[Kabar-indonesia] Analysis: SE Asia democracy remains fragile: Does it matter?

[Joyo at aol.com]

Analysis: SE Asia democracy remains fragile: Does it matter?

By Bill Tarrant

HANOI, November 12 (Reuters) - Thailand's generals refuse to
lift martial law imposed after September's military
takeover. Coup plots swirl in Manila as often as the
seasonal typhoons that bedevil the Philippines.

Indonesia, which ceded many central government powers to
local governments in its democratisation drive after the
fall of the dictator Suharto, shrugs helplessly as smoke
from hundreds of forest fires causes its neighbours to gasp
and fume.

Malaysia's once powerful prime minister, Mahathir Mohamad,
seems intent on toppling his handpicked successor, accusing
him of creating a "police state" and the kind of cronyism
that critics say was a hallmark of his own 22 years in
power.

Southeast Asia is preparing to host a series of summits with
Asia-Pacific powers over the next month with the spotlight
on the region's floundering democracies.

Poor governance should be a concern, given that several
nations are battling Islamic insurgencies, and the
possibility that economic mismanagement could again trigger
the kind of "Asian contagion" financial crisis seen in 1997.

Yet alarm bells are not ringing.

"This region is seen as a high performer," said Tim Condon,
an economist at ING bank. "So far, markets have seen any
initial bout of instability as something that quickly
diminishes."

Indeed, Jakarta's stock market is up a whopping 43 percent
this year. The market in the Philippines, which long ago
priced in that nation's chronic political turmoil, has
soared 35 percent this year.

Even Thai stocks were up five percent since the Sept. 19
coup -- the country's 18th in 75 years. The Thai baht, whose
precipitous fall triggered the 1997 financial crisis, has
risen 12 percent against the dollar this year.

TOPPLING DOMINOES

The Association of South East Asian Nations was founded in
1967 at the height of the Vietnam War and in the midst of
the Cold War when Washington feared nations in the region
would topple like dominoes to the forces of international
communism.

Today, Vietnam is a one-party communist state, but also a
beacon of stability in the region. This week it will welcome
President George W. Bush and 20 other heads of state at its
big coming-out party as host of this year's APEC summit. Its
market, by the way, has risen 73 percent this year.
The Philippines, which will host an East Asia Summit in
December, has for decades fought an Islamic insurgency in
the south. Thailand, Indonesia, Malaysia and even Singapore
have battled a militant Islamic movement that wants to
create an Islamic superstate across the region.

But like the threat from international communism a
generation ago, worries that a pan-Islamic movement could
destabilise vulnerable governments in Southeast Asia can be
overstated, analysts say.

"There really isn't a worry that there's dominoes about to
fall as far as Islamic militancy," said Michael Vatikiotis,
research fellow at the Institute of Southeast Asian Studies,
Singapore.

"People are concerned. but it's not a seriously considered
threat. Terrorologists would have you be very scared. but
nationalism is still far stronger than dogmatism."

The ancient and multicultural societies of Southeast Asia
have taken highly diverse political paths, from communism to
kings, generals and general elections.

Whatever the political stripe, Southeast Asia's largely
agrarian societies remain hierarchical with weak civic
institutions and oversight, which tends to foster
corruption, cronyism and a cosy business/political nexus,
analysts say.

"Neither the civil culture nor the institutions have
developed all that well," said Tom Green, executive director
of risk consultancy Pacific Strategies and Assessments in
Manila.

While the region's political instability throws up constant
surprises, investors and strategists are mostly unperturbed.

For one thing, countries have strengthened their financial
systems since 1997, become more transparent, attacked
endemic corruption and adopted measures to improve corporate
governance.

ASEAN's full calendar of meetings among its members and with
outside powers -- replete with their alphabet soup of
acronyms spelling out the region's various conventions and
mechanisms -- provides a security umbrella of stability for
the region.

"It takes a long time," Green said. "Things aren't going to
be right, from the Western perspective, for decades and
societies at the end will never replicate what we see when
we look at our own institutions."

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Joyo Indonesia News Service
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