The Poor Get Richer the Rich Get Poorer

December 19, 1993|By FRANZ SCHURMANN

Singapore -- When Willy Brandt coined the term ''North-South gap'' it seemed Gospel truth that the North would forever be rich and the South poor. But for 5,000 years prior to the 19th century it was the North that was poor and the South that was rich. Now if the North doesn't find a way to reverse its decline, that historic pattern could again reappear.

The swath of land from Northeast to Southeast Asia has become the world's premier region of economic growth and political stability. But investment is steadily shifting southward. The big corporate investors of the North operate with a vision they will never make public: Over the next few decades they see the North growing old and flabby, while Southerners will be young, educated and avid for the cornucopias of wealth capitalism has shown such genius in producing.

Southeast Asia is the frontier in this new growth boom. But the same process can be found in Latin America, India, and parts of West Asia.

A lot of Northern investors are looking for long-term returns. That requires growing numbers of young people and rising education levels, just the opposite of trends now occurring in most Northern countries. Southern birth rates range from moderate to high. Social structures like family and community vital for development and stability are enduring rather than disintegrating as in the North. And that creates social capital -- the economic clout produced by strong social bonds -- on a scale absent in the North.

In Southeast Asia political systems still are authoritarian and males rule. But growing numbers of women are moving into the public sphere -- the mark of all modern societies.

Southeast Asia begins on the southern banks of the great Yangtze River in China and extends down through the Indonesian archipelago. Once China's huge Three Gorges dam project is completed, this entire region stretching from Shanghai some 1,800 miles into the interior, will become the greatest single industrial region in the world with Shanghai, Hong Kong and Singapore as its hubs.

While Shanghai is only just beginning to hurtle out of its 40-year deep freeze under Northern rule, Hong Kong and Singapore already look like something futuristic: regiments of high rises marching off toward the horizon, electronic gadgets everywhere, efficiency that makes the Germans seem like old-fashioned artisans -- and an unending rise in the economic growth curve.

One towering figure has emerged as this region's visionary: former president of Singapore Lee Kuan Yew. Identifying himself as a Southeast Asian in countries where the super-dynamic Chinese are often feared, he has become the trusted adviser to leaders, business executives and officials on how to replicate the economic prosperity and political stability he brought to Singapore.

All three hub cities are ethnically Chinese and the Chinese have been the prime makers of the Southeast Asian economic miracle. But Malaysia shows -- and Lee Kuan Yew understands -- why the non-Chinese people are vital to its continuation. As in Singapore urban Chinese birth rates throughout Southeast Asia are plummeting. In China 90 percent of all urban people have only one child, and most rural people have only two. In Malaysia and Indonesia recent studies show that fertility has gone down but not to the point of endangering economic growth.

Impoverished Vietnam shows the Southeast Asian model -- foreign investment plus social capital -- in action. Still ruled by old-time guerrillas bewildered by what's happening around them, Vietnam is being inundated with Hong Kong, Taiwan and Singapore investment. Tidal waves of Chinese consumer goods pour in. In Saigon a kind of revolt of social capital is erupting as tens of thousands of family businesses sprout up -- shop on ground floor and family on second -- demanding an end to controls so they can make money.

The darkest cloud in this picture is AIDS. Thailand is booming but the HIV-infection rate is approaching Central African proportions. But among the region's 200 million Muslims strict family values offer hope the AIDS demons can be contained.

Historically the Indian Ocean region was rich because of trade, natural resources, strong social systems and mutual cultural tolerance. Wars generally came from the north. Visionaries like Lee Kuan Yew think that this past can again be Southeast Asia's future. Some decades from now it could be a stagnating North that looks to the South for advice as to how to pull itself out of growing impoverishment.

Franz Schurmann, a historian and sociologist at the University of California, Berkeley, wrote this commentary for Pacific News Service.

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