Problems of South East Asia -2


  • Economic and Human Issues-


Southeast Asia encompasses countries at dramatically different stages of economic and human development. Burma and Cambodia are among the world’s low-income countries, as classified by the World Bank, while Singapore is the third-richest country in the world measured by GDP per capita.

In between these extremes are countries that can credibly aspire to high-income status within the next decade, such as Malaysia, and others where living standards are set to rise rapidly, but which will remain in the middle-income group for the foreseeable future, such as Indonesia and Vietnam.

In human development terms, there is a similar disparity across the region. However, with the possible exceptions of East Timor and Burma, there are no countries in Southeast Asia where the development picture is as poor as that found in Sub-Saharan Africa. Even these two countries have lower rates of child morality and higher life expectancy than Sub-Saharan Africa, partly because the region has not been blighted by HIV/AIDS.

In countries such as Indonesia and Vietnam, graduation to middle-income status has been accompanied not only by falling mortality and improving literacy and school enrolment, but also falling levels of overseas development assistance. Some countries have been more successful than others in translating rapid economic growth into meaningful reductions in poverty. Capital flows, and poor economic management have contributed to credit bubbles and cycles of instability.

Like many emerging economies, the countries of Southeast Asia, with their young and relatively well-educated populations, have a demographic advantage over the developed world. At a very general level this will be manifested in coming years in faster growth and a convergence in living standards.

However, with life expectancies now approaching ‘Western’ levels across much of the region, in coming generations, many countries may have to change their approach to social protection. They may see the same pressures come to bear on their public finances that are currently faced in the developed world.

  • Territorial Disputes-

Southeast Asia is home to a range of complex territorial disputes. These have hindered efforts to build regional co-operation and integration. Many land borders have yet to be demarcated and there are also significant disputes over maritime boundaries. Below is a summary of the main outstanding disputes in the region. The Gulf of Tonkin is disputed by China and Vietnam. There are overlapping maritime claims. At dispute is access to fisheries and oil and gas resources. The Paracel Islands are disputed by China, Taiwan and Vietnam. The Spratly Islands are disputed by China, Taiwan, Malaysia, the Philippines, Vietnam, and Brunei.

On several occasions in the past, there have been naval clashes between China and Vietnam over the Paracel and Spratly Islands, most notably in 1974 and 1988. While these disputes are undoubtedly prompted by competition for natural resources, as significant is the fact that both are located in the path of one of the world’s major shipping routes.

More generally, China has on occasions forced non-Chinese fishing vessels out of parts of the South China Sea that are in dispute, sometimes fining them. China also has a history of pressurising foreign oil companies from doing exploratory work in the area in co-operation with other countries. Tensions have risen over rival claims in the South China Sea in recent years and the countries involved in the disputes have been strengthening their military capabilities in the area. The US Seventh Fleet also operates in the area.

In 2009 Malaysia, the Philippines and Vietnam filed papers with the United Nations Commission on the Convention on the Law of the Sea (UNCLOS), formalising their legal claims. China responded angrily. In mid 2010, US Secretary of State Hillary Clinton stated that the US had a “national interest” in maintaining respect for international law in the South China Sea. Soon after Clinton’s statement, it was reported that China had expanded its “core national interests” to include, for the first time, the South China Sea, although one analyst has since suggested that this may have been a misunderstanding of what Chinese officials said.33

China is opposed to greater US involvement in the resolution of disputes in the South China Sea, preferring bilateral negotiations. The other countries favour greater US involvement and prefer multilateral negotiations through ASEAN.

In 2002 China and ASEAN agreed a Declaration on the Conduct of Parties in the South China Sea in which all countries agreed to seek peaceful solutions to disputes in the South China Sea. There was another rise in tensions between China and ASEAN member states in the region during the first half of 2011. In July 2011 the two parties agreed ‘cooperation guidelines’ for implementing the Declaration. These and other diplomatic efforts led to a lowering of tensions. In November 2011, China proposed that a legally binding code of conduct should be negotiated.