Local family firms, especially Chinese-owned groups, and foreign multinationals drove much of the growth. Their success often depended on links with governments.
Chinese family businesses were central across the region. Groups such as Charoen Pokphand in Thailand, the Salim Group in Indonesia and Robert Kuok's companies in Malaysia grew into large conglomerates.
Many prospered through close ties to rulers. Liem Sioe Liong's Salim Group won valuable licences through its ties to Suharto, such as the right to mill most of Indonesia's flour.
Multinational companies brought capital, technology and access to world markets. American, Japanese and European electronics firms built factories in Singapore, Penang and Thailand.
Governments also created new business classes. Malaysia's NEP helped build a Malay business class through state contracts, licences and share allocations.
Private businesses could also do harm. Cronies in the Philippines ran industries badly, and heavy borrowing by private firms in Thailand and Indonesia helped cause the 1997 crisis.
- Charoen Pokphand
- Thailand.
- Salim Group
- Indonesia; ties to Suharto.
- Multinationals
- Electronics in Singapore, Penang and Thailand.
Worked example: Weighing private business
How important were private businesses?
- Drivers: conglomerates and multinationals created jobs and exports.
- Dependence: many relied on government favour.
- Risk: cronyism and reckless borrowing.
- Judgement: important, but shaped by government.
Watch out for this
Private businesses succeeded independently of governments.
Many of the largest firms grew through licences, monopolies and contracts from governments. Business success and political connections were closely linked.
Check your understanding
How did the Salim Group prosper in Indonesia?
- Through close ties to Suharto that brought licences and monopolies
- By refusing to work with the government
- By selling rice to Burma