Economy Overview

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The shallow waters of the Southeast Asian coral reefs have the highest levels of biodiversity for the world's marine ecosystems, where coral, fish and molluscs abound. According to Conservation International, marine surveys suggest that the marine life diversity in the Raja Ampat area is the highest recorded on Earth.  Southeast Asia was a critical part of the world trading system. Tourism has been a key factor in economic development for many Southeast Asian countries, especially Cambodia. According to UNESCO, “tourism, if correctly conceived, can be a tremendous development tool and an effective means of preserving the cultural diversity of our planet.”  Since the early 1990s, “even the non-ASEAN nations such as Cambodia, Laos, Vietnam and Burma, where the income derived from tourism is low, are attempting to expand their own tourism industries.” In 1995, Singapore was the regional leader in tourism receipts relative to GDP at over 8%. By 1998, those receipts had dropped to less than 6% of GDP while Thailand and Lao PDR increased receipts to over 7%. Since 2000, Cambodia has surpassed all other ASEAN countries and generated almost 15% of its GDP from tourism in 2006. Indonesia is the only member of G-20 major economies and considered as the largest economy in the region.[31] Indonesia's estimated gross domestic product (nominal) for 2008 was US$511.7 billion with estimated nominal per capita GDP was US$2,246, and per capita GDP PPP was US$3,979 (international dollars). Stock markets in Southeast Asia have performed better than other bourses in the Asia-Pacific region in 2010, with the Philippines' PSE leading the way with 22 percent growth, followed by Thailand's SET with 21 percent and Indonesia's JKSE with 19 percent.

Indonesia is the largest economy in Southeast Asia and is one of the emerging market economies of the world. The country is also a member of G-20 major economies. It has a market economy in which the government plays a significant role by owning more than 164 enterprises and administers prices on several basic goods, including fuel, rice, and electricity. In the aftermath of the financial and economic crisis that began in mid-1997, the government took custody of a significant portion of private sector assets through acquisition of nonperforming bank loans and corporate assets through the debt restructuring process. Since 2004, the national economy has recovered and undergone another period of rapid economic growth. Domestic consumption is one of the major driving forces behind the country’s economic growth. The economic growth slowed considerably during 2007-08. However, like India and China, Indonesia recorded higher growth during the globalfinancial crisis, compared to the other G20 members.

Challenges
Labor unrest
As of 2011 labor militancy was increasing in Indonesia with a major strike at the Grasberg mine and numerous strikes elsewhere. A common issue was attempts by foreign-owned enterprises to evade Indonesia's strict labor laws by calling their employees contract workers. The New York Times expressed concern that Indonesia's cheap labor advantage might be lost. However, a large pool of unemployed who will accept substandard wages and conditions remains available. One factor in the increase of militancy is increased awareness via the internet of prevailing wages in other countries and the generous profits foreign companies are making in Indonesia.[51] Inequality

Poverty rate has since been higher in the outer islands. Java, Bali, and Sumatra have benefited more due to the rise of manufacturing and better infrastructure of the inner islands. Economic disparity and the flow of natural resource profits to Jakarta has led to discontent and even contributed to separatist movements in areas such as Aceh and Irian Jaya. Geographically, the poorest fifth regions account for just 8% of consumption, while the richest fifth account for 45%. While there are new laws on decentralization that may...
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