Corona Crisis in the Mekong: From Extractive Imperialism to a New Bloom - Charlie Thame and Jana Rue Chin Glutting February 2021 ...
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Corona Crisis in the Mekong: From Extractive Imperialism to a New Bloom Charlie Thame and Jana Rue Chin Glutting February 2021
TAB LE OF C O NTE NTS
Acknowledgements 01
Introduction 02
Part One: The Corona Crisis in the Mekong 03
National Responses 04
Uneven Impacts 06
Export-Oriented Industries 06
Job Losses 07
Labour Rights Abuses 08
Informal Workers 08
Migrant Workers 08
Refugees and Internally Displaced Persons 09
Insufficient Support 10
Hunger, Hardship, and Distress for Some, Opulence and
Profit for Others 11
Part Two: Capitalist Transformation and Class Formation 14
Capitalism’s Crisis Tendencies 17
The Coronavirus as a Crisis of Capitalism 18
Pandemic as a Trigger 20
The Metabolic Rift 20
Extractive Imperialism in the Mekong 21
Extractive Capital and State Transformation 22
Part Three: Alternatives to Extractive Imperialism 25
Political Education 26
Glimmers of Hope 27
Democratic State Transformation 27
Conclusion 31
Alternatives 32
Bibliography 34
Endnotes 4401 ACKNOWLEDEGEMENTS
We would like to thank My Linh Dang for
her research assistance and contribution
to the study team, Stephen Campbell for
reviewing and commenting on a draft of
this paper, and Doi Ra Lahken, Sophea
Chrek, and Zau Tu for conversations
that have influenced the argument.
Appreciation is also extended to Nancy
Chuang for accepting the challenging
task of illustrating the accompanying
“Expropriation, Exploitation, and Unequal
Exchange: An Illustrated Introduction to
Capitalist Transformation of the Mekong”
and her patience and persistence working
with us to produce a booklet based on
this paper for political education purposes.
Solidarity is extended to progressive youth
and their allies for rekindling hope during
a difficult year through creative, intelligent,
determined, and courageous acts of
resistance.
Author: Charlie Thame (Faculty of Political
Science, Thammasat University, Bangkok)
Co-author: Jana Rue Chin Glutting
Suggested citation: Thame, Charlie & Rue
Glutting, Jana Chin “Corona Crisis in the
Mekong: From Extractive Imperialism to
A New Bloom” Hanoi: Rosa Luxemburg
Foundation 2021.I N T R OD U CTION 02
As of January 2021, over 88 million covid-19 and inherent crisis tendencies. It connects
cases had been recorded worldwide these to processes of class formation
leading to 1.9 million deaths. Countries in generated through the ongoing capitalist
the Mekong subregion have managed the transformation of the subregion, noting
health aspect of the crisis far better than those most affected by the corona crisis
much wealthier counterparts such as the are those societies have disempowered as
United States and United Kingdom. The social relations and state forms have been
US has recorded 66,660 cases per million reorganised towards expanded production
compared to 6, 15, 23, and 141 cases per of commodities for export. It argues this
million in Laos, Vietnam, Cambodia, and has been an essentially extractive process
Thailand respectively. Having weathered whereby natural and social wealth has been
the first wave, Myanmar became a regional commodified, expropriated, and exploited,
outlier with 128,772 recorded cases (2358/ in pursuit of monetary wealth mostly
million) and 2,799 deaths after a mutated accumulated elsewhere. This process is
strain (D614) first d etected i n M arch t hat inherently imperialist, as social relations
can multiply 20 percent faster and is 10 in dominated countries across the region
times more infectious began spreading have been restructured to meet the needs
locally.1 This may lead to a second wave of dominant countries and class fractions,
sweeping through the subregion after leaving subaltern class fractions especially
new infections were discovered in Laos vulnerable to shocks and disruption.
and Thailand in December. Despite
relative success containing the virus, the Part three argues the corona crisis has once
political, economic, and social again exposed the limitations of capitalist
implications of measures to constrain social relations of production and presents
its spread have been devastating for an opportunity to renew struggles towards
many and borne disproportionately by more rational and democratic forms of
the poor. This will have long-lasting social organisation. To this end, it highlights
effects on the livelihoods and wellbeing of diverse social groups across the subregion,
people across the region. from peasants and factory workers to
This paper provides an introduction to the progressive youth, resisting concentration
initial impacts of the corona crisis on some of power and wealth and the demands they
the most vulnerable populations across have made on their respective states. The
the Mekong at the end of its first year. Part paper concludes by arguing long-lasting
one highlights uneven fortunes of different change and genuine social transformation
social class fractions, from low paid can only be achieved by struggles from
workers in export-oriented industries to below led by such diverse subaltern class
those participating in informal economies, fractions, aiming toward progressive
immigrant workers and displaced persons. transformation of diverse state forms so
These fortunes are contrasted with those of that we may rationally re-order our societies
salaried workers, big firms, and investors in to better serve the interests of people and
financial markets. planet. This task is to be pursued through
political education and movement building.
Part two situates the corona crisis and its
impacts in the Mekong within broader global
and regional trends related to expansion
of capitalist social relations of production,
capitalism’s internal and external dynamics,01 The Corona Crisis in the Mekong
National R e s po n s e s 2 04
As of January 2021, Cambodia had Despite an almost non-existent health
reported few cases and no deaths, system, Laos had only reported 41 cases
leading to speculation about the and no deaths. International travel was
reliability of the government’s testing banned from 30 March and a national
and reporting. While the infection rate stay at home order issued. The country
remained low, international borders declared victory over the virus on 11 June
were closed in March and schools shut with just 19 reported covid-19 cases. Yet
nationwide. 400 factories suspended unemployment surged from 2 percent to
operations, leaving around 150,000 25 percent, foreign exchange reserves
workers unemployed. 3 The Tourism were sapped, national revenue decreased,
Ministry reported in September around and loans ballooned. The country risks
$US 5 billion in tourism revenue had been being unable to meet external debt
lost.4 Karaoke parlours, beer gardens, obligations and faces the possibility for a
and entertainment venues were closed in sovereign debt crisis in the near future.10
November. The garment sector employs The massive Mohan-Boten cross-border
the most workers after agriculture and special economic zone under construction
suffered a significant decrease in global on the Laos-China border was ordered to
demand during the pandemic. Overall close for 14 days in December after two
salaries decreased by 30 percent from cases were discovered among Chinese
January to April, with those in the migrants transiting home from Myanmar
entertainment and sex industries hit the via Laos.11
hardest at 84 percent.5 The government
pushed through emergency powers to Myanmar’s case load remained low until
deal with the pandemic, criticised as “a August. A task force was established
pretext to enact emergency measures by the elected National League for
that stifle dissent, side-line political Democracy government to oversee the
opposition, and consolidate power”.6 At crisis response in mid-March 2020 but
least 30 people, including twelve linked was soon undercut by a separate military-
to the dissolved opposition party, were led task force established by the armed
arrested for spreading “fake news” about forces. This was empowered to investigate
the virus.7 In March, Prime Minister Hun covid-19 cases, conduct contact tracing,
Sen was given even greater powers to and clamp down on the press and social
deal with the virus and between $US 800 media and did not answer to Myanmar’s
million and $US 2 billion was allocated de facto elected leader, Aung San Suu Kyi.
to address economic impacts. This The United Nations Special Rapporteur
was supposed to help small farmers claimed the military used special powers
and workers but may have ended up as cover to conduct war crimes against
subsidising big business instead, funds the country’s long-suffering minorities.12
may have ended up in the pockets of big With one of the weakest public healthcare
rice millers, agribusinesses, micro finance systems in the world, more than 45,000
institutions, and banks. 8 According to people, including covid-19 patients, were
the Cambodian Labour Federation, only housed in school buildings, monasteries,
15,000 of 150,000 known suspended government offices, and tower blocks,
garment workers had been receiving cared for by thousands of volunteers
the monthly stipend of $40 promised to who generally received no compensation
them in May.9 and were provided with little protective
equipment.13 Extreme poverty at the05 national level tripled under lockdowns, on exports and tourism, up to 14 million
from 16 percent in January rising to 62 people - a quarter of all working age Thais
percent by the end of the year, posing - could be made unemployed as a result
huge risks for food insecurity and of drought and the pandemic, and an
malnutrition.14 International lenders such additional 9.5 million made poor.18 This
as the International Monetary Fund and the includes 2.5 million working in tourism,
Japan International Cooperation Agency 1.5 million in the industrial sector, and
committed up to US$ 1.25 billion loans 4.4 million in other service sectors.19 A
to help mitigate the economic damage, US$ 12.7 billion stimulus package was
and the government has distributed approved in March after the stock market
20,000kyat (approx. $15) cash handouts tanked, followed by a US$ 58 billion
to households.15 package (10 percent of gross domestic
product) approved in April. This endowed
Thailand had the first wave under control Thailand’s central bank with US$ 12.1
in May following a super-spreader billion to stabilize financial markets by
event at a military-owned boxing gym purchasing corporate bonds, and enabled
in March. Few local transmissions were the government to provide some support
recorded until early December 2020 for low-income workers and distribute
when returnees from an entertainment handouts to middle classes to boost
venue in Myanmar skipped quarantine domestic consumption. Around US$ 33
and a cluster of cases were discovered billion in public partnerships projects are
among migrant workers in an industrial planned for 2020 to 2027 to stimulate the
port south of Bangkok. Several further economy.20
clusters emerged at the end of December
linked to illegal entertainment venues Vietnam had recorded 1,509 cases and
that had not been closed by authorities. 35 deaths as of January 2021. A state of
Borders were closed on 22 March and a emergency and ban on all flights to and
state of emergency declared four days from China was declared on 1 February
later that remains in effect. This allowed 2020. A national lockdown began on 1
authorities to restrict domestic travel, ban April, lifted gradually toward the end of
gatherings, and censor the media, forcing the month. Borders were cautiously and
a brief hiatus on youth-led pro-democracy selectively reopened in May and July.
protests that had erupted nationwide Having effectively contained the first wave,
in January.16 Protests resumed in July a second wave spread from the central city
following the abduction and presumed of Danang in July. People were evacuated
enforced disappearance of an exiled and a local lockdown implemented. Less
critic of the Thai establishment in Phnom draconian measures were employed to
Penh. A “state of extreme emergency” tackle this wave, emphasising economic
was declared on 15 October following recovery and manageable transmission
an extraordinary day of protests directed rates. The resilience of the socialist
at the military and monarchy culminated republic is reflected in the fact it is the
in thousands marching on Government only Southeast Asian economy forecast to
House, encountering a royal motorcade grow in 2020 and managed to send large
en route. The order was ignored by donations of medical supplies including
protestors and rescinded a week later. masks, test kits, and personal protective
The economic impact on Thailand will equipment worldwide from early April to
be among the worst in Asia, with the much richer nations including the United
most globally integrated economy in the States.21 The pandemic has nonetheless
subregion forecast to contract by at least negatively affected 31 million workers,
8.3 percent in 2020.17 Highly dependent with 900,000 out of work and nearly 18million on reduced incomes. The services argument in favour of national economic 06
sector has been most affected, particularly strategies based on low-wage labour and
hospitality and tourism, followed by outsourced manufacturing.24 Taking the
industrial and agricultural sectors garment sector as an example. The Asia-
respectively.22 A US$ 1.1 billion fiscal Pacific region is the largest global hub for
stimulus drawn not from international garment production, employing around 65
loans but Vietnam’s contingency budget million workers, approximately 40 million
was announced on 3 March, including tax of them in Southeast Asia.25 Workers and
breaks and infrastructure investments. supplier firms have long been squeezed
Around US$ 7.6 billion tax revenues and by subordinate positionally in hierarchical,
land rent owed to the state was deferred exploitative global commodity chains. A
in early April for five months and plans 2019 report by Oxfam found that even before
were announced for a US$ 2.6 billion the pandemic, 99 percent of Vietnamese
support package for those affected by the garment workers were paid below a living
pandemic.23 wage and as low as 2.4 cents per piece.26
In contrast, brands headquartered in
advanced economies and tax havens
performed very well in recent years.
The CEO of Mango said 2019 was an
“extraordinarily satisfactory year,” with
Uneven Impa ct s the highest sales figures in the company’s
history and the largest increase in profit
Despite relative success containing in a single financial year.27 Zara reported a
the virus, health measures imposed to net profit of US$ 1.3 billion over just three
constrain its spread have strained and months at the end of 2019, up 14 percent
magnified structural dynamics, inequities, on the previous year.28 As firms continued
and cracks existing prior to the pandemic. to dole out dividends to shareholders, the
The socio-economic fallout for the Mekong pandemic had a devastating effect on
subregion is proving more devastating than workers. Brands cancelled orders, refused
the virus itself, with its impact on different to pay for them, and demanded up to 50
social classes varying dramatically. percent discounts on existing contracts,
forcing locally based supplier firms to cover
costs already incurred for wages and raw
materials, effectively robbing suppliers in
Bangladesh, Myanmar, and Cambodia of
Ex p ort-Ori e n t e d I n du s t r i e s US$ 16 billion.29 As factories were closed,
the workers who toiled to produce the
clothes and footwear that brands profited
The virus has disrupted the approach from were abruptly cast aside, suffering job
to economic development encouraged losses and reduced incomes, often forced
by development partners, financial to wait for salaries to be paid, or laid off
institutions, and preferred by ruling classes without proper compensation. Many of the
across the region: export-led and reliant factories that remained open used the crisis
on deep integration into global commodity as an excuse for union busting.
chains. Lockdowns and subsequent
halts to “business as usual” in mature/
developed markets severely impacted
industries reliant on global demand
with livelihoods and security of low-paid
workers worst affected. As Tran notes,
the pandemic has revealed flaws in the07 Jo b L os s e s
More than one million of 4.3 million workers
in Vietnam’s garment industry lost their jobs
while remaining employees were forced to
accept 50 percent fewer hours and a 40
percent reduction in income.30 Women
make up approximately 80 percent of the
industry, most of whom young internal
migrants from rural areas.31 More than
130,000 Cambodian garment workers lost
their jobs by June, with unionists among
the first dismissed.32 Many of Myanmar’s
1.1 million garment workers, around 90
percent of whom are women, were laid off
while factory owners fled without paying
salaries for work already completed.33 By
July, around 300,000 had lost their jobs, with
many more at risk as a second wave sweeps
the country.34 In Thailand, companies used
the pandemic as an excuse to close down
businesses, fire workers and union leaders
without compensation or taking steps
required by law.35 An estimated 750,000
workers could be laid off in the automotive
sector due to the pandemic, exceeding
the number during the 1997-1998 Asian
Financial Crisis.36 Farmers, fishers, and
traders have also suffered considerable
disruption. Close to 1 million jobs are at
risk in Myanmar’s fishery industry as major
buyers in the United States and China
cancelled orders and $US 750 million export
earnings vanished. Producers were unable
to sell produce locally because seafood had
been processed for export, which locals
could not afford to pay for.37 Over US$
581 million worth of cattle were officially
exported from Myanmar to China through
the Muse border from financial year 2017-
18, but restrictions on livestock imports left
10,000 cattle stranded, burdening traders
who became responsible for mounting
wages, feedstuff, and healthcare costs.
Monetary value of official exports plunged
to $US 40.5 million in financial year 2019-
20 and US$ 13 million in financial year
2020-2021 as of 27 November.38L ab our R i gh t s A bu s e s economy, amounting to approximately 18 08
million people.44 Another 18 million can be
found toiling in Myanmar’s informal sector,
Workers in factories that remained approximately 83 percent of the country’s
open faced wage cuts, unsafe working workforce.45
conditions, and union busting. Management
has dismissed unionised workers while As the formal sector continues to contract
retaining non-unionised workers, and through layoffs and a slow recovery,
unionists have been arrested, charged, the informal economy will balloon,
and imprisoned, leading to accusations exerting further downward pressure on
by unions against employers of collusion labour income, working conditions, and
with authorities to purge activist workers.39 households across the region. Lockdowns
Workers rely on overtime to make ends in Cambodia meant 80,000 nightlife
meet because of extremely low wages but industry workers, including bartenders,
most factories can no longer provide this cleaners, waitresses, and hostesses, went
option. Others have had wages withheld by months without a stable income.46 The
factory managers.40 Arrest warrants were 2019-20 drought meant farmers in Laos
issued for eight union leaders in Myanmar were unable to produce enough rice to
in February 2021 who took to the streets to cover even household consumption and
lead resistance to a military coup. lack the option of off-farm employment due
to the crisis. Short of money for food, some
have been forced to forage to survive.47 In
Vietnam, parents have been forced to send
their children to home provinces to be raised
Inform al wo rke rs by their parents because it is too costly to
raise them themselves. A similar plight
Approximately 78 percent of the total is faced in Karen State Myanmar, where
working population in Southeast Asia most of the young travel to Thailand for
remain in the informal economy, among work, resulting in broken family structures
the hardest hit and least supported.41 This and communities where only the old and
includes the self-employed, those reliant children are left to care for one another.48
on irregular daily wages, taxi and tuk tuk
drivers, subcontractors, waste recyclers,
street vendors, domestic workers, and
sex workers.42 They enjoy neither regular
salaries nor social protections and often fall
M i g ra nt Wo r ke rs
through the cracks of modest government
support mechanisms, making them Migrant workers are a sub-group of
especially vulnerable to shocks. Many are informalised labour, comprising a significant
women and migrants who face additional portion of the region’s workforce and among
discrimination and hurdles. Even in the worst affected of all the diverse fractions
Thailand, the most developed economy in of the Mekong’s working class. Thailand
the subregion, 54 percent of the workforce is a major destination country and Laos,
remained in informal employment in 2017. Myanmar, and Cambodia are major origin
70 percent of the Thai workforce has seen countries. Partial lockdown of Bangkok and
falling incomes during the pandemic, a orders to close 18 border points in March
shockwave that is pulsing through sectors 23 resulted in a mass exodus of hundreds
well beyond exports and tourism.43 In of thousands of migrant workers.49 Many
Vietnam, 57.2 percent of workers outside the of those who remained had little allowance
agricultural sector are found in the informal made for the pandemic, stuck in cramped09 housing with limited access to healthcare.50 went hungry.57 Meanwhile, on Myanmar’s
Others had wages and identity documents border with China, not far from 172 internally
withheld, often afraid to approach displaced person camps housing 106,000
authorities for assistance due to punitive people sheltering from civil war, farmers
immigration policies in host states.51 Loss dumped spoiled crops in the Shweli River
of income for tens of thousands left many due to export restrictions.58
destitute.52 Many were routinely paid below
the minimum wage and indebted even
before the pandemic. A pre-covid survey
found 70 percent of Cambodian migrant
workers in Thailand suffered symptoms Ins uffi c i e nt S up p o r t
of depression due to economic pressure
and poor housing linked to insufficient
income.53 Those returning home often Loss of income for the most vulnerable
faced discrimination as local communities workers across the region forced many to
feared they may spread the virus. In some find ways to become even more resilient in
areas, such as Shan State and Wa region the absence of social safety nets. Official
in Myanmar, returnees were compelled to support has been uneven, insufficient, and
spend 14 days quarantine in ramshackle constrained by lack of resources available
huts as authorities improvised with the little to states.
resources available to them.54
Workers in Myanmar received 40 percent
of their salary, rather than 60 percent as
promised, arriving late or not at all for those
not included in the social welfare system.59
Refugees a n d I n t e rn a l l y In Cambodia, government support has
Disp lace d Pe rs o n s been “neither equal nor fair,” because
assistance was not provided to all, mostly
available only to bigger companies with
As hundreds of thousands of migrants thousands of workers.60 Cash handouts to
returned home, others remained trapped informal workers in Thailand were massively
by lockdowns. Immigration detention oversubscribed, chaotic, and linked to
centres became hotspots for transmission, suicides among economically distressed
where refugees and irregular migrants are people.61
routinely detained in overcrowded and
squalid conditions, sometimes indefinitely.55 Many workers were forced to return to the
350,00 internally displaced persons land to survive, putting additional pressure
throughout Myanmar’s ethnic states and on already stretched rural communities
90,000 refugees along Thailand’s border with who face obstacles imposed on their ability
Myanmar faced even greater restrictions on to access society’s resources in pursuit
mobility and access to livelihoods, leaving of economic growth. Remittances are a
them solely dependent on humanitarian crucial lifeline for the poor, comprising
assistance, contributing to unhealthy coping a significant portion of gross domestic
mechanisms including drugs, alcohol, and product in Vietnam, Cambodia, and
in some cases suicide, as well as increased Myanmar. More than 200,000 migrant
incidence of domestic violence.56 Displaced workers returned to Laos from factories in
persons on the Myanmar side of the Thai Thailand, disrupting remittance flow that
border rely on cross-border trade for basic could push as many as 214,000 people into
necessities including rice, salt, and medicine. poverty.62 Despite low wages, Cambodian
With borders closed, over 500 children workers in Thailand managed to send anaverage of $1,225 home to their families have previously suffered land grabbing, 10
per year pre-pandemic, funds that were who now lack even this meagre means of
“crucial in maintaining or improving living subsistence. As one Cambodian farmer
conditions”.63 Yet farmers across the region put it “the disease we suffer during this
are now supporting family members upon pandemic period is not covid-19 but
whom they may have previously depended landlessness”.67
for financial support. As remittances dried
up, farmers were starved of capital needed The corona crisis has compounded existing
to re-start production, exacerbated by a financial distress of the poor. Cambodia
drop in demand for cash-crops such as had 2.6 million micro loan borrowers
rubber and sugarcane. Thai workers were owing a total of US$ 10 billion before the
able to return to the land during the Asian pandemic. The average micro loan size is
Financial Crisis, but uneven industrialisation, $3,804, the highest in the world and more
drought, and declining commodity prices than double the average annual household
wrought this safety net from them, leaving income of $1,376 in 2017.68 72.8 percent
14 million on the brink of survival.64 of 104 Cambodian small and medium scale
farmers were already in debt pre-pandemic
Commodification of land and expansion and 29.2 percent were forced to take out
of massive infrastructure investments loans from micro-finance institutions and
including hydropower dams have left commercial banks as a result of it. Around
fisherfolk in Cambodia, Thailand, and the 50 percent reported difficulties repaying
southern Vietnam Mekong Delta region loans, 60 percent reported cases of land
struggling with record low water levels grabbing.69 Distressed farmers and garment
and freshwater shortages.65 Many farmers workers have been forced to sell the few
face food insecurity and rising food prices. assets they still have - chickens, pigs, and
A survey of 104 small and medium scale cows - to avoid having their land taken away.
farmers in Cambodia found 59.8 percent As indigenous Khmer farming communities
did not even have enough food to eat.66 sheltered from the virus, they suffered land
This plight is exacerbated for those who grabbing for rubber plantations.70
Personal remittances, received (% of GDP)
10
8
6
4
2
0
1993 1998 2003 2008 2013 2018
KHM MMR VNM LAO THA GSM Average
Source: World Development Indicators11 Hunger, Ha rds h i p, a n d D i s - nine months of 2020.73 Institutions lending
to distressed farmers also did very well. A
tres s for So me , O pu l e n c e major Cambodian micro-finance institution
and P rofi t f o r O t h e rs posted net profits exceeding $US 21 million
in the first half of 2020, up from $US 17.6
million. It’s parent company agreed to sell
As millions face hunger, hardship, and it’s 70 percent share in Cambodia’s biggest
destitution, others saw out the lockdown in micro lender in 2019 for $US 603 million,
comfort. United Nations Secretary General booking a large profit. Another made $US
Antonio Guterres said the pandemic: “has 25 million profit in 2016, $US 27 million
been likened to an x-ray, revealing fractures in 2017, and $US22 million in 2018. This
in the fragile skeleton of the societies we reportedly allowed it to pay $US 5 million in
have built.”71 These are most apparent along dividends to shareholders, many of which
class-based lines. Classes are relational and are development agencies supposed to
multifaceted social and cultural formations help poor Cambodians.74 As an academic
rooted in exploitative relations of production, was quoted as saying:
formed, interacting, and reproducing
through relations with other classes across
global, national, regional, and local scales.
Class formation revolves around the
capital-labour relation, which influences The main beneficiaries of microcredit
the relative material power of different in Cambodia are quite clear. They are
groups in society. The working class as a the chief executive officers and senior
whole is further segmented into fractions managers of leading microfinance
of labour differentiated by the type of work, institutions and their core shareholders
form of employment, gender, ethnicity, and wealthy foreign investors, who …
and a variety of other social factors. Class have been making out like bandits.75
fractions extend beyond just the production
of commodities on the farm or in the factory
to the whole world of work, including often
unpaid labour of domestic work necessary
for social and societal reproduction, such As Lao migrant workers returned home,
as cleaning homes, nurturing children, remittances dried up and farmers forged
nourishing bodies, and caring for the sick.72 for food, the stocks of a Malaysian holding
The people our societies have empowered, company with investments in the country
such as fractions of capital and privileged hit record highs, up 230 percent from June
fractions of labour, were able to weather 2019 after it’s “cash cow” Laos dam came
the crisis with minimal disruption. Some online. The project is expected to yield
even luxuriated and profited from it. While investors net profit of $US 60-70 million
those our societies have disempowered, per year for 25 years, or dividends of
predominantly fractions of labour, have around 16 percent.76 Meanwhile, the $US
borne the brunt. 27 per month allowance paid to thousands
of destitute Laotians living in relocation
In the agribusiness sector for instance, as centres displaced by the collapse of another
small and medium sized farmers struggled dam in 2019 dried up.77
with food insecurity and land grabbing,
earnings of a subsidiary of Thailand’s
largest company and one of the world’s
largest conglomerates jumped 87 percent:
the highest in the company’s history. Profits
grew 36% to $US 593 million in the firstA whole range of essential but low paid of $US 42 billion from so-called emerging 12
frontline workers, healthcare professionals, markets, double the rate of capital flight
those who could not work from home, or during the Global Financial Crisis.82 The shock
rely on extra income to pay the bills, faced was compounded by a crash in commodity
occupational health and safety risks and prices, upon which many developing states
discrimination. Those better paid, able depend. Central banks around the world
to work from home, or with alternative such as Thailand’s responded by shovelling
sources of income such as rental income or money into financial markets at the cost
savings, remained ensconced in comfort. of budget sector deficits and public debt,
For instance, dozens of brave young improving access to credit for large firms
nursing students volunteered to travel to and allowing overvalued financial assets to
the front line to care for suspected virus continue appreciating. This will contribute
patients among returnees on the Thailand to even greater extremes of capital
- Myanmar border.78 Meanwhile, their concentration and centralisation, as cashed
fellow nurses and doctors in Yangon and up conglomerates and the super-wealthy
Mandalay were shunned and treated like pick up distressed assets recycled on the
“dirty monsters” by private landlords, with market at discount prices from struggling
some forced to stay in monasteries while small and medium sized enterprises.83
they battled the virus.79
Volatility in financial markets catapulted
Many sheltering at home ordered takeout total billionaire wealth to $US 10.2 trillion
food via mobile applications delivered by in July 2020, up around 500 percent
informal employees via online platforms. As since 2008 and 19.1 percent since 2018.
demand grew, foreign companies extracted Between April and July 2020 combined
increasing revenues generated by local billionaire wealth ballooned 27.5 percent
businesses and workers. Restaurants using following central bank interventions. An
a popular food delivery app in Thailand employee of Swiss investment bank UBS
were charged 30 percent commission, credited this to the super-rich “having the
with drivers also paying 15-25 percent stomach” to buy shares as markets were
of their income to the Singapore based crashing; as if billionaires were the ones to
company. Despite laying off employees be commended for bravery and risk taking
during the pandemic, the firm’s valuation during a pandemic.84
rose 27 percent: from US$ 11 billion in
2018 to $US 14.9 billion in 2020, attracting
new institutional investors from across the
globe grasping for a piece of the pie.80 Up
in the stratosphere of the wealthy elite,
some luxuriated in opulence. During the
pandemic millionaires in Bangkok could
order Wagyu beef, seafood, and dim sum
delivered and served by white-gloved
butlers from luxury hotels and Michelin
Guide restaurants, real estate valued at $US
1-5 million continued to sell well, and high-
end vehicle manufacturers such as Ferrari,
Rolls-Royce, and Lamborghini launched
top-end models.81
The pandemic punctured global financial
markets, leading to a massive withdrawalCapitution on emerging markets
13 Accumlated non-residential flow to/from EM debt and equities from start date, $bn
0
Chine scare (from 26 Jul 2015)
-5
-10
-15
-20
-25
Chine scare (from 26 Jul 2015)
-30
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Capitalist
Transformation and
Class Formation15 The previous section provided an overview of the growth of surplus populations lacking 15
the impacts of the corona crisis on some of access to formal waged employment”.85
the most vulnerable groups in the Mekong,
contrasted with the fortunes of the more Those who have shown resilience and
powerful. The current section offers a critical even opportunism during the crisis are
analysis of the crisis, situating it in broader those able to snaffle the surplus workers
structural trends related to the expansion of created during this transformation. They
capitalist social relations. managed to do so by being well placed
to capitalise on the process, able to assert
It is important to recognise the people social and economic power over the means
who have struggled the most during of violence and societal control, and the
the current crisis are those that have production, circulation, and consumption
been disempowered by their societies in of commodities. Many of these actors are
the course of the subregion’s capitalist located outside the subregion, but those
transformation. Encouraged by multilateral inside it include militaries and militias;
financial institutions including the World bureaucrats, state officials, well connected
Bank and Asian Development Bank, nature elites; land owners, industrialists, traders
has been commodified and investments and merchants; brokers, compradors, and
directed toward infrastructure, economic emergent middle classes. They managed
corridors, and industrial zones. People have to assert claims over living and non-living
been driven from the land and means of labour: people, populations, and political
subsistence and into low-paid wage-labour in posts; land, natural resources, and new
labour intensive industries including natural technologies. Their privileged positions
resource extraction, contract farming, urban enabled them to accumulate wealth and
manufacturing, and myriad informal jobs prestige as capital was set into motion,
to keep society functioning: construction, especially during the boom years, in turn
domestic labour, street hawking, day labour, allowing them to shape processes of state
and sex work. formation and transformation: writing laws
and building and bending institutions to
Uneven geographical development protect their power and interests. As a result,
compelled people to migrate to towns, a variety of diverse ruling class coalitions
cities, and special economic zones, are ensconced in the upper echelons of
occasionally across international borders, societies across the region. While distinctive
subjecting them to further discrimination to each society, they are predominantly
and labour segmentation by local comprised of rich old men and draw on
governance regimes. Informal employment networks of business elites and tycoons,
is often is the unintended outcome for many old aristocracies and lingering patronage
migrant workers unable to find work in the structures, security forces, and emergent
manufacturing sector, which often first networks of politicians, using wealth to
attracts them to cities. Those who promoted consolidate power and resist struggles for
this approach claimed moving peasant progressive reform.
smallholders from farms to factories would
be accompanied by industrial upgrading and This is the process of class formation that
gradual transition from informal to formal accompanies the inauguration and expansion
labour, stable employment and incomes of capitalism, a process through which our
adequate to satisfy workers’ livelihood and societies allow some to become rich and
consumption needs. Instead, transitions have powerful while others are marginalised and
stalled leaving the subregion’s economies impoverished. Capital is wealth that grows
trapped in “patterns of jobless growth, through the process of circulation over time.
‘saturated’ industrial labour markets, the It is not a thing but a dynamic living relation,
informalisation of industrial production and a social relationship between individualsand groups that provides a foundation for society needs and wants, diverse fractions 16
more complex social structures. Capital gets of labour share certain experiences and
transformed, from ecological, to money, to develop common interests through this
fictitious/finance capital, and codified into process and their collective subjugation to
laws and other structural features of society: the daily drudgery of work. Farmers and
formal and informal institutions, the state, factory workers may share the experience
its organs, and other political, social, and of being pushed off land they once lived on
economic arrangements which we are all and cultivated for sustenance; agricultural
collectively subjected to. Class is not a static labourers and seamstresses may share
and pre-determined social formation, rather the experience of being exposed to toxic
an experience and a process revolving chemicals, pesticides, or dyes. All breathe
around the capital-labour relation. As capital air that has been polluted in the process
is set in motion, society’s natural wealth is of capitalist transformation, perhaps
commodified and people are pushed into compelled to wash in water befouled by
wage-labour. Social relations are reorganised it. Many will share the experience of being
toward production of commodities to mistreated by their bosses; of having pay
exchange for money: industrialisation of deducted for unexpected reasons, of
agriculture for food crops, for example, or having employment terminated at short
expansion of labour intensive manufacturing notice. Many young women will share the
of consumer goods. Commodities produced experience of trying to avoid unwanted
in the Mekong are exchanged in markets to advances; those with different skin tones, of
be consumed locally, nationally, and globally, racial prejudice and discrimination. Migrant
making it a process with distinctive local workers engaged in all kinds of work will
effects but increasingly international and share the experience of being extorted
global dimensions. Local workers and states by officials, of being fearful when they
manage to capture some of the surplus encounter checkpoints, or when they must
workers create through wages, rents, entrust important documents to employers
and taxes, but most has been captured or officials. All fractions of labour are made
by commodity traders and transnational vulnerable to economic shocks and rising
corporations. This is an essentially extractive prices for housing and food, and share
process, whereby accumulation of interests in better social protections and
monetary wealth in faraway places depends access to basic services like education for
on the generation of socio-economic their children and decent healthcare when
and environmental consequences at the they get sick. Many will know the feeling
point of extraction here in the Mekong, of being ignored by the rich and powerful,
including enclosure, dispossession, their voices deemed unimportant to those
poverty, environmental despoilation, labour running their countries, and of being
exploitation, and ill-health.86 intimidated and suppressed when they
mobilise to struggle for better lives.
Classes are created during this process, with
aggregate capital influencing the formation Each these formative experiences are
of social groups as a means towards the deeply personal but inescapably social,
realisation of profit through the labour arising in the course of interaction between
process. Contract farmers, agricultural fractions of labour and fractions of capital.
labourers, seamstresses, entrepreneurs and The latter comprising, for instance, those
traders, have all been sent to work to earn able to assert property claims over the land
an income to pay for food to eat, a roof over on which crops are grown and the homes
their head, raise their children, and care workers live in, technology involved in the
for their families. Although they play very seeds planted, machinery used to harvest
different roles in the production of what and process produce, designs of t-shirts17 that young women toil to make. Private might fetch the highest prices in the future,
property claims allow fractions of capital advertising and marketing commodities,
to appropriate most of the value created by providing security for warehouses and
workers in the process of production and supermarkets, form filling in bureaucracies,
circulation, through rent paid to landlords, and protecting the interests of ruling classes.
protection money paid to officials; incomes Some may be socially necessary activities but
captured by managers and factory owners labour time expended must nonetheless be
allowing them to live comfortable lives, compensated for by surplus first generated
along with the claims of others based in the elsewhere. Crises ultimately occur as a result
region and beyond on the final sale price of of a falling rate of profit in productive sectors,
commodities: such as transportation fees, itself caused by insufficient production of
dividends, and taxes. Under capitalism, this surplus value and the expansion of claims
fluid, dialectical, interactive process is all upon it by non-productive sectors of the
directed toward one thing: making profit. It economy. This is a long term structural trend
is a process animated by struggles between under capitalism, consequent of the process
various class fractions over the who gets to of capital accumulation itself. Increased
claim the lion’s share. accumulation (more land, more machinery,
more money, more knowledge) leads to
increased productivity as fractions of capital
produce more commodities with less
labour. This in turn means fewer workers are
needed in the labour process, which leads
C ap italis m’ s C ri s i s to less surplus value being produced. Crises
Tend encie s are therefore unavoidable under capitalism,
a structural feature of relations of production
predicated on the private ownership of the
Crises are an intrinsic feature of capitalism, means of production and the wage-labour
rooted in the productive sphere of the relation, where workers are forced to labour
economy. Productive labour transforms for longer than they need to in order to
existing use values into new use values, reproduce their labour power.88
which, under capitalism, is geared toward
realising a profit when commodities are Over the years numerous attempts have
exchanged for money. Clearing land to plant been made by people and states to
crops, to be harvested and sold in markets promote the interests of fractions of capital
for a price higher than the combined costs and maintain profitability by squeezing out
incurred producing them. This requires more surplus for less. These commonly
renting land, buying seeds and other inputs, involve social and spatial restructuring,
paying workers to plant and harvest, and leading to concentration of capital,
transporting goods. The difference between intensified exploitation of labour and non-
the cost to produce the commodity and human nature, and outward expansion
the value that commodity is exchanged to access new production inputs such as
for is the surplus, usually appropriated land, labour, and natural resources at low
by the capitalist to use as she sees fit: for prices. The roots of the crises of 2008/9
personal consumption or for reinvestment and 1997 for instance may be traced back
in expanded reproduction. In developed to earlier capitalist crises in the Global
economies a huge amount of social labour North between 1973-1982 when fractions
time has been moved into non-productive of capital sought to return profitability
sectors of the economy, which David Graeber through intense restructuring at home and
has provocatively called “bullshit jobs”.87 abroad. Crises in Japan and Thailand in the
Time and energy devoted to buying and 1980s and 1990s linked to falling rates of
selling produce, speculating which cropsprofit encouraged fractions of capital to production process, over time capital 18
pursue efforts to expand capitalist relations becomes increasingly reliant for its survival
of production from relatively advanced on state intervention, accumulation by
capitalist centres to less developed dispossession, and imperialism in each
economies across the Mekong. A relative epoch of decay.
latecomer, China has joined this push to
keep its economy expanding.
Some take an even longer view of
capitalist crises. Samir Amin, for instance, The Co ronav i r us as a
argued we are in the midst of the second Cr i s i s o f Cap i t al i s m
long crisis of capitalism, beginning with
the social and spatial restructuring of
the 1970s and 1980s, but preceded by Some mistakenly view the covid-19 virus
the first long crisis of capitalism from as “black swan event,” an unforeseeable
1875 to 1945. Following ten centuries of and exogenous cause disrupting our
incubation, capitalism enjoyed just a short economies from the outside to precipitate
century of triumphant flourishing. But by a crisis. This is not the case.92 The corona
the end of the nineteenth century, falling crisis must instead be recognised as the
rates of profit spurred fractions of capital latest in a long succession of crises we
into imperialist expansion, contributing have been collectively forced to endure. It
to inter-imperialist rivalries, particularly is distinctive in that it confronts us with a
among the old European powers, twin crisis. The immediate manifestation
culminating in two immensely destructive and proximate cause is a health crisis
world wars. Widespread devastation tilled following the emergence of a new strain of
the ground for a new wave of capitalist coronavirus in southern China in 2019. The
expansion led by the United States during second is an economic crisis precipitated
the so-called “Golden Age” of capitalism by restrictions imposed to contain its
from 1945 up to the 1973-5 recessions. spread. This distinguishes it from recent
In each case, capitalist expansion relied crises catalysed by bubbles bursting in the
on barbaric primitive accumulation and financial sector of our economies. What
labour exploitation, including imperialism they share are structural drivers related to
through colonial subjugation. Existing the internal contradictions of the capitalist
political and economic relations in and mode of production.
across Southeast Asia are an effect of
these processes. The crises of the 1970s Covid-19 and other emergent diseases have
were themselves directly related to the been linked to land-use change associated
Cold War in Southeast Asia89, one outcome with deforestation, illegal logging, clearing,
of which was a new wave of capitalist mining, agribusiness, and infrastructure
expansion centred on East Asia, itself construction. This has led to the destruction
running out of steam in the late-1990s, of natural barriers preventing spill-overs and
culminating in financial crises across the heightened risks of transmission. Wildlife in
region.90 As Amin observed, fractions of rural and wild areas host previously isolated
capital responded to each long crisis with and unknown viruses and bacteria. As land
the same triple formula: “concentration has been cleared for plantations, livestock
of capital’s control, deepening of uneven farming, energy generation, and access
globalisation, and financialisation of to mineral deposits, microbes infect new
the system’s management.”91 Although hosts such as human beings and livestock.
competition may flourish for a while as This is known as spill-over. If viruses thrive
capitalism matures and takes over the in their new hosts they may then infect
others, known as transmission.93 Spill-overs19 and transmission have been happening for natural limits. It is also important to note
many years. The HIV virus spread in the mid that neither “China” nor “the Chinese” are
twentieth century from chimpanzees and responsible, as racist demagogues have
gorillas slaughtered for bushmeat. Ebola claimed to deflect attention from their own
outbreaks occurring since the mid 1970s failings. As the epidemiologist Rob Wallace
have been passed on by bats to primates reminds us, the United States and Europe
and humans; swine and avian flu outbreaks have both served as ground zeros for
occurring for decades have spread from new influenzas such as H5N5 and H5Nx;
pigs and birds to humans. Yet new viruses multinationals and their proxies drove the
have been emerging with increasing emergence of Ebola in West Africa and Zika
frequency. This century alone we have in Brazil.96 These outbreaks are not driven
encountered new strains of African swine by our “humanity” but by market forces:
fever, Campylobacter, Cryptosporidium, land use change driven by expansion of
Cyclospora, Ebola, E. coli O157:H7, foot- global commodity chains by multinational
and-mouth disease, hepatitis E, Listeria, corporations expanding food production
Nipah virus, Q fever, Salmonella, Vibrio, systems for global markets accompanied
Yersinia, Zika, and a variety of novel influenza by corporate control over otherwise
A variants, including H1N1 (2009), H1N2v, necessary industrialisation of agriculture.
H3N2v, H5N1, H5N2, H5Nx, H6N1, H7N1, This has led to growing dominance of
H7N3, H7N7, H7N9, and H9N2.94 These problematic production techniques such
have been linked to humanity’s increasingly as genetic monocultures, over-reliance
destructive relationship with nature. on pesticides, and antibiotics, which keep
Scientists presenting at the United Nations costs low but at the cost of “externalities”
Summit on Biodiversity in September 2020 that include adverse effects on public
declared: “when we destroy and degrade health, biodiversity, and hastening the
biodiversity, we undermine the web of life emergence of increasingly deadly and
and increase the risk of disease spill-over resistant diseases.97 As Wallace concludes,
from wildlife to people.”95 the cause of covid-19 and other emergent
diseases is therefore to be found “in the
It is worth clarifying this destructive field of ecosystems relations that capital
relationship is not an expression of an and other structural causes have pinned
essentially human frailty. Human beings back to their own advantage”. Corporate
sustainably coexisted with the natural profitability is secured, while damage is
world for tens of thousands of years externalised onto “livestock, crops, wildlife,
until the so-called “Great Acceleration” workers, local and national governments,
coincided with capitalism’s “Golden Age” public health systems, and alternative
of expansion after World War II, which agrosystems.”98
sent us hurtling into ecological overshoot
from the 1970s. Neither is it because
there are too many people on the planet.
Rational organisation of our societies
based on existing resources and genuine
human needs would help avoid dangerous
imbalances between human beings and the
rest of the planet. Rather, it is a symptom
of the development of the forces of
production under capitalism and expansion
of productive output where the drive to
profit overrides all else, including scientific
warnings about social consequences andPand em ic a s a Tri gge r on “Factory Asia”. Multilateral financial 20
institutions encouraged governments to
implement policy reforms to entice inward
The covid-19 health crisis emerged in the investments in infrastructure, power
midst of a long economic crisis. The core of generation, agricultural commodities, and
the global capitalist system has been gripped natural resources. More special economic
by decades of stagnation consequent of a zones popped up, economic corridors
falling rate of profit in productive sectors.99 expanded, large hydroelectric dams and
The last expansion of the global economy coal fired power plants were built, and the
was during a commodity price boom from Belt and Road Initiative was launched. The
1995-2008/9. It has been trapped in a long global capitalist system was kept on life-
recession since, marked by slow growth support between 2009-2020 by escalating
rates and falling levels of productive despoilation of nature and exploitation of
investment. Recovery following the 2008/9 labour. Yet despite the damage inflicted,
crisis was remarkably slow, as reflected attempts to revive it were unsuccessful:
by the longest economic expansion on global economic indicators were dead-
record from June 2009 to 2020.100 The 2008 lining even before the health crisis hit.103 As
profitability crisis was not resolved because one economist put it: “covid did not cause
fractions of capital and government officials the crisis, the crisis caused covid.”104
acting in their interests refused to permit
the huge devalorisaton of capital required
to rehabilitate the profit rate. Instead, costs
were forced onto fractions of labour. Huge
financial losses were socialised through The M e t a b o l i c R i ft
massive expansion of public debt, followed
by imposition of austerity measures
Capitalism’s systemic crisis tendencies are
including deregulation, tax cuts, assaults on
traceable to its internal contradictions as a
working conditions, cuts to public services,
mode of production. Namely those between
and hacking away at the social wage hard
a) use values and exchange values and b)
won over generations of class struggle.101
elemental natural processes and the capital
Tearing at the social fabric of industrialised
accumulation process.105 These lie behind
societies left the populace increasingly
capitalism’s failure to maintain conditions
susceptible to right wing demagoguery
of ecological and social reproduction,
and its scapegoats, itself precipitating a
leading to spoliation, squandering, and
tragic backlash in 2020 when incompetent
robbing of the earth, workers’ bodies, and
leaders of hollowed out states proved
our societies. Central to Marx’s oeuvre is his
woefully inept at handling the health crisis.
critique of the capitalist value form based on
the distinction between real wealth or the
Fractions of capital also responded to the
“natural form” of commodities, and their
2008/9 crisis with revitalized attempts
“value form,” or exchange value associated
to deepen uneven globalisation as a
with capitalist production. Today we often
conjunction of financial, climate, and
conflate value with price, so that the value
food crises triggered renewed interest in
of a house or an apartment is equivalent to
farmland and agribusiness investments
what someone is willing to pay for it: i.e. it’s
around the world.102 Finance capital scoured
exchange. As Foster and Clark explain, this
“emerging” and “frontier” economies in
understanding of value has roots in the rise
search of higher yields. China was presented
of neoclassical economics and its rejection
as a new engine for growth, expected to
of the labour theory of value of classical
heroically drag the global economy out of
political economy in favour of marginal
the doldrums and stimulate a new wave of
utility / productivity.106 According to the
economic expansion geographically centredYou can also read
