ASEAN - search for synergy?

In many ways, unlike the previous gathering in April, the second ASEAN summit of the year in Singapore last week was certainly a much better show. In addition to all the leaders of the ASEAN member states, a number of dignitaries from the key partner states including Russian President Putin, Chinese Premier Li Keqiang, US Vice President Mike Pence attended the summit. Yes, President Trump, owing to his engagements with the post Mid-term polls compulsions at home, was conspicuously absent but his absence did not make any impact on the proceedings of the gathering. The high profile summits, twice every year, along with the attendance of global power brokers, have evolved into one of the most robust and influential platforms in the region once considered to be the backwaters at the periphery of Asia. In the last few years, the ASEAN region has suddenly acquired a more strategic position in trans-Pacific politics. The prevailing uncertainty in the global politics, particularly when the existing economic order is being threatened by the sudden rise in protectionism of the world’s largest economy, has further accentuated the role of regional blocs like ASEAN to counter such a trend.

In his opening address too as the outgoing Chairman of the ASEAN , Singapore’s Prime Minister Lee Hsien Loong also touched upon seriously this very issue that has all the potential to disrupt the global trade balance to the point of total collapse. “The international order is at a turning point. The existing free, open and rules-based multilateral system which has underpinned ASEAN’s growth and stability, has come under stress. Countries, including major powers, are resorting to unilateral actions and bilateral deals, and even explicitly repudiating multilateral approaches and institutions,” said Loong. Throughout the summit, such questions about the uncertain trade environment kept on resonating in each session in different forms. Not surprisingly, the current Sino-US trade war dominated the tone and texture of the summit in an inordinate way. The difference between two countries on their respective versions for the Asia-Pacific region was further highlighted at the summit. The collision between their contrasting strategic interests in the region is now regular feature at all global or regional multi-lateral gatherings. The ASEAN summit was also not immune to this rivalry between the two biggest economies of the world.

The South China Sea, which has graduated from a paltry local territorial disputes to a potential flashpoint in the last two years, was also another topic of sarcastic exchanges between the US and China at the summit. China’s claim of sovereignty over a large part of the South China Sea and its ambitious plan of militarising and developing infrastructures at various islands there has resulted in a major regional dispute that has eventually evolved into a stumbling block in the way regional cooperation. On the other hand, in order to counterbalance the Chinese aggressive presence in the South China Sea, the US has been carrying out aggressive freedom of navigation missions in the area. The positive things is that, despite some sarcastic remarks by the Mike Pence on the China’s “aggression” in South China Sea, Chinese Premier Li Keqiang divulged that China is expecting the Code of Conduct proposal on the disputed South China Sea to be finalized soon in hopes that it will contribute to enduring peace and stability in the South China Sea.

The ASEAN meetings traditionally focus on enhanced trade and security in a region of more than 630 million people. Being the third largest trading partner with a two-way trade worth US$235.2 billion in 2017, the United States is perhaps one of the key trading partner of the region. Interestingly, the regional players are also quite aware of the trading leverage of the United States as well as China and other emerging economies. That is why, a lot of trade talks happened on the side-lines of the summit with other major economies outside the ASEAN, including South Korea, Japan and India. However, the major thrust on trade was visible at the Regional Comprehensive Economic Partnership (RCEP) negotiations which were also carried out at the summit. The RCEP if completed could be the largest trade and investment agreement since the General Agreements on Tariffs and Trade (GATT) as it would embody 25 percent of global gross domestic product (GDP), 45 percent of the total population, 30 percent of global income and 30 percent global trade. Many optimistic observers were expecting the negotiations to be swathed this year, however it was announced at the summit that it would be not be possible to finalize the matters before 2019. The encouraging thing was the pace with which negotiations advanced to the final stage.

Centrality is one of the unique feature of the ASEAN that has completed almost half century of its existence. The same centrality was also quite evident at the Singapore summit. There were two clear-cut but parallel themes: ASEAN-US chapter and ASEAN-China chapter. But the Chinese, because of their extreme urge to create a positive image that has been damaged due to their adventurous policy in the South China Sea, were quite active – and generous too - in enticing its neighbours in the region to with some big-hearted concessions. Beijing has assured the ASEAN members to upscale its efforts to meet the agreed target of US$1 trillion in trade volume and US$150 billion in investment by 2020. ASEAN and China also announced a roadmap titled “ASEAN-China Strategic Partnership Vision 2030” in a bid to bolster ties between the two. The ASEAN region has tremendous inherent strength within that can be utilized but the association has so far failed to explore it properly. Despite such a cultural and physical proximity to each other, intra-regional trade has been stagnant at 25 per cent for many years, which is far below that of other economic groupings such as the European Union and the North American Free-Trade Agreement (NAFTA). Indubitably, ASEAN is evolving fast but still it is struggling to create a synergy to take the benefits from their mutual trade – perhaps the biggest source of frustration for the member states.


The writer is a freelance columnist.


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