SOUTH-EAST Asian governments have recently been congratulating themselves. On the surface, it seems they have good reason. All have experienced sharp rebounds in economic growth in recent months.
SOUTH-EAST Asian governments have recently been congratulating themselves. On the surface, it seems they have good reason. All have experienced sharp rebounds in economic growth in recent months.
WHILE travelling on a train in Melbourne’s western suburbs last month, Indian student Sourabh Sharma was brutally attacked and robbed by a group of thugs. His attackers screamed racial insults as they kicked him in the head, face and ribs.
Asia is the fastest growing region in the world, and is likely to remain so in 2013. However, a number of risks cloud the picture.
The good news is that domestic demand in the region remains strong and should continue to cushion the impact of weaker external demand on overall economic growth. The completion of national elections in Japan and South Korea in December 2012 should also help reduce political uncertainties.
But Asian governments will need to guard against the adverse impact of prolonged easy financial conditions on inflation.
Rising inequality also continues to threaten social stability. Ethnic and religious rivalries remain just below the surface in many countries. When combined with government corruption and (in some countries) high youth unemployment, this could become a deadly mix. This seems particularly true of China.
Territorial disputes also require close monitoring. Much diplomatic activity in the new year is likely to be centered on finding ways to reduce tensions over resource-rich islands in the South China Sea, where Beijing's claims overlap with those of Japan, Vietnam and other Southeast Asian states. South Korea and Japan also have rival territorial claims.
North Korea remains the wild card. Inclined to believe its own propaganda, Pyongyang's new leadership could miscalculate, making belligerent moves that plunge the region into a military conflict that nobody wants.
My name is Dr Bruce Gale and I am a senior writer with the Singapore Straits Times. I studied at LaTrobe University (BA Hons) in Melbourne and later at the Centre for Southeast Asian Studies at Monash University (MA). My PhD thesis, which focussed on Malaysian political economy, was completed at the Malaysian National University (Universiti Kebangsaan Malaysia) in 1987.
From 1988 to 2003 I was Singapore Regional Manager for the Hong Kong based Political and Economic Risk Consultancy (PERC).
I have written several books and articles on Southeast Asian affairs, including Political Risk and International Business: Case Studies in Southeast Asia (Pelanduk Publications, 2007). Books on language include Mastering Indonesian: a guide to reading Indonesian language newspapers (Pelanduk Publications, 2008)