Weathering the Storm: The Economies of Southeast Asia in the 1930s Depression

Published by EH.NET (July 2003)

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Peter Boomgaard and Ian Brown, editors, Weathering the Storm: The Economies of Southeast Asia in the 1930s Depression. Leiden: KITLV Press and Singapore: Institute of Southeast Asian Studies, 2000. xiv + 332 pp. US$39.90 or S$65.90 (hardcover), ISBN: 981-230-079-1.

Reviewed for EH.NET by John Drabble, Economic History, University of Sydney.

Peter Boomgaard is Director, Royal Institute of Linguistics and Anthropology (KITLV), Leiden and Professor at the University of Amsterdam. Ian Brown is Professor of the Economic History of Southeast Asia, School of Oriental and African Studies, London University. The contributors are an eclectic mix of European, American, Australian and Southeast Asian scholars. This volume is the outcome of a panel on “Short- and Long-Term Cycles in the Southeast Asian Economy: Historical Perspectives” at the First Conference of the European Association of Southeast Asian Studies, Leiden, 1995. It contains thirteen papers preceded by an editorial introduction identifying four principal themes, which constitute the headings under which the papers are grouped. These are; changes in material conditions during the slump (four papers), agricultural strategies adopted by small farmers in the face of these changes (five papers), the experience of particular local trading groups (one paper), and the response of the state (three papers). The impact of the slump on large capitalistic (primarily western) enterprises in the region receives relatively little comment. Most papers have a single country focus with, inevitably, some imbalance: Indonesia (four), Philippines (two), French Indo-China (two), Burma, Thailand, and Malaysia (one each). One paper covers Indonesia/Malaysia, and another the Philippines, French Indo-China and Indonesia.

Part 1 (Material Conditions) focuses on the question of the effects of the depression on the standard of living. Thus the prime task for each writer is to formulate the relevant criteria. P. Boomgaard (Indonesia, principally Java) presents various indices of macroeconomic data; indigenous real incomes, food consumption, crude death rates etc. J. Touwen (Outer Islands, Indonesia) argues that real incomes there were slightly lower than in Java, but the local subsistence economy was generally a stronger support network in such times. D. Doeppers (Philippines), confines himself to a single indicator, the annual numbers paying the tax to obtain the cedula personal, a type of personal registration and identity certificate. W. Wolters (Philippines) looks at conditions in four regions, each with a different major commercial crop (abaca, coconut, sugar, rice) with the indicators of welfare being food availability and merchandise sales, both per capita. I. Brown (Burma) also adopts a single measure, imports of cotton textiles. While the diversity of these criteria reflects to a large degree the availability of historical source materials for each country, the conclusions arrived at by these four scholars show a considerable degree of agreement. Despite the severity of the depression in the international economy, standards of living did not show correspondingly steep falls. Resourceful small producers developed countervailing strategies such as product diversification, a switch towards subsistence farming, notably rice, cottage industries etc. Prices of imported goods fell substantially which helped to cushion standards of living.

Part 2 (Agricultural Strategies) has some overlap with Part 1. In Besuki province, Sumatra (S. Nawiyanto), small tobacco farmers rode out the slump through strategies similar to those in Java. However, two other papers on leading rice producers, Thailand (S. Manarungsan) and French Indo-China (I. Norlund) highlight important regional differences. Thailand was not as deeply affected as its neighbor, Burma. Thai farmers were not as deeply involved in market relations, nor did they suffer comparably high levels of indebtedness and land loss as their Burmese counterparts. Government helped by reducing and finally abolishing rice field taxes altogether. French Indo-China lay somewhere in between, with farmer involvement in the export economy varying from area to area. The 1930s saw a clear trend towards diversification of exports. T. Lindblad, (Indonesia) stands somewhat apart in this section, focusing more on the macro-consequences of the slump for longer-term structural change in the national economy.

Part 3 (Trading Communities) has only a single paper, W. Clarence-Smith on Indonesia and Malaysia, describing the experience of the numerically small but relatively wealthy mercantile community of entrepreneurs of Hadhrami Arab origin. As with many primary producers, the qualities which enabled this group to survive the slump were adaptability and flexibility.

In Part 4 the role of the colonial state comes under examination. The central question asked here is whether the policies implemented were in the best (i.e. longer-term) interests of these countries. P. Brocheux (French Indo-China) finds that government action helped to stabilize the export economy but, through imperial preference, tightened trade ties with France and militated against any major moves to industrialize the colony. P. Kratoska (British Malaya) also looks at the trade effects of imperial preference, along with measures to reduce the country’s dependence on imported rice and immigrant labor. He considers the two latter to have improved local autonomy and smoothed the path to later independence in 1957. Rather surprisingly, though, he makes no mention of the government-imposed restriction of tin and rubber exports during the 1930s, a direct outcome of the slump, which had strong consequences for the subsequent pattern of structural change in the economy. A. Booth examines foreign trade and exchange rate policies in French Indo-China, Indonesia and the Philippines, concluding that these operated primarily to serve the economic interests of the colonial power when more concerted efforts to promote local industrialization might have served these countries better.

On the whole this collection of papers hangs together well. It achieves the aims of the editors (Introduction) to counter the view of earlier scholarship that the depression experience of Southeast Asia in the 1930s was a period of unrelieved and universal distress. We are given substantive evidence of the considerable variations in conditions throughout the region and, in particular, the resilience shown by small producers and some mercantile interests to ameliorate the consequences. The editors also offer some interesting comparisons with the Asian financial crisis in the late 1990s. Overall the volume is a welcome compendium of recent research and plainly presages much further research on the topic.

John Drabble was formerly Reader in Economic History, University of Sydney, Australia. He recently published An Economic History of Malaysia, c.1800-1990: The Transition to Modern Economic Growth (Basingstoke, Macmillan, and St Martin’s Press, New York, 2000).