The Tightening Belt Around ASEAN’s Narrowing Road to Success

July 9, 2019/in ASEAN Notes/by akmal.muhammad.f

By Matthew LoCastro, illustration by Lommes (Wikipedia)

The Belt and Road Initiative within ASEAN

The Belt and Road Initiative (BRI), also known as One Belt One Road (OBOR), is one of the most prominent and one of the most shrouded global development initiatives in modern history. With estimated investments of about US$150 billion over the next decade with a total price tag ranging from US$1trillion to US$4 trillion, BRI still remains only a singular part of China’s larger desire to invest, connect, and craft a sphere of influence, or as President Xi describes it, “a community of common destiny,” across Asia.

As of 2018, China has funded 96projects across South East Asia. China’s projects, a variety of roads, railroads, ports, power plants, and other infrastructure projects have provided insight into China’s grand strategy. ASEAN member states will have to determine if China’s investments and influence will support or disrupt ASEAN’s commitments to resiliency and innovation within the realm of its socio-cultural, economic, and political/security pillarsoutlined in the ASEAN 2025: Forging Ahead Together. As with many investment and economic development initiatives, ASEAN members can expect tangible benefits aligned with the ASEAN development framework but should ultimately air caution to China’s advances due to long term and deeply embedded costs.

A Positive Outlook for the BRI

China’s BRI and larger foreign investment goals have the potential to bolster the ASEAN 2025 vision. China has been a leader in poverty alleviation within its own boarders, uplifting 800 million people out of poverty since the 1980’s with the goal of eliminating all domestic extreme poverty by 2020. China’s success has the potential to carry across ASEAN as investments lead to job creation and infrastructure development, and consequentially reducing spatial inequality.

The potential for successful investment impacts are further supported by a 2018 study conducted by The Brookings Institute. Brookings evaluated the national economic impacts of approximately 4,300 Chinese government financed development projects in 138 countries and found that on average, Chinese aid and investment yielded economic growth dividends. For the average host country, a doubling of Chinese official development assistance produced a 0.4% point increase in economic growth two years after the funding was approved.

Reducing inequality, ensuring equitable economic growth, and developing an interconnected ASEAN that can effectively and easily trade goods and services are accomplishments that fall within the ASEAN 2025 vision. By evaluating the benefits of China’s investments, policymakers can be convinced to welcome BRI funding with open arms. However, it is important to recognize that China’s ambitions do not remain in a silo of intentions to promote regional economic growth. China’s larger goal is to strengthen its international influence. Such a goal will come at a cost to ASEAN’s socio-cultural, economic, and political and security pillars and negate the economic benefits incurred by these investments.

The Adversarial Nature of the BRI and ASEAN’s Three Pillars

The ASEAN socio-cultural pillar states that it is a pivotal goal for ASEAN members to promote equitable access to quality opportunities and to protect human rights. BRI financing is not beholden to these standard. Other institutions, such as the IMF and the World Bank Group, will limit financing to causes that may violate the human rights of an ASEAN member country’s citizens. The BRI allows an option to seek financing from a source that does not abide to a standard of respecting human rights. This outlet inherently undermines that drive and motivation for all member countries to strive to uphold the same obligation. It can be more cost effective or convenient to ignore universally agreed upon standards of human rights when there are limited consequences. This issue is further compounded by the appeal of the ease in structuring financing and receiving funds from China.

China’s investments have also been linked to instances of supporting local corruption, degrading the environment, and weakening trade union participation.

In a 2016 case study of Chinese investment in Africa, empirical results consistently indicated more widespread local corruption around active Chinese project sites. This corruption would linger after the project implementation period, seemingly not driven by an increase in economic activity, but rather signifying that the Chinese presence impacts norms.

Chinese investments also do not have an incentive to support the development of renewable infrastructure or low-carbon investments. As China aims to achieve its own sustainability goals, locating financing for high-carbon projects internationallyallows for China to take credit for emission reduction and environmental quality improvements when in reality the environmental damage is occurring abroad.

Among the projects that BRI supports, researchers have also found a tendency for China to maintain control over development projects throughout the entire implementation phase, using Chinese contractors for work performed in the recipient countries. These contract workers weaken the ability of trade unions to advocate for reasonable labor protections and decrease the overall economic benefits received by locals.

Despite promises of potential economic growth, the economic pillar of the ASEAN 2025 framework is also threatened by BRI investments. Chinese banks are worried about the safety of current lending. Since 2015, commercial banks have cut new BRI financing. Furthermore, China is finding it hard to identify profitable projects in belt-and-road countries leading to BRI being commonly referred to as “One Road, One Trap” amongst the business community.

The investment environment is further complicated by the lack of investment transparency and at times, predatory nature of investments. Chinese backed projects have a uniform contractor base. 89% are Chinese companies, 7.6% are local companies from the country of investment, and 3.4% are foreign companies, non-Chinese companies from a country other than the one where the project was taking place. Compared to multilateral development bank funded projects, 29% are Chinese, 40.8% are local, and 30.2% are foreign.China’s investment strategies also provide little room for local organizations to secure contracting opportunities. The lack of contract diversity coincides with the lack of project transparency preventing ASEAN members from understanding the investment activities occurring in the market and discouraging investment.

Several of China’s infrastructure investments, though not the majority of infrastructure investments, have also been labeled as “debt-traps.” A debt-trap occurs when China finances projects on unfair and unequal terms taking advantage of lower income countries financial needs. The trap component occurs when payment deadlines approach and the borrowing country is no longer able to pay its debts.This leads to Chinese intervention to gain control over the physical assets or gain some other distinct advantage to collect on what they are owed.

In Sri Lanka, the Hambantota Port project fell victim to this scheme. Upon striking a deal with a Chinese state-owned enterprise, Sri Lanka borrowed $307 million from the Chinese Export-Import bank, then $700 million, and finally, $1 billion. Once Sri Lanka found itself unable to pay these loans back, it ceded control and sovereignty of the port to China under a 99-year lease agreement.Similar instances of “debt-trap” financing have occurred in Malaysia, the US$20 billion East Coast Rail Link Project, and in Laos, the China-Laos railway project, among a few examples.

China’s investments abroad have become recognized as attempts to dominate smaller economies. Such actions strip ASEAN members of their economic and political sovereignty. This loss of sovereignty can expand into concerns of security and directly affect the third and final ASEAN 2025 framework pillar of promoting political and physical security.

As seen in Sri Lanka and Laos, there is the potential for vital domestic assets to be under the direct ownership of a foreign entity in the instances of defaulting on project payments or loans. Control over ports and harbors, especially in South East Asia poses a large security threat as the acquisition of these assets could bolster Chinese presence in contested areas such as the South China Sea.

Considering several BRI projects involve maritime infrastructure, China could potentially influence ASEAN member states’ ability to use maritime trade routes and block the development of comprehensive maritime cooperation. Chinese ownership of power plants and access to other supply chains, raw materials and natural resources poses a major security risk in the event of conflict and will increase Chinese soft power over the governance decisions of ASEAN due to this looming threat.

The Need for Caution When Addressing the BRI

As ASEAN member states plan to forge ahead together, it is vital that the 2025 framework for the region takes into consideration the external influences that seek to threaten the ASEAN community. Though investment opportunities from China may appear lucrative, they pose a serious threat to the leadership and success of the ASEAN community. The BRI’s goals are vast and this initiative has the potential to produce a network of infrastructure projects unlike anything the world has yet to see. However, the ambitions and intentions of the BRI must be policy maker’s first consideration. Unlike multilateral development banks and other international financial institutions, China’s intention is not focused on aid and mutual global development. It is driven by a desire to control and dominate the actions of other sovereign nations.

Matthew LoCastro attended Hunter College in New York City and is a Luce Scholar

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RELIGION: BOON OR BANE FOR DEMOCRACY?December 20, 2023 - 12:32 am
In December 2022, the Indonesian government passed a law that penalizes sex outside marriage. This is only one of the many changes in the criminal code that observers warn of the increasing conservatism in the country.

Indonesia houses the largest Muslim population in the world and is also a republic whose democratic experiences and milestones have been widely studied by scholars within and beyond the region. This makes Indonesia a compelling case for reflection on the nexus and tensions between religion and democracy. Is religion compatible with democracy? What opportunities and challenges does the “Islamic Renaissance” entail in the country? Democracy on Religion

Liberal democracy espouses secularism, the separation of church and state, and freedom of religion. In an “ideal” democratic system, the state must not endorse nor support any specific religion while guaranteeing the free exercise of religion among citizens. This is essential in a democracy for many reasons. Religious freedom is a crucial civil right that enhances citizens’ individuality and relations with others. It stops one religion from dominating society, hence promoting diversity and co-existence. At the same time, it prevents policies from being framed according to religious beliefs, which may result in discrimination and repression of fundamental human rights.

Religion and its Tensions with Democracy: The Case of Indonesia

This is particularly important for Indonesia. While the country is predominantly Muslim, Indonesia also has many ethnolinguistic groups with different cultures and practices. It is a challenge in itself to build one nation with an immensely heterogeneous society. The diversity in the country resulted in years of ethnic conflict and violence. Even a religious minority, the Ahmadiyya, faces intimidation and oppression in the exercise of their faith. Indonesia’s dilemma points to the longstanding debate in human rights discourse and practice – are human rights universal, or are they relative to culture and local customs? While I am more inclined to support the former, it is important to be aware and carefully consider the context of a country when designing human rights advocacy and interventions.

However imperfect, the democratization process in Indonesia has assisted in facilitating efforts for reconciliation and balancing competing interests in the country. Recently, the President stunned the world when he acknowledged past grave human rights abuses in the country, including an anti-communist purge in the ’60s and the arrest of democracy activists during the Suharto presidency.

Indonesia sits in between secularism and theocracy. The country’s fundamental law espouses Pancasila, which is the foundational political theory of Indonesia. Through its five principles, Indonesian society believes in one God and aspires to create a just and civilized humanity, unity, democracy, and social justice for all. This tells us that, by principle, Indonesia gives importance to pluralism and citizenship. Scholars and practitioners of the law also adopt legal pluralism and believe that different legal systems are complementary rather than contradictory. For example, community practices and customs are considered along with national and local regulations in settling disputes and conflicts at the village level.

However, in recent years, Indonesia has seen the expanding role of Islam in the country’s social and political life. Aside from Islam being a “source of ethical and cultural guidance”, many Islamic organizations have secured formal power, which allows them to easily introduce measures within the state apparatus that cement their own interests. Hardliner Islamic groups have also proliferated, and fundamentalist thought and practices are becoming more and more widespread. Islamic identity politics have also been evident since Widodo coalesced with conservative Islamic factions and appointed Amin, an influential Islamic figure, as his vice president. The new penal code tends to be more religious than secular. This has implications for Indonesia’s supposed secularism and diversity. How can the Indonesian government best represent the interests and aspirations of all?

As Indonesia continues to modernize and extend its economic and political ascendancy in the region, rapid changes in its social relations and dynamics are also expected. This demands a more careful look at the kind of laws and “social controls” that the government enforces. Suppose conservative forces are forwarding laws in the name of protecting tradition and keeping Indonesian values in check. In that case, it should not be at the expense of fundamental civil and political liberties, nor should it be to repress vulnerable groups even further, such as women, LGBT+, and ethnic communities. Admittedly, this is easier said than done. Hence, political representation must reflect the diversity and vibrance of Indonesian society. If only one group dominates political and policy discourse, it ultimately jeopardizes the general will.

When religion becomes the yardstick for crafting rules and policies, it creates biases, whether intended or not. Propositions that are credible and necessary but “contradictory” to a certain religion may be rejected simply because they do not fit the personal convictions of decision-makers. Integrating religion into politics usually leads to oppressive and harmful policymaking. Religion is also a form of heuristics or cognitive shortcut that devalues deliberation and discussion. Instead of scrutinizing issues, people may resort to using their religion as the sole basis for their position on a particular matter. Democracies ought to be deliberative and pluralistic.

Human rights activists and organizations in Indonesia have sounded the alarm on many changes in the criminal code that could stifle individual freedoms and lead to setbacks in the country’s democratic progress. Aside from banning sex outside marriage, the government also reinstated laws that criminalize insulting the President and other state officials and institutions. They also increased the punishment for blasphemy. These laws can be disproportionately used against individuals and groups with legitimate criticisms and concerns about the government. It may also render already marginalized communities even more vulnerable. Religion, Populism, and Repression

This trend is not only unique to Indonesia. Much of the world has seen the rise of “nationalist” movements, often within the pretext of religion and safeguarding culture. India’s Modi has exhibited Hindu nationalist tendencies, which have meant greater intolerance against the Muslim minority in the country. Myanmar’s Tatmadaw has weaponized Buddhism to rally support from the public and account for its atrocities.

The use of religion to justify repressive and oppressive regimes is apparent. Religion is an effective tool to unify a group of people and subject them to a specific set of beliefs and values, which may be highly prejudiced and absurd. Religion acts as a moral compass that defines what is right and what is wrong. Because religion is subjective, it can easily be manipulated to serve political objectives. Populists and autocrats can bastardize religion to create a public enemy, instill an “us vs them” mentality, and sow further polarization.

Failed democracies thrive out of fear, whether it is real or manufactured. Religion can be a potent force to ingrain this fear. This hysteria against change and modernization is easy to whip up when people already have preexisting beliefs. It is not too difficult to segregate people and label them as the “other”. When this distinction is entrenched, it is convenient to normalize discrimination and violence.

It is said that Indonesia is a model for “Moderate Islam” when compared to the Middle East; the “Indonesian way” can complement Western values and democracy. It also has the potential to correct Islamophobia and promote Islam as a religion of peace. On the other hand, if Indonesia cannot find its balance and condone fundamentalist and hardliner Islamic groups to flourish, Indonesia will certainly regress in its hard-won democratic gains.

Religion has inherent contradictions with democracy. Subscribing to a religion and structuring a supposedly diverse society using its tenets is monopolistic and can bring about intolerance. It is paramount for democracies to ensure that civil, political, and socioeconomic rights are not deprived based on religion and other forms of cleavages. The access and exercise of power should be as widely distributed as possible. Public office should not be limited to certain political clans or religious organizations. For instance, at the village level, cultural and socioeconomic elites must share power and administration with vulnerable and historically marginalized groups. There are more reasons and illustrative cases, present and past, to posit that religion is more of a bane than a boon to democracy. At the moment in world history when (dis)information is fast and instant, we must maintain vigilance in dealing with autocratic agendas in the guise of “respecting” values and tradition. It is easier to believe and conform than to reflect and deliberate. But democracy dies when we rely on shortcuts to define what is good for us. Democracy dies, slowly and deliberately, when we allow a few to sabotage our freedoms and liberties to increase their own. Demagogues and despots are usually cunning and do things “in the name of God”.

REFERENCES

Evans, M. S. (2014). Religion and political decision making. Journal for the Scientific Study of Religion, 53(1), 145–163. http://doi:10.1111/jssr.12088

Evans, T. (2012). Separation of Mosque and State in Indonesia. Policy, 27(4), 35–39.

Głodek, A., & Grzywacz, A. (2020). Indonesia – between religion and democracy, Warsaw: Boym Institute. Retrieved from https://instytutboyma.org/en/indonesia-between-religion-and-democracy

Jaffrey, S. (2020). Is Indonesia Becoming a Two-Tier Democracy?, Washington D.C.: Carnegie Endowment for International Peace.

Jamaluddin, M., Chen, H. & Watson, A. (2022). Indonesia bans sex outside marriage as parliament passes sweeping new criminal code, Jakarta: CNN.

Klinken, G. v. (2019). Living in a Sacred Cosmos: Indonesia and the Future of Islam. Journal of the Humanities and Social Sciences of Southeast Asia, 175(1), 81–135. http://doi:10.1111/jssr.12088

McWilliams, E. (2018). Democracy in Indonesia: A Progress Report, Washington D.C.: The Foreign Service Journal.

Nagda, A. (2020). The Diplomat. [Online] Available at: https://thediplomat.com/2020/03/the-islamization-of-indonesias-foreign-policy/

Omelicheva, M. & Ahmed, R. (2018). Religion and politics: examining the impact of faith on political participation. Religion, State, and Society, 46(1), 4–25.

The World Factbook. (2023). Indonesia, s.l.: Central Intelligence Agency.

Wieringa, S. E. (2006). Islamization in Indonesia: Women Activists’ Discourses. Signs: Journal of Women in Culture and Society, 32 (1), 40–27.

Short Biography:

Kay Conales is a student of the Asia Pacific-Master of Arts in Human Rights and Democratization of the Institute of Human Rights and Peace Studies (IHRP) of Mahidol University (Thailand). She also studied in the Faculty of Social and Political Sciences (FISIPOL) of APMA’s partner-university Universitas Gadjah Mada (Indonesia). She can be reached through e-mail at ksconales@gmail.com.

The Tightening Belt Around ASEAN’s Narrowing Road to Success

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