Image by ASEAN.org.
As Brunei begins its 2013 Chairmanship of ASEAN it takes over at a time of enormous potential and very hard work. ASEAN – the Association of Southeast Asian Nations – is going through a remarkable transformation. Once regarded as a “travelling cocktail party”: jaw-jaw to prevent war-war. It is now becoming a complex and nuanced international trade cooperation and integration body, across a market of over 600 million people in one of the world’s fastest-growing economic regions. The origins of the body were to prevent war: in the messy aftermath of World War II and the region’s colonial collapses, culminating in the armed ‘confrontation’ between Malaysia, supported by the UK and Australia, and Indonesia on Borneo in the early 1960s. ASEAN was born in 1967 and lying at the heart of its philosophy is the pursuit of inter-state peace, while respecting sovereignty; a belief that poverty reduction is essential to sustain peace; and that liberal trade and increasingly free markets are the best routes to poverty reduction. In recent years, particularly after the 1998 Asian financial crisis, ASEAN has focused on economic sustainability. To make it effective, the decisions of ASEAN are legally binding on its member states: this marks an important distinction between ASEAN and the geographically larger APEC (Asia Pacific Economic Cooperation) – chaired in 2013 by Indonesia – as APEC cannot impose legally-binding decisions upon member states. Understanding the inter-play between ASEAN and APEC is important; as APEC is the forum where the big voices of China, America, Australia and Japan can be heard. ASEAN’s relationship with China, is its most important challenge and opportunity.
Image by Sodacan
ASEAN is marked by a defiant sense of sovereignty and independence, which provides the counter-balance to its drive for integration. This defiant independence marks ASEAN out as different from the European Union (which has at its core the limitation of national sovereignty). ASEAN has no “Parliament” or assembly of its own to contradict member state governments and nor does it have an enforcement body (in the way the EU has the European Court of Justice). Equally the role of the ASEAN Secretariat, based in Jakarta, is more ‘traffic cop’ than the EU’s supra-national civil service, the European Commission. Necessarily this balancing of legally binding and the sacrosanct preservation of national sovereignty can mean policy dilution and delay. Critics would argue this has in times past been true of ASEAN’s collective stance on (member state) Myanmar, as well as the allegedly watered-down ASEAN Human Rights Declaration (which was unveiled to mixed reviews in November 2012). ASEAN is not trying to become the Asian EU. Equally, it does see the need for more integration and pan-regional joint development in major infrastructure (pan-regional highways; single markets in maritime; aviation and air traffic control). Because also the ASEAN member states realize that they are more powerful as a market of 600 million than as individual countries, there is a powerful incentive for a managed single market for trade and finance across the ASEAN region: the ASEAN Economic Community (AEC) envisaged by 2015. To achieve this member states have identified the need for more ASEAN Connectivity. ASEAN Connectivity is being driven through three stands of member state working groups:
- Physical connectivity – upgrading the pan-ASEAN road network – particularly across the mainland peninsular – and the end-to-end connectivity of roads; airports and ports for more efficient movement of trade. In the context of regional energy security, energy connectivity is a policy, to connect national energy grids to form a regional grid.
- Social connectivity – greater cultural and social interaction; and greater inter-ASEAN mobility andprogressive reduction in visa requirements. This is not (unlike the EU) a commitment to a free movement of member state people to live and work where they choose. Although the use of language in the resolutions suggests this may not be ruled out for some future date.
- Institutional connectivity – the free flow of goods and services across ASEAN member state borders; a single aviation and a single maritime market; and the passporting of business and investment between member states
Although it will not become an Asian EU, ASEAN will become – in the next 5 years or so – a body of formidable geo-political importance. Global business needs to up-weight its attention to ASEAN. One useful route to do this is to get involved in its Business Advisory Council – ASEAN-BAC – as well as understanding that the key to public affairs in the region will be increasingly to frame the conversation with the national governments within an ASEAN context.
Stephen Lock is Edelman’s head of practice for public affairs in South East Asia and is CEO of Edelman’s businesses in Indonesia (IndoPacific Edelman and Zeno Stratcom). IndoPacific Edelman is rebranding as Edelman Indonesia on February 1st.