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Erudite Risk takes an all risks approach to intelligence reporting. We categorize key intelligence into one of 40 different risk intelligence categories.
The goal is to provide intelligence that allows decision makers to avoid being blindsided by what they may have missed, while informing them to make better decisions as well.
Erudite Risk also includes operations categories so you can monitor the environment for better decision making. Everything is tied together--what happens in risk affects operations and what happens in the market impacts risk profiles.
We categorize key intelligence into one of 30 different operations intelligence categories.
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川崎重工裏金問題にみる防衛省OB 「天下り」に葛藤も
Kawasaki Heavy Industries slush fund scandal leaves former Defense Ministry officials conflicted
Nikkei | Local Language | News | Feb. 21, 2025 | Political Scandal or Corruption
Kawasaki Heavy Industries faces a scandal involving a 40-year slush fund primarily tied to the Japan Maritime Self-Defense Force (MSDF). Investigations reveal that the company's repair department created fictitious orders with subcontractors, accumulating 1.7 billion yen in illicit funds from fiscal years 2018 to 2011. This money was used for meals, entertainment, and other purchases, raising significant compliance concerns. Many submarine crew members reportedly benefitted from these corrupt transactions.
The situation is compounded by an oligopoly in Japan's submarine manufacturing, dominated by Kawasaki and Mitsubishi Heavy Industries. Out of 25 submarines in service, 12 were built by Kawasaki, limiting market competition and prompting questions about the necessity of providing goods and entertainment to crew members. An internal audit of 185,000 emails hints at potential links to amakudari practices, where retired Defense Ministry officials are re-employed at Kawasaki, fostering an environment that may normalize such fraud.
Amakudari leads to relationships between retired and current military members, as noted by Professor Masashi Nakano. He suggests these ties may aim to bolster influence and job security for former personnel. While Kawasaki's President Yasuhiko Hashimoto recognizes the advantages of hiring retired JSDF staff, he calls for improved compliance and transparency. As defense spending rises, discussions on reforming amakudari practices are ongoing, aiming to align private sector interactions with national security priorities.
Malaysia is betting on data centers to boost its economy. But experts warn they come at a price.
Asahi Shimbun - E | English | News | Feb. 21, 2025 | UndeterminedEconomic Growth
Johor province in Malaysia is rapidly growing its data center market, projected to reach 1.6 gigawatts by 2025, becoming Southeast Asia's fastest-growing region for this infrastructure. While these facilities are crucial for economic modernization and attracting investment, they significantly raise electricity and water demands, with future needs potentially exceeding 5 gigawatts by 2035. Currently, over 95% of Malaysia's energy is fossil fuel-based, raising sustainability and energy security concerns.
Local businesses like Winson Lau's tropical fish export venture feel the strain from increasing energy demands. Lau is considering relocating to Thailand due to fears of power shortages and outages affecting smaller enterprises. Despite government assurances of job creation, experts suggest data centers offer far fewer jobs than expected, typically providing only 30 to 200 permanent positions per facility.
Most data centers are foreign-operated, catering to international rather than local clientele. While Malaysian officials see growth in data centers as a boon for the digital economy, experts warn of potential resource exploitation and environmental degradation. Efforts to implement efficiency guidelines and enhance renewable energy procurement are underway, but local residents remain concerned about water shortages amid extreme weather, complicating sustainable development.
Australia says Chinese navy ships off Sydney did not pose threats
Asahi Shimbun - E | English | News | Feb. 21, 2025 | Geopolitical Conflict and Disputes
Australia is monitoring a Chinese navy task group operating within its exclusive economic zone off the east coast. Defense Minister Richard Marles confirmed that the task group, comprising a frigate, cruiser, and replenishment vessel, poses no threats as they have not violated maritime laws. The frigate has transited the Torres Strait and is now sailing within 150 nautical miles of Sydney.
Marles stressed the necessity of vigilance, with Australia's air force and navy closely observing the task group. While the situation is unusual, it is not unprecedented, and he asserted Australia's right to surveil the vessels while acknowledging their operation in international waters. A comprehensive assessment will occur once the task group's mission concludes.
This follows Australia's concerns raised with Beijing about a Chinese fighter jet's unsafe actions towards an Australian maritime patrol in the South China Sea—a claim disputed by China. Additionally, China's efforts to increase its influence in the Pacific have prompted caution from Australia and the United States, who are working to prevent Pacific island nations from forming security ties with China. Marles is also set to meet with Papua New Guinean officials to discuss a potential bilateral defense treaty.
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