THE CONCEPT OF A REGION suggests that the societies incorporated within it, while undoubtedly differing in significant ways, share some fundamental characteristics that provide them a regional quality. Issues that have affected one society have likewise influenced other societies; there have been shared historical, social, and political experiences. Moreover, increasing economic integration (internal trade and investment flows, convergence of economic systems) supports the suggestion that East and Southeast Asia is a region. Regionalisation of politics, through institutions such as the Association of Southeast Asian Nations (ASEAN), is also premised on an increasing convergence of political interests between the nations of East and Southeast Asia. Finally, the case for characterising East and Southeast Asia as a region is built on its importance to Australia. From the Australian perspective, East and Southeast Asia is ‘its region’. Australia's economic, political and strategic interests are closely and increasingly linked to developments in the region, and Australia has increasingly adopted a regional foreign policy response to developments in East and Southeast Asia (see Chapters 10 and 12).

Nevertheless, the concept of ‘a region’ remains problematic, for no region can remain immune from international forces. This is particularly the case with East and Southeast Asia, which has been subject to a number of extremely powerful external influences. For example, European colonialism from the late fifteenth century, while uneven in spread and degree of control, cumulatively exerted a profound impact on the societies of East and Southeast Asia. In particular, colonialism had the effect of drawing these societies into an international trading economy increasingly dominated by the economic imperatives of industrial capitalism. There had been significant intra-regional trade in East and Southeast Asia prior to European colonialism, and some international trade. However, colonialism opened the economies of East and Southeast Asia to trade, capital movements, and technology transfer on an unprecedented scale. This brought new commodities and new forms of production, which impelled social changes that impacted on the lives and fortunes of millions of people in countless ways. Similarly, the various societies and states of the region were, through the agency of colonialism, exposed to an international political order in which the nation-state had become, by the beginning of the nineteenth century, the dominant form of political organisation.

THE RELATED ISSUES OF DEMOCRACY, human rights, and development attract considerable attention in Western media reports and scholarly literature on East and Southeast Asia. The tone of this discourse is often critical of the perceived inadequacies of the political systems of some Asian nations, which are considered authoritarian and not sufficiently committed to respecting the right of their citizens ‘to life, liberty and security of person’ (Article 3 of the Universal Declaration of Human Rights). Moreover, past economic failures, as occurred during the 1997 financial crisis, were often explained in terms of corruption, cronyism, and weak domestic institutions (law, property rights, market-led economy) in these countries. In short, they have been criticised for not being sufficiently like Western political systems, which are presented as models for what constitutes a stable, legitimate, and prosperous democratic society.

But in what became known as the ‘Asian values debate’ during the late 1990s and early 2000s, the leaders of some East and Southeast Asian nations, such as Muhammad Mahathir of Malaysia and Lee Kuan Yew of Singapore, rejected this criticism on the grounds that Asian societies have cultural values different from those of the West. These ‘Asian values’ – harmony, unity, respect for leadership, loyalty, consensual decision-making – make slavishly copying the political systems and values of Western nations both impractical and undesirable (Kausikan 1998). Even if democracy and human rights are, as the West maintains, universal values, Asian nations are just not able to implement them, at least not yet. According to this view, their economic underdevelopment relative to Western industrialised nations necessitates political systems that can ensure the stability and harmony necessary for continuing development, something that democracy and a concentration on the rights of the individual cannot do. What is needed is strong leadership rather than the uncertainty and disunity created by the competitive politics and individual liberties of Western democracy. Western criticism also has been rejected as politically motivated interference in the internal affairs of the sovereign nation-states of East and Southeast Asia, an argument often made by Chinese officials. It is denounced as a form of cultural imperialism, and a foreign policy tactic used by Western nations, in particular the US, to bully Asian nations. The West should mind its own business, Asian leaders retort, especially when its own record of democracy and respect for human rights is not only very uneven but also historically quite recent.

IN THE PREVIOUS CHAPTER we examined the ‘age of colonialism’ and noted that historians are divided about the impact of the West on the histories of East and Southeast Asian societies. Some historians have argued that it is incorrect to interpret the history of the region from 1498 to the mid-1950s as nothing more than the history of European colonialism, with the history of East and Southeast Asia limited to a response to this external influence. This view, they argue, ignores the internal historical forces and social structures that existed in the region prior to European intervention and which persisted largely untouched throughout the ‘age of colonialism’. Other historians have pointed to the dramatic and long-term consequences of European colonialism in the region, and argue that it is appropriate both to talk of an ‘age of colonialism’ and to read the history of East and Southeast Asia from this perspective.

Although some historians speak of the ‘age of colonialism’ as though it is an historical period whose dominant characteristic is European colonialism, control of East and Southeast Asia by European colonial powers was in fact sporadic and quite limited during most of this period. European colonial power did not peak until the latter half of the nineteenth century and, even then, some societies in the region managed to avoid direct colonisation. Siam (Thailand) is an example, although it only managed to retain a semblance of independence by deferring to the economic and political demands of Britain and France, the two neighbouring colonial powers in Burma and Indochina. Another example is Japan, which avoided direct Western intervention after 1853 only by acceding to demands that Japan open its doors to commerce and trade. Indeed, the significant influence of the West on Thailand and Japan, two countries that were not colonised, suggests that the cumulative influence of Europe in East and Southeast Asia was very great, particularly in those countries that were colonised. By the end of the nineteenth century, most of Southeast Asia had been colonised, and China, the largest country in the region by population and area, had become a semi-colony, divided into spheres of European influence.

WHILE THE CASE FOR STUDYING Asia and Asian languages should not rest on a purely economic foundation, as some have argued (Garnaut 1989: chapter 15; East Asia Analytical Unit 1992), there are persuasive economic reasons for taking an interest in East and Southeast Asia, particularly from an Australian perspective. Australia's resource-based economy has considerable complementarity with the manufacturing economies of the region, and a close economic relationship has consequently been established, one that has brought both economic benefit and risk. Australia is both a buyer and seller in the markets of East and Southeast Asia. An increasing number of Australians either work in the region or do work in Australia that has a significant Asian content. The context within which Australian commerce and industry take place has increasingly become an Asian context. As Mark McGillivray pointed out more than a decade ago, ‘Australia on average more heavily depends on, and is more integrated economically (in so far as trade is concerned) with Asia than the rest of the world’ (1997: 63). It is, therefore, very important to know something about the economies of East and Southeast Asia, and how their prosperity has affected and influenced the Australian economy.

Japan's economic performance from the 1950s to the late 1980s demonstrated that an economy devastated by war and with few natural resources could achieve rapid economic growth. Its performance during the 1950s and 1960s was so impressive that some commentators described it as an economic ‘miracle’. But could this enviable economic growth be repeated elsewhere? Was there a latent dynamism in the other economies of East and Southeast Asia that could give rise to economic growth as spectacular as Japan's? From the mid-1960s, several economies in the region did in fact achieve impressive economic growth, actually surpassing Japan during the 1980s. These are described as the Newly Industrialising Economies (NIEs) (or Newly Industrialising Countries, NICs). The most successful of these NIEs – South Korea, Hong Kong, Taiwan, Singapore – have also been described as the ‘four little dragons’ (Vogel 1991), the ‘four tigers’ (World Bank 1993), and Asia's ‘miracle economies’ (Bello and Rosenfeld 1992; Woronoff 1986).

IN HIS FOURTEEN POINTS speech to the US Congress on 8 January 1918, US President Woodrow Wilson argued that the nations of post-war Europe should enjoy ‘self-government’, and that it was the absence of democratic accountability among the European states that had led to the outbreak of World War I. The impact of Wilson's call for democratic self-government had little impact on the colonial powers’ attitudes towards their colonies, but emerging nationalist movements in Asia interpreted it as a powerful ideological justification for independence and self-determination. Indeed, the colonial powers regarded self-government as an issue relevant only to European states and societies, and remained unwilling to divest themselves of the economic and political benefits that possession of colonies had brought. If anything, the behaviour of some colonial powers – particularly France, Britain and the Netherlands – became even more intransigent towards their colonies in the face of nationalist demands for political autonomy. They responded brutally towards colonial subjects who dared articulate demands for independence and an end to colonialism.

Suppression of nationalist movements in the colonies of East and Southeast Asia was successful prior to the outbreak of World War II in the Pacific (1941–45). On the eve of the Pacific War there was, with the exception of the American colony of the Philippines, little indication that the colonies of the region would ever be granted independence. But the onset of the Pacific War had a decisive influence on the fortunes of nationalist leaders and movements, and was truly a watershed in the history of East and Southeast Asia. Japanese imperialism had the extremely important effect of destroying or undermining colonial administrations in the colonies of Southeast Asia (Hong Kong, Indochina, Burma, Singapore, Malaya, the Philippines, the Dutch East Indies). It also significantly weakened the Nationalist Government of China and strengthened the hand of the Chinese Communists. The destruction of the power of colonial administrations was accompanied by the destruction of their authority and legitimacy, since they were unable to defend their colonies against the Japanese. They were not omnipotent, and their fallibility had been truly and in some cases fatally exposed by the Japanese advance into East and Southeast Asia (Frey 2003).

On many occasions, Korea's history has been impacted by the relationships it has had with the three regional powers on its border: China, Japan, and Russia/Soviet Union. In the past, Korea was often weak in comparison to these contenders and was forced to survive as best as it could. Increasingly, Republic of Korea (ROK) economic, political, and military power is making it an important player in the region and a sought-after partner. Moreover, South Korea has ambitions to be an even more significant actor and is seeking to build its blue-water naval capabilities, allowing it (a) to be less dependent on others to protect its commercial interests and (b) to have the ability to project power and influence more broadly. As a result, an understanding of South Korea's relations with the major powers in the region is crucial to assess Seoul's current position and where it is headed in the future.

China

For many years, Korea existed as a kingdom under the suzerainty of the Chinese Empire. China and Korea maintained a big brother–little brother relationship wherein Korea paid tribute to Chinese emperors as a sign of respect to its big brother. Korea's historical and cultural ties to China are extensive, as a great deal of Korean culture came to the peninsula from China, including art, education, and the legacy of Confucius. This relationship lasted until the end of the nineteenth century, when China became weak and the Korean peninsula fell under Japanese control.

The story of economic development in South Korea is phenomenal. Shortly after the country was liberated from Japanese colonial rule in 1945, South Korea was demolished during the Korean War, which began in 1950. The three-year war completely devastated the small country and destroyed most of its industries. As a result, South Korea was one of the poorest countries in the world in the 1950s, and its economy was largely dependent on U.S. economic aid. In the 1960s, the economy began to change. With a government-led development strategy begun under Park Chung-hee, South Korea launched an economic development plan that promoted industrialization and increased exports and grew the economy at a rapid pace. For instance, South Korea's per-capita gross national income (GNI) in 1960 was a mere $76 but by 2007 increased to $20,045. Today, South Korea's Gross Domestic Product (GDP) is the thirteenth largest in the world at $970 billion, and it ranks twelfth in the world in total trade at $728 billion. In fewer than five decades, the war-torn economy became a global economic powerhouse.

South Korea's economic success was driven by a government-led development paradigm, which is based on top-down economic directives and regulations from the government rather than a liberal market system. Using depoliticized institutions to intervene in private business under a slogan calling for economic development, authoritarian governments regularly acted to upgrade the country's industrial infrastructure and improve international competitiveness.

The relationship between the two Koreas shows two distinctively different characteristics during two different time periods: 1) Cold War confrontation during South Korea's military regimes, and 2) greater exchanges and increased dialogue during the civilian governments after the transition to democracy. After South Korea's transition to democracy in 1987, democratization and the end of the Cold War had a significant impact on inter-Korean relations. During the Cold War, tension in the region remained high because of infiltrations and terrorist attacks by the North. South Korea's government's policies focused on national security and considered inter-Korean relations a zero-sum game. In general, both Koreas confronted each other without much dialogue.

The transition to democracy and the end of the Cold War, however, gave way to fundamental change in South Korea's approach to the North. The end of the Cold War allowed South Korea to normalize its relationship with China and the Soviet Union. Because of high levels of public support, South Korea's civilian presidents aggressively pursued engagement with the North and, along with the rest of the world, provided a lot of economic aid and investment for North Korea. As a result, trade between the two Koreas has increased significantly, but these efforts have been largely fruitless in promoting economic reform in North Korea and have failed to halt Democratic People's Republic of Korea (DPRK) efforts to develop nuclear weapons and long-range missiles.

The assassination of Park Chung-hee shocked the country and came at a difficult time. After years of solid growth, the economy was in the midst of a steep decline that was due in large measure to the 1979 oil price shock, the second in the decade, that once again doubled the price of oil. In addition, South Korea's debt skyrocketed, and banks were reluctant to provide additional loans that were desperately needed to get through this period. With the shaky economy and uncertain political times following Park's assassination, banks were unsure that South Korea offered a stable investment opportunity. Inflation rose to more than 30 percent, and labor disputes increased, adding to the economic uncertainty. The new government of President Choi Kyu-ha faced some daunting problems, and he had little time to produce results. In the end, he did not prove up to the task and failed to be the strong, decisive leader South Korea needed to weather this storm.

Return to Military Rule: Chun Doo-hwan and the Rolling Coup

While Choi Kyu-ha was working to solidify the new civilian government in the wake of Park's assassination, others had been planning a different course of action. In 1979, Major General Chun Doo-hwan was appointed to head the Defense Security Command (DSC), the most powerful of South Korea's military intelligence agencies. Because the DSC had jurisdiction in dealing with military coups and revolts, Chun was given the responsibility of investigating Park's murder.

On February 25, 1998, long-time dissident leader Kim Dae-jung was inaugurated as president. The election of President Kim had significant political implications in South Korean history. This lateral power transfer was the first in modern South Korean politics. Prior to the victory of Kim Dae-jung, candidates from the ruling party always won the presidential election. Thus, this power transition was the first time an opposition candidate won the election, an important indication that South Korea was becoming a stable democracy. Also, President Kim Dae-jung was different from his predecessors. He was the first president from Cholla Province, the southwestern part of South Korea, and he had a progressive, left-wing political orientation, by contrast with his predecessors, who were conservative, right-wing leaders from the southeastern Kyongsang Province. As a result, significant changes followed in his administration. In this chapter, we discuss political and social changes during the Kim Dae-jung administration in the context of the democratic consolidation process in South Korea.

Domestic Politics during the Kim Dae-jung Administration

Although South Korea experienced the transition to democracy in 1987, there were no clear political cleavages in South Korean society that led to distinct, institutionalized political parties. The chief explanations for this situation are grounded in the legacy of Confucianism and the Korean War. Confucianism emphasizes harmony and discourages division. The Korean War, the first conflict between the Korean people since Silla's unification of the country in 668 a.d., was a result of differences in political ideology.