presentation by ong keng yong
TRANSCRIPT
ASEAN Community 2015 - beginnings, opportunities and challenges
Ambassador Ong Keng YongDirector, Institute of Policy Studies, Singapore
Association of Southeast Asian Nations
1. Brunei Darussalam
2. Cambodia
3. Indonesia
4. Lao PDR
5. Malaysia
6. Myanmar
7. Philippines
8. Singapore
9. Thailand
10.Viet Nam
Beginnings
ASEAN did not start as economic grouping Politics, particularly Cold War dynamics drove 5
Southeast Asian countries to set up ASEAN Easier to use “economics” to inculcate habit of
consultation and cooperation
(Five founding members of ASEAN : Indonesia, Malaysia, Philippines, Singapore and Thailand)
Opportunities (1970s / 1980s)
China's development under Deng Xiaoping's strategy
Multinational companies’ strategy of manufacturing in low-cost locations
Japan's strategy of shifting its production of manufactured goods to Southeast Asia
Oil-rich countries’ cash flow (from dramatic increase in oil prices)
European economic integration and offshore manufacturing
USA's globalisation drive
ASEAN’s Response
Focus on economic cooperation Develop economy of scale Liberalise trade and open market (ASEAN Free
Trade Area or AFTA) Strengthen vision of one economic region Capitalise on Southeast Asia's strategic
geography and inherent strengths
All led ASEAN Leaders to move collectively
First, do the ASEAN Economic Community as it was easier to start and the business/market conditions already there
Later, ASEAN Leaders added the ASEAN Political-Security Community and the ASEAN Socio-Cultural Community
- End of Cold War- Globalisation- China's economic growth- Trade Liberalisation- Free flow of capital
Different world . . . 21st Century
Towards an ASEAN Community
ASEAN Vision 2020
(1997)
“A concert of Southeast Asian nations, outward looking, living in peace, stability and prosperity, bonded together in partnership in dynamic development and in a community of caring societies”
Bali Concord II
(2003)
“An ASEAN Community shall be established comprising three pillars,
namely political and security cooperation, economic cooperation, and
socio-cultural cooperation that are closely intertwined and mutually
reinforcing for the purpose of ensuring durable peace, stability and shared
prosperity in the region”
I N C
O N C E R T
D Y
N A
M I
C
C A
R I N
G OUTWARD
LOOKING
SECURITY
POLITICAL
ECONOMIC
CULTURAL
SOCIO
External Relations
NARROWING THE DEVELOPMENT GAP
Strategic Moves
ASEAN Leaders recognise the challenges and constraints of building ASEAN Community by 2015
ASEAN need to be seen as “serious” ASEAN Leaders moved quickly on:
Having an ASEAN Charter Accelerating economic integration Enhancing ASEAN connectivity
ASEAN Charter: Meeting Global Changes
ASEAN’s way of operating: With change:
Informal and flexibleDeadline not always clearImplementation subjective/non-confrontationalLow priorityInadequate resources
Formal (ASEAN Charter)Clear targets (2015; roadmaps with milestones)Rules-based and accountability (report card to ASEAN Leaders) Compliance-oriented (success stories)
Trade Liberalisation and Market Opening
Started with AFTA Supplemented by FTAs with key trading
partners China's offer to set up Free Trade Area with
ASEAN led to ASEAN-China FTA, then FTAs with Korea, Japan, Australia/New Zealand, India
Such momentum created a high profile on the international scene for ASEAN and facilitated ASEAN's broader diplomatic initiatives
ASEAN Community APSC AEC ASCC
Enhance rules and good governance
Enhance integration and competitiveness
Enhance well-being of ASEAN citizens
Narrowing the Development Gaps
People-to-People
ConnectivityTourism, Education,
Culture
Physical Connectivity
Hard InfrastructureTransportation,
Logistics Facilities, ICT, Energy (Power Grid
and Pipelines), Special Economic Zones
Institutional Connectivity
Soft InfrastructureTrade facilitation,
ASEAN Single Window, Investment facilitation, Services Liberalisation,
Regional Transport Agreements, Capacity-building programmes
ASEAN Connectivity
Resource Mobilisation
Opportunities in ASEAN
Global Trade ASEAN total trade with the world in 2009:
US$ 1.537 trillion Growth of 19% of total trade from 2008 to 2009
despite global economic slowdown
Foreign Direct Investment (FDI) Total net inflow to ASEAN in 2009: US$ 39.6 billion
ASEAN’s Challenges
Implications of enlargement Narrowing development gap Slow progress on ASEAN agenda: decision making
by consensus Bigger countries in ASEAN projecting beyond
ASEAN Myanmar
Affect engagement with ASEAN Dialogue Partners
ASEAN’s Challenges
Competing claims/interests of countries in the South China Sea
Bilateral problems remain, eg border disputes
Ambitions of ASEAN Dialogue Partners, eg China, USA
ASEAN’s Challenges
China’s rise India’s role USA’s distractions Japan’s stagnation EU’s inward-looking orientation
Going forward…
National ego (big country/small country) Bureaucratic culture (corruption/use
technology) Domestic politics (leadership changes) Insufficient institutional set-up to champion
ASEAN agenda (only small secretariat in Jakarta)
Rule of Man; not enough Rule of Law (ASEAN Charter)
Lessons learned
Stay open and inclusive (ASEAN economic integration)
Be transparent (regular meetings at all levels - Leaders, Ministers, Senior Officials, Experts)
Give sense of ownership/stakeholdership (ASEAN agenda)
Adhere to principle of equality (equal shares of operational budget)
Lessons learned (2)
Focus on practical projects first (start with capacity building, then economic cooperation, later political/security issues)
Pick low-hanging fruits and have early harvest (ASEAN-China FTA)
Use existing mechanisms as much as possible; avoid new structures till all ready to accept
Success depends on…
Implementing plans and projects in a timely manner
Keeping the "ball rolling"; no harm with small steps and small yields
Building on any "common factor" Getting the top leadership to weigh in and even
drive projects, where necessary Sharing the "dividends"
Bear in mind…
Political will is everything Design of plan or mechanism not at fault Seize the opportunity Capitalise on any favourable circumstances Engage positively those who matter