ASEAN to-do list far from easy

The Myanmar Times - Weekend - - News - AU­GUST 25, 2017 JO­HANNA SON news­room@mm­

AN ASEAN-WIDE work per­mit, re­do­ing the cur­rency bas­ket of ASEAN states, giv­ing na­tional treat­ment to ASEAN in­vestors, beef­ing up Asean-based se­cu­rity venues, get­ting ASEAN states to com­ply with its own agree­ments – these are a few of the chal­lenges that ASEAN faces as it cel­e­brates its 50th an­niver­sary.

These might seem am­bi­tious or even fan­ci­ful think­ing, but these con­crete steps are among many that have emerged in dis­cus­sions around ASEAN’S this year about how ASEAN can strengthen its core and build more re­silience.

This would help make ASEAN more of a mid­dle power that can sur­vive bet­ter in to­day’s un­cer­tain world, where mul­ti­lat­er­al­ism and glob­al­i­sa­tion/free trade – which have been cru­cial to ASEAN’S eco­nomic growth and re­gional sta­bil­ity – seem to have been thrown into re­verse.

“The new nor­mal in East Asia now is uncer­tainty,” said Jusuf Wanandi of the Jakarta-based Cen­ter for Strate­gic and In­sti­tute Stud­ies Foun­da­tion.

In eco­nomic link­ages, Jose Isidro Ca­ma­cho, vice chair­man of Cred­it­su­isse Asia-pa­cific and a for­mer Philip­pine sec­re­tary for en­ergy and fi­nance, says it is time for “the con­cept of an ASEAN ci­ti­zen­ship,” where ASEAN coun­tries give favoured sta­tus to fel­low en­ti­ties. There should be a clear dis­tinc­tion be­tween a per­son, com­pany or in­vestor be­ing ASEAN or NON-ASEAN, he told the ‘ASEAN at 50: The Way For­ward’ con­fer­ence in Manila ear­lier this month.

In geopo­lit­i­cal terms, an in­ter­nally stronger ASEAN is one able to main­tain its “strate­gic au­ton­omy,” Aileen Baviera of the Uni­ver­sity of the Philip­pines’ Asian Cen­ter said. ASEAN has to be “in­no­va­tive” in de­sign­ing mech­a­nisms that “keep the big pow­ers en­gaged but also as is ASEAN’S tra­di­tion… to main­tain the re­gion as a neu­tral ground and as a re­gion that is most con­cerned with main­tain­ing the strate­gic au­ton­omy of South East Asia it­self.”

Stronger core How­ever one calls it, strength­en­ing its po­lit­i­cal and eco­nomic core must rank high on ASEAN’S to-do list if it is to ma­ture into a more solid com­mu­nity af­ter 50. Ideas for these range from cre­at­ing more vis­i­ble signs of be­ing ASEAN, to un­lock­ing bar­ri­ers to real in­te­gra­tion, to push­ing re­gion­al­ism at the level of pres­i­dents and prime min­is­ters.

Ca­ma­cho pro­poses a much more rad­i­cal push to in­te­grate the other as­pects of the ASEAN Eco­nomic Com­mu­nity (AEC) – ser­vices, labour, cap­i­tal – by which the busi­ness sec­tor has been largely unim­pressed.

“It is about time that each mem­ber coun­try com­mits to adapt the con­cept of an ASEAN ci­ti­zen­ship that will have a favoured sta­tus in our re­spec­tive ju­ris­dic­tions. This should al­low an ASEAN neigh­bour to be dis­tin­guished from a NON-ASEAN per­son, on na­tion­al­ity is­sues in ar­eas like for­eign own­er­ship lim­its, or labour, or pro­fes­sional ser­vices, and many oth­ers,” he said.

Ca­ma­cho added: “Un­less we are pre­pared to for­mally in­cor­po­rate these in our re­spec­tive laws and reg­u­la­tions, ASEAN will be merely de­scrib­ing our ge­o­graphic prox­im­ity in­stead of our po­lit­i­cal, so­cial, cul­tural and eco­nomic tra­di­tion.”

While AEC aims to al­low the free flow of goods, ser­vices, cap­i­tal and skilled labour, busi­ness peo­ple say progress has been pal­try in the in­te­gra­tion of ser­vices in air trans­port, health care, tourism and lo­gis­tics. ASEAN own­er­ship of up to 70% in the ser­vice sec­tor was to have been ac­com­plished by 2010, Ca­ma­cho adds.

ASEAN fi­nance min­is­ters agreed on a road map for a more in­te­grated cap­i­tal mar­ket in 2009, but “very lit­tle has been ac­com­plished”, he said.

Test­ing ASEAN’S re­solve How about an ASEAN-WIDE work per­mit, as pro­posed by for­mer Thai en­ergy min­is­ter Narongchai Akrasa­nee? But the ASEAN Com­mu­nity’s skills mo­bil­ity mech­a­nism covers a lim­ited set of skilled pro­fes­sions, and some coun­tries have put in more re­stric­tions on for­eign labour af­ter the AEC was set up.

Uni­ver­sity of Tokyo’s Masahiro Kawai asked, What if ASEAN gave “much more sub­stance” to its eco­nomic com­mu­nity by be­com­ing a cus­toms union af­ter tar­iffs are all but elim­i­nated? As it is, ASEAN coun­tries re­main chal­lenged by non-tar­iff bar­ri­ers, though of­fi­cials reg­u­larly say tar­iffs are al­most at zero.

To deepen fi­nan­cial in­te­gra­tion, Kawai sug­gested that ASEAN work to have a more sta­ble in­tra-asean ex­change rate by bas­ing it on a bas­ket of cur­ren­cies that gives pre­dom­i­nant weight to the cur­ren­cies of ASEAN coun­tries and those of Ja­pan, Korea and China, rather than those of nonasian states.

Con­clud­ing the ASEAN-LED Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship (RCEP) would help ASEAN main­tain and pro­tect the open eco­nomic en­vi­ron­ment it has thrived in, and pre­vent over-re­liance on any one econ­omy.

Thus far, it has been five years and 19 meet­ings since the start of ne­go­ti­a­tions on what would be the world’s largest free-trade bloc, which groups ASEAN and the six coun­tries with which it has free-trade ac­cords – China, In­dia, Ja­pan, South Korea, Aus­tralia and New Zealand.

The tar­get for com­ple­tion is this year or by the Novem­ber ASEAN sum­mit, but few are hold­ing their breath.

RCEP is pro­jected to lift in­comes by 2 per­cent to 9pc. “With­out RCEP, you’re go­ing to end up a world of bi­lat­er­als, which is dan­ger­ous be­cause you are small, com­pared to big. If you’re ASEAN, you have more bar­gain­ing power,” said Mari Elka Pangestu, for­mer In­done­sian min­is­ter of tourism and cre­ative econ­omy.

Eco­nomics and po­lit­i­cal weight “The ben­e­fits of RCEP are not just con­fined to the eco­nomic but are also in the po­lit­i­cal and se­cu­rity ar­eas,” Pangestu said. “If RCEP can be used to make sure that ASEAN’S cen­tral role is main­tained, then there’s an im­por­tant po­lit­i­cal and se­cu­rity ben­e­fit ver­sus all the re­gional ten­sions and man­ag­ing re­la­tions that we have with the big pow­ers like China, Ja­pan and In­dia, and also those out­side the re­gion, such as the US and Europe.”

In ASEAN cen­tral­ity, ex­perts have sug­gested strength­en­ing one or all of these fo­rums – the ASEAN Re­gional Fo­rum, the East Asia Sum­mit, and the ASEAN De­fence Min­is­ters’ Meet­ing­plus (ADMM-PLUS).

The ARF and ADMM Plus re­main key se­cu­rity venues. For in­stance, North Korea is part of ARF, and ADMM-PLUS has seen 18 mem­ber coun­tries hold com­bined mil­i­tary ex­er­cises. But they face chal­lenges given that ASEAN is be­ing pushed or pulled by the big­ger pow­ers. The 27-na­tion ARF is now 23 years old and still grap­pling with how to go be­yond con­fi­dence-build­ing.

These in­sti­tu­tions’ “his­tor­i­cal achieve­ment” has been to pro­vide a reg­u­lar venue for ASEAN to con­sult with ex­ter­nal pow­ers, See Seng Tan of the S Ra­jarat­nam School of In­ter­na­tional Stud­ies wrote in the Con­tem­po­rary South­east Asia jour­nal in Au­gust. “How­ever, the post-cold War strate­gic com­pact that en­abled this ex­cep­tional devel­op­ment has con­sid­er­ably weak­ened in the face of grow­ing ri­valry among the Great Pow­ers, which has led to pres­sures on ASEAN mem­ber coun­tries to take sides and fo­mented dis­unity within ASEAN it­self,” he added.

The 16-coun­try East Asia Sum­mit has been around for 12 years, but did not de­velop much po­lit­i­cal weight due to rea­sons that in­clude the sus­pi­cion or dis­in­ter­est of some pow­ers.

Walk­ing the talk Much of ASEAN’S rel­e­vance de­pends on how much im­por­tance it gives to it­self and how far its lead­er­ship com­mits to it.

“The next gen­er­a­tion of lead­ers should also be strong po­lit­i­cally, be­cause for them to adapt to an ASEAN in­te­gra­tion pro­gram, there would have to be cer­tain give-ups in order to achieve the kind of in­te­gra­tion we would like to see some day,” said Manuel Pangili­nan of the telecom­mu­ni­ca­tions gi­ant Philip­pine Long Dis­tance Tele­phone Inc. “If we ad­dress the mat­ter of in­te­gra­tion purely from a coun­try per­spec­tive, we will never get there,” he said.

“We (must) fo­cus on ex­e­cu­tion (of ASEAN’S de­liv­er­ables). We spend too much time talk­ing,” said Ca­ma­cho.

They were re­cruited for their ex­per­tise in these ar­eas,” U Ye Min Oo said.

“I have par­tic­i­pated in dis­cus­sions on the econ­omy and in­volved in de­vel­op­ing so­lu­tions on eco­nomic is­sues. I think I will be ex­pected to per­form the same tasks in the NLD Eco­nomic Com­mit­tee. My ex­act du­ties, which will be as­signed, are not known yet.” Dr. Aung Ko Ko said.

The cur­rent mem­bers of the NLD Eco­nomic Com­mit­tee are chair U Han­thar Myint, U Myo Myint, U Soe Win, U Lay Nyunt, Dr. Kyaw Soe, U San Thein, U Aye Lwin and U Ye Min Oo. Its sec­re­tary is U Min Khin.

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