ISEAS-Yusof Ishak Institute

Summary

Introduction

The region's recovery from the destabilizing effects of the 1997/98 Asian economic/ financial crisis had been patchy, and although by 2002 most gross domestic product (GDP) levels had edged back to pre-crisis levels, per capita incomes had not and unemployment was on the rise. The 3.5 per cent growth in Indonesia was achieved over a low baseline. Its path towards economic restructuring, sustained economic recovery, and political stability remained tortuous.

On the road to economic recovery two developments set back confidence and fuelled uncertainties. The Al-Qaeda terrorist attacks on the United States on 11 September 2001 (commonly referred to as “9/11”) opened a new phase of international insecurity. How the United States would pursue the war against global terrorism and with what impacts on the Muslim world fuelled uncertainty. The more open regional economies focussed on the consequences for global travel, business confidence, and the international economy. In retrospect neither the United States nor the most open regional economy, Singapore, was too seriously affected. Within a year both economies had rebounded with Singapore in the third quarter of 2002 seemingly headed for a 4 per cent growth. In 2002 the Malaysian economy grew by 4.2 per cent while the fastest regional growth rate of 7 per cent was recorded by Vietnam. However, the terrorist bombings in Bali on 12 October 2002, which killed 202 people, many of them foreign tourists including 88 Australians, dampened expectations of a rebound as Southeast Asia initially acquired an undifferentiated image in the minds of foreign investors and in travel advisories as an insecure region.

American concerns that parts of maritime Southeast Asia with their local history of Muslim militancy and rebellion against central authority were vulnerable to penetration by the Al-Qaeda network in search of a “second front” resurfaced following the Afghanistan campaign which commenced in October 2001 and resulted subsequently in the destruction of the Taliban regime and disruption of the Al- Qaeda network. The year 2002 began with regional anticipation of the political fallout of the war against international terrorism and ended with nervous tension over the imminence of war in Iraq.

Summary

The year 2008 will be remembered as a watershed for the Malaysian political system and for the forward trajectory of Malaysian democracy. This election year saw a refurbished coalition of oppositional political forces, the People's Pact (Pakatan Rakyat), deprive the ruling National Front (Barisan Nasional) coalition of its twothirds majority of seats in Parliament. Even more significantly, four state governments fell, making it a total of five governments in Opposition hands. I suggest here that this development has created a de facto two-party system for a maturing Malaysian democracy. Economically, Malaysians will be facing a severe downturn though not a technical recession. The year also saw the denouement of a leadership crisis within the United Malays National Organisation (UMNO) leading ultimately to the anticipated departure from the political stage in March 2009 of the fifth Malaysian Prime Minister Abdullah Ahmad Badawi. The political terrain remains fraught with pitfalls for premier-in-waiting Najib Abdul Razak and for Opposition Leader, Anwar Ibrahim, who awaits his sodomy trial.

The Malaysian Prime Minister Abdullah Badawi already had more than his fair share of a baggage of problems to deal with even before his tenure headed into 2008. Let me briefly recollect. After 25 November 2007, five HINDRAF lawyers remained in detention under the draconian ISA, while one was at large. The V.K. Lingam video exposé in September 2007 and the Royal Commission inquiry into it in January 2008 remained much in the public consciousness, so too the Altantuya murder trial which had dragged on from 2007. Inter-faith fractures which had surfaced since 2005 remained largely unresolved and so too internal squabbles within the ruling coalition parties. Most sensationally, the MCA Minister for Health had to resign because of the circulation of a sex video by his detractors. Finally, the economy was not in great shape with petrol prices and inflation spiking and Mahathir still sniping from the sidelines. Yet speculation was rife by early 2008 that an early election would be called presumably to salvage the premier's beleaguered situation, more than one year in advance of the mandatory five years. In a CNN interview Abdullah did admit that a fresh mandate was necessary for him to address a host of new issues and to make good his unfulfilled anti-corruption agenda.

Summary

During the years which saw maximum Chinese withdrawal from international affairs together with maximum United States military commitment to Southeast Asia, the years 1965–71, there was very little journalistic or scholarly interest in the Chinese communities living in Southeast Asia. It was not until after June 1971, when President Nixon announced that he was going to visit Peking, that anxious questions once more began to be regularly asked about the future role of the “Overseas Chinese”. All the fears of the 1950s concerning these Chinese were quickly revived and a large variety of questions were asked. Most of them centred on two related problems with wide ramifications. Firstly, will the Chinese in Southeast Asia be the targets of subversion? Secondly, will they be encouraged to resist assimilation and reassert their Chineseness?

On both these, opinions were divided. There were many who felt strongly that the diplomatic reemergence of China necessarily meant trouble for Southeast Asian countries with Chinese minorities, although some concentrated more on the consequences of American military withdrawal than on what the Chinese planned to do. Others were confident that the time for such fears was over. Most of the Chinese had settled down and made their peace with the new nationalist governments that had emerged since 1945. Most of them were economically well-off and too committed to the more or less laissez faire economics of the region to want to destroy them. Where there was danger, it would come from the growing discontent among the indigenous poor and the political awakening of the indigenous young. Thus one view concentrates on the intentions of China and the other on the effectiveness of Southeast Asian governments. There should also be a third which looks more closely at the reactions of the local Chinese. Although no great threat need be expected from them, there will be changes among them in some specific ways, for example, regarding citizenship among those who have been nationals of the Republic of China in Taiwan and regarding the new perspectives on issues of loyalty and assimilation. These changes will depend on the current policies of Southeast Asian governments, the numbers of Chinese and the degree of assimilation already achieved in each country, and not least on the attitudes of individual Chinese about their countries of adoption.

Summary

In 1998, the Asian economic miracle seemed like a distant dream for the economies of Southeast Asia, with the string of bad news being blamed on excesses committed during the years of strong growth. The countries reeled from the continued withdrawal of capital from the region, the disintegration and collapse of confidence in domestic financial sectors, policy- and psychology-induced demand contractions, the interdependent weaknesses in the international value of their currencies, and political conflict and a significant erosion of the social consensus over economic policy.

The Southeast Asian economies faced these problems in common, but the impact varied according to the level of development, specific features in their financial systems, the nature of the governments’ responses to the crisis, and the impact of the crisis on political stability.

The withdrawal of capital from the region in 1998 constituted the biggest shared factor among the Southeast Asian economies. The level of capital outflow, initiated by the Thai economic crisis of July 1997, increased in 1998 for the four most severely affected ASEAN economies — Indonesia, Malaysia, the Philippines, and Thailand — plus South Korea, with net capital outflows accelerating from US$1 billion in 1997 to $28 billion in 1998. In 1996, there had actually been net inflows of $103 billion.

The fickle nature of short-term portfolio investments was much in evidence during 1998. There was a brief slowdown of capital outflow from the region in the first quarter of 1998, but the levels accelerated as evidence of a deep recession in Japan became inescapable and the yen weakened, Russia's teetering economy saw the offering of interest rates on short-term Russian bonds reach 80 to 100 per cent, and Indonesia's thirty-year political arrangements disintegrated with President Soeharto's resignation in May.

In August, the Russian economic programme collapsed and a general retreat from portfolio investments in all emerging markets ensued. The premium on developing country debt shot up to unprecedented levels of 10 to 15 percentage points by October 1998. Brazil lost at least US$20 billion dollars in international reserves between the Russian collapse and the start of an International Monetary Fund (IMF) economic rescue package in November 1998; this package collapsed in mid-January 1999. Between 1997 and 1998, private capital flows to the emerging economies fell from US$260 billion to US$152 billion in favour of industrial country equity markets.

Summary

American troops came into Thailand twice, in 1961 and 1963. They were contingents of Marines sent to this country when communist Pathet Lao forces advanced towards the Mekong River which serves as a border between Thailand and Laos. The objective was to deter the aggressive communist side from seeking excessive military and political gains in Laos. When the communist forces retreated, the Marines as well as other SEATO forces from the United Kingdom, Australia and New Zealand which joined the U.S. troops in 1963 were repatriated. The U.S. left only a contingent of Army Engineers to help build the strategic road from the naval base of Sattahip to Northeast Thailand.

Why did the U.S. want to send its armed forces into Thailand?

Since I am not an American and privy to the deliberations which led to such a decision, I can only guess at the reasons which a foreigner like myself can detect. As I see it, the reason is not of a selfish nature. The U.S. did not hope to derive any particular benefit from such a move. To my mind, the U.S., in those days, must have felt a sense of mission, a certain responsibility for safeguarding peace and preventing war, particularly aggressive wars. In other words, the U.S. was conscious of its role as “world policeman”, since it has been blamed for allowing wars to break out because it failed to take the necessary actions or to take part in the activities of international organizations like the League of Nations. As a result of those accusations, some of them unfounded, the U.S., since World War II, took it upon itself to bar the road to aggressors and to extinguish the flames of international conflicts. The despatch of U.S. Marines came within the purview of that mission.

Later on, perhaps around 1965 (the exact date is unknown to me as the talks or negotiations were conducted in secret between the then Prime Minister, Field Marshal Thanom Kittikachorn, and the American authorities), the U.S. sent its military personnel, drawn mostly from the Air Force, and war equipment into Thailand. As it was learnt later, this action was necessary because of greater U.S. involvement in the Vietnam War. The military aircraft and the use of air-bases in this country were needed to support U.S. operations in Vietnam.

Summary

On 23 September 1972 President Marcos invoked martial law under the country's Constitution to meet what he termed “the threat of a violent overthrow of our Republic” and “to reform the social, economic and political institutions in our country.” Simultaneously there was an almost total clampdown on the press, television and radio stations, and the mass arrest of prominent citizens, among them opposition politicians and publishers. The declaration of martial law was quickly followed by a number of vigorous measures aimed at controlling the possession of weapons and weeding out the corrupt and incompetent within the government service, and bringing certain basic industries and communications under state control. It is noteworthy that although the communist threat was the justification for martial law the initial measures of martial law rule could also be seen as having been aimed at breaking the power of the oligarchy such as the arms’ ban, detention of political opponents, appropriation of private property, seizure of newspapers and the initial ban on foreign travel.

The immediate reaction of political observers to the imposition of martial law was that it was a move on the part of President Marcos to perpetuate his power indefinitely and suppress all criticisms against his rule which had been mounting since his re-election in 1969. The ordinary Filipino however, tired of the increasing violence and anarchy in Manila during the months preceding September, and burdened by serious food shortages and spiralling prices following devastating floods in June 1972 was more anxious to see the implementation of much needed reforms in the country and the reconstruction of what President Marcos has proudly proclaimed as the New Society.

One of the first to benefit from martial law was the armed forces. On 30 September 1972 President Marcos announced increased rates of monthly pay for the enlisted personnel of the Philippine Armed Forces, increased monthly pay for commissioned officers and promotions for a number of officers. While reforms and improvements in the armed forces had for long been recommended, the Presidential Order coming almost immediately after martial law had the appearance that it was made with the aim of ensuring military backing for the President. Since the imposition of martial law the armed forces have been brought increasingly to the fore with increased political and administrative responsibilities.

Summary

A steep decline in terrorist acts in Indonesia in 2014 should have been good news, especially because it underscored that police vigilance was high and extremist capacity was weak. But a third factor was also involved that was not such good news: more extremists were focused on getting to Syria and joining what they believed was a more important jihad than any they could wage at home. By late 2014, about 100 Indonesians, possibly more, were believed to have left to fight in Syria, some with their wives and children, and most to join the Islamic State.

Violent Extremists in Indonesia in 2014

By early 2014, Indonesia's jihadist community was divided between those who supported violence inside Indonesia, with the police as the primary target, and those who believed that at least for the moment, violence at home was counter-productive. The former generally supported the Islamic State and its predecessor, the Islamic State in Greater Syria and Iraq (ISIS). The latter were more likely to support IS's main rival in Syria, the al-Nusra Front, and its allies.

Prominent in the first group was Mujahidin Indonesia Timur (MIT), a group of some thirty armed men led by Santoso alias Abu Wardah in the hills outside Poso, Central Sulawesi. Santoso had run a series of military-style training camps in Poso beginning in 2011, and graduates and supporters are now scattered across Java, Sumatra, Sulawesi and Nusa Tenggara Barat (NTB). Despite being effectively under police siege during the year in his jungle camp, Santoso managed to smuggle out videos periodically to YouTube and radical websites. While neither he nor any other group managed any bombings in 2014, the few attacks on police during the year were all linked to MIT. Santoso was the first Indonesian to publicly pledge loyalty to the Islamic State after its leader, Abubakar al-Baghdadi, announced the establishment of the new caliphate on 29 June 2014 (1 Ramadan).

The pro-violence group also included remnants of Mujahidin Indonesia Barat (MIB), many members of which had previous ties to an old Darul Islam network led by the now-imprisoned Abdullah Umar. It included some but not all members of Abu Bakar Ba'asyir's organization, Jamaah Anshorul Tauhid (JAT), and many followers of the imprisoned cleric Aman Abdurrahman who had no specific organizational affiliation.

Summary

The political impasse between an entrenched military regime and a restive civilian opposition that followed the massive demonstrations and protests throughout Myanmar in 1988 remained unresolved at the end of 1990. Despite the holding in May of the first multi-party general election for thirty years, with victory by its most outspoken critics, the National League for Democracy (NLD), the State Law and Order Restoration Council (SLORC) government remained in an apparently unassailable position. But faced with sporadic protests and other expressions of discontent and alienation, the military's ability to develop a new and publicly acceptable political order appeared uncertain. In the meantime, however, the economic reforms begun in 1988 continued to gather pace, though without the clear policy guidelines which might have restored confidence more rapidly. In the midst of this domestic political and economic uncertainty, foreign economic and political pressures on the government were unrelenting from major Western governments including Japan, the United States, and the countries of the European Community, though relations with most neighbouring countries continued to be strengthened. The events of the year which have led to such a mixed and contradictory summary of the condition of Myanmar are easier to identify than the causes, which remain a subject of passionate disputation.

Domestic Politics and the Election

That the election would be the central political event of the year, holding the promise of the amelioration of the nation's major political problems, was the expectation of all. As the head of the government, General Saw Maung, said in a speech to an SLORC co-ordinating meeting on 10 January,

The reason why the rule of law and order and the prevalence of peace and tranquillity is being given so much emphasis is because the Pyithu Hluttaw [People's Assembly] election to be held this year is not an ordinary one. It is an election of historic significance, a veritable milestone in the annals of history marking the change from one era to another, from one system to another and a turning point in our history itself.

Despite widespread scepticism expressed inside and outside the country that elections held by the military could be “free and fair”, and that only an interim civilian government, as demanded in 1988, could be entrusted with election management, there was general agreement that the elections themselves were conducted honestly.

Summary

The problems posed by the exodus of people from Indochina were of critical concern to all the Association of Southeast Asian Nations (ASEAN) members in 1979. Thailand, the first ASEAN state to be seriously affected by the post-1975 outflow, had had to receive tens of thousands of overland refugees, primarily from Laos. By comparison with the influx from Laos into Thailand, the scale of the outflow from Vietnam in the first three years after 1975 was relatively small; about 35,000 “boat people” had arrived in ASEAN states by mid-1978. After mid-1978, however, the serious refugee situation in Southeast Asia was aggravated further by a mass departure of people from Vietnam, in a process that became the focus of worldwide attention and concern.

The exodus of Indochinese refugees after 1975 was, of course, only one instance of a series of movements of people in Southeast Asia in recent decades. Since World War II, there have been many such mass movements of people in the wake of political change and internal conflicts — movements which have occurred both within countries (most notably, the mass creation of refugees inside the Indochina states during the Second Indochina War), and between different states (the exodus of people, predominantly Catholics, from the northern to the southern zone in Vietnam in 1954, and the movement of Muslims from Southern Philippines to Sabah from the late 1960s and from Burma to Bangladesh in the late 1970s). All these population movements involved extensive social and economic disruption and human suffering. The Indochina refugee movements after 1975, however, became the focus of regional concern, and international attention and diplomatic activity of a kind not directed towards other refugee situations in Southeast Asia in recent years.

Partly a result of the legacy of thirty years of conflict and partly stemming from internal policies pursued by the Indochina states and from the tensions generated by the Sino-Vietnamese conflict, the Indochina refugee exodus has been a source of enormous human and political problems. For the refugees themselves, it has involved intense suffering and often death, particularly during the voyages in overcrowded boats across the often dangerous waters of the South China Sea.

Summary

Introduction: Wat Thepsirin, 12 November 2006

On the clear, sunny afternoon of 12 November 2006, a sliver of Bangkok's great, good, and merely loyal gathered at Wat Thepsirintharawat Ratchaworawihan to participate in the royally sponsored cremation rites for General Kriangsak Chomanan. Thailand's prime minister during 1977–80, Kriangsak had passed away in late 2003. Three years on, his cremation offered a rare, even reassuring moment of calm and order during a year of disorientating and discouraging developments for Thailand.

Thais present at Wat Thepsirin included a number of those who had shaped recent history. Former Foreign Minister Air Chief Marshal (Retired) Siddhi Savetsila attended the cremation. So did former Prime Minister Chuan Leekpai and several of the leading technocrats of the late 1970s and early 1980s. Dhanin Chearavanont of the Charoen Pokphand (CP) Group was also present — perhaps in recognition of Kriangsak's engagement with the People's Republic of China, where CP was an important early foreign investor, during his tenure as premier.

For all their reminders of yesteryear, the rites had a particularly timely aspect, too. Not least, they came less than two months after a military coup in Bangkok, executed on 19 September 2006. In his time, Kriangsak had been no stranger to coups. He was a leading participant in the October 1976 coup that ended Thailand's three-year experiment with open democratic politics. A year later, the extreme rightist orientation of judge Thanin Kraivixien's government led Kriangsak to lead a further coup, this time without prior royal approval, and to assume the premiership himself. During his years in office, Kriangsak moved to limit the political influence of the rightwing, pro-monarchist mass movement, the Village Scouts. Determined to place the Thai monarchy truly above politics and convinced of the need for a systematic approach to the challenges facing the country, he consulted with the King only minimally. This determination is said to have earned him the lasting dislike of the palace.

With no member of the royal family present, and in the King's stead, Privy Council president General (Retired) Prem Tinsulanonda presided over the 12 November cremation rites. His role was not without irony.

Summary

At bottom, resolution of the seemingly intractable Cambodian conflict depends on responses to a series of difficult politicomilitary questions:

Summary

Following elections in November 1996 a new coalition government took office in Thailand, led by incoming Prime Minister and New Aspiration Party leader General Chawalit Yongchaiyut. The new administration began its work in an atmosphere of great concern about the state of the Thai economy. Throughout 1996 Thai economic commentary was dominated by signs that the export-led boom that began in the late 1980s may be coming to an end. Most important of these signs were an apparently dramatic slow-down in the annual rate of growth of total exports and revelations that some investment and securities institutions may be unable to meet interest obligations. Confidence in Thailand's capacity to sustain high levels of economic performance was seriously damaged. The economic situation had clearly contributed to the downfall of the previous government of Banharn Silpa- Archa and posed immediate dangers for the new government. Identifying the causes of these and other economic problems is the central theme of this article.

Economic Boom, 1988–95

The background to the economic gloom of 1996 was the unprecedented boom which began in 1988. Over the eight years ending in 1995 the Thai economy was the fastest growing in the world (Table 1). The average rate of real GDP growth was unprecedented, at 10.4%, and inflation was low, averaging 5.3%. Two factors produced the dramatic growth: growth of exports, especially exports of labour-intensive manufactured goods; and very high inflows of foreign capital, including direct foreign investment. The two went together, in that much of the foreign investment was in the labour-intensive manufacturing sector. Export growth over this period averaged an extraordinary 28% per annum and as a share of GDP exports surged from 23% in 1988 to 34% in 1995. Economic inequality increased during this period but this should not be taken to mean that the benefits of growth were confined to the rich. The boom coincided with dramatically reduced incidence of absolute poverty, which fell from 22% in 1988 to under 10% in 1994, using the most common definition of poverty incidence.

Economic Gloom, 1996

In 1996 GDP growth in real terms fell to “only” 6.8%, the first year since 1993 of annual growth below 8%. Inflation was moderate at just under 6%.

Summary

Just before midnight on 31 December 1983, His Majesty the Sultan and Yang Dipertuan Sir Muda Hassanal Bolkiah, 29th ruler of Brunei, began reading the Proclamation of Independence to a crowd of 30,000 gathered at the Taman Haji Sir Omar Ali Saifuddien, Bandar Seri Begawan. He declared Negara Brunei Darussalam (Brunei, Abode of Peace) — “which has never been a colony” — “an independent, sovereign and democratic Malay Muslim monarchy based on Islamic teachings”. A 21-gun salute heralded the New Year, and also marked a new era in the long history of this ancient country.

The proclamation outlined the special treaty relationship between Britain and Brunei which dated from 1847. In 1888, Britain assumed responsibility for Brunei's defence and external affairs. Brunei achieved internal self-government under its 1959 constitution which remains in force. The 1959 constitution was promulgated during the reign of His Majesty's father, His Royal Highness the Paduka Seri Begawan Sultan Jeneral Haji Sir Muda Omar Ali Saifuddien, the 28th Sultan, who abdicated in 1967 in favour of his son.1 The 1979 Treaty of Friendship and Co-operation with Britain led to Brunei's full independence on 1 January 1984. With the reading of the proclamation, Britain relinquished its last responsibilities for the state's defence and foreign affairs.

Immediately following the proclamation ceremony, His Majesty the Sultan and Yang Dipertuan unveiled his new cabinet. The Sultan's personalized rule continues with his holding the offices of Prime Minister, Minister of Finance and Minister of Home Affairs. He named six other ministers, including his father, His Royal Highness the Paduka Seri Begawan Sultan (Minister of Defence), and two of his younger brothers, the Perdana Wazir Prince Mohamed Bolkiah (Minister of Foreign Affairs) and the Pengiran Digadong Prince Jefri (Minister of Culture, Youth and Sports cum Deputy Minister of Finance).

In addition, His Majesty named three cabinet ministers who are not members of the immediate royal family. Pengiran Bahrin bin Pengiran Haji Ahas was named Minister of Law and concurrently Minister of Communication. Pengiran Bahrin is a law graduate of Birmingham University. He also obtained his Master of Law from London University and is a barrister of Gray's Inn in London. Pehin Dato Haji Abdul Aziz was named Minister of Education and Health.

Summary

“Time for Change”; “For Real Change Let's Vote for NLD”

On 8 November 2015, in Myanmar's sixth multiparty general election (hereafter GE2015) since independence in 1948, voters’ desire for “change” swept away the conservative forces associated with more than five decades of military dominance in the politics of Myanmar. That simple catchy C-word, reminiscent of Barak Obama's U.S. presidential campaign battle cry in 2008, proved more effective than the “goodies” delivered during the five years of USDP (Union Solidarity and Development Party) rule under President U Thein Sein, as well as the last-minute deluge of amenities, goods and services brought in by powerful USDP candidates to their designated constituencies to garner votes from the weary public. The National League for Democracy (NLD), led by Daw Aung San Suu Kyi, the charismatic daughter of Myanmar's martyred independence hero, “Bogyoke” (general) Aung San, clinched supermajorities in both houses of parliament, stunning pundits, competitors, detractors, supporters and the NLD itself, not only in Myanmar but also in the international community. Thus, GE2015 appeared to herald the dawn of a new era in Myanmar politics, whose troubled experiment in parliamentary democracy was truncated by the military coup of 2 March 1962. However, both powerful agencies and rigid structures stand in the way of “real change” as envisaged by the NLD leadership and aspired to by those who voted in the popular party led by their beloved hero's daughter.

The Bumpy Road to GE2015

One could say that the re-entry of the NLD, especially its chairperson Aung San Suu Kyi, into the mainstream political playground through the by-elections in April 2012 set the stage for the race to win GE2015. People took notice of the NLD's comeback when it won forty-three of the forty-fives seats it then contested. It allowed the party and its leader to play a high-profile role in and out of the parliamentary system and capture the imagination of a public apathetic to electoral politics since the huge setback when the junta ignored the results of the 1990 general election.

Meanwhile, the government of President U Thein Sein, formed in March 2011, carried out significant political and economic reforms as well as administrative restructuring and attempted to achieve performance legitimacy and overcome its image as a quasi-civilian government comprising many retired military officers and serving generals.

Summary

In December 1974 thousands of demonstrators in Kuala Lumpur were dispersed by baton-wielding police, aided by tear gas. Hundreds were arrested. Among those detained under the Internal Security Act (ISA) was youth leader Anwar Ibrahim, probably at the behest of Education Minister Dr Mahathir Mohamad. In September 1998 the two key actors held different positions, but the scenes played out were much the same.

September began with the unexpected imposition of currency controls on day one. More dramatically, on day two Prime Minister Mahathir sacked Anwar from the Deputy Prime Minister and Finance portfolios. In the early hours of day four Anwar was stripped of both the deputy leadership and even membership in the United Malays National Organisation (UMNO), the dominant party in the ruling coalition. On 20 September balaclava-clad, M16-wielding police Special Forces broke down an open door and arrested Anwar, who was then held under the ISA for allegedly endangering public security. At the end of the month he was arraigned before the court, charged with five counts of corruption (abuse of power) and five of sodomy.

The drama of September brought Malaysia unsought international prominence, and opened up many questions. What went wrong between the Prime Minister and his designated heir? Did the fall-out from these events threaten Dr Mahathir's long rule? How strong was the movement for reformasi? Could Anwar make a comeback? Was this yet another power struggle between UMNO factions, or did it represent something more profound?

What Went Wrong?

Relations between Mahathir and Anwar have long been complicated. They first came in contact in 1969, when both were in opposition to Prime Minister Tunku Abdul Rahman. Mahathir spoke at student meetings organized by Anwar, and a student journal under Anwar published a chapter from Mahathir's Malay Dilemma, after the book had been banned. Their paths diverged in the 1970s as Mahathir returned to the UMNO fold and Anwar strengthened his position as a youth leader, particularly with the Malaysian Islamic Youth Movement (known by its Malay acronym, ABIM). In 1982 Mahathir persuaded Anwar to join UMNO, and the two of them worked closely together until Anwar became deputy party and government leader in 1993. From that time the relationship was strained, and both local pundits and the international media frequently predicted a split.

Summary

On 20 May 2002, the República Democrática de Timor-Leste/Democratic Republic of Timor-Leste became the first sovereign state established in the twenty-first century. International recognition of its sovereignty was confirmed when it became the 191st member of the United Nations (UN) in September 2002. This meant that a new, small, fragile state had entered the “international community”. For newly constituted states, such as Timor-Leste, sovereignty is the social status that provides political, economic and social freedom and confers upon them decision-making rights and capacities to pursue interests within the sphere of international relations. New states become holders of governmental authority with a status equal to the great powers of international politics. Timor-Leste's movement from occupied territory to sovereign state reflects a monumental shift in identity entailing new goals and interests, and necessitating new patterns of engagement with the international community.

The political history of the territory now known as “Timor- Leste” has been largely shaped by experiences with various forms of foreign intervention. For around 400 years, the eastern half of the island of Timor was subject to Portuguese colonialism. In 1960, Portuguese Timor was granted self-determination rights under international law as a non-self-governing territory. By 1975, a shift in policy allowed other Portuguese colonies to exercise self-determination, however, Portuguese Timor's decolonization process was halted when its neighbour, Indonesia, annexed its territory in 1975, leading to a twenty-four year struggle for independence. Indonesia's occupation delayed decolonization until 1999, when an internationally-sanctioned ballot resulted in Timor-Leste's separation.

Since 1999, Timor-Leste has been the subject of five UN peacebuilding missions and two international stabilization missions. While international state-building is not new, international recognition of Timor-Leste's sovereignty followed the most extensive period of state-building ever conducted by the UN. The most significant of these missions operated under the auspice of the United Nations Transitional Administration in East Timor (UNTAET). Present in Timor-Leste from 1999 until 2002, it was endowed with responsibility for the administration of the territory and possessed exclusive legislative and executive authority. It was also mandated to provide immediate humanitarian and security assistance, build state institutions and public administration, restore the judicial system and promote “capacity-building” among local actors. The UNTAET's temporary role as de facto sovereign reflects a distinctive transition to independence. Not only was this mission unprecedented in its size, scope and mandate, it was also the high-water mark of UN state-building.

Summary

Australia and Timor-Leste signed the Timor Sea Maritime Boundary Treaty on 6 March 2018 in New York City. While the treaty resolved the symbolic issue of maritime boundary delimitation, no agreement was reached on a development concept for the shared resource, Greater Sunrise. In February, a leaked letter from Timor-Leste's lead negotiator Xanana Gusmão signalled his discontent with these negotiations as he blasted the independent oil and gas expert who had raised significant concerns around the commercial viability of Timor- Leste's pipeline plan and the assumptions built into Timor-Leste's economic modelling. Gusmão publicly declared that the pipeline was “non-negotiable”. The United Nations Compulsory Conciliation report released in April also confirmed that it had been unable to facilitate an agreement on the development concept for Greater Sunrise. The report outlined that Timor-Leste's proposal could only occur with a direct subsidy of US$5.6 billion by the government of Timor-Leste (or another funder), and it would only provide a mere 7 per cent return on a capital investment of US$15.6 billion.

By August 2018, a development deal for Greater Sunrise — the most critical resource for Timor-Leste's mid-term economic viability and functional sovereignty, and the centrepiece of its development agenda — remained elusive.

Summary

This chapter examines the period of international state-building that Timor-Leste underwent prior to achieving political independence. While Indonesia had provided some education, schools and roads over the twenty-four years of occupation — which it sought to contrast with the neglectful Portuguese administration — the ability of East Timor to function as an autonomous state after the popular consultation was severely limited. Political, economic and social realities would render it impossible for Timor-Leste to establish governance structures and rule of law across the territory without extensive international assistance. While East Timor was not necessarily a “blank slate”, it faced significant challenges: the legal system had to be rebuilt virtually from scratch, there was an absence of administrative experience as the public service had consisted of mainly Indonesian personnel who fled after the 1999 ballot and the formal economy was underdeveloped.

While previous chapters discussed international processes of recognition, this chapter examines the ways in which East Timor's sovereignty became contingent upon developing a functional liberaldemocratic state. It examines the role of international state-building in East Timor from 1999–2002, focusing on the International Force for East Timor (INTERFET) and the United Nations Administration in East Timor (UNTAET). East Timor's experiences with international state-building reflected a desire on behalf of key members in the international community to shape the identity of the new state and develop effective governance structures and capacities. There were several state-building goals in East Timor. The first was to establish “empirical sovereignty”, which, as mentioned in the introduction, entails the capacities of states to establish political order and security within a territorial jurisdiction and provide their population “civil and socio-economic goods”. The second was to transform East Timor into a liberal-democratic state. These two goals are not necessarily compatible as liberal peace-building interventions have often struggled to build the conditions for democracy to take hold in societies unused to democratic rule. Nevertheless, the international state-building demonstrates that political recognition of East Timor's state sovereignty was conditional on the establishment of liberaldemocratic institutions.

New states enter an international community with pre-existing normative frameworks with which they are expected to conform. The preferences of industrially-dominant developed states shape the norms that structure behaviours within the international community and influence the expectations of new states regarding the nature of legitimate statehood.

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