Malaysia and Indonesia are Southeast Asian neighbours. They also share a similar history of European colonisation, the Indonesians breaking free of Dutch rule in 1949, the majority of Malaysians from Great Britain in 1957. Development in both countries followed a similar path in the wake of independence. A strong, autocratic leadership took control of each country, enacting wide-ranging economic reforms based on export-led growth, nationalisation of key industries and stringent wage labour controls.
One party dominated the political landscape in each country for much of the late 20th century. In Indonesia, after the overthrow of Sukarno in 1967, that party was Golkar, led with resolute conviction by President Suharto. In Malaysia, it was the United Malays National Organisation (UMNO). Along with their coalition partners from the Chinese (Malaysian Chinese Association) and Indian (Malaysian Indian Congress) minority ethnic groups in Malaysia, the UMNO formed the formidable Barisan Nasional (BN). Amongst several strongmen leaders, Mahathir bin Mohamad (1981-2003) is probably the most famous.
The difference between Golkar and the BN? The BN remains in control in Malaysia, most recently through a disputed election victory on the weekend; Golkar has for several years ceased to be the lead party in Indonesia.
Malaysia has Southeast Asia’s third-biggest economy. Not something to be sniffed at but the economic potential of the country is even greater. It is held back by an economic bias in favour of ethnic Malays (the Bumiputera), to the detriment of the industrious and well-connected Chinese and Indian minorities. In addition, nepotism, cronyism and corruption exist at the highest levels of government, restricting fair and productive economic competition.
Indonesia has its fair share of corruption problems and President Susilo Bambang Yudhoyono has staked his reputation on eradicating such hindrances (with debatable success). However, with its Muslim homogeneity, Indonesia doesn’t have the same ethnic considerations as Malaysia. When the economy crashed in the wake of the Asian Financial Crisis of 1997-98, Suharto was forced to resign, his iron grip no longer tolerated by the majority of the population in the face of economic collapse. Domestic, combined with international and regional pressure, drew an unprecedented concession from a post-independence party. Golkar has not been elected to power since, only forming a junior coalition partner.
Domestic pressure for political and, by extension, economic reform, has grown in recent years in Malaysia. Centred around the charismatic and frequently-imprisoned Anwar Ibrahim, the Pakatan Rakyat (PR) coalition has mobilised civil society in a way rarely seen in Southeast Asia. Yet, despite economic discrimination, Malaysia has yet to suffer the same sought of financial meltdown as Indonesia did to shake the foundations of the BN. Furthermore, whilst Indian and Chinese voters are increasingly turning towards the PR, whilst their ethnic groups are still represented within the ruling BN, the prospects of domestically-inspired change are slim. Simultaneously, many of the Bumiputera retain a debt of gratitude towards the BN for their forceful attempts to eradicate Malay poverty in the 1970s and continue to support them blindly.
Anwar Ibrahim and his followers may hope that China uses its regional influence to force change in Malaysia to benefit the Chinese Malays. However, China remains committed to the ASEAN principle of non-interference in another state’s domestic affairs so this hope, too, remains elusive.
Whilst Indonesia is by no means the most democratic country in the world, the removal of Suharto and the transition to a more competitive political atmosphere has, in turn, helped inspire healthy economic competition and made the country appealing to foreign investors. As long as the BN continues to cling to power, through legal or more dubious means, Malaysia’s development will remain stalled and the prospects of popular discontent mutating into something far more unsavoury will continue to grow.