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15200 results in ISEAS-Yusof Ishak Institute

Page 117 of 760

  • 1 - Introduction

    • By Cassey Lee, Senior Fellow, ISEAS – Yusof Ishak Institute, Singapore, Dionisius Narjoko, Senior Economist, Economic Research Institute for ASEAN and East Asia (ERIA), Sothea Oum, Research Fellow, Asia Growth Research Centre, University of Adelaide
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 1-6

  • Summary

    The economic importance of small and medium-sized enterprises (SMEs) is widely recognized and acknowledged by researchers and policymakers in Southeast Asia. This is not surprising as SMEs typically account for about 97–99 per cent of total enterprises and 60–80 per cent of total employment in Southeast Asian countries (Lee and Zhang 2016). Such statistics notwithstanding, SMEs are often viewed as being disadvantaged compared to large firms because they lack economies of scale and face resource constraints (Harvie 2015). In the theoretical and empirical trade literature on heterogeneous firms, these disadvantages translate into low productivity which affects SMEs’ exporting behaviour. For countries in Southeast Asia, this is a serious problem given the fact that many, if not all, countries in the region are committed to achieving greater intra- and inter-regional economic integration. This is to be achieved via the formation of the ASEAN Economic Community (AEC) as well as participation in bilateral and regional free trade agreements (FTAs). The question that follows then is this — can manufacturing SMEs participate effectively in economic integration given the disadvantages they experienced? It was with this question in mind that the Economic Research Institute for ASEAN and East Asia (ERIA) and ISEAS – Yusof Ishak Institute (ISEAS) collaborated to undertake a research project to better understand the current state of manufacturing SMEs’ participation in economic integration. This book is a collection of the research papers from the project.

    The chapters in this book are organized into two sections. The first part covers country papers. The countries included are Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Thailand and Vietnam. These are based on primary data collected in the research project. The second part covers linkages between multinational enterprises (MNEs) and SMEs in Southeast Asia. Chapters in this category rely on secondary data and fieldwork interviews with MNEs operating in the region.

    For the country studies, several methodological challenges were encountered right from the inception of the project. These affected the sampling approach to be adopted for the surveys. First, due to financial constraints, the project could only cover 200–300 firms per country. Due to this relatively small sample size, it made sense to focus mainly on a few key industries. The main criteria for the choice of these industries was the importance of these industries to the country (see Table 1.1).

  • 8 - Thailand's SME Participation in ASEAN and East Asian Regional Economic Integration

  • from PART 1 - COUNTRY STUDIES
    • By Teerawat Charoenrat, Faculty of Business Administration, Nong Khai Campus, Khon Kaen University, Thailand, Charles Harvie, School of Accounting, Economics and Finance, Faculty of Business, University of Wollongong, Australia
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 355-434

  • Summary

    Introduction

    Thailand's small and medium-sized enterprises (SMEs) have played a pivotal role in the country's economic and social development (OSMEP 2014). They constituted 99 per cent of all enterprises in the country and contributed 73 per cent of total employment during the period 2007 to 2012. During this period, they contributed 33 per cent of total exports on average and approximately 38.8 per cent of total GDP at current prices on average (OSMEP 2013). Of the total SMEs over the period 2007 to 2012, almost one-third were in the manufacturing sector. Manufacturing SMEs employed around 27.1 per cent of the private sector workforce on average over the period 2007 to 2012 and their contribution to total SME GDP was 28.7 per cent over the same period.

    The contribution of SMEs, especially manufacturing SMEs, is indicated in Table 8.1. While the contribution of SMEs to total business numbers remained stable, accounting for approximately 99.5 per cent of total enterprises over the period 2007–12, the contribution of manufacturing SMEs to total SMEs and the contribution of manufacturing SMEs to total enterprises declined from around 28.2 per cent and 28.2 per cent in 2007 respectively to around 17.7 per cent and 17.4 per cent in 2012, respectively.The contribution of SMEs to employment has gained a high level of importance due to their employment of more than 78.8 per cent of total workers over the period 2007–12. In terms of the contribution of manufacturing SMEs to the economy, around one-third of total workers employed by SMEs are in manufacturing SMEs which was equivalent to 26 per cent of total employment in 2012 (OSMEP 2007–13).

    From Table 8.1 it can also be observed that SMEs accounted for around 37.5 per cent of GDP, at current prices, over the period 2007–12. These figures imply that large enterprises accounted for only 0.5 per cent of business establishments in the country over the period 2007–12, but contributed around 62.5 per cent of GDP over the same period. Punyasavatsut (2008, p. 294) pointed out that the contribution of SMEs to GDP remained restricted due to numerous common limitations on their operations, such as a lack of management capabilities, limited access to market information and promotional support from government agencies, a shortage of financial support or working capital, inadequate access to skilled labour, and uncertainties in government support programmes.

  • 5 - Government Policies, Regional Trading Agreements and Economic Performance of National Electronic Components Small and Medium-sized Enterprises in Malaysia

  • from PART 1 - COUNTRY STUDIES
    • By Rajah Rasiah, Distinguished Professor of Economics, Asia-Europe Institute, University of Malaya, Govindamal Thangiah, Department of Development Studies, University of Malaya
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 142-169

  • Summary

    Introduction

    The importance of small and medium-sized enterprises (SMEs) in economic development is now widely acknowledged (Acs and Audretsch 1988). However, despite the significant role they play, SMEs have historically been vulnerable to competition owing to their size disadvantage, especially in industries characterized by economies of scale. Although the evolution of science parks and university-industry research linkages have enabled SMEs to participate in intensive research and development activities, minimum scale efficiencies are still important in scale-based industries, such as automobile assembly, wafer fabrication, and integrated circuits and printed circuit board assemblies (Rasiah 2003). SMEs are also prone to market failures because of information asymmetries, especially when faced with weak institutions. There are also other impediments, such as limited access to finance, legal constraints, lack of skills and technological capabilities that limit the capacity of SMEs to compete with large firms. Despite these shortcomings, governments continue to promote SME development as they are not only competitive in scope-oriented activities, but also act as a conduit to stimulate entrepreneurship. The focus on SMEs has taken on a new dimension in Malaysia following the streamlining of trade and investment policies in the ASEAN Economic Community (AEC) that came into effect in 2015.

    Hence, this chapter seeks to examine government policies to promote SMEs in Malaysia in general, and the influence of regional trading agreements (RTAs) on the export performance of national electronic components firms in particular. The in-depth analysis is confined to the electronics industry to obtain an informed industryspecific assessment of SMEs. National firms were preferred for this exercise because their participation in export markets is far less than foreign multinational companies (MNCs) that primarily engaged in export-oriented assemblies. Also, there is already considerable work on foreign electronics firms in Malaysia (Rasiah 1988, 1994, 1995, 1998, 2010; Narayanan and Lai 2000). Therefore, this chapter focuses for the first time on a large set of data on national firms. The rest of the chapter is organized as follows. Section 2 discusses the significance of SMEs in Malaysia's economy. Section 3 discusses government policies targeted at promoting SME development. Section 4 presents the methodology and data used in the chapter. Section 5 analyses the results. Section 6 finishes with the conclusions.

  • 3 - Indonesian Small and Medium Enterprise Participation in ASEAN Economic Integration

  • from PART 1 - COUNTRY STUDIES
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 34-96

  • Summary

    Introduction

    Background and Objective

    Small and medium-sized enterprises (SMEs) are important in the economic development of ASEAN countries. In Pillar 3 (establishing an equitable economic development) of the ASEAN Economic Community (AEC) Blueprint, SME development is one of the important components. ASEAN established the 2004–2014 SME Blueprint, which set the policies to develop competitive ASEAN SMEs. The blueprint was followed by the 2010–2015 ASEAN Strategic Action Plan SME Development, which outlined specific activities to implement ASEAN SME policies.

    SMEs should take advantage of the establishment of the AEC. Easy access to ASEAN markets generates wider selling potential and more options to outsource production inputs. The latter encourages bigger firms to get input materials from SMEs. In more advanced settings inter-connected production stages that are shared among firms will create mutual benefits among related parties. This will accelerate economic growth.

    This chapter aims to examine the extent and nature of SME participation in ASEAN economic integration. More specifically, it attempts to provide a description of the current state of SMEs in Indonesia and survey SMEs on their perceptions on the ways in which they can benefit from this integration.

    This chapter is based on a survey of 200 SMEs in Indonesia. The survey gathered information on the perceptions of SMEs on the impacts of ASEAN regionalism on their business activities. The field survey covered firms in the manufacturing sector with more than 10 employees/workers in 9 out of 22 main industries in which SMEs have significant presence. These industries include: (1) manufacturing of food products; (2) manufacturing of beverages; (3) manufacturing of wearing apparel; (4) manufacturing of leather and related products (focus on footwear); (5) manufacturing of wood and products of wood and cork; (6) manufacturing of furniture; (7) manufacturing of electrical products; (8) manufacturing of computers, electronics, and optical; and (9) manufacturing of motor vehicles, trailers, and semi-trailers. Some of the interviewed firms have trading activities with firms from other ASEAN countries while some do not. The survey provides some insights on the trading activities of Indonesian SMEs in ASEAN. It also provides information on factors that enhance their trading activities in ASEAN as well as their engagement in the emerging production networks around the region.

  • 11 - South Korean Multinational Enterprises and Vietnam SMEs’ Participation in Global Production Networks in the Context of Increased ASEAN and East Asian Regional Economic Integration

  • from PART 2 - MULTINATIONAL ENTERPRISE STUDIES
    • By Nguyen Ngoc Anh, Chief Economist, Development and Policies Research Center (DEPOCEN, Vietnam), Nguyen Thi Tuong Anh, Vice Dean, Faculty of International Economics, Foreign Trade University, Hanoi, Nguyen Ngoc Minh, Senior Researcher, Development and Policies Research Center (DEPOCEN, Vietnam), Nguyen Thi Phuong Mai, Deputy Director, Development and Policies Research Center (DEPOCEN, Vietnam)
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 514-549

  • Summary

    Introduction

    During the last decade, Asian countries, especially East and Southeast Asia countries, have witnessed an ever increasing trend of regional integration with the dramatic proliferation of regional free trade agreements (FTAs), both concluded and still in the process of negotiation. This process of regional economic integration has been driven by the mutually reinforcing market forces and trade agreements (regional and preferential). According to data from the Asian Development Bank (ADB), the number of FTAs involving at least one Asian country has almost doubled, from 124 in 2005 to 220 in 2016. In addition, there are 67 FTAs being proposed and pending negotiation. This phenomenon is referred to as the “Asian noodle bowl” with the economies of ASEAN and East Asia becoming increasingly integrated. According to data from ADB, the 16 ASEAN+6 countries (10 ASEAN members plus Australia, PRC, India, Japan, the Republic of Korea and New Zealand) account disproportionately for over 62 per cent of total FTAs (being in effect and in negotiation) of the total 48 ADB member countries/economies in Asia.

    The most important market force that drives international trade in recent years is the rise of global production networks operated by multinationals in which firms slice up a production chain into small production stages and then assigning them each to the most cost effective location across borders (ADB 2010; Helpman 2011). Globally operating firms have been taking advantage of these factors to exploit differences in factor prices (i.e. inputs and low-skilled labour) around the world (Blinder 2006; Baldwin-Edwards 2011) and multinationals are at the forefront of global production networks taking advantage of reductions of trade barriers, rapid advancements in production technology, and a decrease in transport and communication costs as explained by Athukorala (2013). He explains that firstly “rapid advancements in production technology have enabled the industry to slice up the value chain into finer, ‘portable’, components” (i.e. modular production technology with “standard fragments”); secondly “technological innovations in communication and transportation have shrunk the distance that once separated the world's nations, and improved speed, efficiency and economy of coordinating geographically dispersed production process”, and thirdly the “liberalization policy reforms across the world over the past four decades have considerably removed barriers to trade and foreign direct investment (FDI)”.

  • 6 - Myanmar SMEs’ Participation in ASEAN and East Asian Regional Economic Integration: With a Focus on Food and Apparel Manufacturing

  • from PART 1 - COUNTRY STUDIES
    • By Thomas Bernhardt, Researcher and Policy Analyst, Centre for Economic and Social Development (CESD) Myanmar, S. Kanay De, Centre for Economic and Social Development (CESD) Myanmar, Giles Dickenson-Jones, Centre for Economic and Social Development (CESD) Myanmar
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 170-286

  • Summary

    Myanmar's Historical and Macroeconomic Context

    For decades, Myanmar's economic system has been characterized by central planning and economic isolation, the latter partly self-imposed and partly due to international sanctions that were put in place in response to military rule. Today, however, Myanmar is leaving this past behind and things are changing rapidly. The shift towards a market-oriented economic system actually started in 1988. Back then, a number of reforms were initialized, aiming at liberalizing the economic system, encouraging private sector development, and promoting external trade as well as foreign direct investment. These developments have gained momentum with changes in the political sphere where a transition towards democracy was initiated in the late 2000s with a constitutional referendum in 2008 and multi-party elections in 2010. The international community welcomed these reforms and gradually re-integrated Myanmar.

    As a result, today there is widespread agreement that the country has great potential for rapid development in the future, in particular thanks to its vast natural resources, its abundance of (especially young) labour, and its geostrategic location (being a member state of the Association of Southeast Asian Nations (ASEAN) and bordering the two most important and dynamic emerging economies, i.e. China and India). In fact, since Myanmar's leadership adopted a market-oriented system in 1988, the number of private manufacturing firms has increased threefold. At the same time, numerous challenges remain. Neither the economic nor the political transition can be expected to be easy and without hiccups. Myanmar is still one of the poorest country in the region. Its economy is dominated by agriculture, characterized by low levels of productivity, and hamstrung by underdeveloped infrastructural and financial systems. Moreover, despite the lifting of sanctions there is still a long way to go for the country in terms of integrating into regional and international economic systems.

    Tables 6.1–6.3 report a number of different macroeconomic statistics that reflect both the positive developments that Myanmar has achieved but also the challenges that were encountered. Table 6.1, for example, shows that Myanmar has seen impressive economic growth. While more recent GDP growth rates did not quite match the two-digit growth rates recorded at the beginning of the millennium, they still remained at high levels and, in fact, accelerated again since 2010 (from about 5 per cent to around 8 per cent per year).

  • 12 - The Evolution of Taiwan's Economic Links with ASEAN

  • from PART 2 - MULTINATIONAL ENTERPRISE STUDIES
    • By Shin-Horng Chen, Director, International Division, Chung-Hua Institution for Economic Research, Pei-Chang Wen, Research Fellow, International Division, Chung-Hua Institution for Economic Research, Meng-Chun Liu, Deputy, Director, International Division, Chung-Hua Institution for Economic Research
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 550-577

  • Summary

    Introduction

    As neighbouring countries, economic relationships between ASEAN and Taiwan have been intensified primarily through de facto economic integration of trade and investment, instead of de jure integration, such as free trade agreements (FTAs). Not until in 2013 when Taiwan signed its FTA with Singapore (known as ASTEP) — its very first trade agreement ever with an ASEAN member. However, long before that, trade and direct investment between the two sides have intertwined to enhance mutual economic relationships. Particularly, it was direct investment in ASEAN made by numerous Taiwanese SMEs starting from the mid-1980s that triggered and pushed forward this economic integration (CIER 1995). In Taiwan, many tend to refer to this integration as the “investment-induced trade”. However, it can involve a process of “deep integration” (WTO 2011; Baldwin 2013a, p. 26) in a crossborder manner.

    In addition, global value chains (GVCs) (Gereffi and Frederick 2010; Gereffi, Humphrey and Sturgeon 2005; Gereffi and Memedovic 2003) and otherwise known as global production networks (GPNs) (Chen 2002; Coe et al. 2004; Ernst 2005, 2006; Sturgeon and Lee 2005; UNCTAD 2005) are keys to such integration. It is well-documented that in East Asia, SMEs have made significant contribution to de facto regional economic integration via their participation in GVCs and/ or GPNs (ESCAP 2009; Lim and Kimura 2009; Harvie 2010; Chen 2002; OECD 2007), which in turn has become an important source of national economic growth. A typical example at issue refers to the GPNs, led by a few brand marketers in ICT (information and communications technology) hardware and software (Chen 2002; Yang and Coe 2009), involving such countries as Taiwan, Malaysia, Thailand, China, India and the Philippines. Furthermore, the WTO (2011) and a few scholars (Baldwin 2013a, 2013b; Low 2013) have suggested that GVCs/GPNs and FTAs often lead to “deep integration”, through intertwining relationships among trade, investment, service and intellectual property; a phenomenon termed the “trade-investmentservice- intellectual property (IP) nexus” (Baldwin 2013a, p. 26).

    Set against the above context, this study sets out to examine the evolution of Taiwan's economic links with ASEAN. Indeed, GVCs/ GPNs are major elements underlying the economic links between ASEAN and Taiwan. To discuss this issue, we examine the macro data of direct investment and bilateral trade, from the Taiwanese perspective.

  • 7 - Philippine SME Participation in ASEAN and East Asian Regional Economic Integration

  • from PART 1 - COUNTRY STUDIES
  • Edited by Cassey Lee, Dionisius Ardiyanto Narjoko, Sothea Oum
  • Book:
    SMEs and Economic Integration in Southeast Asia
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    06 September 2019
    Print publication:
    29 April 2019, pp 287-354

  • Summary

    Introduction

    Small and medium-sized enterprises (SMEs) are expected to benefit from the opportunities arising from increasing globalization and regional economic integration through greater participation in global value chains (GVCs) and global and regional production networks.1 The ASEAN Economic Community was established not only to create a single market but also to serve as a regional production base that will attract more foreign direct investment (FDI). Regional production networks are at the heart of intraregional trade and investment and are the key drivers of economic growth in ASEAN and East Asia. This phenomenon is characterized by the exports of parts, components, capital equipment and other industrial inputs to be assembled into finished goods for export.

    MNCs have established these production networks with domestic firms, particularly SMEs, serving as potential suppliers of outsourced parts or services that have increasingly grown in sectors such as automotive, machineries, electronics, and garments. Participation in regional and global production networks provides SMEs with access not only to export markets but also to newer technologies. To increase their overall competitiveness in international markets, lead multinational firms provide their local affiliates and local suppliers with more rapid technological upgrading and greater attention to quality control, cost control, and human resource development.

    However, participation in these production networks is not easy and there are many challenges that SMEs need to overcome in order to participate in GVCs and production networks. SMEs must be financially strong to carry out the necessary upfront investment, have the ability to comply with stringent standards and other international business practices, and are able to constantly upgrade and innovate in order to maintain their competitiveness. Given their small size and age, government support for SMEs is crucial to facilitate their productive participation in GVCs.

    It is important to note that SMEs participating in production networks are different from non-participants and are often characterized by substantially higher growth and higher productivity (Aldaba et al. 2010). Given the large number of barriers that SMEs must face, making small and medium manufacturers internationally competitive is a major challenge that would require government support particularly by addressing financing, market information, business linkages, technology development, training and counselling and advice.

  • The Politics of Thai Buddhism under the NCPO Junta

  • Katewadee Kulabkaew
  • Book:
    The Politics of Thai Buddhism under the NCPO Junta
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    04 February 2020
    Print publication:
    23 April 2019, pp vii-viii

  • Summary

    EXECUTIVE SUMMARY

  • • The past two decades have been a time of turmoil in Thailand's religious affairs. Disputes, debates and controversies concerning the administration of Buddhism, Thailand's national religion by tradition, have erupted more and more frequently.

  • • This chronic and unresolvable conflict originates from Thai Buddhists’ inability to achieve a broad consensus on religious reform.

  • • Under the governance of the National Council for Peace and Order (NCPO) junta that came to power in 2014, the fierce struggle concerning Buddhist reform seemed to subside.

  • • Upholding and protecting Buddhism might be a duty of traditional Thai rulers who desire for a source of political legitimacy, but the NCPO's decisive actions concerning Buddhist institutional reform were not merely reflected respect for this tradition, but were closely intertwined with the dynamic of contending forces in Thailand's long-troubled religious politics.

  • • Conflicts between the influential religious nationalists and the Thai Sangha convinced the military government of the need to act, for the sake of national security and political stability.

  • The Politics of Thai Buddhism under the NCPO Junta

  • Katewadee Kulabkaew
  • Book:
    The Politics of Thai Buddhism under the NCPO Junta
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    04 February 2020
    Print publication:
    23 April 2019, pp 1-18

  • Summary

    INTRODUCTION

    The past two decades have been tumultuous in Thailand's religious affairs. Disputes, debates and controversies concerning the administration of Buddhism, the country's national religion by tradition, have erupted more and more frequently. This chronic and unresolvable conflict originates from Thai Buddhists’ inability to achieve a broad consensus on religious reform.

    Tensions have escalated as the Sangha—the Buddhist monastic order—has found itself at odds with government authorities over the process of negotiating reform. Monks’ growing inclination to concern themselves with politics and activities that aim to protect monastic interests have displeased sections of the Thai establishment. As a result, the Thai state has recently sought to assert more control over Buddhist affairs in general and the Sangha in particular.

    However, under the National Council for Peace and Order (NCPO) junta that came to power in 2014, the fierce struggle concerning Buddhist reform had seemed to subside. The military junta put an end to some of the prolonged religious controversies and even enforced the Sangha reform measures that former military and democratic governments had failed to uphold.

    Upholding and protecting Buddhism might be a duty of traditional Thai rulers, in their desire for political legitimacy, but the NCPO's decisive actions concerning the institutional reform of Buddhism are rooted not merely in respect for this tradition. Thai society today might not find the legitimation of political power through the defence of Buddhism to be as persuasive as in the past.

    Indeed, what the NCPO did in the area of Buddhist reform during its almost half-decade-long rule reflected a political decision. That decision had been closely intertwined with the dynamic of contending forces in Thailand's long-troubled religious politics. The background of long-term contentions between lay religious nationalists and the Sangha convinced the military government to act, for the sake of national security and the stability of its regime.

    PERPETUAL CRISIS: THE PROBLEMATIC STATE OF THAI BUDDHISM

    Why do Thai Buddhists and the notionally secular state have to concern themselves with the issue of religious reform? The answer lies in the long-running discourse of “Buddhism in crisis” that has been propagated and continually revived in Thai society since at least the late 1970s.

  • Foreword

  • Katewadee Kulabkaew
  • Book:
    The Politics of Thai Buddhism under the NCPO Junta
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    04 February 2020
    Print publication:
    23 April 2019, pp v-vi

  • Summary

    The economic, political, strategic and cultural dynamism in Southeast Asia has gained added relevance in recent years with the spectacular rise of giant economies in East and South Asia. This has drawn greater attention to the region and to the enhanced role it now plays in international relations and global economics.

    The sustained effort made by Southeast Asian nations since 1967 towards a peaceful and gradual integration of their economies has had indubitable success, and perhaps as a consequence of this, most of these countries are undergoing deep political and social changes domestically and are constructing innovative solutions to meet new international challenges. Big Power tensions continue to be played out in the neighbourhood despite the tradition of neutrality exercised by the Association of Southeast Asian Nations (ASEAN).

    The Trends in Southeast Asia series acts as a platform for serious analyses by selected authors who are experts in their fields. It is aimed at encouraging policymakers and scholars to contemplate the diversity and dynamism of this exciting region.

    THE EDITORS

    Series Chairman:

    Choi Shing Kwok

    Series Editor:

    Ooi Kee Beng

    Editorial Committee:

    Su-Ann Oh

    Daljit Singh

    Francis E. Hutchinson

    Benjamin Loh

  • The Trump Administration's Free and Open Indo-Pacific Approach

  • from THE REGION
    • By Brian Harding, Deputy Director and Fellow at the Southeast Asia Program at the Center for Strategic and International Studies (CSIS) in Washington DC.
  • Edited by Daljit Singh, Malcolm Cook
  • Book:
    Southeast Asian Affairs 2019
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    07 September 2019
    Print publication:
    10 April 2019, pp 61-68

  • Summary

    After nearly two years, the Trump administration's approach to the Indo-Pacific region has finally taken shape. Its objectives are a “Free and Open Indo-Pacific”, in line with decades of U.S. policy in the region, but in a new context of outright strategic competition with China. Its means include familiar tools of U.S. engagement, with some modest improvements for the times. But in Donald Trump's America, actions often do not support stated goals and, in the case of policy in the Indo-Pacific, President Trump's personal instincts, in particular his dogmatic approach to trade, have undermined his administration's best efforts in the region.

    Early Days

    Over the course of two years, a series of formal speeches and documents have articulated in increasing detail the administration's Indo-Pacific approach. Throughout this period, the administration has also faced frequent criticism for the slow pace of policy formulation and in appointing key Asia policymaking officials. To understand why policy formulation has been so slow, it is important to go back to Trump's unconventional presidential campaign and presidential transition.

    While all major U.S. presidential campaigns in recent memory have been supported by networks of public policy professionals helping the nominees and crafting policy agendas for the event the candidate is elected, Donald Trump's presidential campaign was different. In stark contrast to Hillary Clinton's 2016 campaign — with an enormous team of unpaid foreign policy advisors working to develop a potential presidential agenda, including a strategy for Asia — Trump had almost no foreign policy advisors. During the 2016 Republican primary season, leading Republican foreign policy hands supported a range of candidates, but almost none signed up to support candidate Donald Trump. Instead, many leading Republican experts actively opposed Trump's candidacy. Furthermore, soon after the election, Trump disbanded his small presidential transition office, depleting any preparatory work that had been done.

    Without a coherent foreign policy framework and with little expertise on Asia within its ranks, the early Trump administration's approach to Asia became highly reactionary, guided by a deep scepticism of China and the reality that North Korea presented an increasingly untenable threat to the U.S. homeland. In particular, the North Korea threat forced the administration to focus considerable attention on Asia in its first few months with a flurry of meetings with Asian leaders.

  • Competing Logics: Between Thai Sovereignty and the China Model in 2018

  • from THAILAND
    • By Gregory V. Raymond, Research Fellow in the Strategic and Defence Studies Centre, Australian National University.
  • Edited by Daljit Singh, Malcolm Cook
  • Book:
    Southeast Asian Affairs 2019
    Published by:
    ISEAS–Yusof Ishak Institute
    Published online:
    07 September 2019
    Print publication:
    10 April 2019, pp 341-358

  • Summary

    In September 2018 a quarrel between a Thai border guard and a tourist from the People's Republic of China at Bangkok's Don Mueang Airport turned violent. The argument took place after the Chinese visitor was denied entry on the grounds that he could not produce evidence that he would return to China after his trip to Thailand. The incident should be worrying for Thailand, given the country's increasing reliance on the growing numbers of Chinese tourists since the coup of 2014. Yet this incident is also symbolic of the internal pressure generated within the Thai state as a result of having to manage China's encroachments on Thai sovereignty.

    In 2018 the Thai military government struggled to maintain a balance between two opposing policy logics. On the one hand, China has become not just a critical economic partner but also a potential model of governance; on the other, Thailand's resilient strategic culture and national identity each emphasize sovereignty and independence, requiring judicious diplomacy with the great powers as the primary tool to achieve these ends. Clearly, there is a tension here: while Thailand may find the stability of authoritarian capitalism attractive, it no more wants coercion from China than it does from the United States.

    In this chapter I assess the extent to which 2018 may have seen the highwater mark of Thailand's embrace of China and its adoption of the China model. I argue that while permanent traces of this connection will remain in the form of more repressive domestic security policies and the goal of greater mainland Southeast Asian economic connectivity, warming relations with the United States will balance Thailand's strong tilt to China over the past five years. The article proceeds in five parts. I begin by examining Thailand's domestic political situation, highlighting how, since 2014, the junta's need for legitimacy has increasingly relied on the Thai elites who fear the rise of a mass movement capable of urban disruption. In the second section, I contend that Thailand is seeing the development of a protection pact between elites, such that they are prepared to sacrifice political liberties for increased security.

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