issue 263 - January 1995
PHOTO BY RICHARD SWIFT
Unmasking the miracle
The noise of money talking tries to drown out the voice of
opposition in the ‘export-led’ economies of East Asia. But the
murmur of discontent over who bears the costs of growth is
getting ever louder. Richard Swift lends an ear.
The business executive was warming to his subject – the wonders of commerce in Hong Kong. There is a ‘buzz’ to the markets here that you just don’t feel anywhere else. Even Tokyo is stolid by comparison. He’d seen multi-million dollar deals clinched over a beer, like the Corona we were downing for eight dollars a pop in the hotel lounge. He certainly wasn’t planning to leave in 1997 when the Chinese Government takes over the shop. He didn’t believe communism really exists any more anyway. Don’t Deng and Li, the Chinese leaders, always fly first class? Why would they kill the goose that lays the golden egg? Already they own much of Hong Kong real estate through their local holding company.
His eyes grew bright and his hands moved with great animation. His enthusiasm was infectious. Entrepreneurial folk-tales of fortunes made, lost and then remade poured forth. It wasn’t just about the ‘bottom line’ either. There were visionaries here. Men like Gordon Wu, who has already started the first links in a new Asian superhighway that will run from Hong Kong through the Shenzhen Special Export Zone across the border, down through south China, into Vietnam and on to Bangkok. It will be the new Silk Highway. There’s a sign you see on bus shelters all over Hong Kong: ‘We Make Success Here’ it boasts.
The boom and bustle of success is evident throughout East Asia. It’s the same in Seoul or Taipei. Business is booming. Those who thought the ‘Four Tigers’ (Hong Kong, South Korea, Taiwan and Singapore in South-East Asia) were a flash-in-the-pan have had to go back to their calculators. The tigers are now well into their third decade of solid economic performance. Some of the companies spawned by this boom, particularly the large Korean chaebol firms like Samsung and Hyundai, are on their way to becoming major corporate players worldwide – investing everywhere, from China to Brazil. In the industrial North they prefer depressed, job-hungry regions with weak trade unions – like Samsung’s new electronics plant in Newcastle, Britain or Hyundai’s car-production facility in the eastern townships of Quebec.
Success is now spreading to a second tier of Asian countries. Malaysia and Thailand have both entered the manufacturing exporters’ sweepstakes, with south China and Indonesia not far behind. Peasant societies that produced rice and vegetables just a few short years ago are now churning out digital computers, cameras, even cars.
The World Bank and the International Monetary Fund – desperate for some vindication of their market-driven, free-trade doctrine – have been pushing this ‘NIC (Newly Industrializing Countries) model’ as the answer to all Third World poverty. But NIC success has often been achieved by ignoring rather than embracing Bank and Fund advice. At least in South Korea and Taiwan the heavy hand of government (the thing the Bank and the Fund deplore most) has been very active: protecting domestic markets, subsidizing exports, controlling credit, running nationalized industries and regulating labour relations.
One could be excused for thinking that the recent story of Asia belongs primarily on the business pages. But there are other voices aside from those of company directors and financial pundits. They are not so easy to hear – it is hard to speak louder than money. But they are there nonetheless.
Other voices: the social movements
‘We have no place to go from here.’ These words are spoken by Nam Sang-wa, deputy-chairperson of a tenant’s committee in Pynchong-dong, part of the bigger Bongchun-dong area of south-east Seoul.
A dozen or so tenants are gathered in the living room in one of the houses that has so far escaped the wrecker’s hammer. Kids run in and out of the room, sitting on their parents’ laps until they get restless from too much grown-up talk. And talk there is aplenty. It swirls around the room as they pass the verbal baton from one to the other, trying to explain to me, this odd outsider the evening has thrown up, just how the mechanics of property speculation affect poor people.
Everyone is well dressed in neatly pressed, colourful clothes – putting me to shame. Koreans pay great attention to personal appearance, even though these people make very small incomes as day labourers, street vendors or doing the housework of the upper-middle class.
They are country people who have moved to Seoul in the last few years. On the hillside areas of greater Bongchun-dong poor people are making their last stand in a city rapidly being gobbled up by expensive highrises. Too many people are chasing too little housing on increasingly expensive land – a side-effect of miracle economics ignored on the business pages. Absentee house-owners in Pynchong-dong sold out to a development company that, with Government approval, has hired a demolition firm to destroy their community. Already 75 per cent of the people have been forced out.
But some 134 households are determined to stay. They hold rallies – and drum festivals, like the one that happened the previous weekend. The demolition company, for its part, turns out the street lights and sets small fires. One of the tenants points to a house 100 metres down the road where some heavy-looking, tattooed guys are hanging out. He says they are members of street gangs the company has moved in to harass people as they move up and down the hill. So far it’s only been insults and threats and scaring the kids. But in the future, who knows? They fear the worst.
The talk goes on well into the evening. Theirs is no isolated struggle. The tenants estimate that there are five major redevelopment zones in greater Seoul and some 500 different struggles to resist forced removal. As we wind our way through the narrow alleys down to the main street a loudspeaker blares out over the hillside. The tenants are rallying their forces for the next meeting.
Such ‘quiet heroisms’ have seen the democratic movement in South Korea through some pretty rough times. Social movements here are highly organized affairs. They have local chapters and national offices, alliances and coalitions, executives and minutes. Files are neatly stacked, membership payments charted on walls. The residents of Pynchong-dong are connected to the Roomers Association that is part of the Association of Urban Poor. This has some 80,000 members and is fighting for the rights of tenants, for decent daycare, and for the street vendors who strive to create a life in the cracks of the Korean economy.
These vendors add a dynamism to Seoul’s streets – whether they’re selling huge, juicy pears or setting up portable bars where one can sit and wash down a variety of seafood snacks. But they have become the latest target of the state’s obsession with control from above. Restrictive zoning laws are being used to sweep them away, these last vestiges of Third World city life.
In all the NICs except Hong Kong social movements come face to face with an authoritarian state constantly trying to narrow the political space for popular resistance. Most of the people I met in Korea had served time in prison – not months but years. Even those who managed to avoid the attentions of the police have paid a price. The work of Kim Sung-Kyu in the poor people’s movement over the past 10 years has left him screened out of regular employment by vigilant managers. It is very difficult for ‘agitators’ to remain anonymous.
Timid democratic reforms
In South Korea and Taiwan there have been timid moves towards civilian and democratic government but the apparatus of repression is still firmly in place. As you ride Seoul’s bright new subway the same voice that announces the stations also warns you to keep an eye out for troublemakers who may be North Korean spies. Posters from the Korean Central Intelligence Agency carry the same message.
In Malaysia things are becoming more, not less repressive. Under Prime Minister Dr Mahathir the Internal Security Act has been amended 18 times – each time to give it more bite. Even in a culture of tolerance like Thailand’s the state can get very heavy, very fast. Thai writer Sanitsuda Ekachai, whose poignant reportage in Behind the Smile evokes the pain of a rural Thailand plundered for the world market, has seen it more than once. It seems ironic – sitting as we are in the ultra-modern office of the Bangkok Post – for her to blame the feudal roots of classical Thai paternalism. ‘It’s paternal indulgence,’ she says. ‘You are my children, you are tolerated to a certain extent, but I can spank you if I feel that you have gone too far, then after that I can be nice, calm and indulgent again.’ Such ‘spankings’ can take the form of extra-judicial killings and disappearances or even of the Tiananmen-style slaughter of pro-democracy students that occurred in the centre of Bangkok in 1992.
The social movements of South Korea confront the hooded, Darth Vader-like police and their massive metal shields with a forthright militancy that is best admired from afar. Fire-bombs and metal poles are the tools of this risky trade – although very few are ever killed or even seriously injured. It is a kind of ritual in which the state must be made to bear some cost for their high-handed treatment of the citizenry. The Green Warriors (all beefy former paratroopers) of the eco-activist group Green Korea dangle on ropes from dams and bridges to expose the latest ecological folly.
In Thailand and Malaysia such tactics are inconceivable. Guile is the best asset of social protest here. Demonstrations appear out of nowhere and disappear just as quickly. Knowing when to push and when to back off is essential. Good intelligence is crucial – when is an opponent exposed politically in the bureaucracy and when do they operate from a position of strength?
By tradition, politics in Thailand is a game played over the heads of the populace. Witoon, director of the Project for Ecological Recovery (PER) in Bangkok, has a good fix on this ‘clientist’ political culture. ‘It runs not by principles but by emotions,’ he says. ‘Pendulums swing back and forth and you must always know where the line is. The bureaucracy is very strong and if you challenge them outright they will come down very hard. But if you can show them benefits and appeal to their interests...’
Sucking the countryside dry
PHOTO BY RICHARD SWIFT
‘I think the most productive thing that one can do in life is to build a house or to farm,’ says Cho Soung-Woo, whose usually cheerful expression passes to one of sad contemplation. His thoughts drift back to his home village and the deserted houses. ‘There are more of them every year – it is becoming a village of old people.’
Cheap food imports from the US have flooded South Korea, destroying a once-prosperous farming sector and driving 500,000 people off the land every year. Cho is president of the Korean Farmers Alliance. Despite his masters degree in Christian theology he takes pride in the street-fighting prowess of his members when they demonstrate against cheap food imports. Low food prices in south Korea and Taiwan mean lower wages in the manufactured-export sector.
But it is in places like Malaysia and Thailand, with majority rural populations, where the high-handed urban bias of miracle economics has been most damaging. Low prices have combined here with destructive mega-projects into a powerful ‘push-factor’, driving people into the factories of the export economy. Thailand has been a playground for the dam-builders – heavily bankrolled by the World Bank – and logging companies who have together laid waste to vast tracts of land and displaced thousands of farming families.
KEEPING IN TOUCH WITH TIGERS
Witoon at the Project for Ecological Recovery sees the pattern behind the plunder: ‘Over half the electricity produced by the hydro boom is soaked up by Bangkok with its massive luxury hotels and burgeoning industrial base.’ PER is part of a wave of hundreds of non-governmental organizations which act as animators of citizens’ action to stop the ruin of rural Thailand. There have been some notable victories – the seven-year-long campaign that stopped the Kanchanaburi Dam on the river Kwai, or the ban on commercial logging in national forests and wildlife sanctuaries.
PHOTO BY RICHARD SWIFT
There has been less success with stopping a dam on the Moon river. Village protests, particularly in the impoverished north-east, are easily isolated without external allies. Witoon sees the role of a group like PER as turning local protest into national issues. Tactics must be carefully crafted lest groups be manipulated by local politicians or some faction of Thailand’s
formidable military. The thin lines of villagers and ‘forest guardians’ blocking logging roads or resisting the siting of eucalyptus plantations in their forest homes are running real risks. Someone told me: ‘It costs only $200 to have a Thai killed, twice that for a farange (foreigner).’
With forest cover dropping from 50 to 20 per cent in just 30 years it is now quite clear that rural Thailand faces a serious shortfall in exploitable resources. The Government is responding by trying to reduce rice farming – so that more scarce water is freed up for the export factories of Bangkok, and more rural people are driven into its slums.
Crusty Father Joe Maier has worked in those slums for 17 years. He feels the loss of something distinctive in Thai life. ‘There used to be a kind of Sabeeh! Sabeeh! (‘Let life come as it will’) but now folks must have three or four sources of income just to keep up,’ he says. With the glorification of the entrepreneur-as-hero it is easy to forget just who put in the long and arduous hours to build these miracle economies.
PHOTO BY RICHARD SWIFT
Workers are, however, finally beginning to reap some of the benefits. Thanks to hard-fought union-organizing drives wages have shot up – to the point that in Hong Kong and Korea they are 10 times those paid in Indonesia or in the export-processing zones of mainland China. This has provoked Taiwanese and Korean companies to shift investments to lower-wage locales – and, sometimes, low-wage migrants to their factories at home. The Asian miracle is on the move, with mobile capital and runaway investment in a restless search for ever-cheaper labour and newer markets.
Wonjin Rayon occupies a vast site several blocks long in Mikum City outside Seoul. These days its mighty stacks no longer belch forth smoke. In its ghostlike silence it appears like a new Roman ruin of our industrial age – a relic of what economists glibly term ‘sunset’ industry.
But one can glimpse a stirring of activity behind the distant security fence – Chinese workers packing up the old machinery for the trip back to Dantong City in north China. Why Chinese workers? ‘No Korean worker would agree to touch this killer technology,’ says Lee Hong Jo of the Wonjin Emergency Counter Measures Committee.
I meet Lee and a group of other former Wonjin workers in their cramped office a short bus ride from the factory. They have lots of time on their hands and the office has become a place to meet their friends and to pursue the serious business of protest – with an impressive lightness of heart. Lee explains that the textile factory was already 20 years old when it was imported from Japan in the late 1950s. Since that time, the workers say, it has killed 16 of them and left 30 more ‘like vegetables’ – the result of exposure to carbon bisulphate leaking from the ancient machines. The lung poisoning is a degenerative disease. They introduce me to Park Sang Soon, a serene 53-year-old woman, who is in the first stages of the disease – headaches, speech problems, hair loss.
After an extensive campaign the workers finally got the authorities to shut the plant down. An official investigation held that it should stay that way and the ageing technology should be scrapped. Workers were guaranteed new jobs. The result: still no jobs and the killer machines have been sold to China. Now every week the workers travel the hour-and-a-half to downtown Seoul to demonstrate – not only for the promised compensation but to prevent the future deaths of Chinese textile workers too.
The story of Wonjin Rayon traces a micro-geography of the shifting ‘miracle’ economics – from Japan to Korea to China. As low-wage and polluting employment packs up shop it is replaced by high-tech (Taiwan and Singapore), heavy industry (Korea) or service jobs (Hong Kong). NIC prosperity is based on the ability to export. As wages improve they become less competitive and a shift must be made to exporting goods with higher ‘value added’. The problem is that someone else – often with a better reputation for quality, like the Japanese or the Europeans – already has these markets sown up. In addition, Japanese transnationals control – and lease out on increasingly disadvantageous terms – the technology necessary for much of this kind of production.
The Asian values offensive
A slow-down in growth has now begun in the mature miracle economies. This may be just the opportunity social movements need to provoke a public rethink about the balance between economic growth and sane, safe, social development. But they require democratic space in which to accomplish this. This is proving hard to come by. The Cold War lingers on in east Asia. Cold War ideology has cemented the control of generals and technocrats on both sides of the bamboo curtain. Repressive anti-communism has been a mainstay of the political diet from Taipei to Jakarta.
But Cold War bogies aren’t scaring the crowds the way they used to. So a new discourse for ‘top-down’ control has to be found. The leading candidate is ‘Asian values’. A major offensive is under way, accompanied by much nationalistic speechifying, conferences on ‘Rethinking Human Rights’ and PR stunts like the public head-shaving of rock stars on TV. But what does it mean? A Buddhist scepticism about consumer materialism? A more balanced approach to life that values nature as well as industry?
Far from it. ‘Asian values’, as propagated by right-wing Japanese think-tanks and echoed by people like Lee Kwan Yew in Singapore and Mahathier in Malaysia, boil down to a sterile cultural conformism and absolute obedience. ‘Commitment to the national community’ is ensured through draconian legal sanctions, the widespread use of capital and corporal punishment. The rights of those who disagree or are just different must be subsumed into the ‘greater good’. East Asian social activists are unlikely to be fooled by bellicose ‘anti-imperialism’ – they know full well that they will be among the first targeted as violators.
It is in the crowded streets of Hong Kong island and Kowloon that you find the offices of regional human-rights and development organizations who take an overview of what is happening to East Asia as a whole. Here the Asian Monitor Resource Centre works with unions across the region on workers’ rights. The All-Asian Students Association helps to stimulate student activism.
John Sayer is director of the Hong Kong branch of Oxfam and an ardent critic of what he sees as a simple-minded analysis of the NIC phenomenon. He emphasizes the sweeping changes the region has undergone and stresses the benefits to ordinary people of being able to offer their children healthier lives and better opportunities. He is unimpressed with what he feels is the anti-development bias of many Third World support groups. ‘You have to replace bad development with good development – you can’t use acupuncture to decommission a nuclear-power station,’ he says.
Sayer is optimistic about east Asians embracing ‘post-wealth’ considerations like democracy and the limits to growth. He is surely right that there is no going back to pre-industrial Asia – even those on the bottom rung of the NIC ladder will tell you that. But optimism about a democratic and sustainable future is easier to believe in liberal Hong Kong – at least for the moment – than almost anywhere else. Singapore and Indonesia have had fast-track growth policies and markets open to the world for decades, but remain ruthless dictatorships. If ecological sanity is coming to Taiwan and Thailand it is arriving very late in the day indeed. Ironically, without the political space for social movements to organize and counter the unequal spread of benefits and the destruction of nature, Asian economic success will remain a house built on shifting sand.
The wrench of the new
In Hong Kong they are producing a play called The Big Wind. It is produced by the Asian People’s Theatre Festival and portrays the wrenching changes East Asia is undergoing. Such changes go far beyond facts and figures, ‘GNP’ and retail sales. In three or four decades much of the region has undergone a profound transformation that took centuries to accomplish in Europe and North America. Whole ways of life and the old certainties that accompanied them have been ripped up. Entirely different rhythms and ideas about what matters have burst forth in their place. Basic meanings of family, work and what is possible have been shaken to the core. For better or worse – it takes some getting used to.
This special report appeared in the the east asian economic miracle unmasked issue of New Internationalist. You can buy this magazine or, to get stories like this one through your door every month, subscribe.