The geographical areas of Asian coastal regions and island nations comprise Southeast Asia. It is unearthed on the southeastern pinpoint of the continent of Asia. The countries are considered achieving milestones regarding impressive democratic transition among the emerging market economies. It is highly consolidated with the global economy. The nations are under the continuous influence of international financial drift. They are giving rise to threats such as outright crisis, occasional stress, and frequent financial shocks. The architecture of financial systems is scrutinized for resolving these problems, and the post-crisis reformation has helped the nations to reinforce a strong and stable financial economy.
Southeast Asia was always considered to be an essential component of the global trading system, and before the perforation by European interests, the economy was booming. A wide variety of articles originated from this region, such as ginger, pepper, nutmeg, and cloves. On account of originated spices across nations, the spice trade becomes predominant. The trading or exchange of spices with barter started with Indian sellers and Arab traders, along with the Europeans. Enterprise building and business relationships started with the brokers of Dutch, Portuguese, British, and French regions.
The economic trade relations suddenly transformed into territory takeover. The perforation of Europeans into the commercial trading interests entrusted the foreign traders to lobby against the Southeast Asian countries. They started to inflate their control over the territories and tried to gain authority. Consequently, the British expanded their control over Malaya, French into Indochina, and Dutch into Indonesia. After the inauguration of the Suez Canal, the telegraphy and transmissions improved with China. Exploiting this development, the activities of interests increased for the Europeans.
The exploitation of other nations into Southeast Asian territories escalated the evolution surge in the zone of infrastructure and transportation. This development attracted many traders from China, and the tin mining industry was initiated, along with rubber industries. Sustainable development also took place in Vietnam, Myanmar, and Indonesia. The well-known British and American merchants settled their trade relations with Thailand. The Western-influenced removed Chinese monopoly to a great extent, and the peddling competition emphasized the exchange of a single most commodity, i.e., rice. Export-import relations between Southeast Asian nations and other foreign countries become dependent on rice. The Philippines put forward small mills for the production of rice, along with sugar and tobacco. Trade activities have grown exponentially over the past few years, and a maximum of imports are from Thailand, Malaysia, and Vietnam.
The economic up-gradation will also be observed in the sector of tourism as investors are interested in Southeastern countries like Cambodia. Cultural diversity can be maintained and preserved by investing in the tourism sector. The rich culture and heritage of ASEAN countries are the centre of attraction for visitors all over the world. In terms of infrastructural development, the countries are working hard to lessen the quality. However, over and done with more demands for infrastructure, there has been a reduction in quality standards. The governing bodies have started to share contracts with private entities for building quality infrastructure within a short period. A maximum of infrastructural projects is now opened for private bodies under the treaty of private-public partnership.
Over the past few decades, Southeast Asian states have topped the charts of financial infrastructure worldwide. The finance and economy had improved after the financial crisis of 1998 when the growth had decreased dramatically. While it is observed that the stagnant increase in economic growth has impacted several industries dealing with power, water, and the transport system. They were struggling to keep up with the pace of development like spices and condiments.
During the past decade, there has been growth and improvement in the industrial output, strengthening trade relations with other countries. The Gross Domestic Product (GDP) of the ASEAN nations is collectively 3 trillion US dollars, which shows a significant increase from the past few years. This skyrocketing GDP of ASEAN countries proves that there has been an improvement in trading partnerships with other nations, and the citizens have employment in almost all the sectors. There have been some risks of regulatory bodies and economic growth. There surge in transportation costs due to inadequate facilities, resulting in urban congestion. The high competition among the countries and productivity efficiencies are likely to prevent the private capital markets from reaching its full potential.
It is estimated that in the coming few decades, the opportunities for growth and transformation will increase. Technology and trade will be enhanced, and therefore, swelling of the economy is predicted. There is a risk of economic turmoil because of forecasted financial risks. There are several aspects of financial structure that are still not decided or reformed correctly. The policymakers of financial markets are heading in the right direction, but the process will need some time. Due to the improvement in trade relationships and collaboration between companies on an international level is observed, the future of the economy is bright. As long as there is the betterment of merchandising and dealing, the economies of the countries will be flexibly useful, and the ASEAN nations will contribute heavily towards raising the collective GDP over time. The countries have a record of surpassing challenges over time. Therefore, it is predicted by the researchers that there will be financial surge and economic prosperity shortly.
The embodiment of Southeast Asia in the world’s economy impacted the sustainable economic growth. It created an unrealistic pattern of economic relation with population growth and financial activity. Gender and class discrimination became predominant and became the major setback of classifying people into wealthy and poor. During World War II and the economic depression of the 1930s, Southeast Asia was profoundly affected as the world economy crashed. The Association of Southeast Asian Nations (ASEAN) promoted industrialization and economic growth among the nation. It established successful trade relationships outside the territories, which marked a new era of transformed economy and development.
Jul 22, 2020