4 - ASEAN and East Asia

Summary

Since the second half of the 1960s and almost till the end of the 1990s East Asia was viewed by the world as a place where one economic miracle was followed by another, where countries considered eternally backward were successfully trying to catch up with the West, and economic dynamism, coupled with stable political foundations, was contributing to greater regional harmony. The impression that enterprising Asians would never let their luck slip away was badly shattered by the financial crisis of 1997–98. The same media outlets, research institutions and rating agencies that used to praise them, suddenly “saw the light” and started complaining as one about the flaws of “crony capitalism” — the system promoting alliances between bureaucracy and big business, rendering fair competition impossible and inseparable from paternalism, corruption and managerial mistakes.

Today passions induced by the crisis have largely settled down. Since the majority of the victims have improved their economic performance and China, untouched by the financial havoc of the late 1990s, continues to grow with an amazing speed, some observers tend to think that the Asian crisis is a thing of the past. That may be true if one views it as a period of dangerous unsteadiness for a number of national currencies and banking systems. But if one assumes that overcoming a serious crisis means getting over a set of its negative consequences — not just economic, but social and psychological, and those belonging to realms of ideology, domestic and international politics too — then the impression may be wrong. Among the factors prompting one to observe the East Asian scene with a degree of scepticism are the problems of individual ASEAN member countries and of this body as a whole. Many of these problems are determined by the differences between that global political environment in which the Association of Southeast Asian nations was born and matured, and the one emerging during the last decade.