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Abdul Rahman Embong and Jurgen Rudolph eds., Southeast Asia into the Twenty First

Century Crisis and Beyond, Penerbit universiti Kebangasaan, Malaysia Bangi, 2000

Chapter 4: The Politics of Asian Corporate and Financial Restructuring, Linda Low:

Distribution of Ownership and Control in Corporations: “family concentration is generally

high …, but higher in Indonesia, Malaysia and Thailand.” P102 In Thailand financial

institutions own 6% of listed companies, while individuals/families own more than 60%.

P104 This is similar in Indonesia, with concentration in the Sueharto family.

Indonesia: formation of the IBRA in 1998 (Indonesian Bank Restructuring Agency): the

conglomerates continue to won the companies by the IBRA will exercise shareholders’

rights until debts owed to the government are settled.” P105 Other actions include anti-

monopoly laws, one of the IMF conditions. (ex: this affects Pertamina in oil, Telkom in

domestic telecommunication). P109 Trials have happened, as on Suharto’s son, and ethnic

relations have been altered with the ethnic Chinese badly affected by the crisis (group

Salim). The author argues that deficiencies in the court and legal system are responsible for

inefficient implementation of reform institutions: “to install a fair and efficient commercialcourt system is difficult in a country where corruption is rife, and where cases involving

major companies are few… poor understanding of modern business practices lie at the

heart of the problem” P112 [rather, interests counter to transition/interests similar to those

promoted by the IMF].

Comparative Political Analysis:

- political commitment towards restructuring as influencing the pace and depth of efforts.

P124 “the triangle of bankers, politicians and big business, is obstructing such progress.”

P125

- contradictory legitimacy concerns: in the long-term, restructuring may bring economic

betters and thus provide basis for legitimacy, but in the short term it destroys established


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patters of power and interests, causing resentment and threatening the government

“there is a perverse situation that unless it is a strong authoritarian regime which is

assured of some long staying power in government, it is unlikely to have either the will or

strength to push reforms through.” P128

- foreign penetration, loss of control layoffs for efficiency resentment of workers

reflected on the current government.

Conclusion:

- economic crisis as altering state-business and ethnic relations.

- Crisis affecting the middle class: lost generation of intellectuals/technicians.

- Blame on globalization strengthening vs. IMF as helping: influencing the perception of

global economy and the probabilities of liberalization. Yet, the ASEAN path seems to

show that the path of liberalization is taken, at least on a regional scope. P133

Chapter 6: The Political Dimensions of the Indonesian Economic Crisis: Ignatius Tri

Handoyo

Indonesia: 1999 still no sign of recovery when both Thailand and South Korea have startedto show signs of growth again. Political crisis: students urging Suharto to step down,

entering the Habibie transition government. The latter’s administration was marked by:

- some positive political decision: release of political prisoners, freedom of the press

- social riots and protests, increased conflict, mainly due to the economic harshness, which

also fostered competition for resources and inter-ethnic resentment in this competition.

Another problem was imbalance in distribution. P154

- Problem of lack of international credibility of Habibie, vs. Chuan Leepkai in Thailand

-“the former president Suharto was replaced by a transitional government which is

illegitimate, weak and ineffective.” law and order falling apart.

- Struggle between the remaining forces of the new order and the reformasi power. P157

Presidential elections in 1999.


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Chapter 7: Thailand: Restructuring the Economy and the Rise of Nationalism, Giles Ji

Ungpakorn.

Thai community looking for scapegoats just after the crisis: the business used the

opportunity to get rid of the NAP-led 1996-7 government under Chivalit. Chuan Leepkai

took over, following IMF conditions (nationalize private debt and close failed banks).

Large amounts of public funds were used to save business, while the social impact of the

crisis (health/education) was at its worth more economic disparity.

- Whereas the Chivalit government bore the brunt of scapegoating, in fact the businesses

themselves were largely responsible for over-borrowing and using the loans for

speculation. P163

- Unlike Indonesia and Malaysia, the change in government did not cause social disorder.

The author argues this is due to the existence of parliamentary democracy in Thailand and

grass-root democratic sentiment: “This is due to the liberal parliamentary democracy

which now exists in Thailand, a product of years of struggle from below.” [as revealed by

the early 80s student protest and demo gov?? What about money politics?]

Political Consequences of Economic Restructuring in Thailand: Thai ruling class

restructuring the economy: ideological consequences and class conflict, which could have

impacts on political stability. P164

- working class: the post crisis businesses have harsher working conditions and lower

wages, in order to compensate for the lack of investment in education/technology which

would be another way to beat competition.

- IMF intervention: resented because it allows foreigners to take over large businesses

(telecommunication and banking), and because further liberalizations puts even more

pressure on small/local enterprises. “nationalistic objections” P165

Left nationalism: IMF conditions seen as a “threat to national independence”. Yet left

commentators do not see alternatives to capitalism, rather they see the crisis as the failure


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of one style of it. There is also use of the dependence theory. This leftism is the main

opposition stream: “State enterprise union publications and academic journals alike refer to

the IMF as seeking to enslave Thailand to the West.” P167 These ideas, rather than those of

the workers, are in the interest of small-scale capitalists facing international competition.

Privatization and Nationalism: [this is in 1998 ~ Leepkai gov.]

The government, emphasizing national interest rather than workers’ interests, proceeded to

the privatization of state enterprises, for reasons of “efficiency”. What this meant was

private restructuring and layoffs, with not government responsibility and lack of

unemployment benefits, while using a nationalist theme to avoid criticism. P168-9 “Thai

ruling class has still managed to shift the burden of paying for the crisis on to the backs of

ordinary people by the nationalization of significant amounts of private dbt, cuts in public

expenditure and increased unemployment.” P170

Yet, resentment of the working class is growing. [ quick move to Thaksin].

The effect of Economic Crisis on Class Struggle: Contradictory effects of the crisis on

workers: firstly anger for declining conditions and wages against a background of inflation.

Yet, not too much opposition due to the fear of losing job, decline of inflation in 1999, andpredominant nationalist ideology linking workers and employers. P171

“the parliamentary system, coupled with certain weaknesses in working class

organization, has allowed for a degree of political stability in these uncertain times.” P172

abdul rahman embong and j

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