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The road to drain or gain: Dutch private investment and economic development in late colonial and early independent Indonesia

On 20 September 2023 Mark van de Water successfully defended a doctoral thesis and graduated.

Water, M.P. van de
20 September 2023
Leiden Repository

This dissertation is about the effects of Dutch private investment in the Netherlands Indies and early independent Indonesia. The aim of my analysis is to contribute to the current discourse about the extent to which the Dutch presence in Indonesia was beneficial, economically speaking. In this dissertation three different topics are discussed: investment, profits and linkages. With respect to investment, I focus on numbers of companies, their size and nationality, and the industry in which they operated. The relationship between economic development in the Netherlands Indies and foreign direct investment (FDI), in particular Dutch investment, forms the core of my analysis. In discussing profits, my purpose is to determine whether profit rates from investment in Indonesia were higher than elsewhere and whether they could be considered excessive, constituting a drain of resources away from the colony. The topic of linkages, serves to identify the economic impact of foreign private investment in terms of effects that could have compensated for the drain. Two time periods are considered: the late-colonial period from 1910-1942, and the time period from the Pacific War onwards, including early independence, up to about 1960, when full economic decolonization had been achieved. Three case studies are discussed: Billiton Maatschappij, Deli Maatschappij and Handels Vereeniging Amsterdam.

Supervisor: Prof.dr. D.E.F. Henley
Co-supervisor: Dr. L.J. Touwen

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