not isolated events triggered solely by the crash of Asian markets, but part of a pattern of political reform throughout the region.
There has been no slackening in the pace of Asia’s industrial revolution in recent months. South-east Asian economies began to recover in 1999, although (as discussed in the final chapter) there are doubts about whether they will return to the high growth rates of the past. Over-reaction has been a consistent theme of short-term foreign investment in Asia, to the detriment of the investors as well as the recipients of the money. In the 1980s and early 1990s, over-optimistic investors thought south-east Asian economies could do no wrong. In 1997 and 1998, they withdrew their money in a pessimistic panic, consigning hundreds of companies to bankruptcy and millions of diligent workers to unemployment. Then they regained their confidence in the first half of 1999, pumping money back into the region in spite of warnings that governments had failed to tackle the ‘crony capitalism’, corruption and poor banking practices that had precipitated the crisis in the first place.
Politicians have been busy, too. In Indonesia, President B.J. Habibie, the interim leader who succeeded the deposed Suharto, allowed the country to hold its first democratic election in nearly half a century in June 1999. The party of Megawati Sukarnoputri, a former opposition leader, won the most votes, but it was Abdurrahman Wahid, the ailing Moslem leader, who was later elected president. Still more remarkable was the Habibie government’s decision to grant the people of East Timor – brutally invaded by Indonesia in 1975 – the chance to secede. A referendum on independence was held under UN auspices in August 1999, amid frequent outbreaks of violence in East Timor itself and other far-flung parts of the Indonesian archipelago. The East Timorese voted overwhelmingly for independence, but pro-Indonesian militiamen backed by the security forces immediately unleashed a campaign of terror on the largely defenceless population.
In Malaysia, Anwar Ibrahim, the reformist deputy prime minister and heir apparent to Mahathir Mohamad, was sacked by Mahathir, expelled from the ruling party, arrested on charges of sodomy and corruption and beaten in detention. He was sentenced to six years in jail. Mahathir also imposed controls on the flow of short-term capital for a year and declared that ‘the free market system has failed’. But Anwar’s supporters took to the streets with the same cries of ‘Reformasi!’ (‘Reform!’) that helped bring down Suharto in Indonesia, and Anwar’s wife Wan Azizah Wan Ismail formed a new opposition party ahead of a general election. A couple of other south-east Asian governments broke with a tradition of polite noninterference to condemn publicly Mahathir’s treatment of his former deputy.
In Cambodia, the main political parties reached a compromise to end a violent dispute over the outcome of the 1998 election, in which Hun Sen’s ruling party won the biggest share of the vote with the help of widespread intimidation of voters. In Burma, the military junta sought once again to crush its opponents with hundreds of arrests. In Vietnam, tensions increased within the Communist Party over corruption and the need for political reform. Joseph Estrada, the action movie star who became president of the Philippines, was criticized for allowing the rehabilitation of business cronies of the late dictator Ferdinand Marcos.
This book is about the ten countries which are regarded – and which regard themselves – as ‘south-east Asia’, the region lying between India to the west and Japan and China to the east and north. In alphabetical order they are Brunei, Burma (Myanmar), Cambodia, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand and Vietnam. All ten are members of the Association of South East Asian Nations (Asean), an organization originally established as a security umbrella at the time of the Vietnam war but which now focuses on trade as well. This is a region with more than 500 million inhabitants and a plethora of cultures and languages; where France, the US and China all came to grief fighting in Vietnam; where Pol Pot murdered more than a million people in Cambodia; which produces much of the world’s opium; which has inflicted on itself some of the worst traffic jams and most polluted rivers; which has (briefly) the tallest buildings on earth in Malaysia; and which boasts in Singapore one of the most computerized cities on the globe. The ten countries are at very different stages of development, but they see themselves as a distinct group with common interests and they are all undergoing industrial revolutions. All have been affected, to a greater or lesser degree, by the region’s financial crisis, and all have undergone convulsive change since World War II.
Some of the changes of the past decades, good and bad, would be familiar to nineteenth century Americans or to the English of the eighteenth century: the migration of men and women from the countryside to the cities in search of factory work, increased crime and pollution and the rise of ‘robber barons’ or ‘gangster capitalists’. But nowadays the process is much faster and there are many new factors: the rapid spread of television and computers; the growth of consumerism; imports of foreign films and music; the use of drugs such as heroin and Ecstasy; new sexual habits; and much else besides. It is hardly surprising that Asians feel bewildered as well as elated by the changes in their lives as they enter the new millennium.
Nor is it surprising that Asian leaders, especially south-east Asian ones, became more assertive on the international stage as they became wealthier and more powerful in the 1990s. The last European colonies in Asia have been handed back to China (Britain returned Hong Kong in 1997, and Portugal was due to leave Macao at the end of 1999). Lee Kuan Yew, the architect of modern Singapore, and Mahathir of Malaysia both remember the colonial era and attribute their economic success since independence to ‘Asian values’. They argue that Asians work hard and respect their families and communities, in contrast to individualistic, liberal and decadent westerners. Opponents of the ‘Asian values’ school, on the other hand, say the argument is a false one deployed merely to justify authoritarian Asian governments.
I have devoted space to this lively debate because it explains much about what went wrong with south-east Asia’s ‘tiger’ economies, and because its outcome should make it easier to predict the region’s future. One of the few benefits of the financial crisis is that it has prompted Asians to ask questions about their own societies. How much of what is happening is peculiarly ‘Asian’ and how much is merely ‘modern’? Do richer and better educated citizens always demand more democracy and better human rights? What is the point of all this economic growth if our quality of life is getting worse?
Few of the answers are simple, but my conclusion is that industrialization itself has proved to be a much more powerful force for change than any particularly ‘Asian’ values. The industrial revolutions of south-east Asia have remarkably similar effects to those that have gone before in Britain, America and Japan. It could be argued that as a western-educated person, it was inevitable that I would come to this conclusion, just as it was inevitable that Francis Fukuyama of the US would assert the primacy of liberal democracy as a political system in The End of History and the Last Man. I do not believe the languages and cultural traditions of south-east Asia will suddenly disappear, any more than they have in France, Germany or Britain. But I was surprised by how few ordinary Asians – and I asked the question of almost everyone I met while researching this book – subscribed to the theory of ‘Asian values’ as voiced by Asian political leaders and millionaires, and by some western business executives too.
In the aftermath of the financial crisis, south-east Asia will resume the race to catch up with the industrialized world. In the process more and more of its inhabitants will enjoy the benefits of prosperity – better education and healthcare, more material goods and more leisure. But this time around, as they emerge from the humbling experience of the economic crash, they will also be more inclined to tackle the challenges of industrialization: pollution, crime, social disorder, cultural confusion and the urgent need to build effective political institutions. In places as different as Burma, Vietnam and Malaysia, lifestyles are changing rapidly and democrats are already demanding a say in the way their countries are run. The revolution in Indonesia was not the first in the region, and it will not be the last.
Victor Mallet
September 1999
