While Southeast Asian economies have been fast expanding in the last decade, better than most regions, wealth and income inequality—i.e., the gap between the rich and poor—has been equally growing.
The United Nations Economic and Social Commission for Asia and the Pacific (UN Escap) reports that “Southeast Asia has seen inequalities widen, a setback to overcome” if Goal 10 (reduced inequality within and among countries) of the UN’s 17 Sustainable Development Goals (SDGs) is to be achieved.
The Asean Post remarks on the disturbing wealth and income disparities in Southeast Asian societies:
“The richest 1% in Thailand controls 58% of the country’s wealth and the top 10% earned 35 times more than the bottom 10%. In Indonesia, the four richest men there have more wealth than the poorest 100 million people, and about 50% of the country’s wealth is in the hands of the top 1%. In Vietnam, 210 of the country’s super-rich earn more than enough in a year to lift 3.2 million people out of poverty. The country’s richest man earns more in a day than the poorest person earns in 10 years.
“In Malaysia, while only 0.6% of its 31 million people are living under the poverty line, 34% of the country’s indigenous people and 7% of children in urban low-cost housing projects live in poverty. In the Philippines, the average annual family income of the top 10% is estimated at US$14,708 in 2015, nine times more than the lowest 10% at US$1,609.”
The World Bank estimates that two Southeast Asian countries, the Philippines (42.3) and Malaysia (41.1), have crossed the borderline index of 40, which is seen as the danger zone for the Gini inequality index (See Table 4). Singapore (39.8), Laos (38.8), and Indonesia (38.2) are dangerously close to the borderline. (Note: The Gini index, or Gini coefficient, ranges from 0, or 0%, to 100, or 100%, with 0 representing perfect equality and 100 representing perfect inequality.)
|Table 4: Inequality in Southeast Asia (Based on the Gini Index)|
|Source: World Bank n.d.; Singapore Department of Statistics 2022.|
The UN Escap reports that Southeast Asia fares badly in all but one of the UN SDGs to be achieved by 2030. It reports that for Goal 1 (ending poverty), progress is hampered by a lack of social spending for health and education and natural disasters. Progress for Goal 2 (zero hunger) is slow, and food insecurity continues to affect 100 million people in the region. Regression is also observed in Goal 7 (sustainable energy), Goal 13 (climate action), Goal 14 (life below water), and Goal 16 (peace, justice, and strong institutions).
The Escap further notes stagnation or lack of progress in Goal 11 (sustainable cities and communities), Goal 12 (responsible consumption and production), Goal 15 (life on land), and Goal 17 (partnership for the goals). It is only in Goal 9 (innovation, industry, and infrastructure) that Southeast Asia is on track. The latter index means that corporate and other business interests have been the sole concern of Southeast Asian governments, to the neglect of the rest of society.
Southeast Asia also lags when it comes to bridging digital divides. While Brunei, Malaysia, and Singapore have high rates of internet users (84 to 94%), Laos, Myanmar, and Timor-Leste have less than 30% of their populations having digital access.
In another report, the UN Social and Economic Council notes that social protection in Southeast Asia is similarly wanting, with 62 to 88% of vulnerable populations deprived of benefits. Of the region’s total population, only 33% is covered by at least one social protection benefit.
The low proportions of the region’s population covered by social protection systems are:
- Children receiving cash benefits (22.2%).
- Mothers with newborns receiving maternity cash benefits (28%).
- Older persons with pensions (37.8%).
- Unemployed receiving unemployment cash benefits (12.3%).
- Persons with disabilities collecting disability cash benefits (28%).
- Vulnerable individuals receiving cash assistance (21%).
Corruption continues to be prevalent in the Asia-Pacific where, “like most of the world, scores have stagnated over the last decade, as noted by Transparency International.” High levels of corruption contribute to rising uncertainty and exacerbate the effects of the Covid-19 pandemic, climate change, and security and economic threats. Politically, corruption bloats the power of authoritarian rulers, adds to the democratic deficit, and marginalizes civil society organizations.
Transparency International’s corruption perceptions index shows that six of the 10 Southeast Asian countries ranked are in the bottom half of the 180 countries surveyed (Table 5). These are Thailand (101st), Indonesia (110th), the Philippines (116th), Laos (126th), Cambodia (150th), and Myanmar (157th). In terms of scores, however, only Singapore registered an excellent 83 (out of 100) and ranked fifth among all countries even as it dropped two places from 2021. The nine other countries had scores below 50.
|Table 5: Corruption Perceptions IndexSoutheast Asia 2022|
|No. of countries ranked = 180. 100 is very clean and 0 is highly corrupt; Brunei was not ranked |
Source: Transparency International 2022.
Like many countries in the developing world, most Southeast Asian countries suffer from fragile health care systems. These have been strained heavily by the pandemic, resulting in staff losses due to burnout and depression as well as pandemic-related deaths. Further complicating the health care situation is the accelerated exodus of medical personnel to developed countries.
The UN World Health Organization noted that “55 countries with some of the world’s fragile health systems do not have enough [health care workers] and many are losing [them] to international migration.” Southeast Asian countries with high levels of health care workers’ out migration include the Philippines, Indonesia, Vietnam, Myanmar, Thailand, Laos and East Timor.
Southeast Asian governments need to address these social flashpoints if sustainable development is to achieved. A redirection of development strategies is needed—one which addresses issues of social protection and wealth inequalities alongside attention to economic growth. Obviously, the two concerns cannot be separated from each other.
To illustrate, a February 2022 report by the UN Development Program strongly argues that “the highest reductions in inequality have been achieved by countries that invest in universal social security” and imposed “higher levels of taxation from the wealthier members of society, which is then redistributed across the population.”
This article is excerpted, revised and updated from the author’s introduction “Post-pandemic Southeast Asia: Systemic perils and peoples’ alternatives” to Re-Imagining Post-Pandemic Societies: Alternative Practices Across Southeast Asia: Volume II, Monograph Series 2023-03. UP Center for Integrative and Development Studies. Read the full report here: https://cids.up.edu.ph/download/re-imagining-post-pandemic-societies-alternative-practices-across-southeast-asia-volume-2/. —Ed.