The Maritime Crescent

Issue 7

Jul 23, 2025

by Nabil Haskanbancha, in Bangkok

In this week’s issue, we begin with the ongoing escalation of conflict in the Middle East, which continues to affect Brunei’s economy and local employment, particularly in several businesses with international ties. This has sparked renewed calls for a region-wide framework to address unforeseen economic disruptions. ASEAN could benefit from a resilient economic framework capable of responding to global conflicts and crises, ensuring the well-being of its citizens.

Next, we examine the implications of Indonesia’s populist agenda and how it affects the country’s annual economic targets, particularly in light of local resources and human capital. When discussing economic reforms and sustainable growth, we often think about inclusive policies and innovative initiatives that help stimulate the national economy.

Finally, the appointment of a new US ambassador to Malaysia has stirred controversy, with critics questioning his Trump-aligned rhetoric and a potential mismatch between his views and the host country’s values. Amid rising concerns over US tariffs and broader “America First” policies affecting ASEAN economies, the question remains: how can Malaysia manage these tensions while safeguarding its strategic interests?

Brunei Darussalam 🇧🇳

Boycotts Beyond Borders: Effects of the Middle-Eastern Conflict on Brunei’s Security & Socioeconomic Stability

by Wira Gregory Ejau, in Bandar Seri Begawan

Over the course of 2025, tensions in the Middle East have remained as palpable as ever. Pre-emptive attacks, retaliatory strikes, and recent US involvement, with threats to target additional targets, have led to an alarming escalation in the region. This raises a crucial question for ASEAN: How might the tensions affect local sentiment of Muslim-majority countries such as Brunei?

The majority of Bruneians have consistently expressed support and solidarity with the Palestinians. When conflict in Gaza escalated over two years ago, many locals began unofficially boycotting companies associated, either directly or indirectly, with Israel–a practice that continues to this day. In 2024, Starbucks Brunei released a statement reporting incidents of violence, vandalism, and assaults against employees at some branches. Similarly, McDonald's Brunei issued a formal statement clarifying that its restaurants are fully operated by locals and that the company supports the Humanitarian Fund for Palestinians in Gaza.

The knock-on effects of these global tensions are likely to continue manifesting locally in increasingly tangible ways, amplifying threats toward local employees, businesses and patrons. Beyond boycott-driven risks and safety concerns, the likelihood of economic disruption is also growing. Local businesses, particularly those tied to international supply chains or foreign investment, may face sudden market uncertainties, leading to price hikes on their products and difficulties in retaining secure employment. Additionally, the potential for renewed boycotts might force companies to alter their branding or operational policies, a pattern that is repeatedly seen in Brunei and neighbouring Malaysia, further unsettling both employees and consumers.

Brunei relies heavily on a select group of franchisees to bolster its economic diversification efforts. Security incidents and boycotts like these could undermine the prospects of current and future foreign investments, slowing progress towards the third goal of Brunei Vision 2035, which aims to build a stronger and more diversified economy. Given that many of these incidents have impacted Muslim-majority states in particular, they highlight the urgency of establishing an embedded “economic shock” ASEAN framework. Such a mechanism would mobilize rapid regional responses and resources to contain the fallout from boycotts, safeguard supply chains, and mitigate security threats–operating in a manner similar to ASEAN Coordinating Centre for Humanitarian Assistance’s (AHA) role in responding to natural disasters.

The real question now is how further conflicts in the Middle East continue to deeply impact local Bruneians. With Brunei issuing the temporary closure of its embassy in Tehran—and as support for the Palestinian cause runs deep—local boycotts may further intensify, inadvertently harming the very employees and small vendors they aim to support. Past incidents have already underscored risks involving local workers at companies with international ties. While Bruneians have long demonstrated solidarity with regional causes, the latest conflict escalations threaten to deepen economic pressures and social tensions. The coming months will likely test the nation's ability to balance deeply held cultural beliefs with the practical need to ensure the safety of its locals amid an increasingly volatile landscape.

Gregory is an MSc candidate in Strategic Studies at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University. He works as a freelance writer specializing in international history, conflict, and counterterrorism. With experience in academia, investigative journalism, and voluntary uniformed service, he focuses on regional security developments across the Asia-Pacific, combining strategic analysis with practical field insight.

Indonesia 🇮🇩

Prabowo's Current Economic Policy Won’t Cut it for his 8% Ambition

by Rayhan Prabu Kusumo, in Jakarta

President Prabowo Subianto's 8% economic growth target is hard to achieve because his current policy framework is mathematically insufficient to deliver such high-octane expansion. His administration prioritizes questionable spending over the structural changes Indonesia needs for sustained high economic growth.

The administration's commitment to expensive, fiscally heavy populist programs reflects a project-driven governance model that prioritizes political visibility over economic competitiveness. This approach becomes particularly damaging when combined with the government's lack of coherent vision for moving up global value chains, apparent from the virtually nonexistent comprehensive policy documents that are supposed to outline a broader strategy for innovation and productivity.

The dyed-in-the-wool downstreaming-led manufacturing paradigm that has been the focus of the current and the previous administrations further demonstrate this strategic confusion. That strategy produces only intermediary products without advancing technological capabilities or industrial sophistication. More troubling is the concentration risk, for example, with over 90% of Indonesia's downstream nickel products flowing to a single destination–China. This overwhelming dependence effectively transforms a policy intended to assert resource sovereignty into a relationship of economic vassalage.

This misguided policy has produced measurable economic deterioration. Growth has fallen to 4.87% in the first quarter of 2025, down from the “status quo” of 5% achieved by previous administrations. The middle class continues to shrink while job growth decreases and unemployment soars across industries, accompanied by widespread layoffs. Poverty rates and inequality have worsened, signalled by BPS-Statistics Indonesia’s deliberate postponement in releasing the poverty data for the first semester of 2025.

These outcomes have proven particularly damaging given the administration's simultaneous austerity measures. The government has cut spending across almost all sectors under the banner of efficiency, yet economic conditions have deteriorated compared to those under previous administrations. This contradiction raises fundamental questions about resource allocation: if efficiency measures reduce government expenditure while economic performance worsens, where do these savings flow and toward what purposes?

Achieving 8% growth requires abandoning populist gestures in favor of strategic economic planning that can navigate complex domestic and global pressures. Indonesia needs innovation-focused industrial policies that build technological capabilities rather than simply moving commodity processing onshore. The economy must shift and reorient toward knowledge-intensive sectors and high-value production.

Such strategic reorientation demands rebuilding a viable middle class through comprehensive social and economic restructuring that addresses both employment quality and broader societal stability. This reconstruction requires first attracting quality investments that create well-paying jobs and establish sustainable economic foundations, followed by corresponding investments in human capital development through education systems that produce skilled workers, and finally cultivating robust innovation systems that ensure sustained competitive advantage.

These ambitious goals cannot succeed without institutional reforms that insulate long-term economic planning from electoral pressures and redefine how the state approaches development challenges. Short-term political incentives consistently undermine the patient capital and sustained focus necessary for economic-industrial transformation. The country can either recognize that 8% growth requires abandoning comfortable assumptions about development and embracing the institutional discipline that transforms economies, or it can continue managing decline through increasingly sophisticated political theater.

Rayhan has a background in government affairs and public policy, with experience across government institutions and advisory firms. His work focuses on the intersection of geopolitics, policy, and risk, with expertise in advocacy, regulatory analysis, and stakeholder engagement. He holds a degree in Government from Universitas Padjadjaran, and has completed an exchange at Universitat Pompeu Fabra in Spain, focusing on global politics and sustainability.

Malaysia 🇲🇾

ASEAN’s Strategic Voice and the Challenge of U.S. Diplomacy

by Muhammad Aiman Bin Roszaimi, in Cyberjaya

On 9 July 2025, the 58th ASEAN Foreign Ministers’ Meeting (AMM) convened in Kuala Lumpur, producing a comprehensive Joint Communiqué that reaffirmed the region’s commitment to unity and strategic autonomy amid global uncertainty.

The Communiqué was issued against the backdrop of intensifying geopolitical rivalry and economic fragmentation; it outlined ASEAN’s shared vision for regional stability, rules-based cooperation, and sustainable growth. Yet, on the very same day, an unexpected development emerged that risked undermining these very principles: the nomination of Nick Adams as the new U.S. Ambassador to Malaysia.

The Joint Communiqué is more than a ceremonial summary as it offers insight into ASEAN’s collective strategic posture. It addresses pressing concerns about rising unilateral trade measures, tensions in the South China Sea, the Myanmar crisis, and environmental sustainability, while also welcoming Timor-Leste’s progress toward full ASEAN membership.

While the Communiqué demonstrates ASEAN’s commitment to consensus, moderation and mutual respect, the nomination of Nick Adams appears contradictory to these principles. The Trump-aligned political commentator and self-proclaimed “alpha male” is widely known for his provocative public statements, including Islamophobic rhetoric and outspoken support for Israel, a position that clashes with the values and sensitivities upheld by many in the region.

His nomination sparked strong backlash in Malaysia, especially from political parties and civil society groups. Youth wings of Amanah, PKR and PAS, and several members of parliament, called on the Malaysian government to reject his diplomatic credentials, citing his disrespectful rhetoric and the disconnect between his values and those of a Muslim-majority country.

This controversy extends beyond a bilateral irritant, particularly when viewed in light of the principles outlined in the 58th AMM Joint Communiqué, which calls for mutual respect and regional stability. The document also reaffirmed ASEAN’s firm support for the Palestinian cause, something that further clashes with Adams’s staunchly pro-Israel stance. Malaysia, long a vocal advocate of Palestinian rights and a proponent of moderation in foreign policy, now finds itself having to balance diplomatic protocol with domestic political expectations.

While the Malaysian Ministry of Foreign Affairs has not issued a formal rejection, the standard host-state approval process for ambassadors may serve as a subtle diplomatic signal of disapproval, allowing Malaysia to assert its position without escalating bilateral tensions. This episode reinforces the importance of ASEAN’s push for strategic relevance and coherence.

The Joint Communiqué articulates a vision of ASEAN as a stabilizing force in the Indo-Pacific, committed to fostering inclusive partnerships with all major powers. But the nomination of Adams could become an early test case. Will the U.S. heed the sensitivities of its partners or will political loyalty continue to override diplomatic appropriateness?

Moreover, Adams’s nomination occurs at a time when ASEAN is expressing growing concern over unilateralism, including new U.S. tariffs that disproportionately affect Southeast Asian exports. By nominating a controversial figure to a key Southeast Asian post, Washington risks undermining regional influence, especially as ASEAN countries shift their attention toward China, the EU, and other global partners.

Aiman is a PhD candidate in Security and Strategic Analysis at the National University of Malaysia. His research focuses on Malaysia’s space policy, ASEAN regional security, and the strategic implications of emerging technologies. His work explores how Malaysia’s defense policy and strategic culture shape its approach to outer space.

Editorial Deadline 20/07/2025 11:59 PM (UTC +8)