SOAS Research Online

Abstract

During the early part of the period 1914-1941 Japan regarded Southeast Asia simply as a supplier of raw materials and a consumer of manufactures. It was only in the 1930s that Southeast Asia became economically vital to Japan, as tension between Japan and the Western powers increased. In particular Japan feared the suspension of exports from the West and from European colonies in Asia. After 1931 Japan had a considerable balance of payments deficit with regard to the West. Consequently Japan attempted to extend her political and economic influence in Southeast Asia in order to reduce her dependence on Western supplies and markets. However, this created tension between Japan and the West as the economies of Southeast Asia were closely integrated with the economies of the Western world. Though Japan succeeded in the 1930s in penetrating these Asian markets to a considerable extent, she was unable to reduce her trade deficit with the West or to create a self-sufficiency area in Asia. Japan further increased her economic expansion into Southeast Asia, but this merely aggravated her already strained relationship with the West. In addition, during this period the Japanese business community, the Zaibatsu, which had close links with the Army, attempted to establish the "Greater East Asia Co-Prosperity Sphere." This was to provide an environment free of Western influence, in which the Zaibatsu could protect and develop their economic interests. Ultimately this led to the outbreak of the Pacific War in 1941 and the Japanese occupation of Southeast Asia.