The first phase of economic globalization in modern times lasted from the early 1950s to the first decade of the twenty-first century. It was shaped by national economies adapting to a global market and was dominated by the liberalization of trade and investments. The impulse for this came from the transformation of national economies that spread growth to other countries, drawing them into globalization. To make it work, rules-based international organizations were set up. Some nationstates went further and established a system of economic integration, such as the European Union (EU)—both an economic and a political enterprise—and the Association of Southeast Asian Nations (ASEAN).

The sinews of the global economy over the next fifteen years will be neither the national economies nor the conventional well-known forces such as trade and investment, but rather demographics, technology and energy, and how these will interact with each other. They will frame the conditions for the national economies to thrive; those that cannot do so will face a lacklustre economic situation. The impulse will be in the opposite direction to what it was in the first phase. This time it will be from internationalization to the national economies.

The political problem will be how to exploit the opportunities that this interaction will put on the table, and the question of where nationstates will be willing to take further steps to globalize their economies despite the short-term problems of restructuring.

Demographics

The size of the labour force (the share of the population aged 15–64 years of age) and the dependency ratio (the share of those aged over 65) are decisive parameters in attempts to forecast the future economic global competitiveness of a nation-state.

For many years the Chinese labour force knew only one direction—it was going up. When Deng Xiaoping initiated reforms in the late 1970s, he gambled on cheap labour costs combined with a reasonably skilled labour force, discipline and willingness, plus the ability to work hard. It turned out to be a colossal success. China became the centre for manufacturing, and it crowded out the industrialized countries as well as competitors among emerging markets and developing economies, coming close to monopolizing labour-intensive, low-cost manufacturing.

Indonesia's Moratorium on Deforestation

First published in The Forests for the Palms on 25 July 2013.

In May this year, Indonesian President Susilo Bambang Yudhoyono released Presidential Instruction No. 6/2013, instructing for a two-year extension to a ban on clearing 158 hectares of primary rainforests and peatland. This extends the original two-year moratorium on deforestation that was declared in May 2011 (Presidential Instruction No. 10/2011) under a US$1 billion deal with Norway to incentivize forest protection in Indonesia as part of the UN-REDD Programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries. The ban preserves about fifty per cent of Indonesia's primary forests in an attempt to reduce the country's carbon emissions, up to eighty-five per cent of which have been traced to the clearing and draining of carbon-rich peatland, mostly related to plantation development. This agreement was to “pause” business-as-usual development to allow time for the government to establish a degraded-land database to provide the necessary information to identify areas of land acceptable for the establishment of economic activity, especially oil palm plantations.

The Indonesian palm oil industry has long opposed this moratorium. The Association of Indonesian Palm Oil Producers (GAPKI) lamented that producers stand to lose more than gain from the moratorium. Palm oil producers have pointed out contradictions between the moratorium and the governmental goals for continued expansion of the sector to reach a crude palm oil output of forty million tonnes per year by 2020. They have argued that for these goals to be achieved, companies “had no choice” but to continue establishing plantations on restricted areas. However, despite the stringent opposition from the palm oil lobby, the president went ahead with this second two-year moratorium.

While this can be taken as a positive sign of Indonesia's commitment to reducing deforestation and carbon emissions, environmentalists have identified several inherent weaknesses in the moratorium that remain unchanged in this second ban. First, this “Presidential Instruction” is a non-legislative document, meaning there are no legal consequences if the moratorium is not implemented. Hence, the instruction has not been able to stop permits from being issued at the local level.

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:

Series Editor:

Editorial Committee:

COVID-19 has exacerbated and accelerated some trends:

• •In geopolitics—the decline of US leadership, rising US-China tensions and the “demise” of multilateralism and rules-based order.

• •On economic globalization—the trend towards regionalization2 and economic nationalism.

More specifically, it has, for both the short and long term, added implications for:

• •Economic recovery—whether it will be V-shaped, U-shaped or L-shaped.

• •Societal structure

• •Technology and data

The health aspects have attracted a lot of interest. The most important one may be: Are we prepared for another pandemic?

Geopolitics

American global leadership has been declining for some years. The US share of global GDP fell from 31.2 per cent in 2000 to 23.8 per cent in 2018. The same trend is visible for manufacturing, with the United States accounting for 16.6 per cent in 2018 compared to not many decades ago when it was the leading manufacturing country in the world. Debt is rising fast. It may still be the leading country for innovation and higher education, but the gap to challengers such as China is narrowing. There have been signs of an American strategic withdrawal for a decade or two in view of a mismatch between its capabilities and commitments. While the United States is unquestionably still the most powerful nation, its global outreach, capability and willingness to continue as global leader are not at the same level they were at the turn of the century. A cornerstone of President Trump's foreign and security policies has been to realign the costs and benefits of the US global role by cutting commitments. In some cases this has been manifested in the withdrawal of troops, as was the case in June 2020 with the announcement of a cut by a third of US troops in Germany Such reductions, often made without any warning to allies, raises doubts about US credibility, and they may give rise to suspicions that US guarantees may be subordinated to presidential whims.

For several years many observers have seen China as the next global leader. This conclusion may be too hasty. China's share of global GDP has risen from 7.2 per cent in 2000 to 15.8 per cent in 2018. This is remarkable, but it still leaves China far behind the United States.

The Southeast Asian transboundary haze has resulted in severe environmental, health, political and economic impacts in the region since the 1970s, and has resurfaced time and again in the past decades. During the episodes of 1997, 2013 and 2015, forest fires and haze brought damage on the scale of tens of billions of dollars to the affected countries—Singapore, Malaysia, Brunei, the Philippines, Thailand, Indonesia itself, and even to the rest of the world—through carbon emissions and climate change. Mainly the result of agricultural slash-and-burn practices on peatland in Indonesia, the pollution problem remains largely intractable and complex despite repeated efforts to mitigate it. Resolving this cross-border issue is critical, and yet is more insurmountable than it appears.

It fundamentally is a classic problem of public good and common property, where everyone owns the commons that is the atmosphere and yet no one is compelled to be fully responsible for it. Standard economic tools such as Pigouvian taxes or a simple Coasian solution cannot be applied. Indonesia can be pressured but not forced to reduce this pollution. The problem is complex to address, primarily because of its transboundary nature, which has made it difficult to assert extraterritorial jurisdiction without infringing on the sovereignty of the culprit nation. For Indonesia, the processes of enacting land use statutes, changing regulatory institutions and enforcing laws are complex and tedious. Plantation owners often deny using fire to clear land and blame shifting cultivators for starting fires in their smallholdings that later spread to plantations. Proof of negligence must be shown, which is susceptible to delays and transaction costs. Moreover, related to the enforcement problems is the complicated nature of Indonesia's decentralized governance system. The coordination of responsibilities for forest fires and haze is spread unevenly across many central and local agencies, with many overlaps.

It is important for all affected countries to undertake the valuation of negative impact costs of the haze such that a form similar to international aid can be offered to Indonesia and assistance provided to targeted sectors hurt by the haze. One approach could be to spend a sum not exceeding the costs of the haze to enhance the ability of Indonesian authorities to detect, locate and respond to the fires, as well as strengthen their ability to prosecute those responsible.

Like democracy, the nation-state is under attack. This should not come as a surprise as democracy is in many respects the political system born to support the nation-state. Like democracy, the strength of the nation-state is, or rather was, coherence, solidarity and a feeling among citizens of being in the same boat. Under the impact of information and communication technology, citizens shift their allegiance to other institutions or groups, cutting the link of mutual dependence holding the nation-state together.

• • It is being replaced by people shifting their adherence and loyalty from a nation-state (nationality as identity) to common and shared values.

• • The role of migration questions the prerogative of the nationstate as the “best” political system. Migration is rarely motivated by a wish to take on another national identity.

• • It is being undermined by the big data companies delivering instruments for communication—social networks overruling the privilege of a nation-state of controlling communication with its people.

A genuine nation-state with a single ethnicity, a single religion and a common culture is difficult to find nowadays. Fifty years ago, such could perhaps be found among the Nordic countries in Europe (Sweden, Denmark, Norway, Finland and Iceland), but since migration began in the 1970s and 1980s the picture has changed.

And with regard to the idea of the nation-state, it should be borne in mind that even if the label is used freely for countries around the globe, there is in reality a big difference among nation-states depending on where they find themselves and their history.

Almost all the genuine nation-states are to be found in Europe. The idea of the nation-state goes back to the end of the Thirty Years War with the Westphalian Peace in 1648. Over recent decades, minorities have risen to question their adherence to the nation-state, as seen in Britain with Scotland and in Spain with Catalonia. It is sometimes forgotten that two instances of what look like solid European nation-states— Germany and Italy—were first created in 1871 and 1861, respectively. In the early 1990s, Yugoslavia, an artificial nation-state created after the end of World War I, collapsed.

INTRODUCTION

Stepping out of the shadow of the past, Vietnam-US relations have seen new horizons since the two Cold War enemies normalized ties in 1995. In 2013, Hanoi and Washington entered into a “comprehensive partnership”, marking a new era of bilateral relations in which the two sides strengthened their ties beyond the economic domain. Currently, the two sides are considering upgrading their relations to the level of “strategic partnership”. The steady progress in bilateral cooperation, especially in the defence and strategic domains, has surprised regional observers and brought new substance to the relationship. Vietnam and the United States have indeed become important security partners, with each country playing an increasingly important role in the other's security policy.

This article analyses the Vietnam-US security relationship with a focus on Vietnam's perception of the relationship and the role that Hanoi would like Washington to play in its security policy. It is arguably their common perception of the China threat, especially in the South China Sea, which has added the strongest momentum to their strategic rapprochement in recent years. Due to this common interest in managing China's rise and its increasing maritime assertiveness, bilateral ties have continued to grow steadily despite the strategic uncertainty generated by the Trump administration. At the same time, such strategic dynamics have also led Vietnam to maintain its supportive view of the US-led regional and global orders. This position of Hanoi will likely stay unchanged in the near future.

The article starts with an overview of the foundations of the Vietnam-US security partnership, followed by an analysis of the role of the United States in Vietnam's national security strategy. It then reviews the key issues in their bilateral security partnership and discusses Vietnam's perception of US power under the Obama and Trump administrations. It concludes by assessing Vietnam's perception of the rules-based international order and the role of the United States in this order.

FOUNDATIONS OF THE VIETNAM-US SECURITY PARTNERSHIP

Among the major allies and security partners of the United States in Asia, Vietnam is perhaps the most special one given the two countries’ recent history of extreme hostility as well as their rival ideologies.

Civilization is a complex, fragile and vulnerable structure that ultimately depends on people's willingness to act in conformity with certain unwritten rules. This does not always filter through to the governing elite, the businesses and the people, all of whom take the cohesiveness of societies and responses to challenges for granted. Analyses of past civilizations disclose that civilizations succumbed to complacency, external changes such as climate factors, and internal strife, mainly about who governed and distributed the wealth.

Unfortunately, our civilization shows signs of all three of these elements. Complacency is widespread. The political leadership target short-term results, neglecting the long-term negative repercussions. This is combined with a worrying tendency among populations to take what has been achieved for granted. The unattractive fact that the outgoing generation has had to strive to get where they are has been put aside and replaced by a feeling that this is our right. External changes such as climate change and resource scarcities are well-known. But, despite a number of declarations and lip service, they fail to be transformed into policies. Internally, a growing gap between those who are rich and powerful and those who are not threatens to break up societies, mainly because the rich and powerful refuse to share what they have, alienating the majority of people who feel they have no chance of upward social mobility.

The past three to four generations plus the one currently in charge crafted a social contract—how to shape and maintain social cohesiveness among people living in the same society. This entailed a reasonable degree of caring for others combined with empathy and understanding of inclusive growth. That kept us going for quite a long time.

The impact of human beings on nature, however, was neglected, with pollution and the loss of diversity being the consequences. It is possible that the twentieth century—should we manage to avoid wiping out our civilization—will be classified as the greatest robbery, in the sense that we plundered nature, disregarding other species and future generations. Perhaps a kinder label might be the century of egoism/selfishness.

Spinoza's Prediction

The Jewish-Dutch philosopher Spinoza (1632–77) predicted that democracy would be guided by and taken over by demagogues jettisoning reason and logic. Freedom for individuals in whatever way it was seen when Spinoza lived would be there, but the mediocrity of rulers would lead to chaos. The elite would rebel against such a system. The people would be confronted with the choice between freedom and chaos versus order and tyranny. Spinoza predicted that people would choose order and tyranny. Men are by nature unequal, and equality among unequals is an absurdity. Therefore, a system which Spinoza labels aristocracy or monarchy, with the ablest individuals in charge, would inevitably prevail.

It is thought provoking that the BBC in February 2017 published a localized breakdown of voting patterns determining the outcome of the British referendum to leave the European Union of 23 June 2016 (the Brexit referendum). The report says that “a statistical analysis of the data obtained for over a thousand individual local government wards confirms how the strength of the local Leave vote was strongly associated with lower educational qualifications. Wards where the population had fewer qualifications tended to have a higher Leave vote.… If the proportion of the local electorate with a degree or similar qualification was one percentage point lower, then on average the leave vote was higher by nearly one percentage point.” History will tell whether the decision to leave was good or bad for Britain, but, as the data reveals, it was decided by the less educated, while the higher educated would have liked Britain to stay. Moreover, those earning most of the money to keep Britain going, including welfare payments, are found among the higher educated.

Six Major Problems

How Representative is Democracy?

Liberal, representative democracy is supposed to produce a parliament and government congruent with the electorate. It does not always turn out this way. Members of parliaments must toe the line to solidify the party's role in blocking legislation across party lines. Sometimes this makes it impossible for the government to find a majority, it overrides the national interest, or prevents members from voting according to their conscience. In the US Congress, members may be regarded as outcasts if they break party discipline.

INTRODUCTION

Malaysia's Pakatan Harapan (PH) government lasted less than two years. After winning the 14th general election (GE-14) on 9 May 2018 to great fanfare, it crashed on 24 February 2020 following the sudden resignation of Prime Minister Mahathir Mohamad and the departure of Parti Pribumi BERSATU Malaysia (BERSATU) from the PH coalition. Many were surprised by Mahathir's move, but a closer look at the nature of PH and how their agenda was received by Malaysians—especially by the Malay bumiputra group—shows that trouble started brewing right from the beginning of its formation. The problems were never resolved and continued to simmer in the background throughout its short tenure.

Some have argued that PH was never truly stable as a government or as a coalition. Leaders from its component parties continuously and publicly bickered, creating a perception that they lacked cohesion. Once in government, PH also lost five of the ten by-elections that took place after GE-14, indicating that their grip on the country's imagination had eroded over time. PH was also unable to maintain popularity while in office, with their poll ratings plummeting as they entered their second year of administration.

Opinions differ as to why PH collapsed. This essay examines the topic from BERSATU's point of view, documenting why the party decided to leave the very coalition that brought them to power. Indeed, many have argued that it was wrong for BERSATU to leave PH, but so far none have sought to answer the question why the party chose such a controversial path. This essay is an attempt in that direction.

In conducting this research, this author interviewed several key leaders from all four PH component parties, some of whom are cited here. Relevant literature was reviewed to supplement the primary data gathered from the interviews as well as the author's personal observations. The author sits in the BERSATU Supreme Council and was involved in several high-level discussions related to the topic. As such, this essay also benefits from an insider perspective. At the same time, great effort has been made to avoid making a moral judgement on the decision taken by the party especially since, at the time of writing, sentiments are still running high.

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:

Series Editor:

Editorial Committee: