ASEAN Investment Report: Foreign Direct Investment and Economic Zones in ASEAN

Last year I acted as a consultant for UNCTAD – United Nations Conference on Trade and Development in the area of special economic zones in the Greater Mekong Subregion. The full report is available online here. You might find some of the sections I wrote in various chapters or I can tell you about them in considerable detail.

The Special Economic Zones of the Greater Mekong Subregion: Land Ownership and Social Transformation

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This is the abstract for the paper I will be presenting for the Land Politics Conference in Chiang Mai in June (http://www.tni.org/article/land-grabbing-perspectives-east-and-southeast-asia).

The Special Economic Zones of the Greater Mekong Subregion: Land Ownership and Social Transformation

Abstract

Special economic zones (SEZs) are geographical areas bounded in space and time that are aimed at encouraging inward investment by privileging capital above labour and above the general legal system. In the Greater Mekong Subregion (GMSR), which consists of Cambodia, Laos, Myanmar, Thailand and Yunnan Province and Guangxi Zhuang Autonomous Zone of China, SEZs have been used extensively and with considerable success according to quantitative measures. In general, these measures have promoted the Factory Asia paradigm of low labour cost competitiveness in import-substituting, export-oriented manufacturing. This is a paradigm that is limited in time and ends with the effect known as the Middle Income Trap, which now affects Thailand and can only really be exited by qualitative change in economy and society to promote innovation and creativity. In other parts of the GMSR, states have not progressed so far along this trajectory and, in Laos and Myanmar, are at the very early stages of their journeys. In the majority of cases, SEZs are built with public sector support and, in particular, with assistance in obtaining land. Often, as in the case of Dawei SEZ in Myanmar, this has involved the forcible relocation of the villagers from an area the size of Singapore. At least some of the dispossessed villagers have mounted armed resistance to this relocation and halted construction. This may be seen as a form of creative destruction during the process of what Polanyi called the great transformation. Social relations and social capital are among the assets that are transformed into market relations as land itself is redefined and reconfigured as commercially important space. This paper explores the variety of SEZs in the GMSR and the way they interact with the people who once lived on or near the land they now occupy. Remedial social policy options are explored.

Keywords: Greater Mekong Subregion, land, special economic zone, transformation

John Walsh, School of Management, Shinawatra University

APISA Annual Congress 2014

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A large crowd gathered to listen to Major General Chaianan Jantakananuruk at the APISA 2014 Congress. He spoke without notes or presentation or abstract or any written record but did answer a few questions.

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My presentation was: Moving beyond Factory Asia in the Mekong Region, which went OK. It was a slightly tense atmosphere at times, since people wanted to speak out about the situation but were concerned not just for their own safety but for the safety of colleagues, conference organizers and so on. Anyone, it concluded reasonably well in the circumstances.

It was held at the Furama Hotel in Chiang Mai, which I would be happy to recommend.

Special Economic Zones in the Mekong Region and Africa

Our abstract has been accepted for presentation at the Asian Studies in Africa: Challenges and Prospects of a New Axis of Intellectual Interactions: John Walsh and Eric Bediako,Special Economic Zones in the Mekong Region and Africa” (Accra, Ghana: January 15th-17th, 2015).

Abstract:

The special economic zone (SEZ) and its role in instigating and facilitating the factory age (i.e. low labour cost competitiveness, import-substituting manufacturing that is export-oriented) has become a symbol of rapidly developing Asia. It may be an exceptional space where individuals are stripped of their usual rights and suffer alienation and sickness along with repression but it has proven to be a generally successful means of raising aggregate income levels. This is true for those countries in the Mekong region which have almost reached the limits of what the factory age can achieve (i.e. Thailand), that are at different stages of the trajectory through the process (i.e. Vietnam, Yunnan province of China and Cambodia) or are only just beginning the cycle (i.e. Laos and Myanmar). There have been significant negative externalities along the way but new concepts of eco-industrial villages may – if these can be successfully realized – indicate a way ahead that minimizes pollution and promotes sustainability of production. Although this approach has achieved success in the Mekong region (within the limits noted), much less success has been achieved across the vast continent of Africa. This lack of success is often attributed to the lack of infrastructure and low levels of integration of SEZ activities with the local economy. However, the Mekong region noted for its infrastructure or for its harmonious and multi-faceted private-public sector relations. What other factors might be relevant in seeking to improve success levels? This paper adopts a case study approach to highlight the different dynamics and factors by which SEZs may be characterized and described. Analysis of the case studies yields some policy recommendations and conclusions.

International Workshop on Korean Trade and Investment in the Mekong Region

The International Workshop on Korean Trade and Investment in the Mekong Region, supported by the Academy of Korean Studies, has been successfully held at Shinawatra University on November 1st and 2nd. The session was opened by the Provost, Assistant Prof. Dr. Chanchai Bunchapattanasakda and then the three keynote speakers gave their presentations.

The first was Group Captain Surapol Navamavadhana, adviser to the Minister of ICT, who spoke about Korea’s policies relating to internet security and how these are being adapted in the case of Thailand.

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The second speaker was Mrs. Suwatana Kmolwatananisa, Assistant Governor of the Industrial Estates Authority of Thailand, who spoke about the ways in which the IEAT is attracting Korean and other investment to Thailand.

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The third and final keynote speaker was Mr. Thanaphon Charawanitwong, Plan and Policy Analyst for the Department of Traffic at the Ministry of Transport. He spoke about Thailand’s transportation infrastructure polices as part of the mega-projects and linking with the Asian Highway Network.

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We then moved on to the academic paper presentations. I gave an Overview of Korean Trade and Investment in the Mekong Region and then Associate Prof. Suravuth Pratishthananda spoke on the subject of Korean engagement with Thailand’s water infrastructure, principally through the activities of K Water.

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After lunch, we then had a presentation from Phramaha Min Phutthithanasombat and Dr. Petcharat Lovichakorntikul about the prospects and issues involved with opening a Korean restaurant in Cambodia.

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Following this, Ms. Nancy Huyen Nguyen, a researcher into Southeast Asian-Latin American links at the University of the Thai Chamber of Commerce, spoke about Korean trade and investment over the course of two decades in Vietnam.

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Next up was Associate Prof. Dr. Teresita Del Cruz-Rosario, formerly of the Lee Kuan Yew School of Public Policy at the National University of Singapore, who spoke about the Korean involvement in the Land Grabs in the Mekong Region.

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Sorry about the quality of that photo – there are bound to be better ones at the library website (http://library.siu.ac.th). Anyway, I switched back to the other side for Dr. Lavanchawee Sujarittananonta’s presentation on the Korean Hallyu and its impact on young people in the Mekong Region.

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The following morning, we kicked off with Dr. Nittana Southiseng, SME Development Specialist at the Mekong Institute in Khon Kaen, who spoke about Korean trade and investment in Laos – the Land of Ample Opportunities, apparently.

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The second speaker of the morning was Mr. Ye Tun Min, a doctoral candidate at our campus in Mandalay, who spoke about prospects for healthy food and herbs in Myanmar for production and export to Korea.

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The final speaker was Dr. Sittichai Anantarangsi, who spoke about the experiences of Thai workers in Korean companies in Thailand.

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There was a good turnout for the opening session and as many as 20 attendants for the second day as well. We are planning a second event on these lines and hope to use the model for workshops and conferences on other themes – the combination of a focused theme and giving extended time to speakers (45 minutes each) was I think successful in promoting interest and discussion. Until the next time.

Land Grabs in the Mekong Region

The most recently received abstract for this weekend’s International Workshop on Korean Trade and Investment in the Mekong Region:

Land Grabs in the Mekong Region

Teresita Cruz-del Rosario, PhD

Independent Researcher

Former Senior Research Fellow and Visiting Associate Professor

Lee Kuan Yew School of Public Policy

National University of Singapore

 

Key WordsLand acquisition, Southeast Asia;  agro-food-feed-fuel complex;  multilateral institutions;  public-private partnerships;  state-transnational capital-local capital alliance

Abstract

In the Greater Mekong Subregion, land grabs form part of a comprehensive agro-food-feed-fuel complex, one which underlies much of the relationships today between states, corporations, and communities.  At the apex of this relationship are states and corporations who, in alliance with local capital and local political agents, promote global strategies to address food and energy insecurities through large-scale land acquisition.  These land deals are mostly happening in Southeast Asia, with Cambodia, Laos and Myanmar as favored sites by transnational capital to secure land rights.  The “usual suspects” in this global “race for arable lands” (Olivier de Schutter) are countries with rapid economic growth faced with increasing shortages of food for their expanding populations and shrinking land acreage for agriculture production.  Most notable are China, Korea, Vietnam, and the Gulf countries (especially Qatar, Saudi Arabia, Dubai, Kuwait, and the UAE ).

A second feature about land grabs is the speed and scale with which this phenomenon is happening.  According to the Netherlands-based Transnational Institute, land deals have risen from 20 million hectares to about 227 million hectares during the period 2005-2009 —- a 100 percent increase in land acquisition over a short period of 4 years.  Third, the TNI study argued that investments in land have replaced the flow of international capital in the aftermath of the collapse of housing markets in the West.   A phenomenon of “land-capital switching” is occurring at a rapid pace in Southeast Asia, with land substituting for capital resources with which to further business development in developing countries.  Wittingly or unwittingly, a fourth pillar in the land grab triangle is the multilateral institutions (World Bank, Asian Development Bank, etc.) whose preference for large-scale infrastructure projects in these countries promote land acquisition under private-public partnership (PPP) schemes.

This presentation seeks to further investigate this phenomenon in the GMS specifically the role of Korean investments in the agricultural sector as part of a broader strategy to address food insecurity issues in Korea.