The Arms Race in Southeast Asia
by Baladas Ghoshal

One striking feature of international relations in the last two decades has been the proliferation of arms in Third World countries. While international attention focused on the arms race between the United States and the Soviet Union, military and arms buildup in the Third World continued unabated, exacerbating existing conflicts in these regions. This buildup occurred not just with the ready assistance of the two superpowers and their allies; it was also aided by Third World countries themselves, many of which actively entered the international arms market as sellers.

This paper seeks to discover the rationale for the proliferation of arms in Southeast Asia—particularly in the ASEAN (Association of Southeast Asian Nations) states of Indonesia, Malaysia, Singapore, Thailand, the Philippines, and Brunei—and the factors contributing to increased outlays for defense in these countries. The paper also examines the development of the armament industry in these countries by looking into patterns of arms procurement, which in many cases involves state-of-the-art weapons.

A Nontraditional Arms Race
The classic arms race model involves a set of specific responses to equally specific actions by two adversaries. This model cannot be applied to arms proliferation in Southeast Asia because there is no country in the region that is specifically engaged in such an arms race with another. In Southeast Asia, processes of action and reaction, setting in motion enhancements of armaments either in quantity or in quality, have not taken place so far, as they have in the case of India and Pakistan in South Asia or between the Arab states in West Asia. Although intraregional conflicts and rivalries arising out of perceived threats do exist in Southeast Asia and may have led to competitive arms acquisition by the countries of the region, arms buildups in the region have not brought about any alteration in the strategic balance. Thus, the case of Southeast Asia constitutes a nontraditional arms race.

Given legitimate security concerns and the latent instabilities in the region, the current level of defense spending in Southeast Asia is still quite low in comparison with the level of defense expenditures in South and West Asia. Some strategic thinkers in Southeast Asia consider the current defense spending by countries of the region to be inadequate or, at best, barely sufficient. Measured as a percentage of gross domestic product (GDP), defense spending in Southeast Asian countries during the period 1975-84 increased annually by just over 6 percent and only 2 percentage points above the annual growth rate in world military expenditures during the same period. For the ASEAN countries, in particular, defense spending as a percentage of GDP varied from 3 percent to 8 percent, and as a percentage of national budgets, from 8 percent to 23 percent. Interestingly, ASEAN’s increased defense spending during this period coincided with the spectacular economic growth and prosperity that these countries achieved in the seventies and the early part of the eighties.

The Southeast Asian arms buildup, except in the Indochinese countries (Vietnam, Laos, and Cambodia), is distinctive in yet another respect. The arms buildup reflects a shift from an earlier emphasis on counterinsurgency and internal security to a more conventional defense posture of preparation for potential external threats. As far as ASEAN states are concerned, there is a genuine need for members to upgrade their fighting capability, especially in the area of combat and equipment, in view of the new security challenges emerging from within the region and from outside it. As a result, the ASEAN countries have embarked on a drive to modernize their air and naval capabilities, and in recent years have opted for sophisticated systems.

Factors Influencing Proliferation
The proliferation of arms and the acquisition of conventional weapons systems by the ASEAN countries have been the products of many interrelated factors, both internal and external. Internal factors include domestic political developments; the availability of funds as a result of fast economic growth; the need to maintain internal security; and latent conflicts between ASEAN states, on the one hand, and ASEAN states and Vietnam and China, on the other. External factors arise from uncertainties regarding the credibility of the Western strategic umbrella that has traditionally been a guarantee of security against external aggression and threats.

By the end of the seventies, the improved internal security situation in all ASEAN states, except the Philippines, relieved the armed forces of these countries of the burden of excessive preoccupation with counterinsurgency operations. This created the opportunity to devote resources to other security needs, including the realization of each country's professed objective of greater self-reliance in meeting external challenges. Indeed, over the last decade, ASEAN has enjoyed remarkable stability and continuity. Malaysia, Thailand, and Indonesia succeeded in suppressing internal communist movements. Challenges and opposition to the ruling regimes in these countries were rendered insignificant or were reduced to manageable proportions, as also was the case with the separatist movements in East Timor and Irian Jaya.

While the potential for instability exists even now—emanating from the narrow political base of most regimes in ASEAN countries and from the lack of distributive justice, despite rapid economic growth—the possibilities of internal explosion are unlikely in the near future unless something unexpectedly goes wrong. This is why the ground forces in ASEAN countries are taking a backseat temporarily in regard to the modernization and upgrading of weapons and equipment. The focus has swung toward naval and air forces, signifying a shift in the defense postures of the ASEAN countries away from a predominantly counterinsurgency-oriented force structure to a conventional deterrent and war-fighting capability to meet the perceived security challenges of the eighties and the nineties.

Shift in Defense Rationale
This qualitative shift in the defense posture is sometimes explained by the planners of those countries in terms of their necessity to be self-reliant and prepared for all contingencies. Some years back, when Indonesia wanted to acquire the F-16 aircraft, the commander in chief of the Indonesian armed forces, Benny Murdani, declared that his country wanted those weapons not because it felt immediately threatened by an external enemy, but because it wanted its pilots and technicians to be well-trained, proficient, and abreast of developments in modern technology. The rationale sounds plausible in view of the experiences of Indonesia in the sixties, when it had to hire approximately 2,000 Soviet technicians for the upkeep of Soviet-supplied MiG-21 aircraft. Murdani argued that by acquiring the F-16 and similar modern equipment, Indonesia could acquire core capability in a few choice weapons systems. By training personnel in advance, the armed forces could expand its arsenal later, if and when required. A similar example of this sort of thinking was the Malaysian move to continue training on submarines in France, Sweden, and West Germany in the mid-eighties even though Malaysia at that time was in no position financially to acquire submarines.

The declining credibility of the Western strategic umbrella over Southeast Asia is another important factor prompting the defense planners of these countries to develop their own capability to meet emerging security challenges. The process of diminishing credibility began with the British withdrawal from Malaysia and Singapore, and climaxed with the fall of Indochina to the communists and the consequent American strategic pullout enunciated in the Nixon doctrine.

The implications of these latter developments become clear when one looks at the sudden strengthening of the armed forces of ASEAN countries and their sudden rush for arms imports. The expenditures on arms imports by ASEAN countries almost doubled during 1976-80 in comparison with the 1971-75 period. For certain countries, like Indonesia and Thailand, the increase in arms imports was even more—for Indonesia, expenditures rose from $30 million in 1973 to $450 million in 1981; and for Thailand, they rose from $10 million in 1973 to $320 million in 1980. The increase in arms imports by Thailand was likely a response to Vietnamese intervention in Kampuchea and the consequent Thai position as a frontline state in the conflict. The Thais anticipated the introduction of MiG-23s into the Vietnamese air force and wanted to counterbalance that by procuring F-16s from the United States.

A modernized and powerful China is always foremost in the perceptions of ASEAN states; Vietnam shares this perception. ASEAN perceptions of immediate and medium-term threats emanating from China have diminished in recent years due to the normalization under way between ASEAN states and China. Thailand has developed a special relationship with China ever since the Vietnamese occupation of Kampuchea. Together, China and Thailand consider Vietnam the primary source of regional instability. The strong views held by Malaysia and Indonesia regarding China’s role as a disruptive influence in the region have given way to dull misgivings. However, these countries want a strong Vietnam to counter any potential threat from a powerful China. Thus, concerns over the long-term threat posed by China do exist, and preparation for any eventuality is viewed by both Asean states and Vietnam as good sense.

Conflict over Maritime Boundaries
New security challenges emanating from latent intra-ASEAN and intraregional conflicts contribute to arms proliferation in Southeast Asia. One such conflict is the disagreement among the regional states over maritime boundaries. The Law of the Sea Convention, which attempted to solve the problems of maritime boundaries between littoral states, has not been ratified so far by most states. Moreover, the region’s numerous islands, atolls, reefs, and rocks, which litter these shallow but resource-rich waters and seabeds, are bones of contention between friends and foes alike. The issue at hand is not real estate itself, but rather the control of claimed territorial waters and the economic exploitation of the 200-mile Economic Exclusive Zone (EEZ) surrounding the disputed areas. The EEZ contains rich marine resources—the two most important being oil and fishing, although the deep-seabed in the South China Sea is also known to contain large deposits of minerals, particularly manganese nodules. The importance of offshore oil is highlighted by one estimate that, by later this year, almost all of Malaysia’s, 85 percent of Brunei’s, and 45 percent of Indonesia’s oil will come from the seabed within territorial waters.

The areas in Southeast Asian waters subject to rival claims by various states in the region include the eastern gap of Thailand involving Thailand, Vietnam, and Kampuchea; the southwestern gap of Thailand involving Thailand, Malaysia, and Vietnam; the waters north of the Natuna islands involving Vietnam, Indonesia, Malaysia, and China; the offshore waters of Brunei involving Malaysia, China, and Vietnam; and the waters north of the Spratly islands involving Malaysia, the Philippines, Taiwan, Vietnam, and China. The economic and strategic importance of the major sea-lanes between the Persian Gulf and Northeast Asia gives all the states in the region a reason to want a stake in the control of those waters.

The potential for conflict from maritime boundary and jurisdictional disputes became evident in 1980-81 when the dispute between Indonesia and Vietnam over the Natuna island group in the South China Sea came into the limelight. Indonesia carried out two huge military exercises involving more than 30,000 troops in a mobilization of conventional forces to meet an “invader from the north.” The Indonesian defense minister, General Yusuf, went to the extent of declaring in the country’s parliament in February 1980, “The Indonesian armed forces cannot avoid the possibility of facing a sea battle in the South China Sea.”

Similar potential for conflict exists in the Spratly island group, where the military presence of Vietnam, Malaysia, the Philippines, China, and Taiwan, together with the buildup of Chinese air, naval, and amphibious forces, has resulted in an extremely delicate and alarming situation. Sino-Vietnamese strategic rivalry extends to these islands that command the sea-lanes linking the Indian and Pacific oceans. There has already been a major naval clash, in March 1988, between Vietnamese and Chinese ships, in which the Chinese displayed a strong presence in the Spratlys. Any future conflict between Vietnam and China over these islands will directly affect the two ASEAN states, Malaysia and the Philippines, that have formal claims to parts of these islands. Conflict may also draw other, extraregional powers into the scene. While there have been public statements from China, Vietnam, and the ASEAN countries of their intent to settle their respective claims and jurisdictional disputes through peaceful means and negotiation, each of the parties has been increasing its military presence by sending more forces to the territory in question and warning other parties in the dispute to stay out. Among the ASEAN states, however, there is now a growing understanding of the need for joint development and exploitation of overlapping maritime zones; this has led to a number of bilateral and multilateral exercises to monitor developments in the region.

Surveillance and Protection
Another related issue responsible for the increased emphasis of ASEAN countries on building their air and naval capabilities is the need for surveillance and protection of their respective sea-lanes of communication (SLOCs). Since a major part of the economies of ASEAN countries is dependent on maritime trade and commerce, a smooth flow of sea traffic is vital to national security. More than with any other group of countries in Asia, the dependence of Southeast Asian countries on SLOCs exposes their economies to damaging disruptions. “It is, therefore, a matter of survival for them,” comments an analyst of the Southeast Asian strategic scene, “that sea routes remain open for maritime commerce.”

There is no denying that ASEAN countries, by themselves, will not be in a position, at least in the foreseeable future, to protect the sea-lanes against any major disruption caused by an external power. However, these countries can exploit their geographic advantage by acquiring capabilities to deny the use of sea-lanes to external adversaries in times of conflict. To acquire such capabilities, the ASEAN countries have, in the judgment of a Southeast Asian scholar, “a vital need to devote resources to the task of patrolling and monitoring traffic so as to ensure safe navigation against relatively low-level threats (such as acts of piracy) in the sea-lanes that pass through their national waters.” It was with this maritime security policy in view that Indonesia and Malaysia, under the terms of an agreement reached in 1971, claimed that the Strait of Malacca formed part of their national waters and that they retained sole responsibility for the safety of navigation through those waters. If the ASEAN states themselves take responsibility for the security of the seas in Southeast Asia, they must, of necessity, upgrade their air and naval forces to sustain even a limited role in the surveillance and protection of their respective SLOCs.

Interactive Strategies
Although a typical arms race model with two adversarial actors rushing to procure the latest and the best in armaments cannot be applied directly in the case of Southeast Asia, the arms acquisition strategies used by states in the region have been interactive. Even among friendly ASEAN states, military planners tend to base their weapons acquisition strategies on “worst-case” scenarios, so military developments in countries of the region have a mutual impact.

The process of arms proliferation in the region started in 1970 when American military assistance to Indonesia increased dramatically, resulting in the acquisition of frigates, minesweepers, tank-landing ships, and other equipment by the Indonesian armed forces. Malaysia reacted quickly and began placing orders for F-5E Tiger II fighter aircraft and Sidewinder air-to-air missiles. In 1985, the Thai decision to buy what is considered to be the world’s most advanced fighter aircraft, the Fighting Falcon F-16/100, and the US acquiescence to sell it triggered reactions in several countries of the region resulting in what looked like a real arms race in Southeast Asia. This decision threatened to alter significantly the existing strategic balance of power within the region. Several other Southeast Asian countries soon followed the Thai example by placing orders for F-16s. Similarly, Singapore’s purchase of three US-built AWACS (Airborne Warning and Control Systems) in 1983 was followed by the Malaysian announcement in 1985 that it would purchase the same system. However, due to an economic recession that hit the entire region in the mid-1980s, Malaysia cut back its military spending in 1986-87 and did not complete the purchase.

A study of the rationale for arms proliferation and increased defense spending, as well as of the pattern of weapons procurement in Southeast Asia, reveals certain interesting insights. The increased defense spending by the ASEAN countries during the last two decades appears motivated more by a perceived need of their military planners to upgrade conventional defense forces to meet possible immediate, medium-term, and long-term threats to security than by a desire to engage in arms races with each other. A unified Vietnam’s predominant position in Indochina was perceived as a security threat by Thailand, Malaysia, and Singapore, leading to a sharp increase in military spending in all three of those countries; yet, Vietnam failed to respond in kind, and so an arms race in this region did not develop.

Baladas Ghoshal is a professor and head of the Department of International Relations and the former coordinator of the Centre for Strategic Studies at Jadavpur University, Calcutta. He is spending the 1990-91 academic year at the Program in Arms Control, Disarmament, and International Security (ACDIS) at the University of Illinois at Urbana-Champaign as a Ford-ACDIS visiting scholar. He specializes in the political development and international relations of South and Southeast Asia.