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:

Daljit Singh

Francis E. Hutchinson

Norshahril Saat

Introduction

Although Indonesia’s relations with Australia are not as important to it as its relations with the ASEAN states, it is clear that Indonesia has been concerned with Australia. This has become particularly evident after the “liberation of West Irian” (now Irian Jaya) and more recently, since the annexation of East Timor. Two issues have coloured Jakarta-Canberra relations — the East Timor problem and Indonesia’s policy towards Papua (i.e. eastern) New Guinea (PNG). This chapter examines recent relations between Indonesia and Australia during the New Order period, especially after the annexation of East Timor, and also considers Indonesia’s relations with PNG.

Indonesia-Australia Relations

Early relations between Jakarta and Canberra were cordial. Australia was among the few Western nations which were sympathetic to Indonesia’s claim for independence. The relationship began to cool once Jakarta adopted a militant foreign policy. Indonesia’s campaign to “liberate West Irian” caused tension between Jakarta and Australia because Canberra was concerned with the security of Papua New Guinea, then Australian “territory”. Australia was suspicious of Sukarno’s policy as the Government feared he might not stop in West Irian. Australian suspicions were strengthened by Indonesia’s konfrontasi policy with Malaysia. Relations between Indonesia and Australia began to improve after the fall of Sukarno and the emergence of Suharto, before the East Timor problem became the major issue between Jakarta and Canberra.

In 1974, Portugal underwent a “revolution” which resulted in its decision to grant self-government to its colony, East Timor. The decolonization process was far from smooth. Internal conflict and the emergence of the left-wing Fretilin were perceived by Suharto’s Indonesia as a threat to Indonesian political stability. Jakarta was afraid that an independent East Timor under Fretilin might become the Cuba of South east Asia. In addition, Indonesia also saw the East Timorese as their “lost brothers”. As a result, Indonesia intervened and eventually incorporated the Portuguese ex-colony into the Republic.

In 1974, when Labor Prime Minister of Australia, Gough Whitlam, visited Indonesia, Suharto sounded him out on the East Timor issue. It was reported that Australia would have no objection if the territory was peacefully integrated into Indonesia. When Indonesia annexed East Timor by force, however, the Australian public was not willing to accept the situation. Even the Labor Government was critical of Indonesia’s action and Australia criticized Indonesia in the United Nations.

INTRODUCTION

More people are living in cities than ever before with around 55 per cent of the world’s population in cities as of 2018, and this is expected to grow to 68 per cent by 2050 (UN DESA 2018). Much of this rapid urbanization is concentrated in the Global South, such as in low- and middle-income countries, which have all experienced significant increases in population and rural to urban migration (Hajer et al. 2020; UN DESA 2018). By 2050, there is expected to be another 2.5 billion people living in urban areas with approximately 90 per cent of this increase taking place in Asia and Africa (UN DESA 2018). Of the urban infrastructure required in 2050, around 40 per cent has yet to be built (Hajer et al. 2020). In the coming decades, Southeast Asia is expected to experience one of the greatest increases in population and urbanization in the world.

Countries in Southeast Asia are rapidly urbanizing from their historically rural population base, with each country at different points in their urbanization development pathway, from Singapore with 100 per cent urbanization to Cambodia with 24.7 per cent urbanization in 2021 (UN DESA 2018). Around 66 per cent of the population of Southeast Asia is expected to reside in urban areas in 2050, compared to an estimated 51 per cent in 2021 and 16 per cent in 1950 (Figure 1a). Of the Southeast Asian nations, Malaysia is one of the most urbanized of the low- and middle-income countries (Lechner et al. 2020a), with an estimated 78 per cent of its population in cities (Figure 1a). Meanwhile, Indonesia, which is a lower-middle-income country (World Bank 2021), has the largest population in Southeast Asia at 271 million (BPS 2021), with an estimated 57 per cent of its population in cities (Figure 1a). Indonesia is also home to the megacity (i.e., city with over 10 million) of Jakarta with a population in Daerah Khusus Ibukota (Capital Special Region) of 11 million (BPS 2021) and upwards of 30 million in the Jakarta metropolitan area (Jabodetabekjur) (BPS 2021). The growth of megacities such as Bangkok and Manila, and major cities approaching megacity size, such as Greater Kuala Lumpur and Ho Chi Minh, is triggering a ripple effect, promoting growth in nearby cities and thereby concentrating urbanization in selected regions (Suzuki 2019).

EXECUTIVE SUMMARY

• • This article reports the findings of an online survey conducted in November–December 2021 on Indonesians’ experience and perception of fintech tools, focusing on fintech adoption in the Greater Jakarta region, which besides Jakarta, includes Bogor, Depok, Tangerang and Bekasi.

• • One key finding is that, in the Greater Jakarta region, socioeconomic status as measured by income is not a key determinant of fintech adoption. This is likely due to the more developed and mature ICT infrastructure in the Greater Jakarta region, which makes fintech tools readily accessible.

• • However, the kinds of fintech tools that are more likely to be used— M-banking, E-wallet, Online Lending, Investment, Donations, and so on—are influenced by factors such as income, education, gender, age and occupation, suggesting that different fintech tools appeal to different groups in society according to their needs and resources.

• • Psychological factors that are important in the adoption of fintech include having many choices in the needed financial services and feeling in control. While fintech users are concerned about data leaks and fraud, this does not deter them from using fintech.

• • It may be anticipated that with the deepening of ICT infrastructure and public education on the safe use of fintech, fintech usage in Indonesia will continue to spread throughout the country.

One Coup for the Brother, Another for the Sister

Historical perspectives from the past can clarify events occurring in the present. Although certainly familiar with the phenomenon of coups d’état, many historians and political scientists in Thailand viewed the 22 May 2014 coup staged by General Prayut Chan-o-cha, then Chief of the Army, against Prime Minister Yingluck Shinawatra, who had been elected to office, as unprecedented.

It arguably differed from the 2006 coup by Army Chief General Sonthi Boonyaratglin against her brother Thaksin Shinawatra, a billionaire businessman who started as a police lieutenant colonel before becoming a politician and being elected to office.

After the Second World War in Thailand, coups against elected governments, usually headed by military or civilian bureaucrats who had turned politicians, had become traditional. These events, it might be pointed out, always involved male politicians, unlike the developments of May 2014.

Before 22 May, Prayut seemed to enjoy a good working relationship with Thailand’s first-ever female Prime Minister. In another first, for just under a year, starting in June 2013, during one of several cabinet reshuffles, Yingluck also concurrently took on the responsibility of serving as Thailand’s first female defence minister in her cabinet, while still holding the prime ministership.

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:

Daljit Singh

Francis E. Hutchinson

Norshahril Saat

Introduction

In 1992, a group of academics from the National University of Malaysia (UKM) organized a seminar titled “Seminar Ahli Sunnah dan Syiah Imamiyyah” (“Seminar on Ahl al-Sunnah and Imami Shi’ism”) in Kuala Lumpur. The two-day event arguably aimed to demonize the Shi’a sect and its adherents, as evident from the content of the presentations which will be discussed below. Among the various presenters was Wan Zahidi Wan Teh (1992, pp. 1–34), a lecturer from the Department of Shariah who presented a paper on “Ahlul Bait Menurut Pandangan Sunnah dan Syiah” (“The Prophet’s Household According to Sunnis and Shi’as”).After a lengthy explanation of his own understanding of the Ahlul Bait, he argued that Shi’as should not have the right to talk about the Ahlul Bait, and he dismissed them as a movement founded by Jews. He then quoted the founder of Wahhabism, Imam Muhammad bin Abdul Wahhab, and referred to Shi’as as apostates (ibid., p. 30). Proclaiming himself as a defender of Islam, he concluded that the goal of Shi’as in Malaysia was to cause Muslims to deviate from the Islamic creed, and to destabilize Muslim society through an underground movement in the country (ibid.).

Another paper titled “Bahaya Syiah Kepada Aqidah, Syariah, Akhlak, Ummah dan Negara” (“The Dangers of Shi’ism to the Islamic Creed, Shariah, Ethics, Muslim Society and the Nation”) was presented by a renowned Malaysian Deobandi scholar, Muhammad Asri Yusoff (1992, pp. 4–41).He began his paper by saying that “the truth is that Shi’ism is a teaching that has long been planned and organized by the enemies of Islam. It is the product and fruit of poisonous trees that were planted by Islam’s enemies in Muslim lands.” Arguably, Muhammad Asri’s paper was not presented according to academic conventions. He did not provide any framework or methodology, and his only argument was that Shi’ism was founded by a Jew by the name of Abdullah bin Saba, and is therefore inimical to Islam and Muslims as a whole.

There was only one paper that presented a more objective and balanced view of Shi’ism.

INTRODUCTION

There is a broad consensus that inequality is harmful for sustainable development. Kuznets (1955) observed the historical record of growth and inequality in some industrialized countries. As incomes grew, inequality first increased and then decreased after a peak. However, recent studies show that inequality can reduce economic growth and increase poverty, and it is possible that an economy can grow without rising inequality, especially in the early stages (Alesina and Rodrik 1994; Persson and Tabellini 1994; Deininger and Squire 1998; Bourguignon 2003). Inequality can also increase the social conflict and violence (Cramer 2003; Østby 2013; Ferrer-i-Carbonell and Ramos 2014). Inequality is also found to be negatively correlated with happiness and life satisfaction (Dolan, Peasgood and White 2008; Schneider 2015; Tran, Nguyen and Van Vu 2018). Understanding the trends and drivers of inequality is, therefore, very important not only for researchers but also policymakers.

In this study, we examine changes in inequality in Vietnam over time and analyse potential drivers of inequality using decomposition and regression methods. Although Vietnam has achieved relatively broad-based economic growth, there is still a large gap in living standards between population subgroups. Thus, in this study we also investigate the gaps in living standards between the Kinh majority and ethnic minorities in Vietnam. Using the richly detailed Vietnam Household Living Standards Surveys (VHLSSs) of 2002 to 2016, we estimate inequality levels and patterns based on different living standards indicators.

Vietnam is an interesting case to look at. Since 1987, the economy of Vietnam has experienced rapid economic growth as well as structural transformation from a centrally planned economy to a market-based economy. As a result of economic growth, poverty has decreased dramatically with the poverty headcount ratio (using the international poverty line of US$1.25 a day (2005 PPP)) falling from 43.6 per cent in 1993 to 14.3 per cent in 2008 (World Bank 2013). In 2016, according to the international poverty line of US$3.20 a day (2011 PPP), the rate was around 8.6 per cent (World Bank 2018). Extreme poverty is almost eliminated, with only 2 per cent of the population living on less than 2011 PPP US$1.90 per day.

Economic growth is not associated with rising inequality in Vietnam. Estimates from VHLSSs show that inequality of expenditure has been very stable in Vietnam.

The relationship between trade times and cross-border paperless trade is estimated in three steps. First, the score of six cross-border paperless trade measures in Table 1 (in the main text) is calculated by converting qualitative data into quantitative data. This is done by applying a simple scale: no implementation or data unavailability corresponds to zero; partial implementation corresponds to 0.5; and full implementation corresponds to one.

Export and import times are measured in hours. They were obtained from the World Bank’s Doing Business database. Time for exports or imports consists of two components, one for documentary compliance and another for border compliance. Documentary compliance captures the time associated with the documentary requirements of all government agencies of the origin and the destination countries. It includes the time for obtaining documents; preparing documents; processing documents; presenting documents to port authorities; and submitting documents. Border compliance captures the time associated with customs regulations and with regulations relating to other inspections that are mandatory in order for the shipment to cross the border. It includes time for customs clearance and inspection procedures conducted by other agencies.

We then use a basic econometric model to estimate the relationship between trade times and the score of cross-border paperless trade measures. The model also controls for two factors that determine trade times, but instances are not many due to the small number of observations in the dataset (forty-three—the number of countries that are key trading partners of ASEAN, see Annex 3). These two factors include the score of general paperless trade measures and the score of other trade facilitation measures.

The general paperless trade measures include:

• 1. electronic customs system;

• 2. Internet connection available to customs and other trade control agencies at border-crossings;

• 3. electronic Single Window system;

• 4. electronic submission of customs declarations;

• 5. electronic application and issuance of import and export permit;

• 6. electronic submission of sea cargo manifests;

• 7. electronic submission of air cargo manifests;

• 8. electronic application and issuance of certificate of origin;

• 9. electronic payment of customs duties and fees; and

• 10. electronic application for customs refunds

Other trade facilitation measures cover the following areas:

• 1. transparency;

• 2. formalities;

• 3. institutional arrangements and cooperation; and

• 4. transit facilitation;

INTRODUCTION

Increasingly divisive levels of inequality are a global problem with profound consequences. With many countries in both developed and developing contexts seeing increasing disparities between the haves and have-nots alike, the potentially disastrous consequences for society and politics and their impact on businesses and productivity can no longer be ignored. Against this backdrop, Singapore’s developmental context is shifting as the rate of economic structural transformation slows. The city-state finds itself at a turning point where hard choices must be made to safeguard the social stability previously upheld by breakneck growth speeds. With its policies historically being an object of study for China, Southeast Asia, and other developed and developing economies, the learnings from how Singapore tackles inequality will resonate beyond its shores.

Addressing parliament in February 2018, Singapore’s Prime Minister Lee Hsien Loong bluntly observed that if widening income inequalities were allowed to create “a rigid and stratified social system”, “Singapore’s politics will turn vicious, its society will fracture, and the country will wither”. Sounding the exact same warning in her inaugural speech three months later, President Halimah Yacob noted that inequality had broken the social compact in many countries and Singapore “must tackle inequality” before the problem became entrenched (Yacob 2018). The recasting of inequality as a serious societal problem in Singapore has become increasingly prominent in recent years, including during the 2020 General Elections.

Although few would question the seriousness of inequality, there is far less consensus on its extent and how to mitigate it. This paper contributes to this debate by juxtaposing empirical trends against the emerging realization that while the normative commitment to meritocracy in Singapore has never slackened, its increasing tension against the lived realities of unequal opportunities is posing a jarring contrast to the narrative of equal life chances, taking an increasing toll on Singaporeans’ belief in the system’s ability to arbitrate life chances based on talent and effort.

There are three takeaways. First, inequality for Singapore has become a matter of national survival, tied to the larger social compact of a functioning meritocracy in spite of constructive efforts by the government towards mitigating the ills of what I call “time two meritocracy”.