The Association of Southeast Asian Nations (ASEAN) has celebrated marked the 40th founding anniversary, marking the long, practical and comparatively effective process of integration in all aspects, especially in economic cooperation relations. Together with the increasing globalisation and regionalisation, ASEAN stands out as a dynamic region and plays a significant role in regulating and attracting attentions from world powerhouses and other regions on the globe. From five initial founding members, ASEAN now has admitted all 10 Southeast Asian nations.
Arguably, the initiation of regional economic cooperation process was the ASEAN Free Trade Area framework agreement (AFTA) in 1992, which was then followed by Preferential Trade Agreement (PTA), with the purposes of facilitating commercial liberalisation by minimising tariffs within the region, removing non-tariff barriers, attracting foreign investment and encouraging all economic sectors to head for wide economic orientation. After that, the ASEAN Investment Area (AIA) was set up to promote the integration of member economies by accelerating direct investment, facilitating investment capital channels, technology transfer and mobility of expertise labourers. Together with the commercial liberation of commodities, ASEAN also commits the commercial liberalisation of services (AFAS), industry (AICO), tourism, shipping and others.
The regional economic linking process thrived when leaders of ASEAN countries decided to set up the ASEAN Community at th 10th ASEAN Summit in Bali in October 2003, in which the ASEAN Economic Community is one of the three mainstay pillars together with ASEAN Security Community and ASEAN Cultural and Social Community (ACSC). After that, the 12th ASEAN Summit in Cebu, the Philippines in January decided to shorten the implementation of AEC by five years to 2015.
Arguably, the formation of ASEAN Community in general and the ASEAN Economic Community in particular showed the indispensable economic tendency of the region toward the quick evolution of the globalisation and regional economic association. This also presents the political will and strong determination of ASEAN leaders in building a region-linking association and unifying an institutional frame with higher legal obligation.
To initially realise AEC, the 9th ASEAN Summit determined: (1) speed up the implementation of existing economic initiatives, including ASEAN Free Trade Area, ASEAN Framework Agreement on Services (AFAS) and ASEAN Investment Area; (2) promote deeper regional integration with priorities given to integrating sectors (integration priority sectors include seven commodity sectors of farm produce, aquatic product, rubber product, wood product, garment-textile, electronics and automobile; and four service sectors of aviation e-commerce (e-ASEAN), healthcare and information technology); (3) facilitate the mobility of businesspeople, skilled labourers and talents, strengthen ASEAN institutions and narrow the development divide. The construction and amendment of ASEAN Charter, expected to complete by late 2007, is a clear evidence for the efforts to integrate the region toward a more effective and stronger ASEAN bloc with more important roles in the globalisation and regionalisation processes. This is vital not only for ASEAN but also its member states.
Although the ASEAN economic integration process is developed in both dimension and depth, it also encounters numerous difficulties and challenges:
Firstly, the development divide among member countries is wide. The gap does not only reflects in per capita GDP (the CLMV sub-group (Cambodia, Laos, Myanmar and Vietnam) is equal to from a third to a fifth of the entire bloc) and economic development level of member countries (Singapore is a developed nation while CLMV is striving to escape from the world extremely underdeveloped countries) but also the market opening, human develop level, infrastructure and economic structure among others. Besides, the diversification of politic regimes and institutions of member countries will trigger certain impacts on the cooperation possibility and regional integration in basic fields like commerce, investment, finance, monetary, environment and social security because each nation has its own political intentions.
Secondly, ASEAN lacks a “locomotive” to pull the entire bloc to create a magnetism to link the markets of the regional economies. Meanwhile, the “centrifugal” tendency of several ASEAN countries to seek bilateral trade agreements with countries outside the bloc is increasing. Singapore is the first country in ASEAN to sign FTA agreements with non-ASEAN members like Japan, the US, South Korea, India and New Zealand. Then, Thailand is actively pursuing similar FTA strategy and has signed with China, India, Japan, Australia, Bahrain and New Zealand. ASEAN, on its own, also signed FTA with China, effective from 2010, with Japan, South Korea, India, ASEAN +3 and ASEAN +5. This partially causes the dispersion of concerns and intentions toward inner-bloc cooperation but the increase in the possibility of seeking external partners.
Thirdly, the implementation of commitments in ASEAN is weak. This can be seen at the ASEAN cooperation plans and programmes which lack concrete measures and steps and lack the leadership in implementation. ASEAN Secretary General and ASEAN Secretariat have a few functions and authority. Moreover, the institutions and conferences have weak effectiveness. The absolute application of “ASEAN Mode” (consensus, non-intervention and voluntariness) partially prevents the flexibility as well effectiveness of ASEAN.
Fourthly, the change in the international environment, with the emergence of China, exposes huge challenge for ASEAN. One the one hand, ASEAN has to seek to keep sustainable development in the relation with China and Japan but still keeps its role of linking axis in the region and the world.
On the other hand, the market and regional economic integration is divided and limited by the tariff and non-tariff barriers, protectionism in investment, the weakness of regional economic cooperation. Obviously, these difficulties and challenges are not easy to overcome quickly. However, importantly, ASEAN countries should be prudentially aware of sound decisions and raise the spirit of 10-country association, a community, with the leading role in the Asian region. Hopefully, the introduction of the ASEAN Charter and economic linking efforts will be soon carried out. An ASEAN Community with three mainstay pillars will be soon brought into life.
Nguyen Ngoc Lan, East Asia Study Institute
Vietnamese
