The 'China Dream' in Southeast Asia

Chinese merchant couple in Burma (wiki)

Even in Japan, official history remains skewed by militaristic patriotism. But China is not a free society, and has few checks on the hijacking of official historiography by aggressive nationalists. Twisted historical narratives and atavistic posturing in both countries underlie the current tensions over a new air-defence zone in the East China sea. If China extends this protection zone to the South China sea, which it claims as "historical waters", then Southeast Asian history will come into play. The jingoistic Chinese media should pay attention to the proud history of the Chinese commercial diaspora in Southeast Asia dating from the seventeenth century. Chinese nationalists need help in understanding why the 'China Dream' would be more effectively advanced overseas through commerce.

Chinese migrants were the 'Jews' of early modern Asia. They were peaceful, thrifty, and industrious, and they adapted to local rules and customs. Some cut off their pigtails and married locals. Most ensconced themselves in the main ports of Java, Malaysia, Vietnam, and the Philippines as traders and craftsmen. Once the Chinese government lifted its ban on overseas trade in 1684, and with the dramatic growth of Chinese shipping in the eighteenth century, there was a larger influx of migrants into hinterlands, and into Thailand and Cambodia. In Burma, Malaysia, and Vietnam, Chinese entrepreneurs took over local mining concerns. By 1830, on the eve of colonial expansion by the Dutch and British, about 3 percent of Southeast Asia’s population was Chinese. Today, ethnic Chinese make up nearly 5 percent of the Indonesian population. In Thailand the proportion is 14 percent.

Most came from south China provinces to escape population pressure, natural disasters, and, above all, the Mandarin-state's political suppression of commerce. They brought their skills, networks, and capital to Southeast Asia to exploit the business and employment opportunities. The result was a distinctive pattern of political economy in most of Southeast Asia which identified the Chinese with trade, and the indigenous elites with office-holding.  

The bedrock of that relationship lay in the monopoly rights granted to Chinese tax revenue ‘farmers’. Indigenous rulers and European enclaves in Southeast Asia emulated northern European states by ‘farming out’ private concessions for commodities, mining rights, gambling, tax collection, and transport tolls. Competitive bidders for these lucrative monopoly rights were almost always Chinese. Revenue-farming allowed indigenous elites to avoid the demeaning hurly-burly of commerce, and it was an effective way of financing administration and ceremonial luxuries without building unwieldy state apparatuses. 

European colonial authorities after 1870 offered protection for Chinese minorities. The major banks, shipping and trading companies, were in European hands, but Europeans were only a small proportion of the population, and employing them was costly. It was efficient to collaborate with ethnic Chinese. The official and scholar of British Burma, J.S. Furnivall, argued that these ethnic occupational divisions reflected the free working of economic forces rather than colonial social engineering. Chinese were simply good at doing business. They might quietly soak up a big share of the regional trading surpluses and repatriate their profits, but they were the indispensable and energetic brokers of the transactions from which indigenous elites and Europeans benefited.

Chinese traders had business advantage through kin-based organisations which shared risks, opportunities, and capital, and which eventually facilitated the emergence of large Chinese firms. The Chinese were more likely to reinvest in economic enterprise rather than trips to Mecca or the financing of court ceremonies. Europeans and local rulers depended on Chinese middle-men to provide capital, connections, and entrepreneurial skills.

Chinese women in Indonesia with Indonesian maid (wiki)

When they believed themselves to be safely assimilated, Southeast Asian Chinese of the late colonial period had less interest in commercial careers, and entered middle-class professions. They were never really safe in Southeast Asia, however, and endured persecution, discrimination, and political violence, especially during times of economic hardship when resentment against Chinese wealth was sharpest. Adaptive and tightly networked, the Chinese excelled in the arts of clientelism, rent-seeking, and corrupt payments which indigenous rulers demanded in exchange for protection and business privileges. When privileges were taken away, as when the Malay colonial administration abolished revenue farms and replaced Chinese-organised bonded labour in the tin mines with more advanced capital-intensive methods, Chinese entrepreneurs quickly transferred their capital into new commercial ventures.  

During the twentieth century the Chinese were Southeast Asia's 'implanted bourgeoisie'. Were it not for the patrimonialism of indigenous rulers, the Chinese might have fostered an entrepreneurial bourgeoisie sooner in Southeast Asia. As things stand now, ethnic Chinese control the commanding heights of Southeast Asian economies in trade, services, manufacturing, banking and finance, but still tend to be excluded from the corridors of political power.


Chinese merchants in Southeast Asia

European mercantilists and nationalist indigenous rulers fed like parasites on closed Southeast Asian markets, but overseas Chinese nourished -- and tried to open -- those markets with skills and effort. The China Dream, if it is to 'come true' like the American Dream, needs to be founded on free enterprise. Throughout the world Chinese diasporas are synonymous with commercial success. Southeast Asia offers the most important examples with historical relevance today. For example, if China abandoned its territorial claims in Southeast Asia and pursued a cosmopolitan 'free enterprise' dream instead of crude propaganda and militarism, it might recruit Southeast Asian allies to persuade Japan to give up its own crudely revanchist claims. What are a few hard rocks in a sea of soft commerce?

Further reading:

Ian Brown, 1997, Economic Change in Southeast Asia, c. 1830-1980, Oxford University Press
Anthony Reid, 1988, Southeast Asia in the Age of Commerce, Vols. 1 & 2, Yale University Press
Nicholas Tarling, ed., 1992, The Cambridge History of Southeast Asia, Vols. 1 & 2, Cambridge University Press




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