The World's Largest City
Issue 27— Key Developments Across Brunei, Indonesia, and Malaysia
Editor’s Note
by Haniva Sekar Deanty, Lead Editor - Maritime Crescent Desk
For this week’s issue, we begin in Jakarta. Rayhan Jasin examines how the city, whose population, redefined under the UN’s latest Degree of Urbanization, has now surged to nearly 42 million, becoming the world’s largest city by this metric. However, behind this statistical leap lies a sobering truth: Jakarta is collapsing under its own density.
While Jakarta is sinking, Sydney Gan reports that Putrajaya is facing another kind of tension. Following the signing of the Malaysia-US Agreement of Reciprocal Trade (ART), Beijing has issued formal complaints, interpreting Malaysia’s alignment with US export controls and security-linked trade measures as a departure from long-standing neutrality. Prime Minister Anwar Ibrahim now finds himself balancing diplomatic reassurance with domestic political pressure, all while defending the ART as an act of economic necessity rather than geopolitical alignment.
In Brunei, Wira Gregory looks at the reconvened East Asia Security Outlook Seminar by the Defence and Strategic Studies Institute. Under the theme “Borneo as a Nexus”, the event reframed the island as a strategic and sustainable development anchor in the Indo-Pacific. With perspectives spanning defence, academia, and even the private sector, the seminar revealed a growing recognition that security cannot be disentangled from economic resilience or environmental stewardship.
Indonesia 🇮🇩
Jakarta, the Drowning Giant
by Muhammad Rayhansyah Jasin
When defined under Indonesia’s official standard, Jakarta’s (city) population only amounted to around 12 million. Yet, under the latest UN broader “Degree of Urbanization” definition, as described in the 2025 Revision of the World Urbanizations Prospects report, it jumps to nearly 42 million, ranking Jakarta as the world’s largest city. The Degree of Urbanization is utilized as the most updated measure to present a more objective cross-country comparison. The national standard excluded most of Jakarta’s underlying support areas like Tangerang, South Tangerang, Bogor, Depok, and Bekasi which are essential components of the Jakarta Metropolitan Area, also known as ‘Jabodetabek’, as residents in these cities commute daily to work and do commerce in the Jakarta city area.
Historically, Jakarta has always been the center of economic and trade hub of Java, serving as the de-facto political seat of the Dutch East Indies Governor General. The city grew by absorbing nearby villages into small towns all connected by main roads to its urban core. Hopeful low-skilled workers from all over Indonesia seeking better opportunities flooded the city every year during the ‘Arus Mudik-Balik’ phase–mass exodus of workers to their hometowns for Ramadan and Eid al-Fitr. The subsequent acceleration of urban sprawl throughout the late 20th Century led to a boom of private housing development that was not readily managed by city officials. Jakarta’s population rose from 11.4 million in 1980 to 25 Million in 2000 and reached close to 42 million by 2025. Its overgrown economy accounts for around 17% of Indonesia’s GDP; receiving up to $7.6 billion worth of FDI in 2024 alone.
Jakarta’s rampant urbanization has spawned multi-dimensional crises: gentrification of slum areas, waste mismanagement, traffic congestion, pollution, urban heat, homelessness, and inequality-induced poverty.
However, these problems are overshadowed by the city’s existential threat: it is sinking, fast.
By 2017, North Jakarta was subsiding up to 2 inches annually, earning its status as the world’s fastest-sinking city. This collapse is driven by unchecked groundwater extraction, poor planning, and industrial waste. Situated 4 meters below sea level, Jakarta’s proposed solution—the miles-long Garuda Sea Walls unveiled in 2016—remains stalled, leaving the megacity increasingly vulnerable to catastrophic flooding.
Cracks in North Jakarta’s coastal embankments, first observed in mid-November, have escalated into a multi-district flooding crisis, prompting an official province-wide alert. Officials attribute the heightened risk to seasonal flooding compounded by a Supermoon, with elevated tides expected until December 11 as city officials prepared up to 600 water pumps to manage overflowing waterways. Governor Anung has also ordered the acceleration of Kali Krukut normalization project, one of Jakarta’s main draining canals, to commence in early 2026.
Facing irreversible subsidence, Jakarta’s survival hinges on halting rampant groundwater extraction. While the new capital, IKN Nusantara, offers an escape, it neglects the sinking metropolis. The controversial $80 billion ‘National Capital Integrated Coastal Development (NCICD) is now a necessary albeit environmental and financial concern. Without alternative water source system, Jakarta will drown under its own weight.
Rayhan is pursuing an Erasmus Mundus Joint Master’s Degree in Public Policy at Central European University and the Institut Barcelona d’Estudis Internacionals. He holds a Bachelor of Social Sciences in International Relations and Political Economy from Ritsumeikan Asia Pacific University. His current research focuses on the socio-economic impacts of Indonesia’s nickel mining industry on local communities and national development.
Malaysia 🇲🇾
Malaysia’s Precocious Balancing Act
by Sydney Gan, in Kuala Lumpur
Geopolitical tensions are escalating in Malaysia as the consequences of the Malaysia-US Agreement of Reciprocal Trade (ART) loom. China has formally lodged a complaint against Malaysia over the trade deal signed during the ASEAN Summit in Kuala Lumpur, citing “grave concerns” over the agreement and warning Malaysia to “fully consider and properly handle this matter in light of its long-term national interests”.
It would seem that Malaysia’s hedging exercise has finally caught up with it. Prime Minister Anwar Ibrahim’s much-bandied-about success in hosting President Trump in Malaysia, although undertaken in the name of appeasement, was a bold and definite choice that contradicts Malaysia’s long-standing goodwill with China. The MADANI Government has justified this decision repeatedly, explaining that the ART was a response borne out of necessity to the US’s initial 24% reciprocal tariff rates (lowered to 19%). But does this act of self-preservation put Malaysia directly in the line of China’s fire – an offense so grievous that it threatens to upend the very platform of neutrality that Anwar’s government has been comfortably perched on up until now?
The specific concerns raised by China pertain to clauses that mandate Malaysia to align with the US on sensitive national security issues. Under the agreement, Malaysia is to follow US trade restrictions, export controls, and sanctions on advanced technology. Although the Ministry of Investment, Trade, and Industry (MITI), as well as other government-linked thought leadership partners, dismissed detractors’ claims that such a clause undermines Malaysian sovereignty, it has done little to assuage China’s concerns about Malaysia’s potential teetering impartiality.
According to analysts, the deal represented a real threat to China’s market access for exports and foreign technologies, as it continues to outsource chipmaking and AI development. In the swirl of public controversy, Anwar was compelled to correspond with Chinese Premier Li Qiang, with the assurance that Malaysia will continue its bilateral cooperation with China. Malaysia also subsequently proposed a new Memorandum of Understanding with China to formalize the two nations’ trade relationship – the negotiations of which are currently underway.
With Malaysia’s precarious balancing exercise, it is an inevitable political risk that dissatisfaction may emerge from either side of Malaysia as a bilateral trading partner. However, Malaysia is determined to forge ahead in careful corrective progress, not to overstep either boundary. As outgoing MITI Minister Tengku Zafrul put it: “This is not a geopolitical pact. It is a trade agreement,” – Malaysia is resolute in preserving its ties to China, even with the increasing geopolitical pressure.
Professor Xu Liping, Director of the Centre for South-east Asian Studies at the Chinese Academy of Social Sciences, made a key distinction between Malaysia’s relationship with the conflicting parties, stating that “Washington is using administrative, not market, levers to influence governments here. Experience shows these methods may deliver short-term gains but cannot last.” With the ART ratification process nearing completion, all eyes are now on Malaysia to observe its next critical steps on this political tightrope, as the state continues to navigate the uncertain and ever-evolving geopolitical landscape.
Sydney holds a Bachelor of Laws from King’s College London, where she focused on Human Rights Law, Criminology, and Public & Administrative Law. She is an Analyst at Asia Group Advisors, providing policy analysis and strategic guidance across the tech, sustainability, and gaming sectors in Southeast Asia. Prior to joining AGA, she worked in the social development sector in London, contributing to the Ukraine Judicial Training Programme through research on war crimes adjudication and the development of a legal training curriculum with high court magistrates.
Brunei Darussalam 🇧🇳
Brunei Hosts 13th East Asia Security Outlook Seminar
by Wira Gregory Ejau, in Bandar Seri Begawan
The Sultan Haji Hassanal Bolkiah Institute of Defence and Strategic Studies (SHHBIDSS) convened the 13th East Asia Security Outlook (EASO) Seminar in Jerudong on 25 November 2025, returning after a six‑year hiatus. With the theme “Borneo as a Nexus: Key to Regional Advancement and Sustainability”, the event underscored the island’s evolving role in regional geopolitics and security discourse.
Professor Ooi Keat Gin of Universiti Brunei Darussalam delivered the keynote, situating Borneo’s contemporary significance within a longue durée historical trajectory. He revisited the island’s marginalisation in regional narratives and argued for its repositioning as a nexus of strategic, human, and natural resources. By tracing Borneo’s evolution from Brunei’s maritime kingdom to its post‑war economic reconfiguration, Ooi advanced the idea that the island’s future hinges on empowerment through sustainable development and regional cooperation.
The seminar’s sessions featured nine speakers from institutions across Southeast Asia and beyond, including Indonesia’s Centre for Strategic and International Studies, Malaysia’s Institute of Strategic and International Studies, and the Rabdan Security and Defence Institute of the United Arab Emirates. The inclusion of Standard Chartered Bank alongside defence universities and research agencies reflected a deliberate attempt to integrate economic and financial perspectives into security dialogues. This multidisciplinary approach suggests recognition that regional stability cannot be divorced from economic resilience and private sector engagement.
With over 200 participants, including senior Bruneian defence officials, foreign defence attachés, and representatives from ministries and universities, the seminar reinforced Brunei’s role as a convener of strategic dialogue. While Brunei’s defence establishment hosted the event, the breadth of participation indicates that the seminar functions less as a national showcase and more as a regional platform for collective reflection. Since its inception in 2009, the EASO has sought to foster dialogue on East Asia’s strategic landscape, and its continuity demonstrates institutional commitment to sustaining such exchanges.
From an analytical perspective, the seminar illustrates the gradual mainstreaming of sub-regional spaces, such as Borneo, into broader Asia-Pacific security thinking. Historically peripheral, Borneo is now framed as central to debates on sustainability, connectivity, and resilience. Strategically, the seminar illustrates how small states, such as Brunei, leverage their convening power to insert themselves into regional conversations without overstating their influence.
Borneo lies at the intersection of critical maritime corridors linking the South China Sea, the Sulu Sea, and the Celebes Sea. This geography makes it both a transit hub for global trade and a buffer zone between continental Southeast Asia and the Pacific archipelagos. Its position exposes it to overlapping spheres of influence, transforming the island into a contested yet indispensable space. The emphasis on “people‑centred” development and sustainability also aligns with wider discourses in ASEAN and the Asia‑Pacific, suggesting that Borneo’s repositioning is part of a larger normative shift rather than an isolated narrative.
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 currently provides research assistance with the International Institute for Strategic Studies (IISS) under their Southeast Asian Security and Defence Internship Programme and conducts investigations on regional security and transnational crime for a confidential company.
Editorial Deadline 06/12/2025 11:59 PM (UTC +8)
