by Nick Gier, Professor Emeritus, University of Idaho
For more on Hong Kong and Singapore see nfgier.com/hong-kong-and-singapore-a-tale-of-two-city-states
Over the last several decades, Singapore, Hong Kong, Taiwan and South Korea have been called the “Asian Tigers.” With economic growth sometimes as high as 10 percent, these countries have become world financial centers (Singapore and Hong Kong) and leaders in microprocessors (Taiwan) and car production and shipbuilding (South Korea).
India, Japan, China Still Dominant
We should not neglect the importance of India, Japan, and China as the largest economies in Asia. For three decades, Japan’s economy has stagnated, but during a recent 3-week tour of Southeast Asia, I saw Japanese cars and motorcycles as well as construction equipment everywhere. Generous as always, Japan continues to be the single largest provider of foreign aid in the region, and it remains among the top three in terms of investment in new manufacturing facilities.
Ancient Indian traders made possible the rise of pre-Islamic Buddhist and Hindu dynasties in this region (Indonesia literally means “India’s Islands”), and this region is now India’s fourth-largest trading partner. India serves as an important counterbalance to China in the region, but it will simply not be successful in blocking China’s huge influence.
China Rising in this Region
Trump’s chaotic transactional trade policies will force these countries to rely more on China. Who would ever think that, relatively speaking, China would be more trusted than the U.S. in this region? Since 2005 Chinese investments have increased 20 times, and in 2023 alone half of all business transactions in the region was Chinese.
Even before the rise of Communist China, Chinese traders dominated the economies of these countries for centuries. One of the main issues of contention when Singapore became a separate state from Malaysia in 1965 was the Malays’ insistence that they did not want the hard-working Chinese of Singapore to be part of their new country.
In 2024, each Singaporean (76 percent Chinese) shares $89,370 of the city-state’s Gross Domestic Product. This compares to $87,081 per person in the U.S. Malaysia should have kept those entrepreneurial Chinese because it lags way behind at $11,748 per GDP.
The Rising Tiger Cubs
Five other Southeast Asian countries have now been added to the list as Tiger Cubs. They are Indonesia, Malaysia, Thailand, Vietnam, and the Philippines. During my recent visit to the first three countries, I personally witnessed the bustling cities and growing industries. Economic growth, except for Thailand, exceeds 5 percent in the four others and is greater than the original Tigers in their current state. Vietnam, where I visited in 2007, saw an increase of 7 percent in 2024.
Not “Confucian” Capitalism
Commentators described this success as the result of “Confucian” capitalism, but we now must revise that theory. Indonesia and Malaysia are Muslim majority countries, Thailand is 90 percent Buddhist, and the Philippines is 90 percent Christian. There is something other than religion that makes these economies succeed.
Confucianism is noted for its emphasis on education, strong families, and hard work, but Muslims, Buddhists, and Christians share these same values. Significantly, the majority of South Koreans have no religious preference at all. Christianity and Buddhism garner support from only 31 percent and 17 percent respectively.
Government and Private Enterprise Blend
These Asian economies are “mixed” meaning that there is a blend of government ownership/regulation and private enterprise. They have been described as “states that intervene in the economy to promote growth and stability.”
South Korea’s success, for example, has been attributed to government support for key industries. Mixed economies around the world stand as proof that government intervention, as libertarians incorrectly argue, does not destroy economic success.
Low Deficits and Unemployment
Even with their active governments, the Asian Tigers are wise fiscal managers, balancing spending and revenue. They are now averaging budget deficits of 2.9 percent, with Singapore and Taiwan achieving small budget surpluses. Unemployment among the nine nations is the same percentage as their deficits.
(At the end of his first term, Trump left us with a 14.7 percent deficit, which Biden brought down to 6.6 percent. With Trump’s insistence on steep tax cuts and excessive tariffs, the deficit and national debt will rise once again. It is worth noting that 20 European nations in the Euro Zone are also fiscally responsible with an average 3.2 percent deficit.)
Excellent Education Key
Excellent educational institutions were key to the original Tigers’ success. Students from each of these four countries always score at the top of the Program for International Student Assessment (PISA) exams. Within just several decades, one quarter of their universities are now, according to the 2023 QS University Rankings, among the best in the world.
Multi-Party Democracies
All the Tigers, except for communist Vietnam, hold multiparty elections, but Singapore’s Lee Kuan Yew (prime minister for 35 years!) made sure that any opposition party stayed out of power. Lee always claimed that his authoritarian policies were necessary for his country’s continued success. My one-day visit last month to Kuala Lumpur, Malaysia, put the lie to this claim: it is just as beautiful, clean, and prosperous as Singapore without its notorious constraints.
Rise in EV Production
Tiger Cub governments are very ambitious. Indonesia has large reserves of nickel, a key component in electric vehicle batteries. But experts doubt that the government can actually, on the basis of that resource alone, start producing EVs. Chinese EVs, however, are now being made in two factories with another to open in 2026.
Vietnam already produces its own EV called the VinFast, and the government, calling it its “glory project,” has invested heavily in its production. The car is sold at a deep discount and, as a result, the company has yet to turn a profit. Its cars are outselling the more expensive Chinese models that are available.
Thailand is the largest car producer in the region as it produces Chinese EVs as well as Japanese gas-powered models. As a response to a drop in EV sales, the Japanese are pushing their plug-in hybrid electrics for a wiser green vehicle choice.
Tiger Cubs are Pumping Oil
Except for the Philippines, the Cubs have extensive oil reserves, and they are extracting oil and gas at a fast pace. After Vietnam, Malaysia is the second-largest producer in Southeast Asia. After viewing the world’s second-tallest building, which the state oil company built in Kuala Lumpur, the obscenity of this waste is clearly evident in the poverty everywhere outside this beautiful city.
The Cubs’ focus on EVs and their lack of investment in renewable energy show a regrettable tension in their respective national visions. I am reminded of the fact that Norway leads Europe in EV sales per capita, but still pumps 1.8 million barrels of oil each day from the North Sea. The prize for green energy courage and wisdom goes to Denmark, which capped its North Sea oil wells and re-committed itself to leading the world in wind turbine production and installation.
Income Inequality Main Problem
The most pressing problem among the nine Asian Tigers is income inequality. Thailand is the worst, where, according to one source, “the richest one percent in Thailand controls 58 percent of the country’s wealth.” Another source states that “in Indonesia, the four richest men there have more wealth than the poorest 100 million people, and about 50 percent of the country’s wealth is in the hands of the top one percent.”
Guest workers in Malaysia are treated as “bonded” labor, and similar workers in Singapore —about 40 percent of the population—live in crowded dormitories. South Korea once had lower income inequality, but that has increased over the past two decades.
Nick Gier of Moscow was a professor of philosophy and religion at the University of Idaho for 31 years. He was coordinator of religious studies from 1980 to 2003. He is the author of The Origins of Religious Violence: An Asian Perspective (nfgier.com/1171-2), and he has just returned from a three-week tour of Southeast Asia. Email him at ngier006∂gmail.com.