Economy

What Happened: Construction started in 2021 on a massive expansion project at Taiwan’s Taoyuan International Airport, designed to accommodate up to 20 million additional passengers a year. Several thousand workers have been imported from Vietnam and Thailand to expand the airport. But these migrant workers report paying exorbitant fees to labor brokers, landing them in debt. At least 500 workers have fled the airport construction site, becoming undocumented laborers elsewhere in Taiwan.

Our Focus: “All 12 Vietnamese men The Diplomat interviewed said they borrowed most or all the $4,300 to $5,700 they paid in recruitment fees,” Peter Bengtsen reports. “...On top of their debts, the construction workers also paid monthly service fees to Taiwanese labor brokers, corresponding to two months of pay per three-year contract.” Such practices are unfortunately standard for migrant workers in Taiwan, but deserve extra scrutiny when occurring at the airport expansion project – the largest single investment by Taiwan’s government thus far in the 21st century. In fact, a Taiwanese government agency holds shares in the firm employing the migrants.

What Comes Next: “Debt bondage due to high recruitment fees has been an elephant in the room for Taiwanese authorities for years,” Bengtsen notes. “Taiwan is one of the remaining places in the world that legally allows labor brokers to charge migrant workers fees for services that elsewhere are borne by employers as human resource costs.” Yet mistreatment of migrant workers – through exorbitant fees and little time off – is rarely considered in official narratives on why some workers turn to undocumented positions. Until Taiwan rethinks its labor policies, big-ticket government projects like the Taoyuan Airport expansion will continue to be plagued by debt bondage risks.

INTERVIEW

Journalist Clare Hammond, author of “On The Shadow Tracks: A Journey Through Occupied Myanmar,” on the lingering legacy of British colonialism in Myanmar: “There are the big, catastrophic conflicts that are widely seen to have their roots in British policymaking, such as the Rohingya crisis, and the fact that Myanmar is home to some of the world’s longest-running civil wars. But just as harmful are the everyday divisions along ethnic and racial lines that have intensified since independence, creating an environment of deep mistrust and fueling ongoing cycles of violence.”

Northeast Asia

Xi Jinping is on just his second stint of overseas travel this year, following his tour of Europe in early May. This time, he’s not going far: The Chinese leader is traveling to Kazakhstan for the SCO summit before paying a visit to Tajikistan. Xi hasn’t traveled as much since the COVID-19 pandemic, and Kazakhstan is the only country he’s visited twice, a clear sign of the priority Beijing accords to its Central Asian neighbor. China’s already-strong influence in Central Asia, meanwhile, is attracting increasing attention amid a perceived decline in Russia’s position in the region.

South Asia

The Maldives’ President Mohamed Muizzu has announced a host of austerity measures and tax hikes in an attempt to stave off a debt crisis. The country needs more than $500 million annually to pay down debt in both 2024 and 2025 – more than its current foreign currency reserve. Nearby Sri Lanka defaulted on its debt in 2022, sparking a severe economic and political crisis. In that case, neighboring India rushed in with critical aid – but Muizzu has pursued ties with Beijing at New Delhi’s expense.

Southeast Asia

The foreign and defense ministers from Japan and the Philippines will meet in Manila on July 8 for talks, which are expected to cover a much-anticipated defense treaty. Since Prime Minister Kishida Fumio’s visit to the Philippines last year, the two sides have discussed a potential reciprocal access agreement (RAA), which would remove hurdles to joint military exercises and deeper defense cooperation. Behind the 2+2 talks, and the possible finalization of the RAA, is the deteriorating security situation in the South China Sea, where China has increased both the frequency and intensity of its incursions into Philippine waters, alarming policymakers in both Manila and Tokyo.

Central Asia

The Shanghai Cooperation Organization (SCO), founded in its present form in 2001, has undergone a significant expansion in the last decade with the additions of India and Pakistan in 2017 and Iran in 2023. At this year’s leaders’ summit, Belarus will join, the first entirely European country to do so. But Indian Prime Minister Narendra Modi is skipping the affair, and questions linger about the group’s effectiveness, given the internal divisions between its ever-growing pool of members.

Mongolians show their index fingers, indicating that they voted in the general election, in Ulaanbaatar, June 28, 2024.

Politics

Choego Ryŏngdoja, Korean for “Supreme Leader,” the title adopted by Kim Jong Un. Like Kim’s appearance on lapel pins, it’s a sign the leader is putting himself on par with his grandfather and father – or even above them.

Diplomat Brief will be on summer break next week. Thank you for reading, and we’ll return to your inbox on July 17!