Got Spare Time?

As I begin to write my new thesis, I thought it fitting if anyone wants to, or has time to, to read my old thesis as an undergraduate:


Underground Markets of South and Southeast Asia

By Elliot Roper

Around the world underground, or “black”, markets are ubiquitous in nearly every country. From the violation of copyright laws to prostitution to drug trafficking, they can be found in both the rural and metropolitan areas of a nation, South andSoutheast Asiaare certainly no exception.  This increasing problem poses several challenges for the economies in nations trying to improve their standing within the international marketplace.  Over the duration of my time in the countries ofSingapore,Malaysia, andSri Lanka, observing this was more often than not a daily occurrence.  Whether living in the remote parts of these countries, such as Tawau, East Malaysia or in the hub of capital cities, likeColombo,Sri Lanka, these markets and some of their consumers could be easily branded.


Regardless of strict laws governing each nation, both citizens and foreigners have invented ways to evade the legal system established therein; each one containing its own kind of “melting pot” of international residents.  In addition, the geographic location granted to these countries enjoy, allows them to enjoy a comparative advantage over other land-locked countries.  Numerous ports allow for accessibility too many of their assets and can frequently be taken advantage of.  This paper is designed to shed light on the specific areas of concern facing this particular region.  Consideration is given throughout the remaining pages to three specific illegal markets negatively impacting the region and both its natural and human resources.




Arriving into Changi airport inSingapore(one of two major international airports in the country), one quickly comes into contact with a growing problem there: prostitution.  More commonly known for its stringent cleanliness laws and swift punishments for violations of them, you can find reading material in airport bookstores identifying locations referred to in some western states as “red-light districts”.  Walking down a street in Singapore in an area known as Orchard, the name given to it by the MRT stop, which is the form of public transportation in Singapore, a citizen or foreigner can expect to find a young girl or boy whistling at them as they pass by; even if they are on the other side of the street.  He isn’t selling DVD’s or Rolex’s, but soliciting women who happen to be upstairs in the building he is standing outside of.  Occasionally, along with the whistling, the common phrase would follow, “young girl for you sir?” Reminder, this isSingapore, notThailandI am referring to.


If you climb up the stairs in the building you will find one floor containing a single hallway with five to seven wooden doors on each side.  The hallways contain, amongst others, Malay, Indonesian and Thai women sitting outside on stools ranging in age from 16-21 years; each waiting patiently for their next customer.  “Those who are forced into prostitution look to Singaporeas the land of milk and honey. They borrow money to come here in hope of decent work but only to find themselves landing in debt and in prostitution.”[2] However, Singapore is not the only country with this escalating problem.  According to the International Labour Organization, “In Malaysia, the estimated figures for working prostitutes range from 43,000 to 142,000, but the higher figure is more probable, according to the ILO analysis.”[3]


Singaporehappens to be a bustling economic hub for international business and its frequent travelers.  Expatriates are found from all over the globe.  Prostitution is a profitable business for this type of industry; however, the consequences for the employees are devastating.  “Despite recent exposure of the brutalities of prostitution and sex trafficking and the accompanying flurry of international and domestic resolutions, the sex industry inSoutheast Asiaremains hugely profitable and deeply entrenched enterprise that thrives on the exploitation of women and children.”


A similar incident occurred while I was living inKuala Lumpur, the capital city ofMalaysia.  Yet again it happened in the more western area of the city; however, there are independent prostitutes that can present themselves in a more intimate location, such as apartment complexes. While residing in one apartment building called Api Api (Bahasa translation: “fire”) in Kota Kinabalu, I had just flown in and was making my way home in a taxi.  The driver had not solicited any young ladies; in fact they hardly ever say a word unless you trigger a conversation with them.  He dropped me off in front of the apartment and I made my way to the second floor by way of the elevator.  I was approached by a young Malay woman, who didn’t say anything, just touched my arm and looked at me.  This category of prostitute can be easily identified by their dress, consisting of unusually short skirts, body language, as well as strong enticing eye contact. Kota Kinabalu andKuala Lumpurare the larger cities inMalaysia; however, one can find similar experiences occurring inSandakanand Tawau, some of the more remote areas inEast Malaysia.


Prostitution strongly felt in West Malaysia and Sabah (the eastern most state inMalaysia) is due to the bordering countries that supply illegal immigrants.  ThePhilippines,IndonesiaandThailandare the biggest contributors to this business.  Rarely ever will you see a Chinese or East Indian prostitute.  They do exist, however, but in a more sophisticated role such as escorts and/or city guides.


The existence of this industry can be rooted in the meager economic status of the countries these women and children are forced to live in.  “The failure for them to attain employment has resulted in the default option of using their physical bodies for other people’s pleasure.  As prostitution has evolved into an increasingly structured transnational business affecting ever larger number of women and children, many from impoverished parts of the world, the distinction between “voluntary” and “enforced” prostitution has been increasingly difficult to sustain.”[4]  While the intent of this paper is not to outline the specific details of the physical consequences resulting from these issues, suffice it to say, unless corrected, the damage will have a lifetime of negative repercussions for generations.




A country surrounded by water on all sides allows for the importation of a variety of products; both legal and illegal.  In Tawau, East MalaysiaI recall having dinner with a Filipino family in a stick house along the outskirts of a coastal town, and watching as little wooden boats passed underneath us delivering an illegal substance.  Everyone in the room dropped their utensils and put their index finger to their lips as the smugglers passed by us underneath their home. It became clear the use of narcotics was prevalent in this society.  The area in which they lived was called Jalan Apas Batu Lima (Bahasa translation: “mile four”).  It is a segment off one of the main roads in Tawau where a lot of Filipinos and Indonesians reside.  The living quarters were not the greatest and illegal drugs where commonly present.  As one researcher puts it,” Narcotics trafficking is now big business in East Asia.”[5]  In this section, I examine the narcotics trafficking situation in the region as well as recall personal incidents while living in the area.


Another part of Tawau was a place called “ice-box”.  This was similar to where the Filipino family lived, in that it housed many immigrants.  “Ice-box” was a place feared by both citizens and local law enforcement officers.  Its stick houses extended roughly 100 yards into the Pacific Ocean and allowed for easy entry from the Philippines, Indonesiaand Papa New Guinea.  Rumors circled around Tawau that police officers had gone into the area attempting to arrest drug traffickers and illegal immigrants, but had not come out alive.  Even with strict laws regarding drug trafficking in Malaysia, local law enforcement has a difficult time regulating this problem in small rural cities.  The entrance of these illegal substances is a sophisticated and detailed one.  “Burmese heroin is frequently moved from the Shan hills of Burma, through Mandalay, and then to Rangoon, Moulmein, or other seaports for shipment to Singaporeand Malaysia.”[6]


When arriving into any major airport in Malaysiaor Singaporethe flight attendant hands you a card to fill out stating your purpose for entering the country and the length of time you will be staying in there.  At the top of those cards it states in big, bold, black letters, something to the effect, DRUG TRAFFICKING IS ILLEGAL AND PUNISHABLE BY DEATH.  In discussions with local citizens from both countries you will find they feel the reason for this is due in part by the governments attempt to keep out as much western influence as possible.  The roots of this can be traced back to the Opium Wars betweenChina andEurope in 1839.  By declaring opium an illegal substance in that year, its repercussions can still be felt throughout all ofSoutheast Asia.


The numbers are staggering as Southeast Asianot only has become a producer and exporter of these illegal drugs, but a consumer as well.  A market for the goods has been established within its borders.  As for Malaysiaand Singapore, it doesn’t help that the center for the Golden Triangle is right next door.  “Drug money is distorting regional economies and exacerbating corruption and political instability.  Narcotics trafficking is now big business in East Asia.”[7]  How big is the narcotics business in Southeast Asia?  “The Golden Triangle region … accounts for 65% of all opium produced illicitly and sustains a heroin industry conservatively estimated to be worth at least US $160 billion annually … in context US $160 billion is roughly four times the value of the international arms trade.”[8]  While narcotics have been coming in and out of Southeast Asia since the 1800s, an old problem has taken on a new form in the 20th and 21st centuries.




Piracy is not a new concept for Southeast Asia; however, piracy experienced today manifests itself in new form.  Instead of raiding the waters from the Malaccan Straits to the Bay of Bengal, 21st century piracy sees no borders and flows in and out of countries at its own pleasure. Southeast Asia is now one of the most lucrative markets for pirated DVD’s, CD’s and computer software that have nearly every intellectual property owner in an uproar.  During my time in South andSoutheast Asia I encountered this type of exchange almost daily.  Whether I was walking down Raffles Street in Singapore or in Sibu, East Malaysia, it was apparent this activity wasn’t slowing down any time soon, in fact some Southeast Asian leaders consider this a substantial part of their economic development.


Flying intoColombo,Sri Lankaon a red eye flight fromSingaporein the summer of 1999, I witnessed just how affluent this trafficking had become.  One of my first nights in a bungalow off the main road, Bambalapitia, was spent watching “Star Wars Episode 1: The Phantom Menace” that a friend of mine had purchased earlier in the day from a local video store.  I noticed the quality wasn’t what I had become accustomed to in theUnited States; nevertheless, my friend boasted about the price of the DVD and how he had bought more than just one. Recently in 2004, a Malaysian friend living inSeattlejust returned from visiting his family in Kuching,Sarawak, with some very expensive web design software now in his possession.  This pirated software now reentered the country of its origin, and at no cost to the customer; again reinforcing that modern day piracy sees no borders.


So what makes this such a significant issue to discuss with other problems facing the world?  People are dying of starvation, AIDS running rapid and international terrorism. Why should we be concerned that some little 15 year old Sri Lankan decides to download aHollywoodmovie, burn it to a DVD and sell it for profit so he can feed his family?  Attention is now turned to both sides of the argument for intellectual property rights.

“More books, movies, drugs, music, software, and video games exist today than at any time in history. Still, the basic tension over intellectual property remains the same. The originators of innovative ideas are trying to stop people from using the fruit of these ideas for free.”[9]  There is a understood, universal moral obligation to respect the rights, including intellectual property, of others; however, is getting a hold of someone’s film or music album on the Internet and selling it the same as robbing a grocery store?  “In the case of satellite retransmission and home copying, it has been alleged that copyright-owners are unfairly deprived of payment for the use of their intellectual property; however, several studies suggest that copyright-holders are indirectly compensated.”[10]  Whether the owners, of entertainment or ideas, are compensated for or not, it is a violation ofU.S. and international law.


Each one of these issues discussed is on the radar of local organizations, most notably ASEAN (the main economic and political body of the Southeast Asian nations).  “In the new decade … ASEAN would also formalize its intent to cooperate on a wider range of security threats … The countries promised to cooperation on counter-narcotics, human trafficking, piracy … and cyber crimes.”[11]  While I am in no position to judge the intentions of this institution and their ability to monitor these issues, it might behoove them to seek assistance in these matters from outside South andSoutheast Asia, despite a growing lack of confidence in some of the more well-known NGOs.


While other issues, such as terrorism and humanitarian and disaster relief, are currently grabbing the attention ofWashington, the United Nations and other organizations, it is imperative that policy makers and world leaders not become complacent with regards to the larger, somewhat unnoticeable, problems in the world.  Ultimately prostitutes and piracy won’t lead to a nuclear war or prevent humanitarian assistance to those who have been impacted by a natural disaster; nevertheless, until international dialogue, followed up with action, this region’s economy will continue to breed even more corrupt governments, as well as merchants.














































[2] Wong, Fayen.  “Prostitution wave hits ‘squeaky clean’Singapore. Rueters. 12 Oct 2004.

[3] International Labour Organization. “Sex as a sector: Economic incentives and hardships fuel growth”.  Sep/Oct 1998. No. 26.

[4] Reanda, Laura.  “Prostitution as a Human Rights Question: Problems and Prospects of United Nations Action” Human Rights Quarterly:JohnsHopkinsUniversity: 1991 Vol 13.   p. 204.

[5] Dupont, Alan.  “Transnational Crime, Drugs, and Security inEast Asia”.  Asian Survey: 1999.  p. 435.

[6] Dupont, Alan.  “Transnational Crime, Drugs, and Security inEast Asia”.  Asian Survey: 1999.  p. 438.

[7] Dupont, Alan.  “Transnational Crime, Drugs, and Security inEast Asia”.  Asian Survey: 1999.  p. 435.

[8] Dupont, Alan.  “Transnational Crime, Drugs, and Security inEast Asia”.  Asian Survey: 1999.  p. 438.

[9] Evans, David.  “Who Owns Ideas? The War Over Global Intellectual Property”.  Foreign Affairs: November?December 2002.  p. 2.

[10] Globerman, Steven.  “Addressing International Product Piracy”.  Journal of International Business Studies: 1988.  p. 498.

[11] Dalpino, Catharin and Lin, Juo-yu.  “China andSoutheast Asia: The Difference of a Decade”. BrookingsNortheast Asia Survey.  2002-03 p. 82.


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