Wednesday, March 4, 2015

Asean integration remains an illusion

The grouping's members have diverse political, economic and legal systems and are at different levels of economic development

MAR 4, 2015


FOR the Asean member states, the benchmark of successful regionalism has been Asean's effectiveness in bringing the region closer.

Asean has provided a forum for closer consultations while promoting the habit of cooperation.

The lack of intra-state conflict in a region derided as a cockpit of war and the Balkans of the East during the 1950s and 1960s has been credited to Asean's success in moulding a greater regional consciousness among policymakers.

Still, in the first 40 years of its existence - from 1967 to 2007 - only 30 per cent of Asean agreements were implemented. I was therefore sceptical of the impact of the Asean Charter when it was adopted in November 2007.

At that time, I criticised the codifying of existing norms instead of breaking new ground.

I was disappointed that the Asean leaders reacted conservatively to the recommendations of the Eminent Persons Group report, which presented groundbreaking and innovative proposals for Asean integration, including a proposal that the ministers who handle security, economic and sociocultural issues report directly to the Asean Summit.

I argued against the stress on consensus decision-making, which resulted in a conservative, lowest common-denominator approach. This "Asean Way" has now become embedded in regional institutional structures and is an obstacle in community-building efforts.

Ties with major powers

SINCE 2008, Asean has performed better than expected. Statistically, 90 per cent of the targets under the three Asean Community Pillars have been achieved. The focus has been on inter-governmental agreements concluded and ratified, work plans adopted, studies undertaken, committees formed and other similar actions.

There is less attention to the effectiveness of these measures and the extent of implementation, from the perspective of reducing transaction costs, increasing intra-Asean flows and improving the pace and depth of Asean integration.

Asean's great achievement has been in facilitating regional relationships with the major powers as well as with international and regional groupings.

The East Asia Summit (or EAS, made up of the Asean 10 plus the United States, China, Japan, South Korea, Australia, New Zealand, Russia and India) and the Asean Plus Three (or APT, made up of the Asean 10 plus China, Japan and South Korea) are central institutions in these relationships.

One problem has been the competing proposals for regional economic integration, with the EAS promoting the Comprehensive Economic Partnership for East Asia and the APT pushing for an East Asia Free Trade Agreement.

The launch of negotiations for a Regional Comprehensive Economic Partnership (RCEP) in November 2012 was a step forward.

Asean could avoid a choice between the two alternative economic visions.

More significantly, as a multilateral agreement, it offers the opportunity to avoid the trade-distorting aspects of single-country free trade agreements (FTAs), since Asean's partners - Australia, China, India, Japan, New Zealand and South Korea - are states which have already concluded FTAs with Asean.

The presence of India in the group is, however, a point of concern as India has often been the cause of deadlocks in multilateral trade and economic negotiations.

During the 1996 negotiations for the first Information Technology Agreement, my Indian counterpart blocked a consensus, fearing a loss in customs duties.

He had no idea India's information technology industry would be a major beneficiary.

Despite the pro-business thrust of Prime Minister Narendra Modi's administration today, there will be a need to overcome the instincts of the Indian bureaucracy if RCEP negotiations are to be successfully concluded.

Lack of Asean mindset

IF WE look at Asean beyond this year, the key concern is that Asean integration remains an illusion.

Asean is a diplomatic community with little impact on the lives of most people in its 10 member states. Its members have diverse political, economic and legal systems and are at different levels of economic development.

There is a real worry that a "two-stage" Asean is emerging, with the six earlier members plus Vietnam leading the way while Myanmar, Cambodia and Laos remain mired in their least-developed country status.

Within the member states, loyalties and affinities are centred on the local level, with the idea of commitment to the nation state receiving more traction today, especially in urban areas.

There is hardly any Asean mindset, except among policymakers, academics and journalists.

Most businessmen resist closer economic cooperation if it undermines their existing market dominance but are keen on opening the markets of their neighbours.

Strikingly, Asean policymakers appear to have tunnel vision.

The three Community Pillars - political-security, economic and sociocultural - are discussed within silos and there is poor cross-sectoral interaction.

What is lacking is a "whole of government" approach.

Asean policymakers focus on their individual sectoral responsibilities and are unable to relate their concerns to the issues affecting other sectors of society.

While there is considerable discussion of Asean connectivity, difficult issues of "behind the border" integration need to be addressed. Critical aspects include the harmonisation of customs standards, the standardisation of legal regimes and the development of infocommunications technology infrastructure.

Fragile unity

EVEN when proposals are made which appear intended to promote closer integration, they fail to take reality into account.

At the Asean Foreign Ministers' Retreat in Kota Kinabalu in January, Malaysia reiterated the call for a common Asean time zone for the capitals of Asean countries.

But Timor Leste is in a time zone 21/2 hours ahead of Myanmar. Does this mean that the door is closed to Timor Leste's future membership as alignment with a common Asean time zone would make little sense?

A growing worry is the fragile state of Asean unity.

The ability of external parties to shape the positions of Asean members on regional issues such as the competing maritime claims in the South China Sea could undermine efforts to create an agreed Asean view.

As China exerts its influence on Asean members to prevent any decisions which could affect its preference for bilateral negotiations, it will be increasingly difficult to reach an Asean consensus.

In July 2012, Cambodia blocked the inclusion of any reference to the South China Sea disputes, resulting in Asean's failure to issue a communique for the first time after an Asean Ministerial Meeting.

This development is a harbinger of future trends.

There will be pressures on Asean states to avoid criticisms of external powers, and the more vulnerable Asean members may feel obliged to agree with their external patrons.

Asean communiques could therefore see a papering over of critical differences and the appearance of Asean unity concealing sharp differences of views.

The writer is Distinguished Fellow and Bakrie Professor of South-east Asia Policy at the S. Rajaratnam School of International Studies, Nanyang Technological University.



Mar 12, 2015

Asean integration a work in progress, not an 'illusion'

By K. Kesavapany For The Straits Times S.e.a View

WITH his rich store of "insider" knowledge, my friend and colleague, Ambassador Barry Desker, has set out a case for believing that Asean has not achieved much in the way of regional integration in the five decades of its existence ("Asean integration remains an illusion"; last Wednesday). While acknowledging that Asean has been successful in "moulding a greater consciousness among policymakers", Mr Desker fears the worst for the regional grouping in the years ahead.

His main frustration appears to be that Asean has not achieved its self-proclaimed goal of establishing a regional economic community by 2020, brought forward to this year. However, is this the only yardstick to measure Asean's success? If politics is the art of the possible, then Asean policymakers have had to trim their sails in accordance with prevailing conditions, both domestically and regionally.

I believe that, when all is said and done, Asean and its integrative processes are working well, albeit at a speed less than what one would like to see. Apart from the European Union, no other regional grouping has been able to build so much cohesiveness as Asean has done. For that matter, even the EU is having trouble maintaining its cohesion as a union, as seen by the ongoing tiff between member states and Greece. Ukraine is another nettlesome issue, with geopolitical and economic implications.

For me, the real worth and value of Asean is the consciousness that has been developed among ministers, officials and NGO representatives of thinking in regional terms.

Emerging issues such as cross-border environmental issues and illegal trafficking of narcotics can only be addressed through a collective mindset.

Mr Desker writes that "Asean is a diplomatic community with little impact on the lives of most people in its 10 member states". I beg to differ.

The fact that this region has been at peace for over five decades surely is something to be treasured, particularly when members of regional groupings in other parts of Asia cannot even sit down together, let alone discuss to find solutions to the myriad of problems confronting them and their peoples. The ease with which nationals of member countries move across the region (except in the case of Myanmar) is but one example of the socialisation of Asean.

[Mmmm.... using "there has been no war" as a measure of success is a rather low bar.]
Until it joined Asean, Myanmar was of little economic significance to the region. Since opening up and embracing the values and practices of Asean, it has become a sought-after market and an investment destination. Thousands, if not millions, of Myanmar people have had their lives changed for the better.

Secondly, Asean economic cooperation, which has evolved into a gradual process of economic integration, has made the region attractive for the flow of foreign investments, capital and technology. In the past five decades, under the umbrella of political and social stability provided by Asean, member states have made unprecedented economic and social progress.

Thirdly, the diplomatic capital that Asean has built up over the years is a worthy strategic asset. This has led, among other things, to the US adopting its "pivot" policy - a reflection of its assessment of Asean's continued relevance to regional peace and stability.

China, behaving as all Big Powers do, is beginning to ponder whether it has gone too far in alienating some of the Asean member states over the South China Sea issue, and in the process, causing disquiet in the international community. The newly elected Modi government in India is directing more of its policy measures towards this region, particularly in the maritime arena.

Rather than dismissing Asean integration as an "illusion" and condemning five decades of efforts put into building a community, I would take a more realistic approach and opt for the route that Institute of Southeast Asian Studies researcher Moe Thuzar has suggested, that is bridging the missing links in the integration process. As she puts it, "it is all about changing mindsets and cultivating an outlook that sees the benefit of working regionally ("Asean's missing links need to be bridged"; last Thursday).

On the occasion of the launch of the $100 million S. Rajaratnam Endowment by Temasek Holdings last year, it was observed in an editorial in The Straits Times that investing in promoting regional cooperation and development is the natural impulse of a small state with an open economy, which needs to stay engaged with its neighbours and others farther afield.

Pioneers like Mr S. Rajaratnam nurtured this instinct and laboured to institutionalise linkages. Illusion or not, Asean is here to stay and we, the inheritors of the legacy of Mr Rajaratnam and the other founding fathers of Asean, are duty-bound to make Asean integration a reality, however long it takes.
The writer is a Distinguished Affiliated Fellow of the Asian Research Institute at the National University of Singapore.

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