money). People are living longer, yet the elderly are going to have fewer relatives to look after them. In many countries in the region, pension systems are either non-existent or already at breaking point, while the intended pension-by-property solution has backfired in most countries. Most healthcare systems are certainly not ready for the pending increase in demand. All of this comes as governments need to get creative with revenue collection. One little-spoken-about impact of the Trump tariffs is that with most Southeast Asian governments agreeing to cut duties on U.S. imports to nearly zero, they're losing a significant chunk of their revenue. Indeed, this and the boom in free trade agreements mean that Southeast Asian governments are having to rely far more on domestic taxes, instead of customs and excise (the usual source of funds), at the same time as revenue collection must massively increase. The expected rational response will be to coerce people into paying higher taxes. However, cheaper, more effective ways are available. For instance, taxpayers could be given a list of five areas in which they want their money to be spent. For example: education, healthcare, defense, public infrastructure, and social development. From the five, they would select three. A ministry would collect all the votes and aggregate them. At a national level, 50 percent of all taxes would be allocated into a common fund, from which the government could spend as it sees fit. But the other 50 percent would be divided up based on how taxpayers voted. This wouldn't significantly alter how governments allocate their expenditures since the percentages involved would be relatively small. And if only a small percentage of people voted for defense spending, say, then the government could still allocate more towards security from the 50 percent common fund. First, this system would make taxpaying seem like a personal investment. If you're particularly aggrieved by the state of your country's education system (maybe you've got young kids) or healthcare system (you're getting old) but aren't bothered by issues such as transport infrastructure or the military, you would be more inclined to think that your money is going to be returned to you in the future. This could alleviate the negative sentiment that your money will be wasted by the government. Second, it would be a useful way of learning what public services the masses actually want their government to deliver. Third, it would greatly reduce a government or leader's ability to indulge in wasteful megaprojects. Yes, they might have 50 percent of the revenue to play with, but they won't control all of it. Another idea. Most human activity is unconsciously motivated by two main things: status-seeking and social copying. For smaller businesses, plaques could be given to display on their premises, indicating that they have paid their taxes for that year. Thus, the absence of a plaque would show customers that the owner hasn't done their duty, making taxpaying a socially reinforced practice. One might combine this with some other form of social embarrassment. In Pakistan, I'm told the authorities have for centuries hired transgender people as tax collectors: the idea is to embarrass business owners into paying, which apparently works quite well. Additionally, state titles could be given to the highest taxpayers. Thailand already does this in a way. So, too, does the Philippines. It also exists in a somewhat different guise in Cambodia, where the honorific oknha (lord) is given to individuals who donate money to the ruling party. Such titles could instead be conferred on people who pay their taxes. There could be fancy awards parties for the rich to flaunt their status as taxpayers. Importantly, titles should be given and taken away each year. For example, they would only be given to the top 50 taxpayers for that year. If you drop out of this index the following year, your title is taken away and given to someone else. When I moved to Phnom Penh, it took me a while to realize why tycoons would drive around in the city's potholed, asphalt-stripped streets in Lamborghinis and Ferraris. People think of 'conspicuous consumption' as showing off luxury and wealth, but it's actually about conspicuous impracticality. By traveling in the least practical way, the tycoons were signalling that they could easily afford the costly repairs. It's the same reason why a male peacock grows such a big, cumbersome plumage that makes them more liable to be attacked by predators. It's also why deer grow the most debilitating antlers and why some people choose to walk around the most violent neighborhoods in expensive jewellery that screams, 'try to rob me if you think you're tough enough.' I also suspect it's the root motivation behind philanthropy. Maybe giving your money away is virtue status-signalling, but it's also a public display that you have enough money that you can afford to spaff some of it on other people. Given this universal impulse, a government could include an option for people or businesses to pay more tax than is required. A 10 percent, 20 percent, or 30 percent surcharge on top of what's expected, for instance. Those who pay this voluntarily would receive some sort of public recognition, a way for them to peacock their seemingly self-effacing act: 'I am so rich that I can afford to pay more taxation than I should.'
