Under siege? Economic globalization and Chinese business in Southeast Asia

To some observers, economic globalization has led to the end of the nation state and geography It is assumed that globalization erodes national differences and geographical heterogeneity. This globalization discourse has a life of its own because it shapes neoliberal thought in economics and politics. In this paper, I attempt to challenge this 'strong globalization' reading of the global political economy. I argue that, instead of leading to a 'borderless' world, economic globalization continues to reinforce national diversity in the face of global capitalism. This argument is particularly relevant to the recent economic crisis in Southeast Asia where Chinese business serves as a dominant mode of capitalism. Through two case studies of Chinese capitalism, I argue that globalization is a highly contested process. On the one hand, it poses a serious threat to the practice and social organization of Chinese capitalism in Southeast Asia. The recent collapse of Peregrine Investment Holdings is a good example of how globalization has put Chinese business under siege. On the other hand, globalization presents opportunities for such social institutions as Chinese business firms to take advantage. The latest move of the Malaysian government to relax its twenty-seven-year old bumiputra equity ownership restrictions to allow more equity ownership of local companies by non-Malays and foreigners exemplifies both the pragmatic response of nation states to globalization and the unintended opportunities opened to Chinese capitalists. Taken together, this paper argues for a historically and geographically contingent reading of the impact and processes of economic globalization, It also suggests some implications for the future of Chinese capitalism in Southeast Asia under globalization.