Singapore

On Wednesday, the New York Times had an extensive article about how Singapore, which hopes to expand its population from around 5.4 million today to around seven million people in fifteen years, plans to house its mushrooming population given its severe scarcity of land. Singapore is, of course, an island, it has already reclaimed large portions of land from the sea around it, it has a reputation for maintaining green space that is critical to its ability to attract companies from around the world, and it already has built nearly fifty skyscrapers in the downtown area, with more to come. So, in Singapore’s classically planned-to-the-hilt style, the city-state is considering building an extensive underground complex including shopping malls, walking areas, bike paths, and research and development areas. Singaporeans have been discussing the underground concept for at least four years, well before the Times picked up the story, and the city-state’s government already commissioned an extensive feasibility study, which has given the approval for the idea for a large underground science R and D center. And given the scarcity of above-ground real estate, and popular concerns in Singapore about income inequality and the high cost of living, the possibility of sizable underground property becoming available, relatively cheaply, for companies and possibly homeowners is likely to be relatively popular. And even if the idea is not so popular, when the Singapore government makes a long-term plan, it doesn’t usually junk the idea. But I find the idea very worrisome. Sure, Singapore needs to plan for global warming and land scarcity, and other cities in the region, like Bangkok, have done an atrocious job of planning. Bangkokians know their city is sinking into the swamp beneath it, but no Thai government has a convincing idea how to solve Bangkok’s land crisis. Yet in cities that already have extensive underground areas, like Montreal or Toronto Coober Peedy in the Australian Outback, the underground region is necessary but depressing to spend significant time in, and few Montrealers would want to live underground. (In Coober Peedy, which I have visited, it is so hot you need to stay underground, but that does not make the underground catacomb town any less depressing.) The cookie-cutter sterility of the high-rise, above-ground housing development blocks constructed by the Singapore government also does not give one hope that a vast underground complex, even one with parks and bike lanes, will be human-friendly enough to counteract the natural unhealthiness of burrowing into the ground.

Even before several of my CFR colleagues and I arrived in Indonesia earlier this week for discussions on regional security and governance, headlines in the region’s media were dominated by the haze that was blanketing Singapore and Malaysia—not to mention parts of Indonesia—as a result of the slash-and-burn practices in Sumatra. In an effort to clear land to plant new crops, farmers there burn crop residue, timber, and peat. The result is hundreds of “hotspots,” or fires that contribute to a thick, toxic haze that travels throughout the region. This is despite a government effort to promote “zero burning” and a moratorium on all deforestation in much of the country. As Huang Yanzhong described in a post earlier this week, this year’s haze marks the most serious since 2007, when economic losses to the region reportedly reached US$9 billion. This time around, Singapore recorded its worst air quality in history, Malaysia closed hundreds of schools, and tourism dropped dramatically. Singapore and Malaysia have both offered assistance, while at the same time calling on Indonesia to step up its game. Indonesia, in turn, has refused the assistance and responded with criticism of its own, with one Minister complaining about other countries “making noise to the world when things go bad.” According to one Indonesian expert, Singapore’s offer of monetary assistance was “insulting.” Indonesian President Yudhoyono, perhaps in an effort to reduce tensions, apologized to the region and promised to devote more resources to the firefighting effort. This year’s contretemps is emblematic of a broader problem in regional governance and Indonesia’s own state capacity. While the challenge of regional haze has been recognized since at least 1985, in the region’s “Conservation of Nature and Natural Resources Agreement,” efforts to build an effective regional response have been stymied. Despite years of agreements to share information, train firefighters, and develop a common air quality index—as well as the establishment of a 2002 “ASEAN Agreement on Transboundary Haze Pollution”—the fires continue to burn. Part of the problem rests in the nature of the agreement, which has no enforcement, sanctioning, or dispute settlement mechanism to help ensure countries’ adherence. The more significant flaw, however, is the failure of the chief culprit in the burning—Indonesia—to sign the agreement. Indonesia wants the agreement linked to other issues, such as illegal logging. Without ratification by Indonesia, the agreement cannot have any real impact on forging an effective collective response. Indonesia’s own weak state capacity poses a second challenge. Enforcement of its forestry regulations suffer from a high level of political and geographic decentralization, which makes it difficult to implement the country’s forest laws; in some cases local officials pass regulations contrary to laws passed by the central government. A powerful palm oil and timber lobby resists the more expensive methods of clearing land, and poor independent farmers have little economic incentive to adopt best forestry practices. Corruption is endemic in the forestry sector at local levels: for example, the former governor of Riau province, which is the source of much of this year’s fires, was arrested for corruption, in part for selling forest permits illegally. Still, there is hope. An alliance is emerging of domestic and international non-governmental organizations who are working with Jakarta to pinpoint the source of the fires, as well as those responsible. Agribusiness companies, such as Bunge, Caterpillar, and Nestle, are pledging not to buy palm oil or palm oil products from companies that practice slash-and-burn or plant in areas under the moratorium. More can be done. Other countries in the region should make clear to Jakarta that as a regional leader, Indonesia needs to ratify the haze agreement; it can’t be a laggard. Economic incentives to bulldoze, excavate, and compost crop residue and timber rather than burn it could also help reduce the temptation to take the quick and cheap route. Finally, the significant role of Singaporean and Malaysian palm oil and timber companies in Indonesia’s economy offers real opportunities for joint law enforcement efforts if the countries can overcome sovereignty and other political tensions.

Haze continues to spread across Southeast Asia, the result primarily of burn-offs from farming by individuals and agribusinesses in Indonesia, combined with the dry summer weather and urban pollution in the region’s largest cities. As Yanzhong Huang notes, air pollution levels in some parts of penisular Southeast Asia have reached record highs this past week; the more proactive governments in the region, like Singapore, have taken health precautions like pushing nearly all residents to wear masks while outdoors and setting up centers across the city-state for low-income and elderly residents to get free face masks they can use. As Yanzhong notes, Singapore also is vowing to pursue companies that use polluting practices and cause this haze. Overall, countries in the region, like Singapore, Malaysia, and Indonesia, appear to be pointing fingers at each other and engaging in diplomatic recriminations rather than collaborating to address the haze crisis and its causes. It is certainly true that most Southeast Asian leaders are not exactly stepping up to the plate – Indonesia in particular, supposedly the region’s leader, has reacted to the haze crisis with a show of diplomatic pique that is useless – but in fact the countries in the region supposedly have a forum to handle non-traditional security threats like haze – their regional organization, the Association of Southeast Asian Nations (ASEAN). Haze has been on the agenda of ASEAN leaders’ meetings and foreign ministers’ meetings and environmental meetings for fifteen years now; I personally have attended at least three major ASEAN meetings where cooperation on reducing haze was discussed at length. More than ten years ago ASEAN inked an agreement on transboundary haze in which ASEAN countries vowed to take measures to reduce haze pollution. Of course, the agreement is vague, has no real enforcement mechanisms, and was not ratified by Indonesia, so it is of little use now. In fact, the transboundary agreement on haze is a perfect ASEAN document: Grand in vision, vague in details and enforcement, and then not acted upon. Indeed, when a crisis actually erupts, the organization’s inherent weakness, which normally can be hidden behind smiling summits and reams of plans for cooperation, is exposed. The organization’s secretariat in Jakarta is badly underresourced, as every ASEAN member knows, and the current ASEAN Secretary-General, Vietnam’s former deputy foreign minister, is a capable diplomat but does not have the tools or the name recognition to push ASEAN members to take any serious action on haze. Of course, this is how ASEAN leaders want it – having a powerful, well-known Secretary General of the organization might diminish individual country leaders’ appeal to being the voice of Southeast Asia, an unofficial post claimed at various times by everyone from Mahathir Mohamad to Thaksin Shinawatra to Susilo Bambang Yudhoyono. Meanwhile, average people in Southeast Asia suffer, as they have done every hot season for sixteen years now.

Having just arrived in Jakarta for a joint CSIS-CFR workshop on emerging Indonesia and rising regionalism, I was greeted by hot and humid weather conditions and horrible traffic. However, this is nothing compared to the severe haze that has blanketed Indonesia’s Sumatra Island, Malaysia, and Singapore, sending air pollution there to record high levels. The haze problem is nothing new. To those who live in Singapore and Malaysia, this has become an annual blight caused by farmers in Sumatra clearing forests to make land for crops. The last major regional haze outbreak occurred in 1997-98. But this time, the thick haze has broken the Pollutant Standards Index records and hit “hazard” levels in the region, and Singapore has threatened to take action. The slash and burn cultivation can be traced to when agriculture was first developed thousands of years ago. According to historian William McNeill, this cultivation method multiplied breeding places for mosquitoes and gave malaria a new, epidemic intensity. It is no wonder that malaria and dengue fever—both of which are transmitted by mosquitoes—are such a major concern in Southeast Asia. The farming practice is not confined to Sumatra, either. Indeed, a similar practice is becoming a growing contributor to severe haze in some Chinese provinces. Two weeks ago, when travelling on the high-speed train to Beijing, I was struck by the sudden drop of visibility, which was caused by farmers in central Anhui province burning straw along the railway. Given the spread of haze to neighboring countries, one would expect that the affected countries would work together to address the crisis.  Instead, we’ve seen the rekindling of old diplomatic disputes and intensified finger pointing among governments, NGOs, and the private sector. Last Thursday, Indonesia accused Singapore of “behaving like a child” and asked for significant financial aid in order to tackle the issue. However, this action is no surprise. The 1997-98 haze crisis has not led to effective cooperation over environmental issues. Countries in the region seem to be determined to protect their sovereignty irrespective of the implications that this may have for the wider region. They might be actively pursuing bilateral cooperation over a particular regional threat (e.g., a pandemic), but the residual lack of trust among them, coupled with the principle of non-interference, makes it difficult to pursue effective multilateralism or forge a real sense of partnership.

On Saturday, 3,000 demonstrators turned out in Singapore—in one of the biggest protests in the country’s history—to protest the government’s new plan to increase the tiny nation-state’s immigrant population by nearly two million people by 2030. And who are this proposal’s greatest opponents? The Singaporean middle class, which has increasingly seen its political capital and purchasing power strangled by the influx of wealthy immigrants, mainly from China. Migration is just one the pillars of globalization that has been badly damaged as a result of the global financial crisis. In a new piece for The National, I argue that—contrary to the hope of many economists, businesspeople and leaders—the global economy is not bound for a new era of increased integration. Oppositely, I contend that today’s crisis will produce the worst deglobalization in modern history; and I explain how migration, foreign lending, and trade will all suffer as a result. You can read the piece in its entirety here.

In the wake of the Philippines government announcing last weekend that Manila and the Moro Islamic Liberation Front (MILF) had agreed upon a peace plan after fifteen years of negotiations and forty years of war, many Thai news outlets are wondering whether Manila could teach Bangkok a lesson in how to deal with the southern Thailand insurgency. The Nation today, in an editorial titled “A Lesson for Thailand from the Philippines,” offers that the Philippine agreement has many key points for Thai policymakers to learn from, a mantra echoed by several other Thai media outlets. Yet there are key differences between southern Thailand and southern Philippines that, at this point, will make it hard to apply many of Manila’s lessons to Thailand: Thai prime minister Yingluck Shinawatra is not personally engaged in ending the insurgency. According to nearly all Philippine news sources, Philippines president Benigno Aquino III made a peace deal with the MILF one of his highest priorities, and agreed to face-to-face meetings with the MILF leaders in order to personally guarantee the peace process and demonstrate his commitment. Prime Minister Yingluck has shown no such interest, perhaps because her brother Thaksin remains the power behind the throne, or perhaps because most Thais in Bangkok and the north/northeast, the Puea Thai power base, do not really care about the situation in the south as long as the war does not trickle beyond the south. The Philippines government was also willing to offer the south a self-governing autonomous zone, which is a red line most Thai politicians will not cross at this point.  The southern insurgents in Thailand do not have any apparent leader. Time and time again, efforts by the Thai government to launch negotiations have been stymied because Bangkok is still not really sure who leads the insurgency, or even whether the top leaders are in touch with each other, since the insurgencies’ cells are so diffuse and disconnected. In contrast, the MILF had a clear leadership to negotiate with.  The Thai government has rejected most assistance from outsiders. As The Nation notes, because the government and insurgents have no trust in each other, outside mediation can be crucial, but the Yingluck government wants to have a peace process with the insurgency with minimal input from outside parties like Malaysia, the Organization of the Islamic Conference, or Saudi Arabia. As a result, the few negotiations that have taken place have failed in acrimony.  The Thai insurgents are not tired of war. Unfortunately, unlike in the southern Philippines, the southern Thai insurgents seem to be only getting stronger and angrier.  Seven people have been killed in the south in the past few days alone, and the insurgency, by shutting down businesses most Fridays, appears to be gaining the upper hand.

Although government-led economic intervention runs counter to established wisdom that the market is best for promoting ideas, the international rise of state capitalism in recent years has suggested that state-supported industries are indeed capable of fostering innovation. In my new piece for Bloomberg Businessweek, I explore the rise of state capitalism, its innovative potential, and the lessons that U.S. and European businesses and governments should draw from this phenomenon. You can read the piece in its entirety here.