Malaysia

Malaysia is a country made up of various British colonies that came together as a federation and then became an independent country. Britain started establishing colonies in the region in the late 1700s. The two main areas include the western colonies on the Malay Peninsula and the eastern colonies on the island of Borneo. The western settlements were part of the Malay Peninsula, which included the colonies of Pinang and Singapore. Eventually, the British took control of the eastern colonies of Brunei, Sarawak, and Sabah on the island of Borneo. In 1957, the western colonies on the mainland peninsula broke from their British colonizers and became an independent country called the Federation of Malaya. In 1963, the British Borneo colonies of Sarawak and Sabah joined the Federation of Malaya to form the current country, which is called Malaysia. In 1965, Singapore broke off from Malaysia and became an independent country. Brunei, which was still a British protectorate, became independent in 1984.

Malaysia has two main land areas separated by the South China Sea. The regions of Sarawak and Sabah, on the island of Borneo, are called East Malaysia; the mainland on the Malay Peninsula is called West Malaysia. These regions have similar physical landscapes, which include coastal plains with nearby densely forested foothills and mountains. The highest mountains, rising 13,436 feet, are in East Malaysia on the island of Borneo. Located near the equator, Malaysia has a tropical Type A climate with monsoons regularly occurring from October to February.

Figure 11.12 Provinces in East and West Malaysia

Diversity of Culture and Ethnicity in Malaysia

Malaysia’s culture is diverse in that several major religions are practiced within its borders. Islam is considered the official religion and is supported by at least 60 percent of the population. About 20 percent of the people are Buddhists, 10 percent Christians, and 6 percent Hindu. The remaining percentages of the population include traditional Chinese religions and local tribal beliefs. In this Islamic country, there are concerns that Muslims get preferential treatment by government programs and policies. There are even special judicial legal courts for Muslims only to work out issues regarding marriage, custody, inheritance, or other conflicting Islamic issues regarding faith and obligation. This court only hears Islamic issues and no other legal matters. There have been movements by minority extremist groups that would like to see Malaysia shift toward a true Islamic state, complete with the Sharia Criminal Code as the law of the land. The movement, however, has been cracked down on by the government. Since the 9-11 incident in the United States, there has been more concern about extremist religious views.

People of Malay ethnic background make up more than 50 percent of the population. People of Chinese descent are the second-largest group at about 24 percent. An additional 11 percent of the population is made up of indigenous groups. During British colonialism, a number of people from South Asia were brought to Malaysia. For example, Tamils were brought from India to work the plantations. Their Hindu beliefs were infused into the culture and some Tamils also converted to Christianity. Sikhs were brought from South Asia to help Britain run the country as police, soldiers, or security officers. The Sikhs who came brought their religion with them, which added to the multireligious dynamics of the country.

Figure 11.13 The Tuaran Road of Kota Kinabala City in Malaysia during a Time of Slow Traffic Notice that the cars are driving on the same side of the road as they would be in Great Britain, Malaysia’s former colonizer.              Jason Thien – Busy Roads of Kota Kinabalu City – CC BY 2.0.

Malaysia’s diverse ethnic and cultural mix often results in strong centrifugal forces that push and pull on the societal dynamics of the country. China has been active in the business community and has established strong economic ties with regional countries that have Chinese populations. The single largest minority group in the province of Sarawak on Borneo is Chinese. As a minority group, Chinese citizens of Malaysia have felt discrimination. Since the official language is Malay and the official religion is Islam, there have been concerns about discrimination against all minority groups. Working through the cultural and ethnic diversity has been a major challenge for the country. Each minority religious or ethnic group desires to celebrate its own special holidays. For example, there is the usual New Year’s celebration on January 1, and then there is the traditional fifteen-day Chinese New Year celebration celebrated at a different time of the year. Sikhs celebrate the Sikh New Year. Buddhists celebrate a holiday in honor of the life and enlightenment of Buddha. Christians celebrate Christmas and Easter. Many other holidays of significance are respected or honored by various minority groups.

Singapore

Under British colonial rule, the island of Singapore was included in the Malaysian federation. It broke away and became independent in 1965. It is a small island measuring about thirty miles long at its widest point. Singapore is about two hundred forty square miles in area. Singapore’s most valuable resource is its relative location. Singapore is similar to Hong Kong in its development. With a good port, Singapore is a hub for ships sailing between Europe and China. It serves Southeast Asia as an entrepôt, or break-of-bulk point, where goods are offloaded from large ships and transported to smaller vessels for distribution to the Southeast Asian community.

Figure 11.14 Singapore and Neighboring Countries

Singapore has made good strategic utilization of its geographic location by serving as a distribution center for goods and materials processed in the region. Crude oil from Indonesia is unloaded and refined here. Raw materials are shipped in, manufactured into finished products, and then shipped out to global markets. Since Singapore is small, it has had to concentrate on manufacturing goods that provide for optimal profits. As an economic tiger, Singapore has transitioned through the same stages as Taiwan, South Korea, and Hong Kong to become an economic power in Southeast Asia.

To keep labor costs low, initial manufactured products were textiles, clothing, and cheap goods. As incomes and labor skills rose, so did the complexity of the manufactured goods. The government of Singapore has targeted certain types of products to ensure a high profit margin and a global market need. This has included automation equipment, biotechnology, and high-end information technologies. Singapore doesn’t manufacture automobiles but it does manufacture automation robotic components that most modern auto manufactures will purchase and use. Medical technology is expensive and is in high demand the world over. Singapore is targeting this market. The information age has spawned new technologies that are evolving rapidly and, once again, Singapore has been at the center of this industry. Singapore has been a center for the production of computer disc drives for a multitude of global corporations.

Singapore Island is a swampy place with no natural resources. All production components, food goods, construction materials, and energy must be imported. Importing everything has raised the cost of living. To compete with the other Asian economic tigers in the global marketplace, Singapore has implemented severe control measures on its operations. There are harsh penalties for criminal activities and for even misdemeanor offenses. Singapore is a safe place to live because of its strict state rules. It has an authoritarian government, which strives to create an attractive place for international corporations to operate. One of the objectives is to eliminate corruption and establish a business-friendly environment.

Figure 11.15 Singapore’s Modern Development Modern high-rise office buildings fill the central business district of Singapore. The administrative district can be seen in the foreground complete with British colonial architecture, established when Singapore was a British colony.                                             Brian Evans – Singapore – CC BY-ND 2.0.

The government of Singapore has entered into trade agreements with two of its neighbors to provide raw materials and cheap labor. A trade triangle has been established between Singapore, Malaysia, and Indonesia. Malaysia and Indonesia provide Singapore with raw materials and cheap labor; Singapore provides its neighbors with technical know-how and financial support. Everyone benefits. Singapore is an excellent example of the upper end of the economic spectrum in Southeast Asia. Countries like Laos or Vietnam would be at the opposite end, since they have a largely rural population based on agriculture that is just beginning to shift to the cities with industrialization. Singapore is already 100 percent urban with high incomes based on high-tech manufacturing and processing of raw materials. Singapore is an economic hub for Southeast Asia, complete with global airline connections and is located on a major shipping lane. Singapore’s world-class port is one of the busiest in Asia. The rest of Southeast Asia is somewhere in between these two ends of the spectrum as far as economic development is concerned.

Indonesia

The country of Indonesia is the world’s largest archipelago state, consisting of more than 17,500 islands, about one-third of which are inhabited. Indonesia is the sixteenth-largest country in the world by area. The combined area of all the islands and regions of Indonesia would equal about the size of the country of Mexico. The country shares land borders with the Borneo side of Malaysia, the western half of the island of Timor, and the western portion of the island of New Guinea, which is shared with the country of Papua New Guinea.

The country’s location on both sides of the equator provides a tropical Type A climate, complete with a monsoon season. Average rainfall can vary from seventy to two hundred forty inches per year. The highest mountain is in West Papua and rises to about 16,024 feet. Indonesia is located on the Pacific Rim, where tectonic plate activity produces earthquakes and volcanic activity. The country is home to over one hundred fifty active volcanoes, including two of the most famous ones, Krakatoa and Tambora. Both had devastating eruptions in the past two centuries. One of the most violent volcanic explosions ever recorded in human history came from Krakatoa, which is located between the islands of Java and Sumatra. A series of eruptions in 1883 were heard as far away as the coast of Africa. Shockwaves reverberated around the globe seven times. Ash erupted into the atmosphere to a height of about fifty miles. The official death toll was 36,417, but estimates from local sources place it as high as 120,000. Global temperatures fell by about 2 °F, and weather patterns were disrupted for the next five years. Krakatoa remains active. Over the past few decades, the volcanic peak has been growing at the average rate of about five inches per week.

Figure 11.16 Major Islands and the Thirty-Three National Provinces of Indonesia                                                                                                                   Wikimedia Commons – CC BY-SA 3.0.

The tropical climate and the archipelago nature of the country provide for enormous biodiversity within the environment. Second only to Brazil in its biodiversity, Indonesia is host to an enormous number of unique plants and animals. The habitats of many of these creatures are being encroached upon by human activity. The remote islands have more of a chance of escaping habitat devastation and remaining intact, but agricultural and extractive economic activities have converted much of the natural environment into a cultural landscape that is not conducive to environmental sustainability.

Animals such as orangutans are losing their natural forests and may become extinct if current trends continue. The timber industry has brought about deforestation. Slash and burn agriculture has destroyed forest habitat, and human development patterns such as roads and urbanization have altered the ecosystems of the region. According to recent reports, Indonesia is one of the largest emitters of carbon dioxide in the world because of the high number of forest fires set each year. In 2009, the United States brokered a deal with Indonesia to forgive thirty million dollars of its debt if the country would work to protect forests on the island of Sumatra, which is home to endangered indigenous animals such as tigers, elephants, rhinos, and orangutans.

In 2010, the estimated population of Indonesia was about 245 million. Indonesia has the fourth-largest population of any country in the world, after the United States, India, and China. Indonesia also has more Muslims than any other country in the world. More than half the population of Indonesia lives on Java, the island where Jakarta, the capital city, is located. Java is the most populous island in the world, and has a population density of more than 2,400 people per square mile. Java is the size in area of the US state of Louisiana. Java has 135 million people, whereas Louisiana has 4.5 million people. Jakarta is a world-class city that is larger than New York City and encompasses a large metropolitan area, complete with many manufacturing centers, business complexes, and housing districts.

The many islands of Indonesia are home to a large number of diverse ethnic and religious groups that vary as widely as any Southeast Asian nation. There may be as many as three hundred different and distinct ethnic groups in Indonesia. Many of the ethnic groups are further divided by islands or distance. More than two hundred fifty separate languages and hundreds of additional dialects are spoken. There are an estimated seven hundred fifty languages spoken on the island of New Guinea itself, with hundreds of them spoken on the Indonesian side of the island, in a population of less than three million. The most prevalent language group in the country as a whole is Javanese, which is spoken by about 42 percent of the population. Javanese includes the official language of Indonesian, which is taught in schools and used in business and politics as the lingua franca of the country. Many people speak more than one language or even a number of languages to communicate throughout the country.

Islam was diffused to Indonesia in the thirteenth century and by the sixteenth century had become the dominant religion. The Indonesian constitution allows for religious freedom, although more than 85 percent of the population follows Islam. There are at least four other religions that are officially recognized: Christianity (both Protestantism and Roman Catholicism), Hinduism, Buddhism, and Confucianism. Since Islam is followed by such a large percentage of the population, the other religions do not carry the same influence. Regional and ethnic differences play a role in the varied religious dynamics. The island of Bali, for example, is home to a majority Hindu population. Most of the Buddhists are ethnically Chinese, and they only make up a small percentage of the population. Christians and Muslims have had conflicts on the island of Sulawesi. It is common to find the practice of these religions less than orthodox in the more rural communities of the country.

Figure 11.17 Skyline of Jakarta, the Capital of Indonesia.  Jakarta has a population of about ten million and is located on the island of Java. Java has more than 135 million people and has about the same physical area as the US state of Louisiana, which has about 4.5 million people. Java has more people than any other island in the world.                                                                         Global Panorama – Jakarta, Indonesia – CC BY-SA 2.0.

In spite of the diversity within the population, the country of Indonesia has established a substantial degree of nationalism as a centripetal force that holds the country together. There is a relatively high degree of stability in spite of the surface tensions or ethnic and religious conflicts that may erupt. An example of the social tensions is demonstrated in the case of Chinese citizens of Indonesia, who only make up about 1 percent of the population but impart a substantial influence over the privately owned business sector of the economy. This seemingly inequitable relationship has resulted in considerable resentment by other portions of the population, often with violent results. The many islands have become natural divisions between cultural groups.

Some of the islands—or portions of them—have attempted to break away in a devolutionary manner and become independent countries. Just as East Timor became independent, the most western province of Aceh on the island of Sumatra had a similar movement toward independence. West Papua on the island of New Guinea has also had an independence movement. The Aceh situation was negotiated out while the West Papua movement has been suppressed by military and political force. Many of the islands possess large amounts of natural resources, so the country of Indonesia does not want to lose these national assets that could prove valuable in gaining wealth for the future. It is not easy to create national unity with such a diverse population scattered throughout such a large archipelago.

Agriculture has been the historic base of the Indonesian economy. In 2010, it accounted for about 13 percent of the nation’s gross domestic product (GDP). Agriculture is the largest employment sector—approximately 42 percent of the workforce. This equates to more than half of the population being rural. Many of the agricultural methods in rural areas are traditional; for example, farmers use water buffalo or oxen for tilling the land. The tropical climate and adequate rainfall provide for multiple crops of rice per year in many areas. Spices, coffee, tea, palm oil, and rubber are also produced in substantial quantities.

Industries are an important building block for how a country gains wealth. In the case of Indonesia, industry accounts for about 40 percent of its GDP and employs about 20 percent of its workforce. Major industries include oil, natural gas, mining, and textiles or clothing manufacturing. Indonesia’s economy has been affected by global markets, but in 2005 still managed to run a trade surplus. Japan has been its main trading partner, and China has also been a major supplier of imported goods. Indonesia has been taking advantage of the trade triangle it has with its neighbors, Singapore and Malaysia, to increase its import and export trade activities.

The political background of Indonesia is similar in dynamics to many of its neighbors. Colonized by Europeans, Indonesia was previously called the Dutch East Indies, which explains why the islands of the Caribbean were called the West Indies. The Dutch colonized Indonesia in the early seventeenth century but had to relinquish possession of the archipelago to the Japanese in World War II. In 1945, after the Japanese surrendered, Indonesia declared its independence, which was finally granted in 1949 after much negotiation. The country’s government quickly moved toward authoritarian rule.

During a fifty-year time period, there were only two authoritarian leaders: Sukarno (1949–68) and Suharto (1968–99). Near the end of Sukarno’s rule, there were violent conflicts between Sukarno’s military and the Communist Party of Indonesia, which resulted in more than five hundred thousand deaths. Suharto’s regime was credited for substantial economic growth but was also accused of serious corruption and the repression of opposition political voices. Since 1999, Indonesia has conducted free parliamentary elections and is now considered the third-largest democracy, after India and the United States.

Brunei

There are noticeable similarities between the oil-rich sheikdoms of the Persian Gulf region in the Middle East and the small sultanate of Brunei on the northern coast of Borneo. Bordered by Sarawak, the sultanate is actually two small separate regions along the coast of the South China Sea. The former British protectorate of Brunei is today a major oil and natural gas exporter. It provides a high standard of living for its small population. The compact country is about the size of the US state of Delaware. The country’s population for 2009 was listed at about 388,000. Brunei is attracting immigrants seeking opportunities and advantages. It is called a sultanate because the kingdom has been ruled by sultans (rulers) from the same family for the past six centuries.

Figure 11.18 Brunei                                                                                        CIA World Factbook – public domain.

The main ethnic groups in Brunei are Malay, at 66 percent, and Chinese, at 11 percent. Brunei is an Islamic State with Islam as its state religion. About two-thirds of the population is Muslim. Buddhism is the second-most popular religion. The ruling sultan is not only head of state but also prime minister of the government and leader of the Islamic faith. Similar to states in the Middle East where Islam is the official religion, alcohol is banned and the public consumption or sale of it is illegal. Prohibition against alcohol has eliminated the establishments of pubs and nightclubs. Non-Muslims and visitors to the country can legally hold small quantities of alcohol for personal consumption.

The people of Brunei have a high standard of living, with the availability of modern amenities. The government has been concerned about integrating the country into the global economy. Natural gas and crude oil bring in about 90 percent of exports and just over half of the GDP. Education and medical care is free. Food, housing, and rice farming are subsidized by the state. The state has been working to expand the economy beyond natural gas and oil. Agricultural production has been increased and unemployment has been a major focus. The wealthy emirate has also been developing its tourism sector and the financial and banking industry.

Brunei may have to take a lesson from the United Arab Emirates (UAE)—that is, to work to develop a free trade zone to attract international trade—if the country wants to continue to gain wealth once the oil and natural gas run out. It has an excellent location on the South China Sea but would have to compete with the established economic tigers of Singapore and Hong Kong as well as the other rising urban centers in the region, such as Kuala Lumpur or Bangkok.

The Philippines

Located on the eastern side of the Southeast Asian community is the archipelago state of the Philippines. With more than 7,100 islands, many volcanic peaks, and an expanse of coastal waterways, the Philippines is home to more than ninety million people in a combined land area about the size of Arizona. The Philippines were a Spanish colony. The name is taken from Spain’s sixteen-century King Philip II. Spain relinquished its claim on the Philippines to the United States in 1898 after its defeat in the Spanish-American War. The people of the Philippines wanted independence at that time and fought a bitter war with the United States in which more than a million people died. The United States allowed the Philippines to become a commonwealth in 1935. The independence movement was placed on hold while the Japanese invaded and controlled the Philippines during World War II. After the war was over, the United States granted the Philippines their independence in 1946.

Environmental Forces

The islands of the Philippines are of volcanic origin. They are mainly mountainous and covered in tropical rainforest. The highest mountain, at 9,692 feet, is Mt. Apo, which is located on the southern island of Mindanao. The Philippines has a number of active volcanoes. The northern island of Luzon is home to the Taal Volcano, Mt. Pinatubo, and Mt. Mayon. The Pacific tectonic plate reaches the southern edge of the Philippine plate where it meets up with the Eurasian Plate. The juncture of tectonic plates creates a similar situation to that of Tokyo, which is at the opposite end of the Philippine plate. Active seismic forces result in many earthquakes. As many as twenty earthquakes a day can be registered here, though many are too weak to be noticed. In 1990, an earthquake on the island of Luzon registered at a magnitude of 7.8 and killed more than 1,621 people, causing extensive damage.

Figure 11.19 Ash Plume from Mt. Pinatubo during 1991 Eruption.  The island of Luzon in the Philippines has a number of active volcanoes. Ash from Mt. Pinatubo caused so much damage that it resulted in the permanent closure of major US military bases in the Philippines.                                                   UGS – public domain.

Luzon’s Mt. Pinatubo volcano has been active in recent years. Before 1991, the mountain attracted little attention, was heavily forested, and was home to tribal indigenous people. The volcano had a colossal eruption in 1991 that was recorded as the second largest in a century, after Alaska’s 1912 Novarupta eruption. Mt. Pinatubo began giving signs of an eruption, which were heeded by the government. Thousands of people were evacuated from the area, which saved many lives. The eruption caused billions of dollars in damage. More than eight hundred people were killed, and more than two million were directly impacted. The eruption destroyed more than eight thousand homes and the overall effects of the volcano were felt around the world.

Mt. Pinatubo’s eruption forced billions of tons of magma, ash, sulfur dioxide, minerals, and particulates into the atmosphere and onto the earth’s surface. The sun was blocked out, temperatures dropped, and ash piled up in nearby areas, causing extensive damage to roofs, roadways, and agricultural lands. The damage from the eruption was amplified by the fact that a full-scale typhoon hit the country on the same date, bringing torrential rainfall and wind that mixed with the ash in the air to create extremely dangerous environmental conditions. The damage had a massive impact on the entire economy of the Philippines.

The eruption severely damaged civilian infrastructure and US military bases in the region. The Subic Bay Naval Base was fifty miles to the southwest of Mt. Pinatubo’s summit, while Clark Air Base was less than sixteen miles to the east. Enormous clouds of ash covered everything. As a result of the damage to the operations at the bases, the United States Air Force evacuated and moved all air base personnel and military assets to bases in Guam, Okinawa, or Hawaii. The United States ultimately abandoned Clark Air Base, while Subic Bay reverted to the Philippines. There are thirty-seven volcanoes in the Philippines, of which eighteen are still active. Mt. Mayon is the most active volcano at the present time. It has had forty-seven eruptions in recorded history. The eruption in 1993 killed sixty-eight people and caused the evacuation of sixty thousand more.

Earthquakes and volcanoes are not the only serious natural concerns of the Philippine Islands; they are also directly in the center of the Western Pacific’s major typhoon belt. As many as twenty typhoons occur yearly in the area of the islands, and as many as half hit the islands directly. The 1991 typhoon Thelma/Uring killed as many as eight thousand people. The 1911 typhoon dumped over forty-six inches of rain in a twenty-four-hour period. Flooding is usually the main problem with typhoons and is the number one killer related to typhoon deaths. For more information, see Chapter 5 “Middle America”, Section 5.5 “Tropical Cyclones (Hurricanes)”. Typhoon activity also brings precipitation to the islands and the region. The Philippines are in the major path of typhoons in the Pacific and will continue to combat the effects of these powerful forces of nature.

Political Geography

The Philippines can be divided into three main geopolitical regions: Luzon, Visayas, and Mindanao. The northern island of Luzon is home to the nation’s national capital region with Quezon, the largest city, and Manila, the capital. Both cities are a part of metropolitan Manila, which has a population of more than twenty million. The northern island of Luzon is home to half the population of the country. The central Philippines consists of the Visayas Island group, including the islands between the Sulu Sea and the Philippine Sea. The southern region of the country is anchored by the large island of Mindanao.

Figure 11.20 The Three Main Regions of the Philippines      CIA World Factbook – public domain. 

The government of the Philippines is a constitutional republic with an elected president. With independence in 1946 came various leaders who have shaped the political landscape of the Philippines. After recovering from the devastation of World War II, the country prospered during the 1960s and showed positive economic gains. The political scene entered a difficult political era with the election of President Ferdinand Marcos in 1965, which turned into an authoritative dictatorship. During his time in power, the economy became sluggish and social unrest began to arise in opposition to his leadership.

Barred by law from being elected for a third time, Ferdinand Marcos declared martial law in 1972 under the premise that there was too much political conflict with Communist elements and Islamic insurgencies. Marcos ruled with his wife Imelda Marcos until 1986, when conditions worsened and the two were implicated in the assassination of opposition leader Benigno Aquino. Corruption, vote rigging, and the dictatorial actions of President Marcos caught up with him through mass protests, which eventually led to his removal from office. He left the Philippines for his exile in Hawaii. It was later alleged that during his twenty years in office, Ferdinand and Imelda Marcos had embezzled billions of dollars of public funds and moved them to bank accounts in Switzerland, the United States, other countries, and into fictitious money-laundering corporations. Ferdinand Marcos died of illness in 1989 in Honolulu.

Imelda Marcos returned to the Philippines to run for public office and even attempted a failed run for the presidency. Imelda was known for her thousands of shoes, which she had acquired while in power. Many of them are in a shoe museum in the Philippines. She was also known for her extravagant spending trips around the world. Several different political leaders have come to power since the Ferdinand Marcos era. Political stability has been difficult to achieve. The national leadership has faced Islamic insurgencies, attempted coups, corruption in the government, and a high national debt. These issues continue today but a modest level of stability has encouraged economic growth.

Cultural Geography

The Philippines is a diverse country with hundreds of ethnic groups. Many tribal groups as well as a large number of immigrants from Asia, Spain, and the United States have made the Philippines home. Together with Spanish influence, mixed ethnic groups have been created. They are an example of the confluence of cultures that make up the country. The Philippines is the only country in Asia where Roman Catholicism predominates, other than recently independent East Timor.

Figure 11.21 Ferdinand Magellan brought Christianity to the Philippines and converted members of the Cebuano tribe to Catholicism in 1521. Lezumbalaberenjena – Catedral de Santa Clara – CC BY-NC-ND 2.0.

Christians make up about 90 percent of the population. All but 10 percent identify themselves as Roman Catholic. A modest Muslim population is prominent in the southern island of Mindanao and neighboring islands. Islamic fundamentalism has increased the insurgency in the region, causing political and economic turmoil and conflict. People of Chinese heritage often follow Buddhism, Taoism, or Chinese folk religions. Various tribal groups still follow their cultural animist beliefs and have traditional shaman religious leaders.

The Philippines is home to more than one hundred eighty native languages and dialects. English and Filipino were declared the official languages of the Philippines in 1987. Tagalog is the main language spoken. Filipino is a version of Tagalog that is used in many of the urban areas. English and Tagalog are used in different parts of the country. The population growth rate is considerable. The Philippines will soon push past the one hundred million mark, at which point it will become a country in which 35 percent of its citizens are under the age of fifteen. Average family size is more than 3.2, which will continue to influence the economic situation of the country.

The Global Economy and Outsourcing

The modest level of political stability has caused the Philippines to become an attractive destination for global corporations who seek to outsource their information and technology service jobs. Any work that can be conducted over the Internet or telephone can be outsourced to anywhere in the world with high-speed communication links. Countries that are attractive to business process outsourcing (BPO) are countries where the English language is prominent, where employment costs are low, and where there is an adequate labor base of skilled or educated workers that can be trained in the services required. All three of these requirements are met by the labor force of the Philippines. The historical influence of the United States has provided a base of English language speakers. The country also has an adequate population base with the education or professional skills necessary to meet these demands. Corporate colonialism has the Philippines in its business focus and is finding a good source of available labor.

In 2005, information technology and BPO amounted to about thirty-four billion dollars globally. Since 2005, that amount has increased dramatically, doubling and tripling in some countries by 2009. India has been a major destination for BPO, but the Philippines is gaining ground and increasing its infrastructure in an attempt to gain a larger share of the market. Other countries around the world are a part of this outsourcing market. This type of business activity shifts jobs from one country to another. A country might lose these types of jobs, but its corporations can remain competitive in the global marketplace if they can cut costs of operation by outsourcing their service work to a low-cost country.

Figure 11.22 Street Scene in Manila with Jeepney on the Left and a Bicycle Card Front and Center The greater metropolitan region of Manila has more than twenty million people. The city of Manila itself is one of the most densely populated large cities in the world.                                                                 Stefan Munder – Manila – CC BY 2.0.

Jeepneys

The term jeepney is derived from the use of early US army jeeps left over from World War II that were used as base vehicles transformed into a type of taxi. These transformed vehicles took on a cultural identity as jeepneys with their flamboyant colors and extended seating. Jeepneys are now produced for this purpose and are the most widely used public transportation mode in the Philippines. An electric version of the jeepney is being developed for a number of Asian countries.

US corporate giants like America Online, Texas Instruments, Citibank, Hewlett Packard, JPMorgan Chase & Co., and the McClatchy Company (third-largest US newspaper company) have been shifting call centers and other back-office functions to the Philippines. Other European companies like Germany’s global Siemens Corporation, Royal Dutch Shell, Swedish Telecom provider Ericsson Telecommunications, and Danish shipping giant Maersk are examples of corporations that have established outsourcing centers in the Philippines. The economic savings can be considerable. BPO wages in the Philippines are one-fifth of the wages paid for the same jobs in the United States. Those same wages are double the national average wages for Philippine employees. A rise in the number of outsourced jobs is welcome news for the Philippines, whose economy is in need of a boost.

East Timor (Timor-Leste)

Timor is an island of southern Indonesia not far from Australia. The island is divided by its colonial history. The eastern half was a Portuguese colony beginning in the sixteenth century. Portuguese colonizers introduced Christianity in the form of Roman Catholicism. The western half was associated with Indonesia, which was a Dutch colony during the colonial era. The Japanese occupied the Dutch colony during World War II but had to give it up after they surrendered in 1945. Indonesia received its independence in 1949 and laid claim to the whole island of Timor. East Timor made a declaration of independence in 1975 but was occupied by Indonesia. A bitter civil war erupted. A year later, Indonesia declared it its twenty-seventh province. The civil war resulted in the deaths of as many as two hundred fifty thousand people. It wasn’t until 1999 that Indonesia finally ceded its political control over East Timor. The Australian military has been instrumental in securing East Timor for independence, and has been serving as a peacekeeping force for internal security for the past decade. The United Nations (UN) recognized East Timor as a sovereign independent country in 2002. The official name of the country is listed as Timor-Leste.

Timor-Leste has a population of about 1.2 million. About 98 percent of the population is Roman Catholic. The only other predominant Catholic country in Asia is the Philippines. About 90 percent of the population still works in agriculture. The country has had a difficult time establishing a stable government and reducing conflict. Almost all its infrastructure was damaged in the civil war and rebuilding has been slow. Poor and impoverished due to the civil war over independence, the country does have some opportunity derived from the large natural gas field in the vicinity. East Timor has been working to gain control of its maritime boundaries to benefit from the offshore natural resources.