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08
December

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The European Commission said on Wednesday it had requested the formation of adjudicating panels at the World Trade Organization, the next step in two trade disputes with China after failing to resolve them bilaterally.

The disputes, both brought to the WTO at the beginning of the year, concern alleged Chinese restrictions on EU companies' rights to use foreign courts to protect their high-tech patents and on trade with EU member Lithuania.

The EU executive, which oversees trade policy for the 27-member European Union, said both sets of measures were highly damaging to European businesses, with those against Lithuania disrupting intra-EU trade and supply chains.

The Commission formally requested consultations with China at the WTO, the first step in a WTO challenge. Such consultations rarely resolve disputes.

The EU executive said the WTO panels would likely be formed in early 2023, noting that panel proceedings can last up to one and a half years.

China will handle the EU's trade disputes request in accordance with the WTO's dispute settlement procedure, its commerce ministry said in a statement.

The panel requests come as the European Union reviews its stance towards China, seeing it increasingly as a competitor and system rival. Russia's invasion of Ukraine has also led EU leaders to express concern about economic reliance on China, which has taken a more neutral stance on the conflict.

The United States and the EU held the third ministerial-level meeting on Monday of their Trade and Technology Council (TTC), designed to enhance regulatory cooperation and present a united front against China.

An EU official said the timing of the requests was not linked to the TTC, but reflected the work required to build both cases. In the Lithuania case, many of China's actions were not published measures, which are typically the focus for WTO litigation.

The Lithuania dispute stems from China's downgrading of diplomatic ties with the Baltic nation of 2.8 million people from December 2021, and pressure on multinationals to sever links with it, after it allowed Taiwan to open a de facto embassy in Vilnius.

The Commission said China had also placed import bans on alcohol, beef, dairy, logs and peat shipped from Lithuania on the basis of plant and food safety rules without proving the bans were justified.

The Chinese foreign ministry said in a statement on Thursday that accusations it was targeting Lithuania with "discriminatory measures" were "pure fabrications". It did not elaborate.

In the other case, the Commission said Chinese courts had since August 2020 issued "anti-suit injunctions" that prevent European companies from seeking redress over standard-essential patents in non-Chinese courts, such as EU courts.

The Commission said Chinese manufacturers used the injunctions to pressure patent rights holders to grant them cheaper access to European technology. (Reuters)

08
December

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The U.S. Congress is expected to start voting as soon as Wednesday on a massive military policy bill including authorization of up to $10 billion in security assistance and fast-tracked weapons procurement for Taiwan.

The compromise version of the annual National Defense Authorization Act, or NDAA, does not include some controversial provisions of Taiwan legislation lawmakers proposed this year, including sanctions in the event of "significant escalation in aggression" against Taiwan by China, or a proposal that Taiwan be treated as a "major non-NATO ally."

China considers Taiwan its territory and has never renounced using force to bring it under its control. Beijing responded angrily when the Senate Foreign Relations Committee approved broader Taiwan legislation in September despite concern within President Joe Biden's administration that the bill could go too far in heightening tensions with China.

The Senate and House Armed Services committees unveiled the NDAA late on Tuesday. The $858 billion military policy bill is expected to pass Congress and be signed into law this month.

The "Taiwan Enhanced Resilience Act" included in the NDAA authorizes appropriations for military grant assistance for Taiwan up to $2 billion per year from 2023 through 2027, if the U.S. secretary of state certifies that Taiwan increased its defense spending.

It includes a new foreign military financing loan guarantee authority and other measures to fast-track Taiwan's weapons procurement, as well as the creation of a training program to improve Taiwan's defense.

"Taiwan's democracy remains the beating heart to our Indo-Pacific strategy, and the depth and strength of our commitment to the people of Taiwan is stronger than ever," said Democratic Senator Bob Menendez, chairman of the foreign relations committee and sponsor of the Taiwan legislation.

Taiwan's Foreign Ministry expressed its gratitude for the "continued strong support for Taiwan's security", adding it looked forward to the legislation being passed.

China staged military exercises near Taiwan in August after a visit to Taipei by then-House Speaker Nancy Pelosi, and has continued its military activities close to the island though on a reduced scale.

The U.S. State Department this week approved the potential sale of $428 million in aircraft parts for Taiwan to help its air force, which is strained from repeatedly intercepting Chinese jets operating around the island.

Passed every year since 1961, the NDAA addresses everything from soldiers' pay increases and how many aircraft can be purchased to strategies for addressing geopolitical threats.

The compromise version of the NDAA followed months of negotiations between Republicans and Democrats in the Senate and House. (Reuters)

08
December

 

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Malaysia's Anti-Corruption Commission said on Thursday it has opened an investigation into an alleged misappropriation of 600 billion ringgit ($136.39 billion) in government funds.

The investigation comes after new Prime Minister Anwar Ibrahim announced a review of government projects worth billions of dollars approved by his predecessor Muhyiddin Yassin, alleging they did not follow proper procedures.

Muhyiddin, who was prime minister for 17 months between 2020 and 2021, has denied wrongdoing and said he would welcome an investigation.

The anti-graft agency did not provide details on the latest probe or its targets, but called on the public to come forward with evidence or information.

Anwar was appointed premier last month, forming a government with rival blocs after a tightly contested election race with Muhyiddin resulted in a hung parliament.

Anwar this week ordered a review into Muhyiddin-era projects, including a plan for a state-owned 5G network and flood mitigation projects worth 7 billion ringgit ($1.59 billion).

Corruption is a major issue in Malaysia, with former prime minister Najib Razak jailed this year after being found guilty in a case linked to a multibillion-dollar scandal at state fund 1MDB.

Anwar's deputy Ahmad Zahid Hamidi - whose coalition is a key partner in the new administration - is also facing dozens of corruption and money laundering charges. Ahmad Zahid has pleaded not guilty.

Tengku Zafrul Aziz, a former finance minister in Muhyiddin's administration who oversaw government spending, said on Twitter he would cooperate fully with investigators if asked.

"There's nothing to hide," he said in a Twitter post. Tengku Zafrul last week was appointed to Anwar's cabinet as international trade minister. (Reuters)

08
December

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Indian Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) was set to win the biggest majority by any party at elections in his home state of Gujarat on Thursday, a big boost to the Hindu nationalists ahead of general elections in 2024.

The western industrial state of Gujarat is a bastion of the BJP, which has not lost a state assembly election there since 1995. Modi was Gujarat's chief minister for 13 years before becoming prime minister in 2014.

With the final results likely to be announced in the next few hours, the BJP was ahead in 156 seats out of 182 in Gujarat's state assembly elections and was set to surpass its best results when it won 127 seats in 2002.

The final count was set to become the highest won by any party in Gujarat, bettering the 149 seats that the Indian National Congress won in 1985.

At the last state election in 2017, the BJP had bagged 99 seats.

"Thank you Gujarat," Modi wrote on Twitter as hundreds of supporters danced to the beat of drums in celebration at the BJP office in state capital Gandhinagar.

"I am overcome with a lot of emotions seeing the phenomenal election results. People blessed politics of development and at the same time expressed a desire that they want this momentum to continue at a greater pace. I bow to Gujarat's Jan Shakti (people power)."

Modi remains widely popular in the country due to economic growth and also his strong base among India's Hindu majority population, despite critics pointing to rising inflation, unemployment and growing religious polarisation.

He is eyeing a third term as prime minister in 2024 and campaigned extensively across the state in the run-up to the Gujarat vote.

"Modi's popularity, which he has systematically built since he was the chief minister, is very much the factor behind BJP's victory," said Ghanshyam Shah, former director of Centre for Social Studies in Surat, Gujarat's second largest city.

"His direct relationship with people has translated into votes for the BJP."

The landslide win in Gujarat will come as a welcome boost for the BJP, which lost control of the municipal corporation in the national capital Delhi to the Aam Aadmi Party (AAP), in results announced on Wednesday.

At 1130 GMT, the count showed India's main opposition party Congress will secure 17 seats, far below the 77 seats it won in 2017, while the AAP, which emerged in 2012 out of an anti-corruption movement, was leading in five constituencies, having won none the last time.

However, the BJP lost control of the small northern state of Himachal Pradesh to Congress, which is set to win 40 out of 68 seats in the state election held last month and whose results were announced on Thursday.

BJP was hoping to ride on Modi's aggressive campaign to retain power in Himachal Pradesh but was clearly behind, winning 18 and leading in seven seats as counting neared its end.

The defeat will leave the party and its allies in control of 15 states and one federal territory in India. (Reuters)