Asian Godfathers: Money and Power in Hong Kong and South-East Asia

The Western world views the economies of Southeast Asia as "Asian tigers," and sees Hong Kong, Malaysia, Singapore, Indonesia, Thailand and the Philippines as hubs of free trade and innovation. Not so fast, warns Asia expert Joe Studwell. What appear to be sleek, streamlined economies are more like rickety old jalopies that creak with cronyism and secretive monopolies. In this enlightening, searing attack, Studwell pegs Asia's ruling tycoons or "godfathers" as charming billionaire throwbacks who ruthlessly control business empires with the permission of corrupt, ever-shifting governments, prospering as the populace struggles. Studwell does a masterful job of synthesizing a sprawling topic. getAbstract recommends his book to anyone who's considering investing in or doing business in Southeast Asia.

As a student with an MA in Southeast Asian Studies, I can attest that this book does a great job summarizing the economic and political landscape of Southeast Asia. The book focuses on the role of the region's elite businessmen and how they take advantage of corruption, weak anti-monopoly laws, and political connections to build their empires. These elites dominate the domestic sectors of the economy, so they generally do not compete with multinational firms in the export sector. Unlike other books I have read on Southeast Asia, this one not only provides examples but identifies larger trends and patterns that are useful in understanding the problems Southeast Asia currently faces. There is a lot of information, and it can be a pretty dense read for readers not already attuned to the region, but it's definitely worth it, even if just to get an idea of how politics and business really don't mix well in the region.

This book makes a very interesting read and offers a different approach to understanding the economy of a region: the author looks at these economies mainly through the business sector and avoids overloading the book with graphs, charts, tables, etc. It is an interesting story (although heavily studded with Chinese names). This may result in an incomplete picture, and the book is not quite academic, but this does not avoid it providing a relatively objective look on an important sector of this region's economy. Studwell is very critical of the corporate sector of the SE Asian countries, including those of Hong Kong and Singapore. He traces the origins of the mostly ethnic Chinese businessmen and their companies from the colonial days to the present. He dismisses any notion of "Asian values" as the foundation for the success of these businesses and their owners, but rather attributes their rise to license-peddling, concessions, monopolistic practises, lots of graft, etc. One is reminded of Balzac's words: "every great fortune, of onknown origin, is usually the result of a crime". His comments on the banking sector are particulary scathing. The author explains that these businessmen are not the cause of this situation, but have merely adapted to a region-wide system of patronage and corruption held in place by the local politicos for hundreds of years to the present (much of it inherited from their colonial masters). The business leaders have saving graces: personally charming, they lead flamboyant lives and they obviously do contribute to their local economies (through employment and investment). In spite of this, and the crisis of 1997-98 the SE Asian economies have sustained high levels of growth over the past two decades, which Studwell attributes mostly to multinationals, and the export prowess of small local firms, plus the hard-work of the average Asian. The author's critique goes beyond mere anecdotes and history , as he affirms that the SE Asian corporate sector does not have the efficiency and productivity of the typical world-class company. The origins of these businesses leads to a focus on trading and short-term wheeling-dealing, without a clear strategy, technological strength and branded products. The companies are very much tied to the personality and/or the family of the main owners. Worst of all, they are lacking in transparency, corporate governance and their stock market practises are less than ethical. Studwell's observations seem vindicated by the markets: since the 1994-97 peak the stock markets of these countries have not fully recovered, and the Hong Kong and Singapore indices are barely above their levels of 10 years ago. As SE Asia acquires more economic stability it is logical to assume that per-capita income will rise and lead to stronger domestic economies, with less dependence on export-led growth. In this context Studwell is correct in insisting the the corporate sector of these countries clean up the

Growing up in South East Asia and having followed much of the Asian Financial Crisis in school and in my job this book is indeed a great read. It is well researched and well written and offers a plausible explanation to the economics and development in the region. I wrote an article about it in my magazine column. I recommend this book to anyone from SEA or anyone interested in the region as a whole.

Studwell's Asian Godfathers challenges the mythos surrounding Li Ka Shing, Robert Kuok and a group of about 50 others, the economic kings of Southeast Asia he calls godfathers. Media consumers have been force-fed repeated helpings of stories about the godfathers as economic clairvoyants, captains of wealth creation, etc. Studwell demonstrates that the godfathers are creating little if any wealth in their areas of operation (Hong Kong, Indonesia, Malaysia, Philippines, Singapore and Thailand)---that they are rather parasites, having gained monopoly access to limited resources (raw materials, port facilities, banking licenses) through guanxi with political cronies, maintaining it through bribery in various forms, and pocketing use fees. The cover is sappy, but don't let that deter you--Studwell's book is well worth your time if you seek to better understand SEAsia.