The growth of FDI from ASEAN coming to the US has dramatically outpaced that coming in from other regions. Image: ASEAN Matters for America, 2014.

The Missing Statistic Revealing Strong US-ASEAN Ties


Henry Clay, the 19th century senator, argued that “statistics are no substitute for judgment.” Yet one statistic is missing and its lack is hurting judgments about the relative importance of the United States to Southeast Asian countries and, in turn, the region to the United States.

It is now commonplace in Southeast Asia to hear the confident judgment that the spoken-about country’s economic present and future is “with China” while its security present is “with the United States.” Trade statistics with China and the United States are selectively marshalled to support this binary, China-favoring misjudgment.

Yet, when the statistical focus shifts from trade to direct investment, which is a much deeper and lasting form of economic interdependence, the comparative economic weight significantly shifts to the United States.

For example, in 2014, the United States accounted for roughly one-sixth of net foreign direct investment into the Philippines and was in fact the largest single investor. Chinese net flows, according to Philippine central bank figures, amounted to zero. The Philippines has the second largest population in Southeast Asia and boasts the strongest growth rates among the major economies in the region.

The Indonesian story involves much larger total figures and tells a similar story according to the Indonesian Investment Coordinating Board figures. In 2013, the United States was only the third largest source of net foreign direct investment after Japan and Singapore. Yet, the United States’ total of $2,436 million was roughly eight times larger than Chinese flows of $297 million. Early signs are that US figures for Indonesia should rise now that the presidential elections are over and Jokowi is starting to roll out reforms.

Comparative statistics for Singapore are not quite as stark but involve the largest total flows and stocks by far of any Southeast Asian economy. According to Statistics Singapore figures, in 2013, US net direct investment flows to Singapore equaled $8,400 million, roughly six times the figure for China of $1,485 million. In 2013, the total stock of American direct investment in Singapore was $113,700 million, roughly seven times the Chinese figure of $15,927 million. The United States alone accounts for roughly one-seventh of Singapore’s total foreign direct investment stock.

A statistic that is highly correlated with these foreign direct investment figures is unpublished and seemingly uncollected. Yet, it likely would tell an even more impressive story about the depth of America’s economic interdependence with the majority of Southeast Asian economies. It could well be the best single statistical foil against the misjudgment about the comparative economic weights of the United States and China in the region, even better than these investment ratios that are heavily in favor of the United States.

What is this mysterious, missing statistic? It is the number of people employed by American multinationals in the major economies of Southeast Asia and the region as a whole. There are two worrying explanations as to why a great headline figure is missing, which would otherwise encapsulate the enduring and growing economic importance of the US to the region, and the region to the United States.

1) Firms may be unwilling to report their employment figures for commercial confidentiality reasons, and;

2) Embassies may be unwilling to gather and publish these figures due to fears of backlash from the United States over the ‘outsourcing of jobs’.

Headline figures of billions of dollars of investment flows may not generate as many stories or capture the imagination of as many people as trade ones. Yet, clear, simple and direct statistics on who provides jobs would. American diplomats, firms and chambers of commerce in Southeast Asia are rightfully frustrated by the erroneous argument that the region’s economic present and future lies with China and not with the United States. Yet, by an act of omission, the most persuasive statistic to reverse this misjudgment is missing. Finding it and promoting it would be in America’s interest to show how much it matters to the region and the region to the United States.

Malcolm Cook is a Senior Fellow at the Institute of Southeast Asian Studies (ISEAS), Singapore.