Given what some believe to be the peaking of production of various natural resources as well the fact that agricultural and water resources are increasingly valuable, it would come as no surprise that commodity producing countries are gaining more bargaining power.
In relation to this topic, Asia Sentinel recently published an article entitled Indonesia's Growing Economic Nationalism, which is well worth a read. I don't agree with the author's view that Indonesia will be hurt by being more protectionist. In fact, I think that the country is moving from a position of strength, and will be able to use the bull market in commodities to its advantage.
From Singapore's perspective, the most immediate impact would be that DBS Bank would probably not be allowed to acquire Bank Danamon, which I feel is not a big loss to Singapore, given the fact that DBS has had a poor track record in overseas acquisitions. From a longer term perspective, we need to watch out for Indonesia exerting its economic might on Singapore for both economic and political ends. We may be moving into another era where the neighbourhood gets less friendly.
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