Malaysia and Thailand: Models for Economic Development at the Margins?

Abstract

In the new international division of labour/power, much talk centres on the performance of the NICs and near-NICs, especially as potential models for other Third World state economic development. This chapter addresses the question of whether or not it is possible to use the relative success of Malaysia and Thailand as a model for other developing countries in their search for economic development. Malaysia and Thailand have in recent years been singled out by a wide variety of analysts as next in line to become ‘newly industrializing countries’, or NICs. They have a high rate of economic growth, their economic prosperity is driven by a rapid expansion of the manufacturing sector and like the Asian NICs — South Korea, Taiwan, Hong Kong and Singapore — they have become significant exporters of manufactured goods. Moreover, unlike the Asian NICs they appear to be more closely akin to the general population of developing countries. They are not, like Hong Kong and Singapore, Chinese-dominated city-state entrepots that turned to export-oriented industrialization out of a lack of an internal market. Nor do they at first glance appear to have the set of prerequisites for success that are often cited in the cases of South Korea and Taiwan: advantages accruing from the period of Japanese colonial occupation, massive US aid and support for key policy changes, timely entry into the US market place, strong central governments and a relatively homogeneous population with cultural values that facilitate economic development.KeywordsForeign Direct InvestmentJapanese ColonialAsian NICsJapanese Foreign Direct InvestmentMalaysian EconomyThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.