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Southeast Asia

China’s relations with Indonesia requires more cautious moves

photo: ANTARA

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Authors: Zhou Dong-chen & Muhammad Raihan Ronodipuro

At the invitation of Chinese military commission, Indonesian Minister of Defense Prabowo Subianto made a working visit to Beijing during December 17-19. It is clear that the comprehensive strategic partnership between the two countries has maintained good momentum, as Chinese military leaders expressed that the Chinese and Indonesian militaries should implement their consensus reached by the leaders of the two countries, explore deepening cooperation in various areas, promote the two sides’ comprehensive strategic partnership and benefit the two countries and the region. Echoing his Chinese counterpart’s remarks, Prabowo highlighted the necessity of enhancing regular contacts and dialogues between the two militaries in order to jointly safeguard regional peace.

Though having been partners in modernizing Indonesian weaponry system, this is the first high-level visit to China by Indonesian Defense Minister with a view to discussing the efforts to further enhance cooperation in defense of the two countries. Yet, the rapidly growing power of China has constituted one of the most strategic dimensions in East Asia and beyond. For realist view, it represents a key driver of change in the dynamics of major power relations and will have significant impacts on the Asian-Pacific since the end of the WWII. True, the rise of China, even though it is claimed the peaceful rise, has become a dominant discourse within and outside public circles as well. For Indonesia which is the largest country in Southeast Asia and had complicated relations with China until the early 1990s, the rise of China unexceptionally presents an opportunity and challenge. Since normal relations between Beijing and Jakarta were restored less than three decades, Indonesia’s response to the rise of China is still evolving. As scholar Rizal Sukma observed that while recent developments suggest a marked improvement in bilateral relations, Indonesia’s policy of re-engagement towards China should also be perceived from the complex relationship of history, the primacy of domestic politics and the imperative of regional considerations.

Given this, the study argues that Indonesia’s policy towards China continues to reflect a degree of ambiguity and suspicion as well. On the one hand, Indonesia is sure to take the benefits of having good relations with China and begins to demonstrate increasing comfort in managing the bilateral relations with the rising economic giant. On the other hand, Indonesia remains ambiguous of China’s long-term goal and intentions in the region. This mentality has surely led Indonesia to pursue a policy of re-engagement characterized by a mixture of cooperative and suspicious approaches in its response to the rise of China.

There are several reasons to endorse the argument that China’s relations with Indonesia should be moving cautiously and attentively. First of all, since China and Indonesia shared modern sacrifices imposed by imperialist powers of Europe and Japan, it did help promote the reciprocal recognition of each other in 1950; yet it unnecessarily means that their relations have proceeded steadily. In effect it is quite opposite as their relations were subject to pressures stemming from each domestic concerns, particularly for the perceptions among the public and the elite have served as the key context within which Jakarta’s policy towards Beijing has been formulated and carried out. For example, in the early 1960s, attempts by both parties to forge a radical political alignment, primarily in terms of a united front against the West, failed to withstand the pressure emanating from Indonesia’s domestic politics, which was patently manipulated by the West. As a result, the Beijing-Jakarta axis was brutally brought to an end in 1965, followed by the suspension of their normal relations for more than 20 years.

Secondly, it is true that both China and Indonesia can’t ignore each other in a long run, it is because China has rapidly increased its power and influence since the 1980s while Indonesia as the largest country in the Southeast Asia has also aspired to be a regional power. In light of the vicissitude of the world politics, the two countries began to rethink of their relations in a more realist perspective. Yet, even during the 1980s, the anti-communist leadership of Indonesia was not moved by what China had already adopted the reform and openness policy. The dynamics of Indonesian politics which required the preservation and the enforcement of anti-communist ideology as the basis of regime legitimacy, arduously carried out the predominance of domestic political interests over other necessary concerns in Indonesia’s foreign policy. Only by 1990, did the two countries finally agree to resume direct trade and soon restored diplomacy. Even though, the restoration of normal relations did not improve substantially. Suspicions and sensitivity continued to characterize Jakarta’s attitude towards Beijing. The event in 1994 once again verifies this point when a labor unrest soon flared into an anti-Chinese riot in Sumatra. China’s official concerns were not only rejected but also accused of flagrant interfering in Indonesia’s internal affairs. As for China, the episode is a reflection of its lack of understanding in Beijing on Indonesia’s sensitivity on issues involving the ethnic Chinese minority in the country.

Thirdly, from the very beginning since 1990 when both countries resumed their relations, still Indonesia preferred dealing with China within a multilateral framework, either through ASEAN or the ASEAN Regional Forum (ARF). It is argued that ASEAN has been regarded in Jakarta as likely to be a more effective instrument for managing relations with a China regarded with apprehension and some foreboding. Similarly, the ARF has been taken by many Indonesian elites as a regime not only to engage China regionally but also to secure Beijing’s respect for international norms of inter-state relations. Prior to early 1998, Indonesia had begun to promote the economic dimension of bilateral relations with China. Since then, the contacts in overall terms have increased rapidly and remarkably. It is said that the great efforts to promote trade between the two sides since 1990 were obstructed by the financial crisis in 1997, yet, ironically it was the political implications of the 1997 financial crisis in Indonesia that opened up the opportunity for a much more cordial relationship between Indonesia and China to develop. For sure, the financial crisis which brought the Suharto regime from power served as a defining moment in bilateral relations of the two countries as the collapse of Suharto’s regime was followed in 1998. To certain extent, during the after the financial crisis, the ruling elites of the two sides did manage the issue well and did not let the long issue of Chinese diaspora in Indonesia out of control. Due to this, since 1998, the real improvement in the bilateral relations has become more evident, and the scope of bilateral cooperation has been expanding to include cooperation on areas such as security and defense. In 2005, China and Indonesia further established a strategic partnership which covered all the key areas such as security and defense technology cooperation. In addition, China’s image as a responsible and benevolent major power have also received further boost during the Tsunami disaster that struck Indonesia and other Indian Ocean countries in 2004.

Yet, as the past lessons have indicated that despite obvious improvements in bilateral relations, Indonesia and China are not immune from issues. Three issues might affect how Indonesia-China relations would evolve in the future. First, internationally Indonesia’s elite remain uncertain regarding China’s role and long-term intentions in East Asia. In this context, they are easy to follow the realism that a rising major power with an ancient pride aims to be a dominant power in the region would certainly revive Indonesia’s sensitivity. Although some of Indonesians have begun to display their willingness to trust China, but that trust takes time. A public opinion poll conducted by the Lowy Institute in 2006, for example, reveals that Indonesians trust Japan (76%) more than China (59%). For China to be fully trusted, it needs to consistently pursue a good neighbor policy towards Southeast Asia.  Second, domestically, there is still the issue regarding the public perceptions of Indonesia’s ethnic Chinese. If there is a resurgence of anti-Chinese feeling in Indonesia, and if the issue of the ethnic Chinese minority once again becomes a political victim in Indonesia, then Indonesia-China bilateral relations is sure to be affected adversely. Due to this, both sides need to learn how to avoid their previous mistakes in the new era.

 China and Indonesia have learned the lessons from the past. As a result, the bilateral relations have been improved over the last two ten years in terms of maturity and stability. In spite of this, the reality still requires the ability of the two countries to steer in the course cautiously and attentively.

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Southeast Asia

Thailand and Kon La Krueng Co-payment Scheme: A Challenge towards Sustainable Consumption

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Image source: bangkokpost.com

The COVID-19 has impacted many people around the world, particularly the poor people who are unable to meet their fundamental needs through self-sufficiency. These hard times of the COVID-19, it has taught us that our world is becoming more complex and that we must be prepared for unexpected events, such as this severe pandemic. From this case, it is evident that many poor people all over the world have been disproportionately affected by the COVID-19; as a result, surviving during this adversity is not easy for them.

Since the first outbreak of the COVID in early 2020, Thailand has been on lockdown and un-lockdown alternately. The closure of the country’s borders has not allowed foreigners to enter the country. This is to prevent the COVID-19 infection from spreading throughout Thailand. Nonetheless, the country’s closure has resulted in a slew of issues, including a drop in GDP growth.

According to the World Bank, Thailand’s economy is still suffering from the COVID-19 pandemic and is expected to grow at a low 2.2 per cent in 2021, down from the 3.4 per cent anticipated in March of the same year. It is obvious that due to this pandemic, the country’s growth could be that surprising. Nonetheless, it is not only Thailand that couldn’t achieve its expected growth but also many other countries worldwide. If we focus specifically on the ASEAN countries, most countries are facing the same situation; the GDP growth projection has dropped this year compared to last year’s. Indonesia is one of the countries that have been facing this slow growth because of the pandemic, the GDP Growth Rate Projection of Pre-COVID was 6.0 per cent and has dropped to 3.2 per cent for this year.

Apart from affecting the country’s GDP growth, it is undeniable that it also heavily affects people in the country. There is a wide range of impacts on people, especially vulnerable people, poor people, informal workers, etc. Many Thai people lost their jobs and returned home without money to feed their families. This is a bad thing that happens to them. Poor people have been affected heavily by the COVID-19 pandemic; many could not find work during these times. During the country lockdown, many informal workers such as street vendors were not allowed to go outside of their houses; thus, this badly affected their lives to find money to feed their families.

Moreover, this also led to unemployment issues in the country, not only in Thailand but also in other countries across the world. For Thailand’s case, the unemployment rate of this year was likely to reach 2.5% in the second quarter, representing about 937,500 unemployed workers, up from 1.96% in the first quarter, representing 758,000 unemployed workers. Therefore, it is obvious that the COVID-19 has impacted the country in many ways. Thus, the government should take action to help their people to overcome these hardships during the pandemic.

Thailand has shown a satisfying solution for this issue. The Thai government has come and played a critical role in helping people who have been suffering from this pandemic’s negative impacts. There are some financial schemes or programmes that were released by the Thai government to help the Thai people. One of those is the Kon La Krueng (Half-Half) co-payment scheme which is a project that the Government expects to stimulate domestic consumption and boost the economy by giving pocket money to Thai successful registrants.

The first phase of this project began on October 16, 2020, with payment beginning on October 23 – December 31, 2020. Registration for the second phase began on December 16, 2020, and payments were accepted from January 1 – March 31, 2021. While the third phase, round 1, opened for registration on June 14, 2021, the payment period ran from July 1 – December 31, and the second round’s phase 3 registration ran from October 16 – December 31, 2021, the payment period ran from October 4, 2021, to December 31, 2021.

For eligible and successful registrants above the age of 18 who are not state welfare or other financial scheme cardholders, the government provides 8,000 Baht. The length of time it takes to pay varies. If she or he had fully registered for the first phase, she or he will earn 3,000 Baht and an additional 500 Baht for the second phase without having to re-register. As a result, the total cost is 3,500 Baht. In phase 2, new registrants will receive a total of 3,500 Baht right away. And for phase 3, everyone will earn an additional 4,5000 Baht, with the first 1,500 Baht being given out during round 1’s phase 3 and the remaining 3,000 Baht being given out at round 2’s phase 3 on October 1 and November 1.

There are roughly 43 million registrants for all three phases of this financial scheme, which allows both sellers and buyers to register and take a critical benefit from this financial support from the government. Only food, beverages, general items, and service charges (massage, spa, manicure and pedicure, public transportation) are permitted to be sold under this scheme. Every purchase will be subsidized by the government to the tune of 50%. A successful registrant is permitted to spend the scheme subsidy at a rate of not more than 150 Baht per day or no more than 300 Baht for the shared cost. Every payment will be made through the Pautang G Wallet application.

Kon La Krueng (Half-Half) Co-payment Scheme has helped both consumers and local vendors positively across the country. Local businesses are growing as the money is spent in the local community which is positively affecting the local economic growth. Many vendors are also benefiting from this project; it grows local business and higher the consumption of local businesses. Moreover, it is promoting a cashless society as those involved with this scheme will have to pay online through G Wallet in the Pautang application. So, this is a change in people’s behaviour and adaptability toward a cashless society. From all this, it is undeniable that the government spending through this half-half scheme has grown the local consumption across the region and the nation positively.  The government spending on the half-half scheme for phase 3, round 2 (October – November) has increased the country’s GDP to 0.24 per cent. This means that this financial scheme has increased national consumption which positively affects GDP growth.

The spending behaviour of Thai people through this scheme during this pandemic is increasing, particularly local consumption across the country. This has a beneficial impact on overall national consumption. Local companies are flourishing, and local vendors can generate more income. Nevertheless, this consumption behaviour leads to some concerns about sustainable consumption. People are delighted while spending their money on common necessities, which can lead to rapid consumption both locally and nationally. As a result, the government may need to consider sustainable consumption so that people are more conscious of it, particularly their rapid consumption during this scheme, which may influence their negative money-spending behaviour and less sustainable daily consumption.

To conclude, the Kon La Krueng co-payment scheme provided by the Thai government has helped Thai people to consume more which is benefiting most Thai people in the country during the COVID-19 pandemic. Also, it helps increase the GDP growth, particularly from national consumption and government spending. Nevertheless, this rapid consumption of Thai people during this pandemic has arisen some concerns, particularly sustainability in which the government should promote this awareness so that people will be more aware of their daily consumption behaviour.

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Southeast Asia

Vietnam’s President Phuc visit to Switzerland and Russia

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Image source: chinhphu.vn

Vietnam’s President Nguyen Xuan Phuc visited Switzerland and Russia(November25-December 2) to promote his country’s bilateral ties with the two countries. During the visit to Switzerland, the Vietnamese president initiated a link between the Swiss state and Vietnam. For Vietnam, which has already ordered and administered eight different vaccines in its country to protect its citizens from the COVID-19 pandemic, the need is to procure more vaccines. The immediate urgency is to get medical equipment and to import resuscitation supporting machines so that critically ill patients should be saved. In terms of medical equipment and diagnostics procedures, Switzerland is one of the foremost countries for research in fields of diagnostics, pharmacy, lifesaving medicines and new kinds of vaccine development. Vietnam has been facing immense threat from the new variants of COVID-19 and related complications. The country is looking for conclusion of free trade agreement with European free trade association. The European Free Trade Association comprises of Norway, Switzerland, and Lichtenstein, There are also immense possibilities of improving the trade basket between the two trade partners. Vietnam is slowly emerging as an alternate manufacturing destination too.

The total volume of trade between Vietnam and Switzerland is more than 3.5 billion U.S. dollars. Vietnam which was the permanent member of the UN Security Council for the year 2020-21 is looking for developing better understanding and greater participation in international institutions such as United Nations, its affiliate organizations and the World Trade Organization(WTO).

Switzerland is also one of the enticing destinations for Vietnamese travelers and it is expected that there might be possibility of more flights between the two countries. During the visit to Switzerland discussions were held also with regard to promoting defence relations, interaction between the legal bodies of the two countries, promoting science and technology interactions between different institutions, encouraging investment from Switzerland to Vietnam, and also celebrating five decades of establishment of diplomatic relations between the two countries. President Phuc concluded his visit to Switzerland on November 29th and went to Moscow to hold meetings with its counterpart Vladimir Putin. 

During the visit to Russia, the two sides discussed areas to promote further cooperation in realizing the true potential of comprehensive strategic partnership and developing coordination in areas such as humanitarian and disaster relief. One of the important milestones during the visit of President Phuc has been the signing of bilateral agreement on vaccine production so that Sputnik V could be produced in Vietnam. The agreement which was signed between Vabiotech and Russian Direct Investment Fund(RDIF) would promote development of Sputnik V vaccine research in Vietnam, and developing resilient supply chains within Vietnam so that the vaccine can be produced in that country. One of the interesting aspects of this agreement is development of a Research Center and a small lab to look into efficacy of the vaccine and develop new formulations to counter the new variants of Coronavirus. Other prominent areas include developing cyber security architecture, exchange of cultural troupes, research in renewable energy and promoting sports between the two countries. Vietnam is emerging as one of the important sources for iron ore and therefore Vietnam now wants to diversify its vehicle manufacturing facility.

In fact, that Vietnam is increasingly reliant on Russia for its defence imports and in the past have imported sophisticated frigates, Sukhoi 30 aircraft, and Kilo class submarines. The growing defence relationship between the two sides is also expected to further expand in terms of sonar systems, supersonic missiles, air defence equipment, and training of sailors and technicians. 

Vietnam and Russia have a long-standing relationship even after the disintegration of the USSR. Russia has been very supportive of Vietnam efforts with regard to countering the three major powers which included France, the US, and China. The three Vietnam wars and the valor of the Vietnamese soldiers were much appreciated in erstwhile Soviet Union and thereafter by Russia. The historic ties  between the two countries was much appreciated and there has been much research which has been done with regard to cultural, historical, and political interactions between the two sides.

 The visit of President Phuc is seen as a new addition to the relationship as the president stated in one of the business interactions that the two sides should lift their trade by 15 times and also facilitate investment in each other’s countries. During one of these interactions, he clearly stated that Vietnam has emerged as one of the top 20 priority countries and therefore Russian investors should look forward for investing in Vietnam. He urged the Russian companies to capitalize on the free trade agreements that Vietnam has signed with Eurasian Economic Union and also understand the liberalization measures that Vietnam has undertaken in the recent past.

In the joint statement, which was released between the two sides it was clearly articulated that there is mutual respect and friendship between the two countries. The foundation of this relationship has been through mutual trust, territorial integrity, right to self-determination, and no use or threat of force against each other. The joint statement clearly stated that the two countries will work together in the field of security, military interaction, defence, and developing new technologies in defence sector. In the joint statement it was also stated that the two sides should work on capability planning, training, developing better science and technology cooperation, and forge strategic partnership in areas such as international law and promote interactions in UN agencies. The joint statement also alluded to the 1982 UN Convention on the Law of the Sea(UNCLOS) and it was particularly important in the context of developing issues in South China Sea. 

President Phuc used his diplomatic acumen to issue a joint statement in which there was clear reference with regard to developments in South China Sea. Russia supported Vietnam’s endeavor for full and effective implementation of the Declaration of the Code of Conduct of the South China Sea parties (DOC) under the 2002 agreement. Another important aspect was looking into sectors for promoting ASEAN Russia relationship and realize the potential of the comprehensive action plan between the two sides. The visit to Switzerland and Russia was effective and it met the objectives which were laid out in terms of achievements and new ideas which would be put into practice for the future. 

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Southeast Asia

Local Wisdom Brings Everybody Towards Sustainability

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Me and the Bajo kids posing with clamshell powder. Source: Author’s Collection

Climate change, carbon emission, zero waste, circular economy, and sustainability. If you are anywhere on the internet just like 62% of the world’s population, chances are you must be familiar, have understood, or at least have heard of these 21st century buzzwords. If you Google search the word ‘sustainable’, it would give you more results than if you search for ‘Titanic’, ‘globalization’, even ‘BTS’. Clearly, people all around the world has been putting more and more attention towards the concept of sustainability.

The question is, how well do we understand sustainability? What is being sustainable in development, business, and life in general entail?

Sustainability concepts were built on the foundation of protecting the resources of the Earth and the wellbeing of humankind which are negatively impacted by our abusive patterns of production and consumption. The Commission on Environment and Development (WCED) in its highly-cited Brundtland Report, also called Our Common Future, formally defined sustainable development as development that meets the needs of the present without compromising the ability of future generations to meet their own need. The Triple Bottom Line (TBL) first coined by John Elkington in 1994 is the fundamental concept in business to balance Profit, People, and Planet[1]. The concept really gained its momentum when the United Nations (UN) in 2015 set out 17 Sustainable Development Goals (SDGs) to be adopted and achieved through global partnership by its Member States in 2030.

As a way of thinking, however, balancing wealth, society, and the environment has actually been a part of traditional belief systems, religious teachings, medieval philosophies, and communal ways of living for centuries. Indigenous people all over the world for years have developed and for the most part maintained cultural knowledge, norms, and rules that stem from the adaptation process to the environment, commonly referred to as the local wisdom. Long before the natural, organic, free-this-and-that-synthetic skincare boom, People of Bajo or the Sea Gypsies community have been harnessing the ingredients provided by Earth as their recipe to having healthy and firm skin despite being out in the sea under the sun for most of the time. They would make use of the clams’ shells or rice grain mixed with herbs like turmeric to make powder that would protect their skin from the scorching sun.

Local wisdom is also at the heart of many customary rules, including activities to manage their natural resources. For instance, many indigenous coastal communities in Eastern Indonesia implement Sasi Laut that would only allow fishing in certain areas for around two weeks to three months and close for one to two years. This local wisdom embodies the concept of marine conservation and has been passed down from generation to generation. Globally, indigenous people that constitutes less than 5% of the world’s population is protecting around 80% of the planet’s biodiversity.

Moreover, economic, environmental and social issues come in different form and intensity in different countries and communities. It might be pollution for urban area, declining water quality for tourism destination, or the non-existence of proper waste management system for rural area. Thus, achieving sustainability would require a bottom-up approach in identifying the most pressing problem in a particular country or community. The integration of local wisdom would contextualize the existing varied frameworks, concepts, tools, and innovations on sustainability to be positively perceived, better understood, and well implemented. It is the bridge to include the less represented voice, common people, and indigenous communities to be parts of climate and sustainability conversation; making sure to leave no one behind.


[1] Elkington, J. (1998). Cannibals with forks: The triple bottom line of 21st century business. Gabriola Island, BC: New Society Publishers.

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