South east Asia’s infinite capacity for surprise

“You are all clapping. The King is not required to clap, he is required to sign,” the once and future prime minister explained to a country which had not felt the need to prepare for a change of government but was now worried about whether it would actually happen.  

"South east Asian people spend more time on their mobile phones each day than people from any other region in the world.”

“That is what the provision of the Constitution says. It doesn't say, ‘I like you, I don't like you, I love you’,” the world’s oldest elected leader explained to nervous applause.

With its diverse cultures, economic development levels and political practices, south east Asia has an infinite capacity for surprise - not least for neighbours like Australia prone to missing the wood for the trees in such a biodiverse region. 

Malaysia’s election has been a classic case in point. It challenged the emerging new political science thesis that south east Asia may be a region which goes through the motions of democracy without ceding much change in power.

Thailand’s long delayed return from military rule, Cambodia’s no opposition party poll and a Filipino vice-president isolated from government decision making have all lent weight to this thesis.

Unrest

When Australia capped more than four decades of diplomacy with the Association of Southeast Asian Nations (ASEAN) with a rare summit of regional leaders – that is, a summit held outside the region - it was then Malaysian Prime Minister Najib Razak who unexpectedly stole the show with a most un-ASEAN public attack on Myanmar State Counsellor Aung San Suu Kyi.

His complaint about the flood of almost 1 million Muslim Rohingya people from Myanmar into Bangladesh raised two big questions about south east Asia’s capacity to act like a coherent region – one increasingly promoted as the third leg of global growth after China and India.

How could the region be seen to be living up to that global scale economic and diplomatic potential when it was failing to collectively deal with its worst human rights crisis in a generation? And how could it live up to the same potential when one of longest serving leaders was suddenly happy to attack a fellow leader for political expediency?

Expansion

But in September a very different vision of south east Asia was unfolding in the traffic congested streets of Hanoi and Ho Chi Minh City.

A company built on the pillion seats of Indonesia’s ubiquitous motorcycle taxis was firing the opening shots of a battle royale for the hearts and wallets of more than 600 million mostly youthful consumers suddenly empowered by digital technology.

Indonesia’s first unicorn tech start-up and ride-hailing business Go-Jek - now valued at $A5 billion - took its biggest step out of its home market in a competition to become the region’s dominant consumer services and cash payments platform. This is a battle which has attracted investment from technology giants in Japan, China and the US. 

Go-Jek’s $US10 billion Singapore-based rival Grab is already more active across the region but faces a challenge dislodging Go-Jek in Indonesia, the country with the biggest potential demographic dividend of youthful consumers and workers.

The regional internet economy is forecast to be worth more than $US200 billion by 2025, changing the way business is done and possibly achieving a sense of regional integration that has often eluded trade negotiators and diplomats despite half a century of planning.

According to a Google-Temasek study, south-east Asian people spend more time on their mobile phones each day than people from any other region in the world and twice as much time in ecommerce marketplaces than Americans.

These vignettes from a brief few months of tumult - political, human and technological – emphasise how this region is entering a challenging new phase of modernity after the dramas of decolonisation and the hubristic high economic growth of the Asian Tiger era.

Beyond the glittering shops of Bangkok’s Siam Paragon Mall and the endless blue horizon of the infinity pools in Nusa Dua, an old culture of patrician and authoritarian politics and business is under pressure from a new generation of digitally empowered consumers.

Grab, messaging app Line and discount airline Air Asia are the real new arteries of a region torn between the promise of greater ASEAN integration and domestic social challenges forcing most leaders to look more inward.

Down under

All this is happening at Australia’s front door on a scale increasingly impossible to ignore.

One statistic neatly captures how south east Asia will inevitably loom larger in Australia’s sense of place and engagement with the broader region for better or worse. When Australia opened diplomatic relations with its south-east Asian neighbours four decades ago, its economy was about one third bigger than the combined production of all five then members of the newish ASEAN group. 

Now looking forward about the same distance into the future, four of those original countries (Indonesia, Thailand, Malaysia and the Philippines) plus Vietnam are each forecast to be economically larger than Australia.

The March ASEAN Summit set up a new agenda for Australia to underpin a new relationship with the countries of south east Asia and the collective ASEAN group from the new partnership with Vietnam to a series of cooperation programs from city renewal to coordinated terrorism laws. But it was at the very end of the gathering that Laotian Prime Minister Thongloun Sisoulith most evocatively captured the potential for Australia to engage with the region.

He said the Australian aid-funded Mekong River bridge crossing between his country and Thailand in the early 1990s - which he helped negotiate - had simply transformed his nation by turning it from a land-locked to a land-linked county. 

In retrospect, this was a matter of the right idea at the right place at the right time. And one vision of a future to come. But not the only one.

Greg Earl is the editor of Disruptive Asia: Special ASEAN edition and was a former south east Asia correspondent for the Australian Financial Review.

This is an edited extract from a new collection of essays about Australia and south east Asia published by Asia Society Australia to identify the challenges and opportunities Australia faces in the region. The essays cover topics ranging from business success stories to the decline of regional language study in schools. They are intended to reflect on many of the themes from the historic ASEAN-Australia Summit in Sydney in March. The full series of essays can be read here.