What this lesson teaches
I can judge which factors, at home and abroad, did most to shape economic change in Southeast Asia.
Syllabus 9174, Paper 2, Theme II, Learning Outcomes. evaluate the factors shaping economic change in different contexts and over time
Make a guess
During the Vietnam War, the USA spent heavily on bases and troops in Thailand. How do you think this affected Thailand's economy?
- It boosted construction and services.
- It damaged it, because war harms trade.
- It had no effect, since the money stayed in the USA.
Show the answer
It boosted construction and services.
The Cold War brought aid, markets and spending to anti-communist states, while closed states missed out.
The Cold War brought aid, markets and spending to anti-communist states, while communist and closed states were cut off.
The USA wanted prosperous allies against communism. It gave aid and opened its market to Southeast Asian goods.
War brought money. US spending on bases and troops in Thailand during the Vietnam War boosted construction and services. Singapore earned income by supplying and repairing ships during the war.
Japan, an American ally, paid war reparations to Burma, the Philippines, Indonesia and South Vietnam in the 1950s. Its aid and investment grew in later decades.
Suharto's anti-communist New Order won Western aid. From 1967 a group of donor countries, the Inter-Governmental Group on Indonesia, lent to Indonesia regularly.
Communist and closed states lost out. Vietnam was isolated after 1975 and depended on Soviet aid, which shrank in the late 1980s. Burma chose isolation.
- US aid and markets
- For anti-communist states.
- Japanese reparations
- 1950s.
- Donor group for Indonesia
- From 1967.
Real examples to use
Friendship Highway, Thailand, 1958
Built with US aid to link Saraburi and Nakhon Ratchasima, it cut the journey from Bangkok to the north-east from about 10 hours to three. From 1954 to 1958 the USA spent 55.7 million dollars on Thai roads.
Aid to the New Order, from 1967
The Netherlands-chaired Inter-Governmental Group on Indonesia brought Western states, Japan and the World Bank together to lend to Suharto's government until 1992.
Japanese reparations, 1954 to 1959
Burma 200 million dollars, the Philippines 550 million, Indonesia about 223 million and South Vietnam 39 million, mostly paid in Japanese goods and services.
Worked example: Linking the Cold War to economic change
How did the Cold War shape economies?
- Aid: US and Japanese aid to allies.
- Spending: the Vietnam War boosted Thailand and Singapore.
- Markets: open US markets for exports.
- Isolation: Vietnam and Burma cut off.
Watch out for this
The Cold War only harmed Southeast Asian economies.
It did great harm through war, but it also brought aid, spending and open markets to anti-communist states.
Check your understanding
How did the Vietnam War help Thailand's economy?
- US spending on bases and troops boosted construction and services.
- The war cut Thailand's trade with its neighbours and the West.
- Thailand sold weapons to North Vietnam.
Show the answer
US spending on bases and troops boosted construction and services.
Right. War spending added to growth.