Southeast Asian Economies Research Articles

Insights on household’s resilience to shocks and poverty: evidence from panel data for two emerging economies in Southeast Asia

ABSTRACT Given the importance of understanding the resilience of rural households to shocks and poverty in developing countries, we consider resilience as a capacity and estimate a (latent) variable reflecting household’s resilience capacity, and we investigate how better resilience capacity can help rural households mitigate the negative impacts of shocks and improve their welfare. We use panel data of 3367 households from two emerging economies in Southeast Asia collected in three survey waves for empirical analyses. We use a generalized structural equation model to estimate the latent variable of household’s resilience capacity. Then, the results of fixed-effects estimations show that the lagged resilience capacity of rural households is significantly and negatively correlated with losses caused by different types of shocks. Moreover, the results of fixed-effects estimations with a control function approach indicate that an improvement in resilience capacity can prevent rural households from falling into poverty in absolute and multidimensional terms.

Analysis of factors affecting financial distress in Vietnam – an emerging economy in East Asia

Understanding the conditions leading to business failure and predicting them earlier is the best way for companies to overcome and minimize their harm, improve their performance, and avoid financial distress and bankruptcy. This paper aims to measure the level and trends of factors affecting financial distress in Vietnam – an emerging Southeast Asian economy, along with the managerial implications drawn from the research results. Research data were collected from 606 firms listed on the Vietnam Stock Exchange from 2018 to 2022. The Altman Z-score is used to determine the financial distress of these firms. The factors researched and tested in this study are all internal factors divided into two groups with distinct features. Non-financial factors belong to management characteristics; financial factors are typical indicators of a firm’s financial statements. The study uses OLS, FEM, and REM models to analyze the influence of financial factors (Total liability to Total assets, Sales growth, Firm size, and Firm age) and non-financial factors (Board size, CEO duality, Institutional ownership level, Independent member, and Foreign CEOs) on financial distress and GLS regression to overcome the model’s shortcomings. The results show that the factors in the research model significantly impact financial distress, of which six factors (Board size, CEO duality, Institutional ownership level, Foreign CEOs, Sales growth, and Firm age) are negatively correlated. Three other factors (Independent members, Total liability to Total assets, and Firm size) are positively correlated with financial distress. AcknowledgmentThe author thanks everyone who helped make this study possible.

Imperative Individual Effect of Resource Rents Towards Environmental Sustainability in Southeast Asian Economies

The aim of existing research is to analyze both the overall and specific impressions of natural resource rents on ecological damage within Southeast Asian countries. The study intentions to assess the inverted U-shaped foundation within the context of economically developing nations in Southeast Asia. The experiential findings from FM-OLS and D-OLS indicate that the initial phase of U shape EKC is supported by economic growth and carbon gas releases positive relationship over the long term. Nonetheless, the opposing impression of squared form of growth on carbon gas releases illustrates the inverted U formed premise of EKC in unindustrialized Southeast Asian markets. Simultaneously, consumption of renewable energy paradoxically undermines environmental cleanliness due to its favorable bearing on carbon gas releases. At the level of individual natural resources, coal rent positively influences carbon gas releases. Further, forest plus oil rentals subsidize to the lessening of carbon gas releases. Nonetheless, forest resource rents represent the most significant environmentally sustainable indicator. This suggests that the growth rate of emerging economies is boosted by forest rentals, which also perform a starring role in mitigating damage to the environment. The overall level of natural resources, along with the aggregate of resource rentals, has a optimistic control on atmospheric carbon dioxide secretions and contributes to environmental degradation over time.

Cultural Dimensions and Consumption Values of Cross-Border Electronic Commerce: A Canonical Analysis

The purpose of this research is to explore the fitting models for cross-border e-commerce by developing localized business strategies tailored to cultural factors. The study adopts Hofstede’s five cultural dimensions along with Sheth et al.’s five consumption value dimensions. A canonical correlation analysis is employed to identify the fitting relationships between cultural dimensions and consumer values. The targeting samples focus on the rapidly growing Southeast Asian economy. The results indicate differences in cultural dimensions among countries like Taiwan, Vietnam, Malaysia, Indonesia, and Myanmar. The canonical correlation analysis reveals fitting combinations for each region: Taiwan’s higher individualism, masculinity, and long-term orientation align with demands for functional, conditional, and emotional values in e-commerce. Vietnam’s high risk-taking propensity fits demands for conditional and epistemic values. Malaysia and Indonesia, with similar cultural profiles, are highly correlated with consumer demands in functional and emotional values, with Malaysia additionally emphasizing epistemic value. Myanmar’s high masculinity and long-term orientation correlate with demands for functional, emotional, and conditional values, while its low power distance links to demands for social and epistemic values. Overall, the study shows that there is no fixed correspondence between cultural dimensions and consumption values in e-commerce. Optimal configurations vary, emphasizing the importance of tailored strategies to promote e-commerce development across different regions.

CHALLENGES AND PROBLEMS IN LABOUR LAW FROM THE PERSPECTIVES OF INDONESIA AND MALAYSIA

This study provides a critical comparative study of the labour laws of Indonesia and Malaysia, two of the most prosperous economies in Southeast Asia, but with different legal systems due to their respective political, socio-economic and colonial legacies. A wide range of topics were discussed, covering almost all major issues related to the laws affecting practise, namely historical development and legal reforms, current challenges related to wage inequality, migrant workers and enforcement of labour protection. A qualitative comparative analysis was conducted based on primary legal documents, including the Indonesian Omnibus Law on Job Creation and the Malaysian Employment Act 1955 as amended, supplemented by secondary sources such as policy papers and academic articles. The findings suggest that decentralisation in Indonesia leads to uneven enforcement across regions, while Malaysia's centralised administration falls short in protecting migrant workers. In both countries, economic growth clashes with labour rights, with Indonesia struggling with a largely informal sector and Malaysia with a very high dependence on migrant workers. The discussion emphasises the fact that while recent legislative reforms have taken place, weak enforcement and problematic dispute resolution reflect the persistent problems. The study concludes by outlining policy implications that support strengthening enforcement mechanisms, formalising the informal sector and adhering to international labour standards to promote good employment practises. The results obtained with such a methodology contribute to the discourse on labour law and provide insights for policy makers, academics and other stakeholders concerned with the dynamics of the labour market in Southeast Asia.

ANALYSIS OF SYARIAH BANKS' FINANCIAL PERFORMANCE BEFORE, DURING AND AFTER THE COVID-19 PANDEMIC IN SOUTHEAST ASIA: THE CAMEL APPROACH

The outbreak of Covid-19 has had an impact on several sectors, including the economy in Southeast Asia, which has an important role in the global supply chain. Covid-19 has an impact on the decline in Real GDP which causes a decline in economic growth which is followed by a recession which causes weak financial performance of Sharia Banking. This research is a type of quantitative research with a comparative approach. This research aims to find out whether there are differences in the financial performance of Islamic banks in Southeast Asia before, during and after the Covid-19 pandemic. The variables used to measure banking performance are CAR, NPF, ROA, BOPO and FDR. The data used is secondary data in the form of documentation of banking financial reports obtained from the financial reports of each Islamic bank. The population of this research is all sharia banking which is included in "The Largest Islamic Bank 2020-2023" according to The Asian Banker, sample selection was carried out using purposive sampling technique, the number of samples for this research was 26 sharia banks. The data analysis method used is the difference test with the Wilcoxon sign test. The results of this study show that before and after there are significant differences as measured by CAR and ROA. Meanwhile, the NPF, BOPO and FDR ratios show that there are no significant differences. Conditions during and after Covid-19 as measured by the BOPO ratio have significant differences. Meanwhile, the CAR, NPF, ROA, FDR ratios show that there are no significant differences.

Vietnamese young consumers’ green purchase behavior: Does green trust matter?

It is crucial to practice environmentally responsible purchasing since impulsive purchases can damage the environment. Green purchase behavior (GP) can help consumers lessen their environmental impact. An integrated structural model of GP was developed by drawing on postulates from the Protection Motivation Theory (PMT). A total of 302 Vietnamese university students were surveyed using the snowball sampling method. It was found through structural equation modeling (SEM) that there is a significant association between perceived severity (PS), perceived vulnerability (PV), and GP. The relationship between PS, PV, and GP is mediated by attitude toward green purchase (ATT). Also, green trust (GTR) plays a significant moderating role in the PV and GP relationship. The findings, including the correlations between the variables, provide credence to the suggested theoretical framework. Since studies on environmental problems and green purchasing behavior are still in their early stages, this work helps fill a gap in our understanding of the phenomenon in the context of Vietnam, a developing Southeast Asian economy. This research may help manufacturers and marketers of green products encourage the use of their products to improve environmentally friendly and sustainable behavior. The findings suggest marketers and manufacturers should emphasize environmental pollution's perceived severity and vulnerability. It is also critical to establish consumers' trust in green marketing.

Retraction Note: Does the individual effect of resource rents imperative in the attainment of environmental sustainability? Evidence of Southeast Asian economies.

Retraction Note: Does the individual effect of resource rents imperative in the attainment of environmental sustainability? Evidence of Southeast Asian economies.

Impact of Digital Marketing, Influencer, Live Features, and Reviews Shopee Purchase With Brand Image

The advancement of information and communication technology in the digital era has revolutionized various aspects of human life, including in the realm of business and marketing. Marketing activities that once relied on direct interaction between sellers and buyers have now shifted towards digital marketing that utilizes online platforms. Indonesia, as the largest economy in Southeast Asia, has made an e-commerce as the main driver of socioeconomic growth. Supported by a population of over 270 million people and ever-increasing internet penetration, the development of e-commerce in Indonesia has experienced rapid progress in recent years. This study aims to analyze the impact of digital marketing, influencer marketing, live features, and Online Customer Reviews on online purchase decisions on the Shopee platform with brand Image as an intervening variable. This research used a quantitative method with a data collection technique through an online questionnaire to 210 Shopee users in Indonesia. The measurement of construct validity and reliability was carried out using the measurement model (outer model). Then, the structural model (inner model) was used to test the model's strength, predictive ability, model significance, and the direct and indirect influence of independent variables on the dependent variable. The test tool employed SmartPLS 3.0. The results of this study indicate that the variables of Digital Marketing, Live Features, and Brand Image have a significant influence on Purchase Decisions on Shopee e-commerce. Furthermore, the variables of influencer marketing, live features, and Online Customer Review have a significant influence on Brand Image on Shopee e-commerce. Meanwhile, for the indirect influence, the variable live features have a significant influence on purchase decisions on Shopee e-commerce through Brand Image as an intervening variable.

Innovation and Entrepreneurship in Southeast Asia: The Role of Geographical Indications

The Southeast Asian economies have been highly proactive in developing Geographical Indicators (GIs) within their jurisdictions. For instance, Thailand developed its “One Tambon One Product” (OTOP) project to support community co-operatives in tambons (sub-districts) and villages throughout Thailand. The aim was to increase village incomes and preserve local wisdom. This followed Japan's One Village One Product (OVOP) program. This was followed by its “One Province, One GI” to encourage each of its 76 provinces and Bangkok to develop at least one GI product. The aim was to increase village incomes and preserve local wisdom. Subsequently, the Lao People’s Democratic Republic (PDR) established its One District One Product (ODOP) program. In addition, local communities throughout most of the eleven Southeast Asian Nations, often with the support of external development agencies, have protected their products using GIs or Trademark legislation. The number of domestic GIs registered within the eleven Southeast Asian nations as of April 2024 was Cambodia with seven, Indonesia with 127, Lao PDR with six, Malaysia with 79, Thailand with 194, and Vietnam with 94. These cover both agricultural and non-agricultural products, with the majority in each jurisdiction being the agricultural sector. This paper outlines the legislative framework of GI protection of products from the above jurisdictions and how the legislation has provided a framework for local entrepreneurs and communities to develop and protect local products, thus improving the quality of life of those local communities, whether as producers or providers of labour. Cambodia and Lao PDR have also followed a different path to registering GIs as they are parties to the World Intellectual Property Organisation’s Geneva Act, which provides a one-stop shop for registering GIs. Products protected by the relevant legislation include agricultural products, products derived from agricultural products, cooked food, handicrafts, and woven cloth, including associated designs and pottery methods and designs. Three examples are provided in detail: Kampot Pepper – Producers return to ancestral lands after 40 years of civil war and unrest; Bolaven Coffee – International development agencies support small landholders to form a co-operative to support the development of their community; and Mak Mao Berry Juice – One man’s 30-year passion to commercialise a local product.

Transboundary viral diseases of pigs, poultry and ruminants in Southeast Asia: a systematic review

Livestock is a strategic part of the small-farm economy in Southeast Asia’s society, providing food income, clothing, fertilizer, and draught power. However, incidences or outbreaks of transboundary animal diseases (TADs) are due to converging factors such as the natural hazards’ aftermath, climate change, deforestation, urban growth, changing production conditions, and market chains. Therefore, this affects productivity and impacts farmers’ livelihoods with small holdings. The literature review was carried out to understand the current situation of TADs in Southeast Asia, identifying knowledge gaps to provide actions for disease control and prevention in the region. We have attempted to summarise the scientific literature in English on the prevalence data of TADs in Southeast Asia between 2011 and March 2022. Relatively few studies evaluated the distribution of TAD, where most of the studies focused on diseases that are important for international trade, such as avian influenza (AI), African swine fever (ASF), classical swine fever (CSF), foot-and-mouth disease (FMD) and Newcastle disease (ND). Traditional production systems have received little attention in such studies as they belonged to mainly smallholders. The outbreaks of ASF and lumpy skin disease (LSD) in 2019 resulted in increased research activity between 2019-2022, while the other TADs were ignored in this period. For new emerging TADs diseases such as ASF and LSD, there is only information about the first detection without prevalence information. Therefore, further epidemiological investigations are necessary to reduce the gaps in disease surveillance reporting systems and support the prevention and reduction of further outbreaks.

Alih Fungsi Bahu Jalan sebagai Lahan Parkir di Kabupaten Lumajang

Indonesia, as the largest economy in Southeast Asia, has witnessed significant infrastructure development driven by government efforts to foster sustainable economic growth. This development, particularly in urban areas, has led to increased land demand and the repurposing of public spaces. Lumajang Regency in East Java Province, known for its tourism and mining potential, has experienced substantial population growth, with a 9.37% increase between 2018 and 2022, according to the Central Statistics Agency. This growth has heightened the need for adequate infrastructure, including parking facilities. This study investigates the local government's policy on the repurposing of road shoulders for parking in Lumajang Regency. Employing a normative legal research method, the study examines relevant laws and regulations, including primary legal materials such as the 1945 Constitution of the Republic of Indonesia, Law No. 22 of 2009 on Road Traffic and Transportation, and specific local regulations in Lumajang Regency. The findings indicate that the unauthorized use of road shoulders as parking spaces, especially on Jalan Jend. S. Parman and Jalan Alun-Alun Utara, has caused significant inconvenience and traffic congestion. The study emphasizes the need for proper implementation of parking regulations, including the installation of appropriate signage and road markings, as required by law. The research concludes that the misuse of road shoulders for parking contravenes existing regulations, highlighting the urgent need for improved enforcement of parking policies in Lumajang Regency to manage traffic flow and public convenience effectively.

Strategic exploration of sustainable drivers in innovating decision-making for disruptive policies through a facial expression-based fuzzy model

ABSTRACT The purpose of this study is to identify critical factors that affect the performance of disruptive innovation of the companies. In this process, a novel decision-making model has been constructed to achieve this objective. First, selected indicators for effective disruptive innovation policies are analysed with facial expression-based quantum spherical fuzzy DEMATEL. Furthermore, the second stage of the model consists of the ranking the performance of the Southeast Asian economies for the sustainable drivers of the disruptive innovation policies. Within this framework, facial expression-based quantum spherical fuzzy TOPSIS methodology is taken into consideration. The main contribution of this study is that considering facial expressions of the decision-makers helps to achieving more accurate results. In addition to this issue, integrating Spherical fuzzy numbers with DEMATEL and TOPSIS techniques contributes to make a more comprehensive evaluation so that uncertainty in decision-making processes can be handled more effectively. The findings indicate that market penetration has the highest importance to increase the performance of the disruptive innovation. On the other side, Singapore and Philippines has the greatest performance with respect to the disruptive innovation policies of small and medium enterprises.

FDI and human capital development: a tale of two Southeast Asian economies

Middle-income economies must prioritise human capital development to ensure long-term sustainable growth and economic upgrading. While foreign direct investment (FDI) is believed to aid this endeavour, its impact on technical vocational education and training (TVET) remains understudied. This research explores the influence of FDI by multinational enterprises (MNEs) at various stages of global value chains (GVCs) on TVET graduate numbers in Vietnam and Indonesia from 2006 to 2016. Our findings reveal that greenfield FDI plays a role in shaping TVET supply, with heterogeneous effects across different GVC segments and subnational regions. Specifically, FDI in logistics, sales and marketing, and support and servicing are associated with an increase in the supply of TVET graduates in the region, whereas FDI in headquarters and production may lead to a decline in technical skills. To address these dynamics, public policies should prioritise flexible education systems capable of adapting to MNEs’ evolving skill demands. By doing so, these economies can elevate local human capital levels and avoid the stagnation often associated with middle-income traps. This research underscores the importance of aligning policy with the needs of a rapidly changing global economy to foster sustainable development.

Perbandingan Hukum Penanaman Modal dan Investasi Di Indonesia dan Di Tiongkok

Indonesia and China are two countries with rapidly developing economies in Southeast Asia. These two countries have great potential to attract foreign investment. However, there are differences in investment and foreign investment regulations in the two countries. This research aims to compare investment and foreign investment laws in Indonesia and China. This research uses normative legal research methods with a comparative approach. Research data was obtained from literature studies, namely laws, government regulations and other related literature. The research results show that there are similarities and differences in foreign investment and investment regulations in Indonesia and China. Similarities include, recognition of the rights of foreign investors; providing incentives for foreign investors; and resolving investment disputes. The differences include the subject of investment, business fields open to foreign investment, investment requirements. From this research, researchers can draw the title, namely Comparison of investment law and foreign investment in Indonesia and China

India–ASEAN Economic Relations and North-east India: Act East Policy as a New Paradigm

The article delves into three aspects: (a) India–ASEAN economic relationship since the last three decades of Look East Policy (LEP), (b) the achievements of North-east India (NEI) under LEP and Act East Policy (AEP) and (c) adding a note on AEP as a new ‘development paradigm’ in NEI. The study finds that the India–ASEAN economic relationship deepened in the post-LEP period as merchandise trade and foreign direct investment (FDI) inflows increased manifold. However, neither LEP nor AEP made any significant impact on NEI in terms of economic growth, exports and FDI inflows. Economic growth stagnated and even decelerated in some states in NEI, while exports and FDI inflows remained abysmally low. LEP was a failed policy instrument for NEI despite many claims and assumptions. The major reason was infrastructure deficits and poor connectivity in the region for a prolonged period. AEP has emerged as a new ‘development paradigm’ with renewed thrust on infrastructure buildup and connectivity constructions. The ongoing and completed connectivity projects in rail, road, air and water, improvement in power and telecom, multimodal logistic park in Assam and improvement of trade infrastructure in NEI under AEP would attract investment from both domestic foreign sources, enhance productive capacity, increase exports and accelerate economic growth. AEP is expected to open new possibilities for trade and investments in NEI through regional economic integration with South Asian and South-east Asian economies given geographical location, ethno-cultural proximity, historical linkages and resource endowments.

Global alcohol policy implementation in Thailand: A narrative review

Alcohol consumption is growing in emerging economies. Thailand is an upper-middle-income emerging economy in Southeast Asia where the alcohol market has been under an oligopoly, which political groups are attempting to amend. The Thai Ministry of Public Health works in close partnership with the non-profit sector in alcohol control, and has recently adapted the World Health Organization’s (WHO) SAFER initiatives as part of the national alcohol agenda. In light of these ongoing changes, we conducted a narrative review with the following objectives: (1) to describe the development of alcohol control policy strategies in Thailand; and (2) to describe the current situation on alcohol policy implementation. We performed a search of the published and grey literature in both Thai and English languages using keywords related to topics of interest, and reviewed data on SAFER's effectiveness using a group of indicators (policy-attributable health outcomes). We found that Thailand has laws and regulations covering various domains of SAFER. However, gaps do exist with regard to regulation of alcohol outlet density, relatively low alcohol sales permit fees, control of online and surrogate marketing of alcoholic products, and enforcement of drinking-and-driving deterrence measures, among others. A review of the indicators showed that annual per capita alcohol consumption (APC) and prevalence of drinkers have remained constant since 2008, whereas the prevalence of binge-drinking has been on a decline since 2014. However, deaths attributable to alcohol have increased in both men and women. The findings of this narrative review may have implications for policymakers and stakeholders in behavioral health.

KL-SG High-Speed Rail – a catalyst for national economic development

PurposeIn an increasingly interconnected world, transportation infrastructure has emerged as a critical determinant of economic growth and global competitiveness. High-speed rail (HSR), characterized by its exceptional speed and efficiency, has garnered widespread attention as a transformative mode of transportation that transcends borders and fosters economic development. The Kuala Lumpur – Singapore (KL-SG) HSR project stands as a prominent exemplar of this paradigm, symbolizing the potential of HSR to serve as a catalyst for national economic advancement.Design/methodology/approachThis paper is prepared to provide an insight into the benefits and advantages of HSR based on proven case studies and references from global HSRs, including China, Spain, France and Japan.FindingsThe findings that have been obtained focus on enhanced connectivity and accessibility, attracting foreign direct investment, revitalizing regional economies, urban development and city regeneration, boosting tourism and cultural exchange, human capital development, regional integration and environmental and sustainability benefits.Originality/valueThe KL-SG HSR, linking Kuala Lumpur and Singapore, epitomizes the potential for HSR to be a transformative agent in the realm of economic development. This project encapsulates the aspirations of two dynamic Southeast Asian economies, united in their pursuit of sustainable growth, enhanced connectivity and global competitiveness. By scrutinizing the KL-SG High-Speed Rail through the lens of economic benchmarking, a deeper understanding emerges of how such projects can drive progress in areas such as cross-border trade, tourism, urban development and technological innovation.

Digital Divide and Digital Competence among Accounting Students

The problem of this research is the existence of a digital divide among accounting students in Indonesia despite the rapid growth of the digital economy in Southeast Asia. This research explores the relationship between the digital divide, seen through social factors, and the digital competence of accounting students. This research uses a quantitative approach, with the subjects being accounting students. Data was collected through a survey with a questionnaire distributed to 398 accounting students at various universities in Indonesia. Data analysis was carried out using descriptive tests and non-parametric tests. The research results show that social factors significantly influence students' digital access and competence. Younger students tend to have higher levels of digital competency. Family factors such as parental education, employment, and income significantly influence students' digital abilities. In addition, computer ownership by students and effective technology integration by lecturers also impact students' digital competence. In conclusion, the digital divide still exists among accounting students in Indonesia, which affects their digital competence. The implications of this research include the need for curriculum expansion and social interventions to overcome the digital divide among accounting students, ensuring their readiness to face the digital era.

A study on Overseas Chinese bank in Indonesia - Focusing on Bank Central Asia

This study seeks to comprehensively analyze the historical development and current status of the Indonesian banking industry. Furthermore, it aims to delve into the origins, developmental trajectory, and current standing of Overseas Chinese Bank Central Asia, a pivotal player in the Indonesian banking landscape, while evaluating its competitive edge. Drawing from this examination, practical implications and strategic developmental approaches will be proposed. Through an extensive review of literature, we will scrutinize the evolution and present state of Indonesia's banking sector, along with the establishment, growth history, and current position of Bank Central Asia. Utilizing Porter's Five Forces analysis model, we will assess the competitive dynamics of Bank Central Asia, complemented by a SWOT analysis to scrutinize its internal and external environments. Despite its inception by overseas Chinese, Bank Central Asia has emerged as a frontrunner in Indonesia's financial realm. While it exhibits deficiencies in digital transformation, product innovation, customer experience, risk management, and collaborative innovation, it boasts strengths in network expansion, talent cultivation, and system enhancement for promotion and development. Leveraging these competitive advantages, Bank Central Asia has sustained its leading position within the Indonesian financial landscape. To maintain this competitive edge, Bank Central Asia must astutely navigate market trends, competitor actions, and regulatory shifts, making informed decisions and flexibly adjusting strategies as needed. Leveraging its external networks and internal strengths, Bank Central Asia has upheld a sterling reputation and achieved sustainable growth. The exploration of these Overseas Chinese banks not only sheds light on the intricacies of the Southeast Asian economies but also offers valuable insights into the dynamics of global banking and finance.