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
Indonesia had large oil reserves; Singapore had almost no natural resources. Do you think resource-rich countries always grew fastest?
- No, resources helped but could also become a trap.
- No, because resources did not help economies grow.
- Yes, natural resources brought the fastest growth.
Show the answer
No, resources helped but could also become a trap.
Indonesia was hit when oil prices fell in 1986, while Singapore grew through trade, skills and foreign investment.
Natural resources, population, skills and political stability shaped what each economy could do. They set the opportunities and limits for governments.
Natural resources mattered. Oil and gas gave Indonesia, Malaysia and Brunei large revenues, especially during the oil price rises of the 1970s. Fertile land let Thailand and Burma export rice.
Resources could also be a trap. Indonesia's heavy dependence on oil left it exposed when prices fell in 1986. Countries with few resources, such as Singapore, had to rely on trade, skills and foreign investment.
Population size shaped markets and labour. Large populations, as in Indonesia and the Philippines, offered a big home market and cheap labour, but also many people to feed and employ. Small Singapore had almost no home market, which pushed it towards exports.
Skills and infrastructure mattered. Singapore and Malaysia inherited ports, roads and an English-educated workforce from British rule. Indonesia and Burma had far fewer trained people at independence.
Political stability affected investment. Fighting in Burma and the turmoil of Sukarno's last years drove investors away, while stable governments in Singapore and Malaysia attracted them.
- Oil
- Indonesia, Malaysia and Brunei.
- Rice
- Thailand and Burma.
- Few resources
- Singapore.
Real examples to use
Indonesia's oil, early 1980s
Oil and gas provided about 70 per cent of the government's budget, so the 1986 price collapse, to below 10 dollars a barrel at one point, hit the state hard.
Singapore's lack of resources
With no hinterland and almost no home market, Singapore turned swampy Jurong into its first and largest industrial estate in the 1960s to attract export factories.
Burma's lost advantages
Rich in rice, timber and gems, Burma was still classed by the UN as one of the least developed countries on 11 December 1987, showing that resources alone did not bring growth.
Worked example: Comparing starting conditions
How did domestic conditions shape change?
- Singapore: few resources, a good port and skills; it had to export.
- Indonesia: oil wealth and a huge population.
- Burma: rich land but instability and few skills.
- Judgement: conditions set limits, but policies decided outcomes.
Watch out for this
Countries rich in resources always grew fastest.
Burma had rich land and resources but stagnated, while resource-poor Singapore grew fastest. Policies mattered more than resources.
Check your understanding
Why did Singapore's small size push it towards export-led growth?
- It had large oil reserves to pay for building new factories.
- Its neighbours banned trade with it after 1965.
- Its home market was too small to support large industries.
Show the answer
Its home market was too small to support large industries.
Right. It had to sell to the world.