THE TRADITIONAL CONTEXT OF PADI PRODUCTION

The extensive monoculture of padi in the Kedah Plains is directly dependent on the availability of water. However, no traditional system of irrigation was developed to regulate the supply or access to water. Padi cultivation was entirely dependent on the rainfall brought regularly by the South-east Monsoon. During the dry season, the clay surface of the Plain dried up so completely that no crop whatsoever could be planted. Consequently,

The social organization of padi cultivation had thus to contend firstly, with individual household surplus management and/or consumption ties with other village households or sources of credit outside the village economy in order to tide over the lean and hungry months; secondly, inadequacy of household labour for harvesting in particular, due to the uniformity of the ripening process. Production ties thus had to be established with other households either in the form of exchange or hired labour.

On the other hand, however, the absence of irrigation as an important factor of production made the development of communal forms of organization based on the village as a territorial unit unnecessary.

The production ties made incumbent by the simultaneity of padi operations were of a flexible and largely dyadic nature, of which three major arrangements were found:

1. “Kontrek” (contract) arrangements between a farm operator and another villager, who would “help” with the transplanting or harvesting every year. This approximates to a patron-client relationship.[…]

COLONIAL HISTORY

There is no doubt that the era of colonialism has always represented a caesura for Third World societies. Although the impact of colonialism varies in different countries and regions, the era generally marked the beginning of far-reaching changes for colonized societies. What is of particular interest here is the destruction of the “natural economy”, that is, an economy with dominating use-value production and limited trade relations, in favour of the development and establishment of the market economy.

The most important mechanisms of this destruction since the era of colonialism have been:

1. • the intervention of the colonial state;

2. • the internal monetization of traditional social relations;

3. • an increasing dependency on industrial products in place of traditional self-produced goods;

4. • the development of new tastes and needs;

5. • the destruction of the ecological equilibrium;

6. • the disintegration of the domestic economy, social obligations, and traditional forms of reciprocal and collective labour.

(Elwert and Wong 1979; see also Evers, Clauss, and Wong 1984)

This does not mean that all these mechanisms have worked harmoniously. They were also dependent on other influences, such as the pre-capitalist social background and existing internal structures.

For a better understanding of the significance of this process of social transformation, we refer to the work of Polanyi (1971, 1979). Although his research is focused on the European context, particularly with regard to the explanation of the economic crises at the beginning of the twentieth century, a modified use of his theoretical reflections on so-called underdeveloped societies seems justifiable. His main issue was the potential destruction of social structures in the market-establishing process. He pointed out that the market principle as it was established in Europe during the eighteenth century effected a particular transformation of all societies concerned. It is one of Polanyi's fundamental statements that in pre-capitalist societies the economy was always embedded in social relations, while with the domination of the market principle, social relations are embedded in the economy. This means the establishment of the market principle as such results in a reversal of the relations between society and the economy.

The great benefit of competition is the pressure upon firms to be efficient. Efficiency means production of the quality of service desired by consumers at least cost. Provided there is some degree of price competition, firms whose quality of service is poor, whose costs are high or whose profit margins are excessive will lose custom to their rivals and ultimately be driven out of business. Market sanctions upon inefficient firms have the great advantage of being internal to the industry. If these sanctions are effective, the industry' is self-regulating as far as efficiency is concerned.

In the case of the Indonesian interisland shipping industry, there is strong evidence of competition. As discussed in Chapter 3, the large number of firms and the ease of entry appear to ensure that individual firms cannot hold significant market power. In other words, firms have little scope either to sustain excessive costs or to charge excessive profit margins if they wish to remain in business in the long-run. These predictions of market structure seem to be borne out by observation of competitive behaviour: firms engage vigorously in both price and quality competition. What needs to be determined now is whether that competition is in fact effective in raising the level of efficiency in the industry.

Ideally the level of efficiency would be measured in terms of the costs and profit margins of individual firms. Unfortunately financial data are highly confidential. Even if data were available they would be unlikely to present an accurate picture of a firm's true financial position. Many firms in Indonesia keep multiple sets of books — a set for the bank, a set for the taxation authorities, and so on.

The approach taken below is therefore to focus not upon performance and efficiency per se but upon the process by which competition raises the level of efficiency. The first part of the chapter looks at some indicators — crude and partial though they be — of the dispersion of efficiency among the many firms in the industry.

A crucial fact to emerge from a survey of modern Malay literature is the close link between literature and the social and political forces which surround it. From pre-war years until today, Malay writers, always sensitive to the shifts in mood in their environment, have absorbed and responded to the influences around them, and have registered in their works the imprint of these forces. Equally important in characterizing modern Malay literature is the tendency among writers to see literature as having a social purpose. Literature plays the role of exposing social ills and problems, articulating certain stances, reflecting what is perceived as the hopes and aspirations of the people or of seeking to guide society towards the path of Allah. This orientation is given some measure of sanction by literary bodies, the government and religious movement and proponents, all of which made use of literature, albeit for different purposes.

While the literary culture is rich with variations and modifications to suit changing times, one nevertheless observes particular perceptions which continually inform literary works. A definition of social class appears to prevail in writers' perception of Malay society, a view which they reinforce by identifying different values with the respective classes. Similarly, their image of the rural world is clearly differentiated from that of the urban centres. In giving expression to these perceptions, writers adopt an Islamic perspective as the only valid point of reference in their value systems.

An interesting point to note is that these perceptions persist despite glaring contrasts in the writers' circumstances. For example, while in many cases the link between contemporary writers and the rural world is not altogether severed, the village no longer serves as the only conceptual framework for today's writers, as it did their earlier counterparts. Not withstanding this difference, the rural-urban dichotomy which dominated pre-war literature does persist. Its presence may be implicit or less obvious than in the pre-war period, but a pervasive continuity is evident.

The difficult situation in East Asia with regard to maritime law is basically not different from that of Southeast Asia. There are also a number of semi-enclosed seas — the East China Sea, the Yellow Sea and the Sea of Okhotsk — which are surrounded by a few states, and therefore common borders have to be established. In addition, the states concerned at the northwest rim of the Pacific Ocean have differing political and ideological views, and so final agreements cannot be expected in the near future. The PRC and Taiwan are officially at war and neither recognizes the international law status of the other. The Democratic People's Republic of Korea (North Korea) is hostile towards the Republic of Korea (South Korea). An armistice provides for relative peace; nevertheless, relations are strained. Japan and the USSR are not at war, but a peace treaty has not been negotiated because the USSR (it declared war against Japan on 7 August 1945, one day after the atom bomb struck Hiroshima) gained the southern half of Sakhalin and the entire Kuril Islands following the unconditional capitulation of Japan. Japan is now interested in regaining the islands of Shikotan, Habomai, Kunashiri and Etorofu, which lie in the vicinity of the northeastern coast of Hokkaido and were not included in the Treaty of St. Petersburg. It is mainly the refusal of the USSR to hand over these islands that hinders a final contractual settlement on maritime law questions between both states. The lack of diplomatic relations between Japan and North Korea is also a negative aspect in the overall situation. The historically founded political aversions between lapan and South Korea seem to be absolute. The dissimilarity between the neighbouring states in the northwest Pacific is also of importance. The PRC and the USSR dominate the entire region because of their political and military power, although the economic strength of Japan, Taiwan, and South Korea is a counter balance worth mentioning.

This paper presents a study of how decisions on the automotive complementation project have been made in the Philippines. The process of decision-making involves both the private and government sectors because the scheme, although focused on the private sector, necessarily requires government participation in the form of laws to support the automotive industry and to establish a link with ASEAN at the committee meetings where government officials make decisions on matters of regional interests.

Industrial complementation in the ASEAN definition is a system of schemes for the manufacture of different products within an industry or related industries in ASEAN countries. The scheme involves both existing and new products of industries whose production is duplicated in a number of countries. The idea is to allocate the production of such products or their components to the member states, preferably where there are already existing industries, in order to achieve economies of scale.

State of the Automotive Industry

The Philippines had a modest production of 671, 874 vehicles in 1975. There was one car for every 100 people; one commercial vehicle for every 150 people and one motor-cycle for every 238 people. Gross National Product was figured at P40.8 million in 1974 and P43.203 million in 1975. Per capita income based in 1967 constant prices was US$304 in 1974 and US$327 in 1975.

The Philippine automotive industry developed from a network of distributors and dealers selling built-up vehicles from 1916 to the five or six years of reconstruction. After World War II, the assembly phase of the automotive industry was brought about by the imposition of full import control which was partly due to the pressure of diminishing foreign exchange reserves. Assembly plants for completely knocked down (CKD) packs were then created. The fragmentation of the small market for cars and the existing tax and tariff structure, however, prevented the industry from developing beyond the assembly stage.

In the literature of the 1970s, there emerged in general a further significant shift in focus from that of previous years. The preoccupation with Malay leaders and their pretensions which dominated the literature of the 1960s, was no longer evident as a major theme. However, the perception of the upper class and figures of authority suggested in earlier literature persisted, although in less obvious terms. Novels such as Perjudian [The gamble] (1973), Izin dalam Paksa [Consent under duress] (1973), Lambak [Lambak] (1974), Krisis (Crisis) (1976), Noni [Noni] (1976), Bel urn Masanya [Before its time] (1977), Tiba Masanya [The time has come] (1977), Kernel ut [Crisis] (1977) and Seluang Menodak Baung [A carp impaling a fish] (1978) are among some of the literary works which perpetuated the perception of the Western-educated officers, the DOs, the Makil Rakyat(s) and government officials as essentially corrupt and hypocritical. The literary preoccupation of the 1970s, especially in the first half of the decade, revolved around the fishermen, farmers and the landless poor who faced the task of opening up new land to start a new life. A sympathy for their struggles, dedication arid commitments found expression in literary works. In his survey of the novels of the 1970s, Safian Hussain suggests that besides love stories literary works of the period may be roughly divided into two preoccupations, namely, life of the urban dwellers and the villagers. He further adds that on the one hand writers tend to dwell on the ills of urban society by highlighting the hypocrisy and moral decadence which plague it. On the other, their focus on village concerns tend to centre on peasants' sufferings and difficulties, along with their determination to meet the challenges of life (Safian Hussain 1981, p. 42).

Alongside the preoccupation with the struggles of the rural poor, the period was also to show an interest in the literary conventions associated with the “absurd”.

The project on “Industrial Restructuring and Adjustment for Japan-ASEAN Investment and Trade Expansion”, based on the results of studies conducted by the Japanese and the ASEAN country research teams, is a co-operative effort to map out issues, constraints, possibilities, and policies pertaining to industrial restructuring in Japan and the respective ASEAN countries. Like the preceding two projects in the ASEAN Regional Studies Promotion Programme (ARSPP), it is a co-ordinated effort involving researchers and officials from both ASEAN and Japan, and is an integral part of government efforts on both sides to strengthen economic co-operation.

The basic objectives of the project are to promote sustained growth, employment expansion, and national well-being in the ASEAN countries. The operational objectives are to analyse the process of industrial restructuring and adjustment with a view to suggesting measures at national, bilateral, and multilateral levels to enhance the process of industrial development in ASEAN, and to strengthen economic relations between ASEAN and Japan. More specifically, this study attempts to identify policies, measures, and schemes that would facilitate the relocation of certain industries from Japan to ASEAN.

It should, however, be noted that there are great diversities among ASEAN countries with regard to physical area, population size, objectives, and interests. These national economies are also at varying stages of economic development based on distinct growth strategies. In addition, the respective country teams use different research methodologies and emphasize separate aspects of the topic. As such, there are areas where comparison and treatment of these countries as a bloc proved difficult. Where such gaps exist, these are filled by supplementary material extracted from other sources such as those noted in the references.

The contents of this volume are divided into two independent parts. Part I, the ASEAN overview, begins with a review of the changing economic structures of ASEAN countries in both a historical and world context. The first chapter therefore sets the backdrop for analysing industrial changes and restructuring efforts in the chapters that follow. The second chapter attempts to identify both declining and growing industries and the impact of industrial changes on the community and private firms.

The pattern of ASEAN dependence on industrial market economies has changed in many respects. Nevertheless, the growth prospects of ASEAN countries are still very much dependent on the economic performance of the industrial market countries. At the present stage of development in ASEAN countries, there is an evident need to export higher value-added manufacturing products or at least primary products with further processing from members with a lower level of industrialization. Trade among ASEAN countries, though increasing, is minimal when compared with export potentials to markets of industrial countries. The success of the present export-oriented industrialization strategy practised by all ASEAN countries is therefore highly dependent on the level of demand for their exports in the industrial countries and the access they have to these markets.

Recovery in the industrial countries may benefit the different ASEAN countries to different degrees depending on their structure of merchandise exports. Generally, countries that are less protected should begin to increase national output before those that are heavily protected. The prospects for ASEAN countries' exports in this decade, however, are uncertain and present indications are not encouraging. The same can be said about flows of external financial resources from both official and private sources. Moreover, a slower rate of increase in these countries' exports would reduce their ability to repay commercial loans, and hence their ability to borrow. This is particularly the case for the Philippines, Indonesia, and Malaysia.

A conducive external environment no doubt helps and is an important factor, but domestic efforts are the ultimate determinants of the pace of industrial development in ASEAN countries. A much quoted remedy is industrial restructuring and adjustment in these economies.

Industrial structures in ASEAN countries have undergone fundamental changes during the last two decades partly as a result of deliberate government actions in response to both internal and external factors. However, the programmes for current industrial restructuring for the respective ASEAN countries are at different levels with varying levels of government involvement.

Thailand is one of the Southeast Asian countries in which the motor vehicle plays a significant role in socio-economic development. The automotive industry has numerous components and has wide ranging implications. Depending on vehicular construction and usage patterns, the automotive industry could be classified under (a) passenger cars (b) trucks and commercial vehicles — both light and heavy, and (c) buses. There is considerable interchange in the use of these different categories of vehicles, and commercial vehicles could double as goods and passenger transport depending on locality and need. At the same time, there is an equally thriving sector for the two-wheeler such as motor-cycles and scooters.

In terms of the country's balance of trade, the costs resulting from importation of these vehicular units were staggering. In 1972, for example, such vehicles constituted the fifth major import item for the country in terms of value. If a part of the energy imports (namely petroleum and related products) were regarded as consumables for these motor vehicles, then it is beyond doubt that the policy makers should take more than just a cursory interest in this area, with a view to modifying the usage of motor vehicles in a manner best suited for the country.

The response of the Thai authorities has been to press for a reduction in the outflow of valuable foreign exchange earnings, to help the industrialization of the country, improve the level of technical skills, and create sufficient jobs for an ever growing population of employables. The automotive industry has been realized as one which could be structured to fulfil all these requirements, thus the strategy of creating a viable automotive industry in the country. The gap between aspiration and achievement however continues to plague the various governments which have been ruling the country and the dream of an integrated automotive industry remains unattainable while the root problems which have plagued this industry remain unsolved.

This paper examines five aspects of the Thai automotive industry.

The population projections were prepared by the component method which consists of separate projections of both the number of males and females in each age group of the population. It is usual to project the population by time-intervals equal to the age-intervals into which it has been divided. Since the 1985 base population has been divided into quinary age groups, the projections are most easily made for five-year intervals of time which implies that at the end of the five-year period all the survivors of one age group would have moved into the next higher age group. Each cohort of the 1985 sex-age group is diminished to account for mortality with the passage of time. This step requires a set of five-year survival ratios which are deemed to represent mortality in each cohort during specific periods of time subsequent to 1985. A multiplication of the original number in each sex-age group by the relevant ratio will yield the estimated number of persons five years older at a date which is five years later. A repetition of the procedure will furnish the estimated population aged ten years older than those at the base date and for the ten years later.

In the second step the future number of children born in each five-year time-interval subsequent to the base year is estimated in order to fill the vacuum in the first age group 0–4 at periods of time every five years later. This requires the formulation of a set of plausible assumptions regarding the future course of fertility in terms of the gross reproduction rates. Having worked out these rates, they are utilized in conjunction with the female population in the relevant reproductive age to derive the estimated number of births for the various five-year periods. The number of births surviving to the end of a given five-year period can be estimated by multiplying the number of births during the period with the appropriate survival ratio. This estimated number of survivors is used to fill the vacuum in the first age group 0-4 at every five-year time-interval.

Two major forces have worked towards the continual loss of the forest cover of the Philippines since the beginning of this century. These are: (1) the large-scale commercial exploitation of the timber resources of the forests; and (2) the demand for the land on which the forests stand.

Timber Exploitation

The history of timber exploitation goes back to the period of the Spanish occupation, when the finest quality timber trees were felled for the construction and repair of the Spanish galleons plying the trade routes from east to west. Although exploitation was confined to the more accessible lowland forests, the extent of deforestation was severe enough, particularly in the islands of Cebu and Bohol, to spur the Spanish Government to issue a Royal Decree in 1974 prohibiting the felling of trees for commercial purposes in problem areas (Makil 1982).

There were, nevertheless, very substantial quantities of commercially valuable durable hardwoods that remained unexploited, especially in the largest islands of Mindanao, Luzon, and the Visayas. During the American period of occupation the output of logs and lumber increased at a modest rate – from about 100,000m3 in the late 1800s to about 1.6 million m3 in 1935, an average rate of increase of 11 per cent per annum (Fig. 1). The total cut from 1908 to 1935 amounted to 20.8 million m3, or only 2.6 per cent of the 800 million m3 of standing timber estimated by Whitford (1911) to have covered the Philippines in 1910. Forest products, mainly timber, contributed an average of 3.4 per cent to the total value of all exports during the period 1937-40.

At the end of World War II it was estimated that as much as three-quarters of the Philippines was still under forest (Myers 1980). Large-scale exploitation of the forests began soon after the Philippines attained its independence in 1946.