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Abstract
The term ‘emerging market’ is widely used in popular and scholarly fields to simply indicate an empirical condition of economic improvement. For Indonesia, this affirmative investor label covers economic activities including cheap commodity extraction via the plantation and the mine for the world market, despite the expropriation and ecological ruin such extraction generates. This article connects this emerging market present with the colonial past by tracing how extractive spaces and relations have been produced over time with the help of investment capital. Developing the concept of ‘extractive investibility’ in historical colonial perspective, the analysis begins by tracing Dutch East India Company (VOC) era interventions and the establishment of the Cultivation System and plantation economies on Java and Sumatra by the Dutch colonial state. The article then documents how the brief ‘Third Worldism’ interlude meaningfully challenged these colonial extractive relations. The analysis ends by detailing how the emerging market label was explicitly conceived to replace the term ‘Third World’ and continues to function as a discursive idealisation which directs capital back toward extractive spaces.
Acknowledgements
My thanks go to three anonymous reviewers as well as Matthew Watson and Lena Rethel for their generous engagement with earlier drafts of this article.
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No potential conflict of interest was reported by the author(s).
Notes
1 This claim is later substantiated through an engagement with emerging market architect Antoine Van Agtmael’s own testimony in which he describes replacing the term ‘Third World’ – which he misreads as ‘disparaging’ – with the uplifting ‘emerging market’ label. This account details how parts of the self-described Third World, as well as parts of the former Soviet Union, became included within investment funds that spread risk over broad portfolios.
2 On ‘extractive capital’, see Gago (Citation2015); Veltmeyer (Citation2013).
3 Verenigde Oostindische Compagnie, literally translated as the United East India Company but more commonly known in English as the Dutch East India Company or VOC (Ward, Citation2009, p. 1).
4 For example, at its inception the corporation possessed the (then innovative) features of transferable shares and the separation of management and ownership which have come to be core traits of the modern corporation. However, contrary to views that these two come “as a coherent logical set” (Gelderblom et al., Citation2013, p. 1072) along with three other key corporate features of legal personhood, limited liability, and a permanent capital, in fact the latter three developed incrementally and in reaction to the exigencies of merchant operations in the East, particularly relating to the need to finance such extensive operations.
5 On Java, the VOC forced villages to cultivate coffee and retained all, or at least a portion, of the profits as tax revenue (Clarence-Smith Citation1994, p. 243; see also Van Niel, Citation1990, p. 70). Rebellions in the early years of the nineteenth century in which Javanese cultivators destroyed plantations and burnt storage places led to some reforms.
6 Article 80 of this legislation ruled that one-fifth of village land use should be turned over to crops for export. Derived from this was the system through which one-fifth of a peasant’s annual labour was obligated to the colonial government as “cultivation service” – itself a replacement for earlier forms of tax and produce delivery (Van Niel, Citation1990, p. 74).
7 As agricultural production for export expanded its capital base under the Cultivation System, new resentments were created between the Dutch residents of Java and those in the metropole. European networks on Java were perceived as guarded and nepotistic with respect to land rights and plantation contracts–these were protectionist practices which, ironically, many Dutch in the colonial metropole objected to (Van Niel, Citation1990, p. 72).
8 See Shilliam (Citation2015, p. 3) on cultivating relations ‘sideways’.
9 See Sajed (Citation2019) on Third Worldism as a political project.
10 In July of 2016 an international tribunal at The Hague ruled that Britain, the US, and Australia had all been complicit in the 1965 mass killings in Indonesia which were referred to as “politicide”. All three of these complicit states were found to have encouraged the violence by “using propaganda to manipulate international opinion in favour of the Indonesian army” a policy which continued even after evidence of mass killings had become apparent (Global Research, Citation2016).
11 Morgan Stanley Capital International (see MSCI, Citation2016).
12 Soederberg understands this within a wider context of “neoliberal revisionism” (Citation2007, p. 480) following the adverse results of structural adjustment policies (SAPs) prescribed by financial institutions which served to deepen poverty and inequality in the Global South.
13 Liberal accounts from the IMF and others blamed rises in external debt and short-term private sector borrowing along with overvalued currencies, a loss of export competitiveness, real estate bubbles, and overextended banking systems for the Asian Financial Crisis. They marked it, in other words, as having endogenous ‘Asian’ origins in countries with state interventionist cultures. More statist accounts contest that the crisis was rooted in the power shifts of the 1980s away from the state and towards private business interests and, further, that it was the capture of the state by private capital which allowed for overextended banking systems and debt burdens to arise in the first place (Robison & Rosser, Citation1998, pp. 1594—1595).
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Lisa Tilley
Lisa Tilley is currently Lecturer in Politics and Leverhulme Early Career Fellow at Birkbeck, University of London. Her work focuses on political economy/ecology, race, and historical/present-day colonialism, extraction and expropriation, especially in Southeast Asia. She also co-convenes the CPD-BISA working group and is Associate Editor of Global Social Theory.