It suggests that the expanding profile of various state-controlled entities in local capital markets constitutes a new form of state financial activism responsive to (upper) middle-class consumption preferences such as modern infrastructure, urban housing and low-risk investments. This activism highlights state agency and complicates the propositions of the emergent literature on state capitalism and financial de-risking that focuses on increasingly close alignment of the interests of states and international portfolio investors. Accordingly, the authors caution against unilinear conceptions of the state in which activism is primarily geared towards accommodating the preferences of international investors. The article posits that states are actively trying to establish new market logics for the benefit of their domestic middle classes via the development of domestic capital markets, and that the emergent role of middle-income country (upper) middle classes as financial consumers reconfigures processes of state-managed financialization.

When Prime Minister Anwar Ibrahim said the cost of living must be “managed” and its impact “curbed”, he acknowledged a reality Malaysians already live with daily: prices are rising, and livelihoods are tightening.

But the language matters. To manage is not to solve. To curb the impact is not to confront the cause. This is the quiet politics of our time, where symptoms are treated but the structure producing them remains untouched.

The usual story that Malaysia’s cost of living crisis is about “inflation” or “global pressures” is too convenient. Prices are not rising in a vacuum.

What Malaysians are experiencing is a class problem: the cost of reproducing everyday life (food, housing, transport) has risen faster than wages.

The rising cost of living is not simply the result of global shocks or temporary supply disruptions. It is the outcome of how the economy is organised. Food, housing, transport – these are not just necessities; they are profit centres. Every ringgit a household spends passes through layers of pricing, markups, debt, and rent extraction. By the time a family buys cooking oil, pays rent, or services a car loan, they are not just consuming. They are sustaining a system that continuously takes a share of their income at every step.

So, when traders say gradual price increases are affecting them, they are not wrong. But they are also part of the chain. Rising costs cascade downwards: from producers to wholesalers, from wholesalers to retailers, and finally to consumers. At each stage, margins are defended. The burden accumulates at the bottom.

The government’s instinct is predictable. Convene the Cabinet. Consider targeted subsidies. Perhaps tighten price controls on a few essential goods. Offer reassurance. These are politically necessary moves, but they are also deeply limited. They help households cope with high prices without asking why those prices are persistently high in the first place.

The diagnosis for Malaysia’s cost of living crisis is as follows:

• Wage suppression as a development model: Malaysia’s growth since the 1980s has depended on cheap labour (including migrant workers), weak unions and state discipline of labour. The result is expected: productivity rises but wages stagnate. Workers produce more value but receive a smaller share.
• Commodification of necessities: Basic needs are organised for profit: housing becomes a speculative asset, food is controlled by supply chains and middlemen, and transport is car-dependent and profit-driven. This means capital extracts rent from survival itself.
• Oligopoly and politically connected capital: Key sectors are dominated by large conglomerates, GLCs, and politically linked firms. This is not a “free market” but a managed capitalism where profits are protected.

Under Anwar, the policy response has focused on cash transfers, targeted subsidies, and mild wage adjustments. These do not solve the problem. They merely subsidise capital by helping workers afford high prices without changing why prices are high.

Cash aid, in effect, becomes a transfer from the state to workers, back to corporations via consumption.

Just don’t touch the underlying system!

Cash transfers and subsidies, for instance, provide immediate relief. But they also allow the underlying system to continue functioning as before. Money flows from the state to households, and then quickly back into the same channels of rent, interest, and profit. Relief becomes a stabiliser, not a solution.

Take housing. It absorbs the largest share of income for most households, yet prices are driven less by construction costs than by land speculation, financing structures, and market positioning.

Or transport: a car is no longer just a purchase, but a long-term financial commitment shaped by loans, fuel costs, and infrastructure that leaves few alternatives.

Even food, the most basic necessity, is embedded in supply chains where value is added and extracted at every stage. In this context, to “manage the impact” is to accept that the structure remains intact.

Essential goods, housing and mobility

A more honest approach would begin by asking harder questions.

Why are essential goods treated as avenues for profit maximisation? Why does housing function as an investment vehicle before it serves as shelter? Why must mobility depend on private ownership that locks households into years of repayment?

Food, utilities, basic services are social needs

Addressing the cost of living requires more than cushioning its effects. It requires reducing the extent to which everyday life is exposed to profit extraction.

That means expanding genuinely affordable public housing, not just facilitating home ownership at high prices. It means building reliable, accessible public transport so that owning a car is a choice, not a necessity. It means ensuring that essential goods, such as food, utilities, basic services, are priced with social needs in mind, not just commercial returns.

Entrenched interests, political constraints

None of this is easy. Each step runs into entrenched interests, institutional habits, and political constraints. But without confronting these realities, the cycle will repeat: prices rise, relief is offered, pressure builds again.

The danger is not that the government is unaware. It is that awareness stops at management. Because in the end, a society cannot subsidise its way out of a system that makes living expensive. It can only change the system, or continue paying for it.

Fluency is not the same as understanding

I have studied Indonesian society, media and culture for more than 30 years. That gives me a particular vantage point on a problem that reaches well beyond Indonesia: large language models – LLMs – like ChatGPT, Claude and Gemini can now speak dozens of languages with remarkable fluency. That fluency creates the impression that AI understands local cultures.

Producing grammatically correct Indonesian, Arabic, Swahili or Hindi, however, does not change the underlying worldview through which these systems reason. It does not alter how they think about people, relationships, responsibility or what counts as a good outcome.

Those assumptions are shaped by training data drawn predominantly from English-language sources based in the United States. Meta’s open-weight model LLaMA 2 was trained on approximately 89.7% English-language text; LLaMA 3 includes only about 5% non-English data. Major commercial models don’t publish equivalent breakdowns but draw heavily on the same sources. Arabic, the fifth-most-spoken language globally, accounts for under 1% of content in large training datasets. Languages with tens of millions of speakers, including Bengali and Hausa, barely appear.

Beneath the surface of these multilingual conversations, English functions as a hidden intermediary. A study by researchers at the University of Oxford found that LLMs routinely conduct their core reasoning in English, even when prompted in other languages. They translate the output at the final stage. A user receives flawless text in their preferred language, but the underlying logic originates elsewhere.

What the data shows

To examine how this plays out in practice, I ran experiments with ChatGPT, Claude and Gemini. I asked questions in both English and Indonesian about concepts such as education, responsibility, well-being and several Indonesian terms that resist direct translation into English. These included terms such as “gotong royong,” which describes a tradition of communal mutual assistance.

Then I asked questions about education in both languages, using the word “pendidikan” in Indonesian. The answers were consistently centered on individual development, personal autonomy, critical thinking and preparation for the labor market.

What largely disappeared were the dimensions of pendidikan that Indonesian educational traditions have historically emphasized. In Indonesia education has long been focused on ethical discipline. Scholars of Indonesian education such as Christopher Bjork and Robert Hefner have documented how distinct these traditions are from models that treat education primarily as a path to individual advancement and career preparation, which is the lens through which the AI tools viewed education.

The Indonesian concept of “malu” offers a starker example. Often translated as “shame” or “embarrassment,” malu has been analyzed by anthropologists Clifford Geertz and Tom Boellstorff as something closer to a shared social awareness.

A person might feel malu when speaking out of turn in front of elders, or when a family member’s behavior reflects poorly on the household. It regulates conduct and signals awareness of one’s position within a web of relationships. It is cultivated, not merely felt. It is a form of relational awareness rather than a private psychological event.

When asked directly to define malu, the models acknowledged its social dimensions. In scenario-based questions that simply used the word without asking for a definition, however, all three fell back on the English translation of shame, consistently framing it as an individual emotional experience.

One representative response framed malu as a normal emotional reaction to be managed through self-reflection and confidence-building – a personal psychological problem rather than a social one. The relational dimensions of the concept disappeared entirely, replaced by the language of individual emotional regulation.

A distinctly American worldview travels inside the translation, largely unannounced.

Why this probably won’t change soon

Translation is far cheaper: Train one model on the vast English-language web, then use multilingual output capabilities to serve global markets. As media scholar Safiya Umoja Noble argues about algorithmic systems more broadly, what looks like a technical outcome is actually a structural one, shaped by who has the wealth and infrastructure to build these systems.

The embedded worldview isn’t a mistake; it’s what happens when knowledge production is profit-seeking.

The main exceptions are Chinese models such as DeepSeek and Alibaba’s Qwen. They represent a genuine alternative to the U.S.-dominated pipeline, though research shows they operate through a distinctly Chinese cultural lens. Asked about a workplace disagreement, for instance, they tend to advise silence or indirect phrasing to preserve harmony rather than the direct, private correction that Western models recommend.

Other regional efforts, such as SEA-LION for Southeast Asia and Kan-LLaMA for the Indian language Kannada, use U.S. models as their foundation. They add additional vocabulary and cultural information related to local languages. But the core logic remains tied to the original U.S. training.

Why this matters more than it might seem

One might reasonably ask whether this is simply a limitation users can work around. Decades of media scholarship demonstrate how audiences interpret foreign media through their own cultural frameworks.

For example, anthropologist Brian Larkin documented how viewers in northern Nigeria rework the narratives of Bollywood films to align with local Islamic values. Larkin found that Muslim viewers in Kano reinterpreted Bollywood films through an Islamic moral lens, reading their narratives as reinforcing local values of propriety and ethical conduct. That dynamic depends on encountering media as something with a visible origin. But to do that, you need to know where your media is coming from.

Conversational AI is different. Research at Harvard Business School finds that people increasingly use AI systems for emotional support, advice and companionship. When a culturally specific worldview is delivered through a relationship that feels attentive and empathetic, in your own language, it arrives less as a claim to be evaluated and more as a shared premise within a dialogue. It becomes difficult to notice, and harder to contest.

The concern is that these perspectives become the new normal. Certain ways of reasoning about family life, education and responsibility may come to feel natural and self-evident. Linguistic diversity among AI systems is real and growing. Cultural worldview diversity, however, has not kept pace.

If you've taken a Grab or used another ride-hailing app in Southeast Asia recently, you've likely noticed a change. A growing number of drivers are no longer driving just Japanese gasoline-powered autos, but a string of unrecognizable electric vehicle (EV) models made by other countries. Make no mistake, these fashionable looking cars might not be recognizable, but their manufacturers, notably Chinese and even Vietnamese, are aggressively taking market share away from legacy Japanese automakers. According to the PwC ASEAN-6 Automotive Market Snapshot, EV adoption in the region rose from 9% in 2023 to 13% in 2024. This growth is being led by Chinese manufacturers, who are boldly challenging Japanese incumbents.

Chinese automakers like BYD aren't just selling cars using deep discounts, they're underwriting regional assembly and supply chain integration, displacing Japanese market share that long anchored ASEAN as a quasi-domestic market for legacy automakers Toyota, Nissan and Honda. Added to the fray for Japan, the industry's relatively slow transition to fully electric models created a vacuum that Chinese brands have filled with technologically advanced, affordable alternatives.

Thailand and Vietnam are now established EV hubs, with Indonesia and Malaysia reportedly soon to follow suit. This comes as several ASEAN members continue to leverage free trade frameworks to optimize regional production networks, attract capital and underscore structural shifts in industrial alignment. Worse yet for Japanese automakers, the move by their ambitious competitors to produce more EVs represents not just product evolution but a successful challenge to entrenched industrial leadership. What can Tokyo do? It depends on whom you ask. According to recent reports, the loss of market share is creating a ripple effect that threatens an extensive regional supply chain, which includes over 2,700 Japanese parts manufacturers. As sales of Japanese internal combustion engine (ICE) vehicles slump, major automakers are being forced to restructure.

Honda, for its part, has consolidated its Thai factories, while Mitsubishi Motors suspended production at key plants to cut losses. This reduction in output directly impacts local subcontractors, who rely on high-volume orders from these finished vehicle plants. To counter this "Chinese assault," Japanese firms are also pivoting toward hybrid vehicles, a segment where they still maintain a competitive edge. They are also seeking closer cooperation with several ASEAN governments to develop a long-term road map for regional auto production.

But it's not just Chinese EV makers creating the shift in ASEAN auto markets, Vietnam has also joined the top tier. New automaker VinFast remains the most ambitious -- and controversial. The company has been accused of design and manufacturing flaws that have led to accidents, and even fatalities. Despite this, VinFast, long on the periphery of Asia's auto narrative, is now at a strategic pivot.

By the end of 2025, VinFast had achieved a dominant, record-breaking position in Vietnam, accounting for 35% of the country's auto market share, according to Automotive Logistics. VinFast is also a leading EV manufacturer in Southeast Asia and has a new footprint in India, where it is investing $500 million in a new manufacturing plant in Thoothukudi, Tamil Nadu. VinFast is now considered the largest electric car brand in the country, competing heavily with Chinese EV manufacturers.

However, the story isn't only about individual EV brands, governments in the region are also taking action. According to FDI Intelligence coverage, Thailand, Vietnam, Indonesia and Malaysia have deployed a battery of tax breaks, subsidies and investment incentives to lure EV manufacturing and supply chain investment. These moves do more than attract plants, they signal a shift in Asia's broader industrial strategy away from legacy export networks toward new energy vehicle ecosystems.

In practice, this means Japanese automakers can no longer rely on preferential treatment or historical scale alone. Chinese brands with aggressive market pricing and government-aligned deployment strategies are capturing assembly footprint and downstream volume, while Vietnamese players layer in localized demand growth and regional supply chain diversification. This structural repositioning matters for Tokyo because it erodes not just market share, but capital-incentive gravity.

Behind closed doors, it appears executives at Japanese automakers are sounding the alarm. Bloomberg recently reported that Japan's "wait-and-see" approach to full EVs has moved from a conservative strategy to a critical risk as Chinese manufacturers (led by BYD) achieve unprecedented vertical integration and scale.

Not only have Japanese auto brands lost significant market share in Southeast Asia to Chinese brands but their combined share in Thailand, a key market, plunged from nearly 90% five years ago to 69% in 2025. Ultimately, Japanese auto brands simply can't compete on price. Chinese EV automakers BYD and Xiaomi can slash new auto prices far below what Japanese automakers offer because they lack the in-house battery supply chain that Chinese firms have access to.

As noted, Japan's survival currently hinges on its dominance in hybrids. But Bloomberg warned this is a "gilded cage." While hybrids are profitable now, they simply can't help Japan develop the software-defined vehicle (SDV) capabilities where China is currently leading. Moreover, Chinese EVs are being marketed as "smartphones on wheels." Bloomberg highlights that Japanese automakers are still struggling with software integration, leading to a perceived "tech gap" among younger consumers.

This leads to an inevitable reality for Japanese automakers: simply concede that they will have to survive as smaller niche players in an increasingly competitive and crowded market. The threat is no longer theoretical; it's an active displacement of Japanese industrial influence -- something Tokyo will find politically unnerving.

Formatting is a little messed up but I cba fixing it

The most outspoken government in the region was Muslim-majority Malaysia, an outspoken critic of Israel that has for years ~maintained friendly relations~ with the Islamic Republic of Iran. In a ~statement~, the Malaysian Foreign Ministry condemned both the U.S.-Israeli attacks on Iran, as well as the retaliatory Iranian missile strikes on Saudi Arabia, Bahrain, the United Arab Emirates, Kuwait, and Qatar. “At this critical juncture, all parties must exercise maximum restraint to prevent further escalation that could destabilize the region and carry wider global consequences,” it stated. However, Malaysian Prime Minister Anwar Ibrahim was ~more outspoken~, condemning “unreservedly” the assassination of Ali Khamenei and arguing that the strikes have brought the Middle East to “the edge of grave and sustained instability.” He also promised to table a parliamentary motion condemning the attacks on Iran. “The cruelty of Zionist Israel never stops because they have lost all sense of humanity,” he ~said at a fast-breaking ceremony~ yesterday.

Indonesia’s Foreign Ministry also issued a ~statement~ calling on all parties “to exercise restraint and to prioritize dialogue and diplomacy.” It also reiterated the “importance of respecting the sovereignty and territorial integrity of every country and resolving differences through peaceful means.” Meanwhile, President Prabowo Subianto has said he was ~willing to travel to Tehran~ “to conduct mediation,” although no party has expressed any support for his proposal so far.

Meanwhile, acting Thai Foreign Ministry spokesperson Panidone Pachimsawat ~told reporters~ that Bangkok is “closely monitoring the situation with grave concern.” He added that the 110,000 Thai nationals in the Middle East, the majority of whom work in Israel, has been placed on alert and that a plan for their evacuation “has been prepared.” Forty-six Thai nationals ~were killed~ in the conflict between Israel and the Palestinian militant group Hamas, most of them during Hamas’ attack into southern Israel on October 7, 2023.

In a statement, the DFA said that ~no Filipinos had been injured~ in the initial attacks, but that the Philippine embassies in Tehran, Iran and Tel Aviv were “on full alert.” Meanwhile, Foreign Secretary Theresa Lazaro ~called on all parties~ to “resort immediately” to dialogue and negotiations.

Most of the other governments in the region issued statements calling for various variations of restraint. At a ~press briefing~ on Saturday, Vietnamese Foreign Ministry spokesperson Pham Thu Hang said that her government “calls upon all relevant parties to exercise maximum restraint, immediately end all escalatory actions, protect civilians and essential infrastructure, and resolve differences through peaceful means in strict accordance with international law, the United Nations Charter, and relevant U.N. resolutions.”

Singapore’s Ministry of Foreign Affairs ~stated~that it “regrets the failure of negotiations” and the outbreak of war and similarly urged all parties “to return to negotiations to achieve a peaceful resolution in accordance with international law and the principles of the U.N. Charter.” Cambodia’s Foreign Ministry similarly ~called on~ “all parties concerned to exercise maximum restraint to avoid further escalation that would harm civilian lives and undermine peace.”