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Globalization in Asia:
Getting the Breeze Without the Bugs

Executive Summary: Nearly two years since Asias economic crisis began, the region has begun to express doubts about the impact of globalization on regional societies. Although the term defies simple definition, participants agreed that globalization has several core characteristics:

Unprecedented economic interdependence, driven by cross-border capital movements, rapid technology transfer, and "real time" communication and information flows. Rise of new actors that challenge state authority, particularly nongovernmental organizations and civic groups, global firms and production networks, and even financial markets. Growing pressure on states to conform to new international standards of governance, particularly in the areas of transparency and accountability. The emergence of an increasingly Western-dominated international culture, a trend which in many countries has sparked concern about the erosion of national identity and traditional values. The rise of severe transnational problems that require multilateral cooperation to resolve.

Globalization and Regional Security The impact of globalization on Asias security is complex. In some ways the impact has been positive: economic integration has reduced the potential for conflict, particularly in Southeast Asia. Nevertheless, globalization may give rise to new security concerns, and aggravate existing tensions.

New transnational threats Globalization has contributed to the rise of energy and environmental issues, food and water access, migration, and organized crime and terrorism as major security concerns. To be effective, responses to these problems must be multilateral in nature. Weakening regional institutions The financial crisis has weakened Asias two major regional organizations, APEC and ASEAN. APEC was helpless during the crisis, and ASEAN appears increasingly divided. Shifts in the balance of power Because globalization can fuel rapid economic growth, shifts in the balance of power can occur more quickly than in the past. Rapid Chinese growth and Japanese

economic stagnation may change the strategic equation in Asia in a relatively brief period of time. Expanding roles for the military The combination of new threats and lingering concerns will place unprecedented demands on regional military organizations. Militaries will have to take on new roles, even as resources decline and recruitment falls.

Globalization and Sovereignty Although globalization is often viewed as a challenge to national sovereignty, states in Asia have chosen to embrace the global economy. During Asias boom years, globalization was viewed as a tool for strengthening national power, rather than as a potential threat. This view was reinforced by the belief in Asia that governments could participate in the global economy without altering domestic political structures and practices. Across the region growing wealth often coexisted with authoritarianism. Events in Indonesia, however, suggest that globalization can force political, as well as economic, change. Globalization can exacerbate divisions within society, with some groups profiting more from globalization than others Indonesias ethnic Chinese, for example. In the face of globalization, ethnic divisions and separatist movements could worsen, and social cohesion could suffer as well. Authoritarian regimes may have more to fear from globalization than democratic states. Governments that embrace norms such as transparency, accountability, and the rule of law concepts that form the backbone of democratic societies appear to have suffered less from the financial crisis than their authoritarian counterparts. For now, few Asian governments appear likely to reject globalization entirely. Nevertheless, the possibility of an Asian backlash primarily against the United States remains real. A new "grand bargain" between the West and Asia is essential. The West must recognize that Asian concern over eroding values and social cohesion is legitimate; Asia must cease demonizing the West for its role in spurring globalization, because no nation is immune to the challenges and opportunities it presents.


As the effects of an unprecedented economic crisis continue to ripple

across Asia, a fundamental issue has moved to the forefront of policy discussions in the region: the long-term impact of globalization on Asian societies. Even during the years of Asias economic boom, scholars and government officials across the region engaged in a lively dialogue about the influence of global forces on the region. The debate over alleged differences between Asian and Western "values" that emerged in the early

1990s was at least partly an expression of Asian concerns about globalizing forces. The Asian financial crisis has provided new fuel for this debate. Prominent, mainstream Asian thinkers from India, to Malaysia, to Japan are now pointing to globalization as a possible threat to internal cohesion and economic health. Commentators in the West have generally assumed that the crisis would precipitate disillusionment with so-called Asian approaches to governance and economic management, spurring further "convergence" with Western practices. Although there is evidence that some Asian countries have moved in this direction, others are drawing alternative conclusions: namely, that adherence to Western methods leaves Asian societies more vulnerable to the ravages of global capitalism, and more exposed to forces that corrode long-standing cultural and social norms. The outcome of this debate will have profound implications for the regions security environment, and for the United States which is seen in much of Asia as the ultimate driving force behind globalization. To explore Asian perspectives on globalization, and to examine how the phenomenon is reshaping the regions security environment, the AsiaPacific Center invited a group of distinguished government officials and scholars for three days of intensive discussions. Although thinking about the influence of globalization is still very much in its infancy, the meeting served to sharpen thinking about how relations in the region may or may not be transformed in the years ahead. Globalization: What Is It? To examine the impact of globalization on Asia, the term must first be defined. The task is not simple. Several conference participants noted that groups within societies define the term differently, often to suit narrow, parochial interests. In South Korea, for example, labor unions make use of the term in demanding the "universal" right to assemble; business interests, in contrast, employ it to spur deregulation. One American observer noted that "globalization" is often used to describe so many different things that the term is essentially meaningless; globalization has become, he noted wryly, the "el Nino of the social sciences" a force that can be blamed for almost anything. Other participants questioned whether globalization was truly a new phenomenon. An American historian noted that the entire course of human history can be seen as the gradual expansion of transportation and communication networks; in that context, globalization may be little more than an extension of past patterns of human interaction. At the very least, as a South Korean participant noted, "globalization" must be distinguished from terms like "interdependence" and "integration" vocabulary which have been part of the social science lexicon for decades if the concept is to have meaning.