Governments gained more control over their economies, but most still relied on foreign money and markets. Countries that pursued self-reliance most strictly paid the highest price.
Self-sufficiency in food was a key aim. Indonesia became self-sufficient in rice in 1984, a major achievement, although it had to import rice again in later years.
Burma pursued self-reliance most strictly. It cut itself off from foreign trade and investment, and it became one of Asia's poorest countries.
Local control of business increased in some countries. In Malaysia, the foreign share of company ownership fell from about 63 per cent in 1970 to about 25 per cent in 1990. State firms such as Petronas took control of oil and gas.
Malaysia also built a national car industry. Proton, protected by high taxes on imported cars, came to dominate the home market.
Yet growth depended on foreign capital. Singapore's manufacturing was led by multinational companies, although the state controlled key firms such as Singapore Airlines. The 1997 crisis increased foreign influence, as the IMF set conditions and foreign firms bought struggling local companies.
- Rice
- Indonesia self-sufficient in 1984.
- Malaysia
- Foreign ownership about 63% (1970) to about 25% (1990).
- Proton
- A protected national car.
Worked example: Judging economic nationalism
How far did countries gain control of their economies?
- Food: Indonesia's rice self-sufficiency in 1984.
- Ownership: Malaysia's foreign share fell sharply.
- The price of isolation: Burma's poverty.
- Limit: continued dependence on foreign capital.
Watch out for this
Economic nationalism meant cutting all foreign links.
Most governments aimed for more local control while still welcoming foreign investment. Only Burma tried full self-reliance, and it failed.
Check your understanding
What does Burma's experience show about self-reliance?
- Cutting off foreign trade and investment left it poor.
- Self-reliance made it the richest country in Asia.
- It depended heavily on multinationals.