In the early 1990s, Singapore, the Malaysian state of Johor, and the Riau Islands in Indonesia sought to leverage their proximity, differing factor endowments, and good logistics connections to market themselves as an integrated unit. Beyond national-level support in all three countries, the initiative had the support of state and provincial leaders in Johor and Riau, respectively. Now, however, the situation is markedly different. The Malaysian government and its Johorean equivalent have invested considerable resources in encouraging closer integration with Singapore. For its part, the Indonesian central government has been promoting special economic zones and export-oriented activities. However, the provincial government of the Riau Islands has turned away from export-oriented industrialization, preferring instead to promote cultural sub-nationalism and traditional economic activities such as fishing and small-scale farming. This development is counter-intuitive. Traditional fiscal federalism theory argues that decentralization encourages competition between provinces for investment, jobs, and growth. While Indonesia has undergone one of the world's most far-reaching decentralization reforms, Malaysia has pursued a consistent centralization campaign at the expense of state governments. Thus, we would expect the Riau Islands entrepreneurial drive to be unleashed, and Johor's to be smothered. However, Johor's drive for capital is undiminished, while the Riau Islands pursuit of investment has dissipated. This monograph will explore the reasons for this paradox.

The term 'Middle-Income Trap' refers to countries which stagnate economically after reaching a certain level of per capita income on the basis of labour- and capital-intensive growth, and are struggling to transition towards more skill-intensive and technology-driven development. It has resonance for the increasing number of countries in Asia who have either languished in middle-income status for extended periods of time, or are worried about growth slow-downs. This book sets outs the conceptual underpinnings of the Middle-Income Trap and explores the various ways it can be defined. It also focuses on the debate surrounding the Middle-Income Trap which questions the appropriate institutional and policy settings for middle-income countries to enable them to continue past the easy phase of economic growth. The book engages with this debate by investigating the role of institutions, human capital, and trade policy in helping countries increase their income levels and by highlighting factors which enable the shift to higher and qualitatively better growth. It questions how the large emerging economies in Asia such as China, Indonesia, and India are currently grappling with the challenges of transitioning from labour-intensive to technology- and knowledge-intensive production, and discusses what can be learnt from the countries that have been able to escape the trap to attain high-income status. Providing a conceptual framework for the Middle-Income Trap, this book will be of interest to students and scholars of Asian Economics, Comparative Economics and Asian Studies.

The term 'Middle-Income Trap' refers to countries which stagnate economically after reaching a certain level of per capita income on the basis of labour- and capital-intensive growth, and are struggling to transition towards more skill-intensive and technology-driven development. It has resonance for the increasing number of countries in Asia who have either languished in middle-income status for extended periods of time, or are worried about growth slow-downs. This book sets outs the conceptual underpinnings of the Middle-Income Trap and explores the various ways it can be defined. It also focuses on the debate surrounding the Middle-Income Trap which questions the appropriate institutional and policy settings for middle-income countries to enable them to continue past the easy phase of economic growth. The book engages with this debate by investigating the role of institutions, human capital, and trade policy in helping countries increase their income levels and by highlighting factors which enable the shift to higher and qualitatively better growth. It questions how the large emerging economies in Asia such as China, Indonesia, and India are currently grappling with the challenges of transitioning from labour-intensive to technology- and knowledge-intensive production, and discusses what can be learnt from the countries that have been able to escape the trap to attain high-income status. Providing a conceptual framework for the Middle-Income Trap, this book will be of interest to students and scholars of Asian Economics, Comparative Economics and Asian Studies.

The results of Malaysia's 14th General Elections of May 2018 were unexpected and transformative. Against conventional wisdom, the newly reconfigured opposition grouping Pakatan Harapan (PH) decisively defeated the incumbent Barisan Nasional (BN), ending six decades of uninterrupted dominant one-party rule. Despite a long-running financial scandal dogging the ruling coalition, pollsters and commentators predicted a solid BN victory or, at least, a narrow parliamentary majority. Yet, on the day, deeply rooted political dynamics and influential actors came together, sweeping aside many prevailing assumptions and reconfiguring the country's political reality in the process. In order to understand the elections and their implications, this edited volume brings together contributions from ISEAS - Yusof Ishak Institute researchers and a group of selected collaborators to examine the elections from three angles: campaign dynamics; important trends among major interest groups; and local-level dynamics and developments in key states. This analytical work is complemented by personal narratives from a selection of GE-14 participants.

To Singapore's immediate south, Indonesia's Riau Islands has a population of 2 million and a land area of 8,200 sq. km scattered across some 2,000 islands. The better-known islands include: Batam, the province's economic motor; Bintan, the area's cultural heartland and site of the provincial capital, Tanjungpinang; and Karimun, a ship-building hub strategically located near the Straits of Malacca. Leveraging on its proximity to Singapore, the Riau Islands-and particularly Batam-have been a key part of Indonesia's strategy to develop its manufacturing sector since the 1990s. In addition to generating a large number of formal sector jobs and earning foreign exchange, this reorientation opened the way for a number of far-reaching political and social developments. Key among them has been: large-scale migration from other parts of the country; the secession of the Riau Islands from the larger Riau Province; and the creation of a new provincial government. Adopting a multidisciplinary framework, this book explores three issues: what have been the social, political, and environmental effects of the rapid economic change set in motion in the Riau Islands; to what extent can or should the province seek to reconfigure its manufacturing-based economy; and how have the decentralization reforms implemented across Indonesia affected the Riau Islands.

In 1990, the Malaysian state of Johor - along with Singapore and the Indonesian island of Batam - launched the Growth Triangle to attract foreign direct investment. For Johor, this drive was very successful, transforming its economy and driving up income levels. Today, Johor is one of Malaysia's 'developed' states, housing large clusters of electrical and electronics, food processing, and furniture producing firms.These economic and social changes have also had political ramifications. While Johor is a bastion of two of the country's oldest and most established political parties, the state's large, urban and connected electorate has made it hospitable terrain for new political organisations. Beyond electoral politics, Johor is also the home of a powerful and influential royal family, with very specific ideas about its role in the state's political life. Building upon earlier work by the ISEAS - Yusof Ishak Institute on the Singapore-Johor-Riau Islands Cross-Border Region, this book focuses on this important Malaysian state, as it deals with important domestic challenges on one hand and strives to engage with international markets on the other.

Twenty-five years ago, the governments of Singapore, Malaysia, and Indonesia agreed to jointly promote the citystate, the state of Johor in Malaysia and the Riau Islands in Indonesia. Facilitated by common cultural references, a more distant shared history, and complementary attributes, interactions between the three territories developed quickly. Logistics networks have proliferated and production chains link firms based in one location with affiliates or transport facilities in the other territories. These crossborder links have enabled all three locations to develop their economies and enjoy rising standards of living. Initially economic in nature, the interactions between Singapore, Johor, and the Riau Islands have multiplied and grown deeper. Today, people cross the borders to work, go to school, or avail of an increasing range of goods and services. New political and social phenomena have developed. Policy-makers in the various territories now need to reconcile economic imperatives and issues of identity and sovereignty. Enabled by their proximity and increasing opportunities, families have also begun to straddle borders, with resulting questions about citizenship and belonging. Bringing together scholars from a range of disciplines, the 18 chapters and more than 20 maps in this book examine the interaction between Singapore, Johor, and the Riau Islands over the past quarter-century, and seek to shed light on how these territories could develop in the future.

Once acting as local representatives of the national government and content to let their larger counterparts do the "heavy lifting", state and provincial governments are increasingly expected to be stewards of their economies and deliver sustained growth rates for their citizens. Spurred on by increasing competition, not least from neighbouring territories, sub-national governments are increasingly formulating their own plans for economic development, taking out loans, investing in specialist facilities, and establishing marketing offices abroad. Despite this increasingly challenging environment, there is little research on what sub-national governments can or should do to catalyze the development of their economies. Focusing on the electronics sector, this book draws together ten cases of promising states or provinces largely, but not exclusively, from Asia. These dynamic regions have managed to outcompete the primary economic and political centres of power in their countries and are negotiating their own entry into one of the most challenging and demanding sectors. In exploring the issues of agency, autonomy, and state-business relations at the sub-national level, this book aims to shed light on a vital, but overlooked topic.

However impressive the economic success of Penang has been over the past four decades, structural conditions in the region call for a fundamental reconfiguration of this Malaysian state's competitive advantage. In the 1970s, the ageing entrepot transformed itself into a manufacturing hub for the electronics industry and a well-known tourist site. This outward-looking model of economic growth has underpinned Penang's economic development up until the present. The question that now arises is whether Penang's present mode of development will continue to be effective, or whether it will have to transform itself. First, Malaysia in general, and Penang in particular are caught in a middle-income trap. Second, while the evolving weight of the global economy is shifting towards Asia, many of its emerging powers are competing with Penang in areas where it formerly excelled. Third, Penang is a state within a federation, and its capital, George Town, is a secondary city. Neither can rival Kuala Lumpur in terms of size or facilities, and thus must offer investors other attributes. Effectively meeting these challenges while retaining Penang's vibrant and living culture are the key issues that are dealt with in this second volume of the Penang Studies Series.