U.S. sends two destroyers through Taiwan Strait amid tensions with China The move comes amid a trade war between the U.S. and China and escalating tensions between Taiwan and China, which has warned that it will defend — by force if necessary — its “One China” principle under which the self-ruling island is seen as part of China’s own territory, awaiting reunification. -The Japan Times

Beijing hits out at Washington for ‘playing Taiwan card’ after US warships sail through strait Mainland’s Taiwan affairs chief says Taiwanese people ‘should clearly understand the real purpose behind these US moves’ -SCMP

In battle of wills with Beijing, Trump needs to keep the upper hand At the same time, he put Beijing on notice that he knew something about linkage and leverage — tactics that long had worked to China’s unilateral advantage but now, given the new president’s extensive dealmaking experience, were about to change in the West’s favor. Decades-old constraints on U.S. policy on Taiwan and trade now were on the table as assets, not liabilities. -The Hill

Trade, Technology, and Xi Jinping’s Question -Project Syndicate

How Carrie Lam’s impatience caused a perfect storm over status of English in Hong Kong A mini-meltdown over having to answer a question in English blows up into a public relations nightmare for the leader of ‘Asia’s World City’ -SCMP

Japan is finally starting to admit more foreign workers -The Economist

Pompeo sees hard road ahead but pursues N. Koreandenuclearisation talks -The Asahi Shimbun

Indonesian presidential race: The more the merrier for Widodo Old rival Subianto wants united opposition, but other parties are seeking their own candidates -Nikkei



Trade war with China would bring U.S. higher prices, lower growth The Federal Reserve is already picking up signs that the threat of a trade war is causing businesses to rethink investment plans. In the minutes from its June 12-13 meeting, the Fed’s policymaking committee noted: “Contacts in some districts indicated that plans for capital spending had been scaled back or postponed as a result of uncertainty over trade policy” -AP

US-China trade fight lands punches across supply chains Response by farmers and electronics suppliers creates unintended consequences -Nikkei

China’s Carmakers Have a Strong Home Front in This War Plunging domestic auto stocks obscure the greater damage faced in the U.S. Donald Trump is trying to take on the single most globalized industry — and China. But the world’s largest car market won’t budge. -Bloomberg

China customs delays clearing US goods as duties loom -The Jakarta Post

China's COSCO Shipping wins U.S. security clearance for OOIL deal In a regulatory filing on Sunday the company said the U.S. Committee on Foreign Investment in the United States had notified it that it does not have any outstanding security issues following an agreement with the U.S. government to divest the Long Beach container terminal business to a third party. COSCO said ownership of the container terminal business will be transferred to a trust while a buyer is sought. -Reuters

Huawei says does not expect U.S. sanctions China’s Huawei, the world’s largest maker of telecommunication network equipment, does not see itself becoming the target of U.S. sanctions and will keep buying U.S. chips this year, one of its three rotating chairmen told a French newspaper. -Reuters

FCPA WATCH Credit Suisse Analyst Really Brought in Clients Also Aramco, Dell, Boring and Fabulous Fab. -Bloomberg

Northrop Grumman angles for role in Japanese stealth fighter program -The Japan Times

A peek into the startup economies of Malaysia, Vietnam, and Indonesia With Southeast Asia’s massive growth in tech funding from 2016 to 2017, all eyes are on the startup economies of countries like Malaysia, Vietnam, and Indonesia. While these three countries saw varying amounts of tech funding and have vastly incomparable startup densities, the challenges their populous face are giving rise to startups in interesting verticals. -Tech-in-Asia

Indonesia prepared to retaliate if Trump goes ahead with tariff plans Trade Minister Enggartiasto Lukita has said that Indonesia will prepare a retaliatory policy if the United States moves forward with its plan to impose tariffs on 124 products imported from Indonesia as part of its effort to reduce the trade deficit between the two countries. -The Jakarta Post


U.S. trade deficit with Japan shrinks 12.6% in May -The Japan Times

U.S. Oil Sellers May Look to India as China Tariff War Escalates “If China imposes tariffs, their refineries won’t buy U.S. crude since it would cost more,” Sandy Fielden, director of research for commodities and energy at Morningstar Inc., said by telephone. “U.S. sellers would have to find alternative buyers.” -Bloomberg

Securities firm faces fine over manipulation in bond futures Mitsubishi UFJ Morgan Stanley Securities Co. faces the prospect of a hefty fine over market manipulation by an employee trading in government bond futures. -The Asahi Shimbun

China Cancels U.S. Soybean Purchases as Trade War Takes Hold -Bloomberg