Chinese Diaspora as a Virtual Nation: Interactive Roles between Economic and Social Capital
| Published date | 01 December 2004 |
| Date | 01 December 2004 |
| Author | Gordon C. K. Cheung |
| DOI | 10.1111/j.1467-9248.2004.00502.x |
| Subject Matter | Original Article |
Chinese Diaspora as a Virtual Nation:
Interactive Roles between Economic
and Social Capital
Gordon C. K. Cheung
University of Durham
This paper attempts to analyse how and in what ways the Chinese diaspora interacts with glob-
alisation in Southeast Asia through their economic and social capital. It explores the theories of
globalisation and contrasts them with the thematic changes of Southeast Asia studies, and it
conceptualises the economic power, the geographical dispersal nature and the social networking
of Chinese diaspora in order to understand how a virtual nation is being constructed. It then exam-
ines empirical studies of that economic power using the specific case of Indonesia; comparative
studies of Chinese companies in Southeast Asian countries; and foreign direct investment in China
from the Association of Southeast Asian Nations. Finally, it surveys the building of the virtual com-
munity through ethnicity, languages, associations and Confucianism, from which social capital has
been generated among the Chinese diaspora in Southeast Asia.
The Chinese diaspora serves as a point of departure in the re-examination of the
concept of sovereignty in the globalisation process (Wang, 1991; Lynn, 1999; Olds,
1999; Sassen, 1998; Friedman, 1999). I will use the term ‘Chinese diaspora’
throughout this paper instead of ‘overseas Chinese’ or Huaqiao: as ‘Overseas
Chinese’ suggests relations with China more than their own characters in the estab-
lishment of economic power and community network; and Huaqiao is ‘controver-
sial’, because its Chinese connotation entails nationalistic feeling and the ambiguity
of residence (Wang, 1991, p. 6). ‘Chinese diaspora’ is not perfect either, but it does
capture the notion of their economic and networking relations, especially through
border-crossing activities.1 Their economic power, citizenship and ethnic solidarity
contribute to the establishment of a new paradigm of the virtual nation vis-à-vis
the existing nation-state system.2 ‘Virtual nation’ refers here to the economic power
circle, ethnic cluster and regional locality of the Chinese diaspora that reside in
various Southeast Asian countries. By examining the networking relations of the
Chinese diaspora’s capital and their social networks, I will attempt to mingle
between the Chinese communities in this region with the debate of regionalism
and globalisation.
In this paper, I will explore the theories of globalisation and contrast them with
the geographical dispersal situation of the Chinese diaspora to look at their spatial
and temporal natures in post-cold-war East Asian studies (Sum, 1999). The expe-
riences of how and in what ways they can adapt to the local communities will be
the focal point. I will then analyse the economic power of Chinese diaspora using
the specific case of Indonesia; comparative studies of Chinese companies in South-
east Asian countries; and foreign direct investment (FDI) in China from the
© Political Studies Association, 2004.
Published by Blackwell Publishing Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA
T H E C H I N E S E D I A S P O R A A S A V I R T U A L N AT I O N
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Association of Southeast Asian Nations (ASEAN). The conglomeration of economic
power among Chinese diaspora develops the economic nexus that helps them to
economically manage ‘across geographic units’ through virtual governance (Porter,
2000, p. 15). Thereafter, I will survey the building of the virtual community
through ethnicity, languages, associations and Confucianism, from which social
capital has been generated among Chinese diaspora. By so doing, it helps us to
understand how they are able to maintain order if no formal hierarchy and formal
legally binding principals govern their behaviour. Besides, if such social network-
ing can generate values, this study can shed light on to what extent those values
can be facilitated and even ‘invested’ among such people (Putnam and Goss, 2002,
p. 8).
Chinese Diaspora as a Virtual Nation
The exploration of Chinese diaspora, collectively, as an actor vis-à-vis the globalisa-
tion process allows us to shed light on the existing concept of international
politics.3 In a recent article in Foreign Policy, the consultancy firm A. T. Kearney and
the Carnegie Endowment for International Peace constructed an index of globalisa-
tion (Kearney, 2001). Scientific measurement has been conducted to calculate the
level of globalisation by comparing and contrasting different interactive forces such
as goods and services, finance, personal contact, technology and inequality factors.
They discovered that Singapore topped the ranking as the most globalised nation
(Kearney, p. 58), contrasting with some thinking during the cold war that power
was equivalent to the size or military might of a country (Friedman, 1999).4 Besides,
Singapore is a hub of the Chinese diaspora and necessitates our further exploration
of such people and regional globalisation.
The case of Singapore suggests that the ingredients of power relations, nation-state
relations and the conceptual understanding of globalisation should be carefully
investigated. Figure 1 demonstrates the quadrangular relations between globalisa-
tion and regionalism and between state and non-state actors in East Asian studies.
Areas I and II discern two main categories of studies during the cold war, when
ASEAN was (in area II) a case of regional development in East Asia, and the unit
of study is the state. Area I indicates that trade is one of the bones of contention
among countries, confronting them with trade conflicts, which is also one of the
elements of globalisation. Japan–US trade conflicts in the 1980s are a classic case,
and the Sino–US trade conflict has become more obvious in the early 2000s
(Prestowitz, 1988; Lardy, 2002).
In area III, the Asian financial crisis in 1997 was considered to be a detrimental
consequence of globalisation where international flows of finance were not
matched by country-specific development (financial regulation, government trans-
parency and portfolio investment) (Haggard, 2000; World Bank, 1997; Kregel,
1998). In area IV, however, where Chinese diaspora emerge as non-state actors in
the Southeast Asian region, they occupy some of the basic elements, such as spatial
and temporal relationships and border-crossing, that constitute part of the under-
standing of globalisation. The notion of how Chinese diaspora generate regional
globalisation requires us to examine the different definitions of globalisation. I want
to study three such definitions:
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G O R D O N C . K . C H E U N G
Figure 1: Quadrangular Relations of East Asian Development and
International Relations
Globalisation
I (Trade )
III (Asian financial crisis)
State
Non-state
II (ASEAN) IV
(Chinese
diaspora)
Regionalism
A process (or set of processes) which embodies a transformation in the
spatial organization of social relations and transactions – assessed in terms
of their extensity, intensity, velocity and impact – generating transconti-
nental or interregional flows and networks of activity, interaction, and
the exercise of power. (Held et al., 1999, p. 16)
Globalisation, as I shall conceive of it in what follows, at any rate, is not
only, or even primarily, about economic interdependence, but about the
transformation of time and space in our lives. (Giddens, 1998, pp. 30–1)
Globalisation is a process that generates contradictory spaces, character-
ized by contestation, internal differentiation, continuous border cross-
ings. (Sassen, 1998, p. xxxiv)
Held et al.’s definition emphasises the concept of flows and the intense transaction
process of globalisation. When it comes to the traditional concepts of territories and
geopolitical area, the stretching of the issues of the economic, social and political
in a globalised world will ‘generate pressures towards a re-territorialisation of socio-
economic activity in the form of subnational, regional and supranational economic
zones, mechanisms of governance and cultural complexes’ (1999, p. 28). The
extent to which globalisation affects our re-definition of social economic activities
comes later when they explore the concept of globalisation, and the further
T H E C H I N E S E D I A S P O R A A S A V I R T U A L N AT I O N
667
questioning of the roles of nation states in governing our international commu-
nity, especially when ‘Contemporary global governance involves a relocation of
authority from public to quasi-public, and to private, agents’ (Held and McGrew,
2000, 2002, p. 10).
Giddens (1998) points out, in addition to economic relations, the interaction
between time and space in the understanding of globalisation. He later pitches the
impacts such as information, family and religion on globalisation (Giddens, 1999).
And later still, he demonstrates that ‘globalisation from below’ had already begun
among millions of individuals and some organised groups (2000, p. 123).5
Among Sassen’s studies on global cities, international migration and even the
transnational roles and impacts of the credit-rating companies point to sovereignty
and national territories of which massive transaction of financial activities re-
constitutes the roles and the functional usage of cities (Sassen, 1996, 1998, 2001).
International migrations, particularly to the US, are energised by the ‘power-
ful international forces ......
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