Australia's Security and the threat of Islamic Extremism in Southeast Asia

Australian foreign and security policy confronts a series of difficult challenges in coping with the emergence of an Islamic extremist threat in Southeast Asia. Australian policy makers are being drawn into unfamiliar linkages with moderate Islam, and into closer cooperation with Indonesia, the most populous Islamic nation in the world, in an attempt to offset Islamic extremists. Further, they must achieve those objectives at a time when important interests are at stake beyond Southeast Asia, when bipartisan agreement about the direction of foreign policy is waning, and when divisions over the appropriate trajectory of Australian security policy are intense. A delicacy almost unprecedented in Australian foreign policy will be required.

Conditional risk, return and contagion in the banking sector in Asia

This paper investigates risk and return in the banking sector in three Asian markets of Taiwan, China and Hong Kong. The study focuses on the risk-return relation in a conditional factor GARCH-M framework that controls for time-series effects. The factor approach is adopted to incorporate intra-industry contagion and an analysis of spillovers between large banks and small banks. Finally, the study provides evidence on these relations before and after the Asian financial crisis of 1997. The results are generally consistent across the markets and with expectations.