Li Keqiang visit will boost cooperation with ASEAN

5 10 2013

By Zhou Wa

Chinese Premier Li Keqiang will attend a meeting of East Asian leaders and pay an official visit to Brunei, Thailand and Vietnam from October 9 to 15, Foreign Ministry spokesman Qin Gang said on Friday.

Together with President Xi Jinping’s ongoing trip to Indonesia and Malaysia, Li’s visit shows the importance China attaches to the region and will further stabilise the situation in the region, and upgrade cooperation to a new high level, analysts said.

“With the visits, China hopes to show members of the Association of Southeast Asian Nations that it is a dependable partner of these countries,” said Ruan Zongze, vice president of the China Institute of International Studies.

“Beijing wants to show its neighbours that China hopes to promote a stable atmosphere for win-win cooperation, and that cooperation with China will bring more opportunities,” he added.

Wang Yizhou, a professor of global studies at Peking University, said: “China’s ties with Southeast Asian countries are subtle at the moment, given the disturbing South China Sea issue, but the visits show China’s determination and confidence to thoroughly resolve the issue.”

In Brunei, the Asean chair country in 2013, Li will attend the 16th China-Asean leaders’ meeting, the 16th Asean plus three (China, Japan and South Korea) summit and the eighth East Asia Summit.

Li will explain the Asean policy implemented by the new generation of Chinese leaders and tell Asean countries that Beijing will further develop a strategic partnership with them, resolve disputes through political dialogue, and jointly maintain regional peace and stability with them, Xinhua News Agency reported on Friday.

Li will also explore new possibilities for cooperation with leaders from Asean countries, including upgrading the free trade deal, building up the Regional Comprehensive Economic Partnership and establishing a framework for investment and funding as well as credit rating, Xinhua said.

Although Asian countries demonstrate a momentum for continued growth, the risk of economic downturn still exists in these countries, so China and Asean countries need new mechanisms to maintain the favourable momentum, Ruan said.

“A portal for investment and funding will be highly welcomed by Asean countries, which can offer capital guarantees to those countries to implement their projects for continuing economic development and improving infrastructure and connectivity with each other,” he said.

With such a mechanism, cooperation between China and the Asean can be intensified, he added.

“To deepen cooperation, China and the Asean should also control the risks brought by some political and security problems, such as the South China Sea issue,” said Wang from Peking University.

Li is due to discuss the issue with leaders from Southeast Asian countries during his upcoming trip.

China and Asean countries should not let the South China Sea issue harm their favourable cooperation, said Wang.

But the issue only plays a small part in China-Asean ties, with cooperation being the major element of the ties, he added.

This year marks the 10th anniversary of the establishment of a strategic partnership between China and the Asean. China and Asean countries have enjoyed sound relations and cooperation since the establishment.

So far, China is the top trading partner of the Asean, while Asean ranks as China’s third-largest trading partner. Bilateral trade has grown from US$55 billion in 2002 to more than $400 billion last year.

From :

China Daily

Engaging the US in a time of crisis: Obama’s sweep through ASEAN

30 09 2013

By Kavi Chongkittavorn

On October 2013 US President Barrack Obama is visiting four Asean members in one sweep through the region. He will attend two leaders’ meetings in Bali, Indonesia, and in Bandar Seri Begawan as well as make separate visits to Kuala Lumpur and Manila. To make that commitment amid the crisis in Syria and hordes of other gridlock, including the financial meltdown at home, shows the importance Washington attaches to the region. That much is clear.

When Obama came to power four years ago, he was lucky to have Hilary Rodham Clinton as Secretary of State, as she played a major role in demonstrating that the US attention on Asia was more than skin-deep. She made the region her priority throughout her tenure. In 2009, she signed the Treaty of Amity and Cooperation and patiently took part in all Asean-led meetings and won the admiration of ASEAN leaders, hiking the US profile as a key guarantor of peace and stability in the region. However, this positive imprint is wearing thin these days in this part of the world where personal touch and rapport matter.

US Secretary of State John Kerry is returning to Asia, following Obama. Despite his Vietnam credentials and history and his diplomatic credentials in the Congress, he has not been connected with the regional scheme of things. He has been too busy carrying out shuttle diplomacy throughout Europe and the Middle East and won accolades for countering Russia’s diplomatic offences in Syria and Iran. In the foreseeable future, it will give rise to concerns of inconsistency in US policies towards the region. Washington is in dire need of a Clinton-style personality and diplomacy.

Fortunately in Southeast Asia, the US is not on a head-on collision with Russia. More importantly, Moscow is not focusing on the region as it should be despite the desire to strengthen Asean-Russia relations and taking part in the grouping’s connectivity master plan in the Far East. His assertion that Russia is also an Asia-Pacific power remains rhetoric. Since the East Asia Summit (EAS) expanded to include US and Russia in 2011, no Russian president has showed up. Same with the upcoming EAS in Bandar Seri Begawan. As of now, while the US and Russia continue to squabble over Syria, another major power, China, is being left very much alone to consolidate its regional diplomacy.

Not surprisingly, China’s new Foreign Minister Wang Yi has wisely maximised this window of opportunity. He visited the ASEAN region three times in five months since his appointment in late March. His personalised diplomacy works well, a departure from his stoic predecessor Yang Jiechi. Good rapport between leaders has enabled ASEAN and China to renew engagement and make progress on overall relations and the work on the code of conduct (COC) in South China Sea. To top it all, Beijing recently initiated a people-centred foreign policy towards Asean.

In more ways than one, this new regional and international dynamic will have direct impact on the region, in particular the EAS. Both the US and China are active in shaping the EAS agenda this time around. As the premier leaders-only forum in the region, they want their concerns of the day to be discussed.

Gone are the days when ASEAN could set the agenda as it wished. Now the tide has turned. Consultation with EAS members is pivotal as a means to increase engagement with the major powers, especially the US. In addition, the EAS has already become the main forum where a new regional security architecture is being discussed and constructed.

From the US perspective, security issues including the elimination of chemical weapons, nuclear non-proliferation and the reactivation of North Korean nuclear programme should be on the EAS agenda. Washington hopes that ASEAN and other EAS members would share a similar concern on these topics. ASEAN members have expressed support for the US-Russia agreement to eliminate Syria’s chemical weapons. Thailand issued the strongest endorsement of efforts to eliminate the chemical weapons.

Taking the cue from Asean, China is taking a different track with a development agenda such as bridging the income gap and poverty alleviation. Food and energy security, disaster management and dealing with pandemics are also common Asean-China themes. Obviously, both sides want to limit discussions on the maritime conflict at the EAS as the COC process between ASEAN and China has made progress.

As in the previous EAS, other non-Asean members such as Australia, Japan, South Korea, India or New Zealand could raise any regional issue their leaders see fit. As the current ASEAN chair, Brunei fervently hopes that the tone and scope of EAS discussions this year would be friendlier but candid. The EAS leaders will have only two and half hours of discussions to make their points; there will no opening or ending remarks.

From :

The Nation

ASEAN in the Power Web

26 09 2013

By Julio Amador III

President Barack Obama’s upcoming participation in the East Asia, APEC, and the ASEAN-U.S. confabs in Southeast Asia during his October trip to the region will highlight important challenges that the region faces, particularly the role that small states play in great power relations. While analysts and scholars are still debating the relationship between the United States and rising China, the countries of Southeast Asia, independently and as ASEAN, already understand that the ultimate nature of relations between the two great powers will directly affect them. For that reason, they do not want to wait passively for the result, but are actively engaging the U.S., China and other external stakeholders to help shape the evolving regional order.

China seeks a new type of great power relationship with the U.S. that would give it almost-equal status to the latter in the global arena. Beijing is seeking assurances from Washington that U.S. policy will take Chinese interests into account. In Northeast Asia and Southeast Asia, this would mean that China will have unspoken primacy in the same way that the U.S. enjoys an unchallenged role in the Western hemisphere.

Thus, China’s actions such as disputing Japan’s administrative control over the Senkaku/Diaoyu islands by regularly dispatching maritime surveillance vessels to the surrounding area, taking over the Philippines’ Scarborough Shoal and attempting to take over Second Thomas Shoal, and maintaining a long-running dispute with Vietnam over the Paracels are alarming indications that it is willing to do what it takes to prevent violations of what it considers its sovereign territory.

Southeast Asia has generally enjoyed peaceful and productive relations with China. In fact, ASEAN and China have maintained a “strategic partnership” since 2003, which identifies numerous areas for cooperation. Earlier, in 2002, ASEAN and China concluded a Declaration on the Conduct of Parties in the South China Sea. As a geographic reality, ASEAN member states have had no choice but to find ways of working with China. The regional body has for that reason always sought to encourage China to play an active role in regional institutions in an attempt to “socialize” it to accepted norms.

Increasingly, though, China expects the respect due a great power, one that has now displaced Japan as the world’s second-largest economy. Yet while China may believe that it is destined to dominate Southeast Asia, most countries in the region would naturally prefer to retain their autonomy. That doesn’t mean they will oppose China directly; indeed, they are prepared to make certain concessions in some areas that do not affect their national interests. Many East Asian countries respect China’s economic wealth and dynamism. Respect, however, does not mean obeisance. Southeast Asian states do not wish to rely entirely on Beijing’s goodwill so they try to balance their engagement with China by engaging external powers through ASEAN and by bilateral means wherever possible.

In contrast, Southeast Asia is much more accepting of U.S. primacy in the region. There are three important reasons for this: U.S. respect for freedom of navigation, its role in preventing other powers from dominating the smaller countries in the region, and its lack of territorial ambitions in that area. The general transparency of U.S. policymaking is also helpful to Southeast Asian states in that they have an idea of how the U.S. will react to certain policy decisions that they might make. The U.S. rebalancing has been welcomed by many ASEAN countries as both an affirmation of the region’s importance, and also as representing a formal commitment to deeper engagement in the broader Asia-Pacific region.

Still, ASEAN as a whole does not want to be in a position that would force it to choose between Beijing and Washington. First, it has always sought to position itself as a neutral and credible platform for dialogue among great powers through entities such as the ASEAN Regional Forum, the ASEAN Defense Ministers Meeting Plus and various ASEAN Plus mechanisms. Second, there is always the fear that the U.S. commitment to the region will disappear once a new crisis erupts, especially in the Middle East. Even in the face of greater Chinese assertiveness in its territorial disputes in the South China Sea, ASEAN has refused to categorically take the side of its own members that have borne the brunt of Beijing’s displeasure. It is easy to imagine the chagrin this would cause the leaders of these member states, but ASEAN’s caution is also understandable.

Nevertheless, ASEAN has also been prodding Beijing to negotiate a Code of Conduct. While Chinese leaders have reiterated that they are in no rush to do that, there are efforts within ASEAN to get Beijing to commit to the process. Under Brunei’s chairmanship, ASEAN members were able to agree that they need to work together to make the code a reality. Singapore has also consistently called for a code of conduct and has raised the issue with multiple visiting Chinese leaders. Indonesia is keen to preserve ASEAN unity on the issue and has sought to create a middle ground that addresses the concerns of member states in any dispute with China, while avoiding outright schisms within the group. Even though Thailand is seen by some as aligning with China, Bangkok has nevertheless committed to working with other ASEAN member states on the code, even if it is not giving the issue too much emphasis.  

Member states are keen to have ASEAN remain as the center of the regional architecture. For that to happen, the body must maintain a delicate posture between the U.S. and China while at the same time engage with other powers such as Japan, Russia and India, to ensure that it has a say in the direction the region will take.

ASEAN’s task is made all the more difficult because foreign policy coordination is not a major strength of the association. Given that the ten member states have different strategic outlooks and threat perceptions, the job of coordinating a regional position falls to the chair, which rotates among the member states. The ability to resist external pressure is often dependent on the relative power of the chair. In Cambodia’s turn in 2012, it was widely perceived that Beijing had a tremendous influence on ASEAN’s deliberations through its Cambodian partners. Brunei’s chairmanship, however, has been different this year because its economic and political standing gave it more freedom to resist external pressure. It was thus able to generate a consensus on sensitive issues like the South China Sea.

For ASEAN to remain a credible facilitator of great power relations in the Asia Pacific, it must respond to two equally daunting challenges. First, it must create a true regional community that has a narrow development gap and a bustling economy. Only an ASEAN that can stand on and for its own will have the capacity to resist external pressure from the great powers. To achieve this, member-states must succeed in their goal of a united ASEAN community in 2015. This would further move them towards a community of states that take each other’s concerns as their own and that prioritize the rights of the peoples of ASEAN.

The second challenge is to move away from paper declarations, and avoid focusing excessively on process. ASEAN needs to demonstrate more progress in achieving its various goals, like the ability to absorb development assistance, implement agreements and introduce or sustain reforms for foreign direct investment. With more than four decades of evolution behind it, ASEAN cannot continue to hide behind noble, aspirational declarations while consistently failing to produce the goods. As citizens demand more accountability from their governments, increasingly aided by social media, ASEAN member states will need to reckon more and more with their peoples, whose interests may transcend state boundaries.

Centrality in the Asia Pacific’s existing regional architecture is something that ASEAN has earned, but can it keep it? If ASEAN member states realize that the period of papering over substantive issues such as territorial and maritime disputes is over and that these issues can no longer be separate from the overall exercise of community-building, then the body could indeed remain at the center of Asia-Pacific regionalism. If not, well, then the existence of the Trans-Pacific Partnership demonstrates that other regional arrangements can be set up sans ASEAN.

ASEAN’s central role in managing power relations in the Asia-Pacific is not a given, but must continue to be earned. Fail to do so and the great powers themselves will determine the future of the region. That would be a sad outcome for a regional body that has hitherto managed to keep a central position in the regional power web.

Julio Amador III is an Asia Studies Visiting Fellow at the East-West Center in Washington and Fulbright Graduate Student at the Maxwell School of Citizenship and Public Affairs. 

From :

The Diplomat

Greenpeace Report Calls for Renewed Vigor in ASEAN’s Renewable Energy Drive

24 09 2013

By Ethan Harfenist

Greenpeace Southeast Asia laid out an argument on Tuesday for a concerted push for renewable energy in the Association of Southeast Asian Nations (Asean), focusing on both the economic and environmental benefits of a greener power policy.

“The deteriorating climate should be Asean’s top concern, given that the region is experiencing frequent and more intense extreme weather events due to climate change caused by carbon emissions,” said Amalie H. Obusan, regional climate and energy campaigner for Greenpeace Southeast Asia.

Launched at the 31st Asean Ministers of Energy meeting in Bali, “Energy [R]evolution: A Sustainable Asean Energy Outlook” emphasizes the socio-economic advantages of pursuing renewables in a roadmap detailing how the regional group could safeguard its energy security.

“The Asean region, with its rapid pace of economic and population growth should play an important role in this global solution as the E[R] report clearly shows that a low carbon development path is possible,” Obusan said.

The report said sustainable energy sources — such as wind, photovoltaics and geothermal energy — could comprise 70 percent of the region’s total electricity generation by 2050. This is due in part to a “democratization of energy production,” according to Greenpeace — access to solar panels could bring electricity to remote or deprived Southeast Asian communities currently unconnected to electricity grids.

Costs and benefits

The exploitation of green-energy sources across Asean could, the report said, result in $2.8 trillion worth of investment, $2.7 trillion in fuel-cost savings and 1.1 million jobs by 2030.

“There is already a strong global movement for reducing the dependency on fossil fuels by increasing the share of renewable energies,” said lead author Sven Teske, renewable energies director at Greenpeace International.

“The Asean countries have more than enough natural resources to become a leading player for clean, renewable energies. Renewable energies are more competitive than coal, utilize indigenous local resources and create more employment. Using more renewables is now an advantage for the economy, not a burden and reduces their dependence on dirty, imported fossil fuels like oil and coal.”

Indonesia, a net importer of gasoline and one of the biggest markets for natural gas in the world, has in the past acknowledged the need to gradually switch over to renewable energy sources, but the obstacles — bureaucracy, corruption, funding and land law among them — remain as plentiful as the sources themselves.

On Sept. 20, state-owned electricity company Perusahaan Listrik Negara forecast that Indonesia would need at least $77.3 billion to sufficiently develop renewable energy as a source of electricity by 2021.

Mochamad Sofjan, head of the renewable- and new-energy division at the Jakarta-based company, said that amount would be enough to add another 13,000 megawatts to the country’s power grid over the next eight years.

“During that period, we will build power plants with hydro, geothermal, biomass and solar as energy sources,” Mochamad said.

PLN, which provides much of the power to the country’s population of nearly 250 million, believes renewable energy will contribute at least 20 percent of the country’s electricity needs by 2021.

“Currently, 86.3 percent of our power plants are powered by conventional energy, while renewable accounts for only 13.7 percent,” he added.

Facts on the ground

In April, Israeli business website Globes reported that Ormat Technologies, a subsidiary of Israel-based renewable energy company Ormat Industries, had signed a joint-operating contract to construct a 330-megawatt geothermal power plant in Tapanuli, North Sumatra. The project would be Indonesia’s largest to date, after the Wayang Windu plant in West Java.

Refurbishment of existing infrastructure — as opposed to new, big-ticket renewable-energy projects — is another avenue along which Indonesia has taken some steps.

Entec Indonesia, the Bandung-based subsidiary of its Swiss parent, Entec, worked with a local firm in West Sumatra to develop the Salido Kecil mini hydroelectric plant in a fairly remote area 50 kilometers south of Padang.

The plant was built almost a century ago to power the local gold mining operation. Ardi, Entec Indonesia’s project manager, told the Jakarta Globe that the company replaced the three turbines and installed a new generator to improve the power station’s output.

“We were able to use the existing superstructure because it was in good condition,” he said.

The plant’s 660 kilowatts, at a cost of 4,500 tons of CO2 per year, has the potential to power almost 1,000 homes.

Green politics

Greenpeace warned, however, that Asean’s renewable-energy outlook was inextricably linked with the contours of its political landscape.

“Climate change is a wholesale problem requiring a wholesale solution, one that needs the absolute cooperation of every nation in the region,” said Obusan.

“For the sake of a sound environment, political stability and thriving economies, now is the time for Asean to commit to a truly secure and sustainable energy future — one built on genuinely clean technologies, economic development and the creation of hundreds of thousands of green jobs.”

From :

The Jakarta Globe

Bracing for the ASEAN economic integration

23 09 2013

By Niceto S. Poblador

MANY Filipino business leaders and corporate managers seem to be visibly on edge about the impending implementation of the economic integration of ASEAN. No matter how one looks at it, the launch of the ASEAN Economic Community in 2015 will truly be an event of historical significance, one which will drastically alter the way we do business and manage our economic and corporate affairs.

What many businessmen fear most of all is that the crumbling of protective and regulatory walls that used to insulate them from their rivals elsewhere in the region will, in one fell swoop, expose them to unfettered competition which they fear they are ill-prepared to deal with.

The forthcoming integration of the economies in the region into the ASEAN Economic Community (AEC) was the subject of the recently concluded 11th MAP International CEO Conference. While the six speakers at this forum touched on wide-ranging topics, there was one dominant message that was common to all the presentations: While the formal creation of the AEC poses great challenges and difficulties and create new uncertainties for business organizations and countries in the region, it also opens up great opportunities for accelerated and sustained growth and profitability for all. AEC seeks to achieve the goal of economic prosperity for the region by creating a single market and production base, by enhancing the region’s competitive stance vis-a-vis the rest of the world, and by promoting equitable economic growth within the region.

On balance, we believe that the potential benefits from AEC far outweigh the perceived problems and difficulties associated with it. In responding to the situation, business organizations should therefore focus their attention and devote their energies on the advantages that integration offers, rather than sulk over the problems and uncertainties that lie ahead.

In doing business with our counterparts in the other countries in the region and beyond, our main concern should be how to develop creative and innovative products and services to cater to the increasingly demanding needs of today’s consumers. Textbooks on strategic management tell us that to establish our competitive edge, we must develop the resources that enable us to produce those glitzy products, and the competencies to advantageously position ourselves in the market to gain customer loyalty.

In today’s complex and fast-paced knowledge-driven world, value creation is the major aspect of strategy, and gaining market share is only of secondary importance. (Come up with a good product, and the customer will come to you — it’s as simple as that!) Moreover, value creation through product innovation and development no longer takes place within the narrow confines of a business enterprise but through extensive collaboration with other organizations, including those with whom we are potentially in competition. This goes to show that in today’s world of business, collaboration is the name of the game! (The term popularly used to describe this strategy is “coopetition,” short for “cooperative competition.”)

In today’s economy, knowledge has become the most important economic resource, one moreover which is most easily transferable across corporate and national boundaries. It is the great equalizer of business opportunities, one that evens out the playing field. It is also resource that figures most prominently in collaborative strategies.

It is our belief that thriving in the emerging regional economic community requires business strategies intended to develop the firm’s human capital, which includes not only knowledge and human skills, but also an organizational culture that nourishes mutual trust and collaboration — intangible assets that are the main drivers of business success in the global economy.

Niceto S. Poblador is a former Professor of Management in UP Mindanao.

From :

Business World Online

Opportunity goes begging in ASEAN regional bloc

23 09 2013

By James Hogan

While the Australian economy remains firmly hitched to China, Australia needs to realise there are significant investment and trade opportunities emerging with our neighbours in Southeast Asia as well.

This week, the third round of Regional Comprehensive Economic Partnership negotiations takes place in Brisbane, involving the

10 ASEAN countries as well as Australia, China, New Zealand, India, Japan and Korea.

With nine of our top 12 trading partners participating, it needs to be closely watched by Australian businesses.

The ASEAN bloc boasts more than 10 per cent of the world’s population, with a combined GDP of $US2.1 trillion ($2.2 trillion) and a rising middle class.

And Australia, with its strong and mature services sector and close proximity, is better positioned than most to meet the insatiable needs of ASEAN’s rising consumer force.

Despite this, Australia’s emphasis on China has meant we have been somewhat asleep at the wheel when it comes to capturing the ASEAN opportunity.

Since 2000, HSBC estimates Australia’s total exports to ASEAN have grown only 5.2 per cent a year — with resources the main contributor — paling in comparison with our export growth to China of 23 per cent over the same period.

With $US3 trillion investment needed for infrastructure development in Asia (excluding China and India) and a further 600 million people entering the middle class by 2030, the bulk of Australia’s exports to ASEAN will be largely resources and energy related.

However, ASEAN’s rising middle class is hungry for high-quality goods and services, giving Australia an opportunity beyond commodities. This can be seen in countries like Vietnam where 65 per cent of its 90 million population is under 35 and with its urbanisation rate set to double in the next 20 years.

To date, education has been Australia’s largest export to Vietnam and is expected to grow.

We are also seeing growth in construction among our customers in Vietnam.

Sydney-based property developer and trader, Lobana, bought into ASEAN 30 years ago, originally as agri-traders and subsequently expanding into commercial property development.

With China shifting away from being the world’s factory as a result of increased wages, ASEAN has been filling the void and spurring foreign businesses’ interest in the region as an investment destination.

Indeed, foreign direct investment in ASEAN has increased in lockstep with China’s wage inflation of about 20 per cent since 2005. ASEAN’s low-cost manufacturing sector and highly productive labour force will further entice Western markets to invest directly into the region’s growth.

However, despite its proximity to the regional economic beast, Australia has not yet embraced this opportunity. Of Australia’s total FDI abroad, ASEAN accounts for 6.5 per cent, compared with the US (28 per cent) and Britain (14 per cent).

While ASEAN’s fundamentals are already impressive, we expect the trade and investment growth to be amplified when the ASEAN Economic Community — which will seek to further eliminate tariffs and other trade barriers within ASEAN — comes into existence at the end of 2015. The potential could be comparable to the development of the European Union, effectively creating what could be one of the world’s biggest markets.

While China will continue to dominate Australia’s trade story, there is a vast ASEAN opportunity at our doorstop. Given its future demographic trajectory, developing stronger trade and investment ties with ASEAN should be a key priority for our foreign strategy.

And forums like the RCEP should be seen as a vital vehicle to fully capture the potential of one of the world’s most dynamic regions.

James Hogan is the head of commercial banking at HSBC Bank Australia

From :

The Australian

The Courtship of ASEAN

23 09 2013

By Dylan Loh

The Association of South East Asian Nations (ASEAN) has enjoyed considerable diplomatic attention in recent months. This is due in a large part to a courtship involving three major powers: Japan, China and the United States.

Japanese Prime Minsiter Shinzo Abe has visited ASEAN three times since returning to power late last year, his latest trip a whirlwind tour that took in Malaysia, Singapore and the Philippines. In all, he has to date visited seven counties in ASEAN.

China, too, has been ramping up its engagement and has also adopted a more conciliatory tone in recent high-level meetings with its ASEAN counterparts. Chinese Foreign Minister, Wang Yi, has visited ASEAN at least three times. Significantly, on June 2013, China agreed to hold talks with ASEAN on a proposed Code of Conduct governing naval action in the SCS. These advances are a contrast to its earlier stance, where it steadfastly refused to entertain ASEAN on maritime territorial issues, such as when it guided Cambodia to thwart a collective ASEAN effort to release a joint communiqué on the South China Sea disputes at the 45th ASEAN ministerial meeting.

Meanwhile, U.S Secretary of State John Kerry and Secretary of Defense Chuck Hagel have both made trips to ASEAN countries, stressing the importance, relevance and ongoing strength of the American pivot. The Philippines and the U.S. have also begun discussions to extend access to more military bases for American troops in an important material consequence and manifestation of the American pivot.

While the cultivation of ASEAN by major powers is not new, the intensity of the recent courtship is unprecedented. Which begs the question: why ASEAN and why now? Two compelling reasons stand out, one practical and the other more strategic. First the utilitarian, as ASEAN becomes ever more coherent (not an entirely painless process) through initiatives such as a common market, it is becoming ever easier for major powers to cultivate ties with all of ASEAN simply by augmenting and amplifying relations with a few members. Case in point: Abe’s visit to three nations (out of 10 ASEAN countries) has been reported by numerous media outlets as a “tour of ASEAN” and as an act that would strengthen ties with the entire bloc. This is true for exchanges by the U.S and China as well.

But just because it is becoming easier to engage ASEAN is not sufficient reason to explain the recent attention. There is also an underlying strategic imperative, and that has to do with geography.

ASEAN has become the site for proxy power competition. For instance, galvanized by its East China Sea disputes with China, Japan has been busy generating support and political goodwill in Southeast Asia. For example, on a stopover in the Philippines (which has its own maritime issues with China), Tokyo sought to reenergize ties by way of maritime support, increasing economic exchange, an extension of a credit loan and, most notably, the provision of 10 petrol vessels to the Philippines Coast Guard in what is, surely, a pointed message for Beijing.

The U.S., on the other hand, sees its traditional dominance in the Pacific under growing pressure. With each new assertion of America’s decline and China’s rise comes a need to reiterate and reinforce its position in this part of the world. It is no surprise, then, that we are seeing redoubled efforts by Washington to engage and re-engage, assure and reassure.

ASEAN naturally stands to benefit from all this romancing, but it needs to maintain its composure and not be seen as leaning towards any one power. It also must not be bullied into submission. In an almost Machiavellian way, ASEAN continues should cultivate an image of neutrality. That will ensure the region remains diplomatically and economically relevant. 

Dylan Loh holds a Master of Science in International Relations from the Rajaratnam School of International Studies (RSIS) in Singapore.

From :

The Diplomat

Japan, U.S., ASEAN must team up to counter China’s maritime advance

22 09 2013

It is becoming apparent that China intends to strengthen its hegemony in the South China Sea while stalling for time in drawing up a code of conduct to avoid hostilities.

China and the Association of Southeast Asian Nations held the first official talks among senior officials to move toward deciding on a code of conduct to regulate the activities of countries concerned in the South China Sea.

Yet China remained halfhearted over the issue throughout the talks, with the meeting only deciding on the establishment of a meeting of experts.

In the South China Sea, China is in conflict with such ASEAN countries as the Philippines and Vietnam regarding sovereignty over the Spratly Islands and other islands and reefs.

China asserts a claim of exclusive sovereignty over not only the Spratly Islands but nearly all of the South China Sea. Yet it has not brought the international community around to its point of view.

For over a decade, the ASEAN countries have been trying to secure agreement from China on the establishment of rules of conduct to prevent overt hostilities in the South China Sea. Yet, with its overwhelming military and economic power, China refused to hold such a meeting until recently.

It is regrettable that even when China finally did come to the negotiating table, it proposed discussing other issues instead and would not go into a detailed discussion on the code of conduct.

Scarborough stare-down

In the South China Sea, with no code of conduct for concerned countries, the crisis is only deepening. The current focal point lies in the conflict between the Philippines and China.

Around the disputed Scarborough Shoal, over which both countries claim sovereignty, naval vessels from the two sides faced each other for two months. The government of the Philippines said that after it moved its vessels away, China placed concrete blocks on the shoal.

Earlier this year, the Philippines filed a request for arbitration under the U.N. Convention on the Law of the Sea, asserting that China’s claim of sovereignty over the shoal is unlawful. This month, China held an exhibition inviting heads of ASEAN member countries. But the president of the Philippines was not invited.

The snub must be interpreted as an attempt by China to rebuke the Philippines over the country’s having taken legal action against China.

It is understandable that the Philippines, pressured physically by China, has been intensifying relations with the United States and Japan.

While having expanded a joint military exercise with the United States, the Philippines is moving ahead in talks with the United States that are likely to lead, in effect, to the stationing of U.S. forces in the Philippines again. There is a possibility that the Subic naval base, once a strategic foothold for the United States, will again be used for the deployment of U.S. forces.

Prime Minister Shinzo Abe, since he took office last December, has intensively visited ASEAN countries and presented his plan of providing 10 patrol vessels to the Philippines.

For both Japan and the United States, which face the expanding presence of China in the East China Sea and the western Pacific, the significance of cooperating with ASEAN member countries by taking concerted actions with them is not limited to the South China Sea. It will help their efforts to check China from expanding its maritime activities elsewhere as well.

From :

The Yomiuri Shimbun

Why the 2015 deadline for the ASEAN economic integration?

21 09 2013

BY John Goyer

As ASEAN continues on its long path toward regional economic integration, US companies are responding by developing strategies to operate in and adapt to the region as a single market and production base. In the “ASEAN Business Outlook Survey” released August 2013 and prepared by the US Chamber of Commerce and AmCham Singapore, slightly over half of US companies surveyed said that their companies are preparing strategies based on ASEAN’s plans to reduce and eliminate barriers to trade in goods, services, and investment among its member countries.

The survey, highlights of which were presented at the August 19-21 ASEAN Business and Investment Summit in Brunei Darussalam, polled 475 senior executives representing US companies in all ten ASEAN countries, and found great optimism toward the region. 79% of the respondents reported that their company’s level of trade and investment in ASEAN has increased over the past two years, and an overwhelming 91% of respondents expect it to increase over the next five years.

This optimism is based, significantly, on economic integration; most respondents—77%—say that ASEAN integration is important in helping their companies do business in the region. One survey respondent explained that the “seamless movement of goods and services will enable productive operations across the ASEAN region.”

ASEAN’s work on intra-regional tariff reduction, liberalization of trade in services, liberalization of investment, and streamlining of customs administration and procedures are all factoring into US companies’ investment decisions. The majority of survey respondents were in the services sector and 68% attached importance to the ASEAN Framework Agreement on Services. 56% of respondents reported that the ASEAN Trade in Goods Agreement is important to their companies’ investment plans; 59% said the same of the ASEAN Comprehensive Investment Agreement, while the figure for the trade facilitation and customs development work plan was 63%.

The positive outlook for ASEAN should be encouraging for policymakers in the region. Not only are individual ASEAN countries attractive investment destinations, but the potential of an integrated region with a population of 600 million, a $2 trillion GDP, and good growth prospects is raising ASEAN’s profile in the eyes of US investors.

…and integrating externally…

While working to integrate its own internal market, ASEAN has recently entered into free trade agreements with a number of its major regional trading partners: China, Japan, India, Korea, and a joint agreement with Australia & New Zealand. The survey sought to gauge usage of these FTAs by US companies with operations in ASEAN. As it turns out, a significant number of US companies are seeking to take full advantage of these agreements. Nearly half of the US manufacturing companies surveyed say that they utilize the provisions of these agreements to export goods from ASEAN to its major FTA partners: China (63%), Japan (48%), India and Korea (47%), and Australia & New Zealand (45%). This, in turn, is boosting ASEAN’s total exports, and helping facilitate its integration with the rest of Asia.

Use of the services provisions for these agreements is much lower however, perhaps reflecting the limited coverage of services in those agreements. Of ASEAN’s three FTAs for which services provisions are in effect (services provisions for India and Japan have yet to be implemented), 33% of respondents reported exporting services from ASEAN to China. For Korea, and Australia & New Zealand, the figures were 27% and 21%, respectively. There is likely to be room for significant growth in this area, given that services account for the greatest share of economic output in most ASEAN countries, and that the barriers to trade in services tend to be high relative to trade in goods.

While significant numbers of US companies are using these agreements, many still are not, which raises a question of how much untapped export potential exists. Respondents cited a variety of reasons for not using these FTAs, but one common theme was simply a lack of familiarity with the agreements.

…but facing skepticism

The ASEAN Economic Community (AEC) in a sense represents the culmination of ASEAN’s aspirations toward regional integration. The AEC articulates the vision of an economically-integrated region by the end of 2015 between all ten member states: Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam. The vision is for a single market and production base in a highly competitive economic region with equitable economic development and fully integrated into the global economy.

As the survey demonstrates, US companies clearly think that the AEC is important; however, just over half of respondents surveyed—52%—do not think that this goal will in be place by the 2015 deadline. Only 23% of respondents believe that ASEAN will realize the goals of the AEC by 2015, with the remainder of respondents neutral on this question. Of the respondents who answered that it was “unlikely” for the AEC’s goals to be met by 2015, 59%—or almost two-thirds of respondents—believe it will not happen until 2020 or later.

Whether warranted or not, this skepticism suggests that additional education and outreach needs to be done, and ASEAN should be doing more to broadcast the AEC benchmarks that it has already met. As one survey respondent aptly stated, “The AEC 2015, we feel, will have enormous and positive impact in the years following 2015, but is not well understood within our region, let alone outside of it.”

Looking ahead

ASEAN is an attractive market in itself, but it has the opportunity to position itself at the very center of a rapidly evolving regional trade architecture. This survey shows that while US companies are thinking regionally, they will need to focus increasingly on strategies to take advantage of ASEAN’s potential as integration accelerates. Meanwhile, ASEAN will need to enhance its efforts to educate investors about the AEC and the advantages of an economically integrated region. If both sides do their part, the benefits of an integrated ASEAN will be realized sooner rather than later and to the benefit of all.

John Goyer is Senior Director for Southeast Asia at the US Chamber of Commerce

From :


ASEAN’s democratic deficit

13 09 2013

By Verdinand Robertua

In a recent debate forum held in Jakarta, there was a perception that Indonesian political parties contesting the 2014 elections, pay no heed to the country’s readiness to face ASEAN Community 2015 as an important campaign issue.

In fact, however, the ASEAN Community 2015 is a topic of the public’s interest for both the legislative and presidential election next year for two reasons: (i) the impact of implementation of ASEAN single market in 2015 and (ii) the accountability and accessibility of ASEAN community.

For ordinary people, the dynamics of ASEAN lacks relevance. ASEAN Community only exists in the ASEAN leaders’ imagination.

In Indonesia, where half of the 60,000 villages are without electricity, 116 million people lack access to proper sanitation and only 47.71 percent of the population has access to drinking water sources, most people will care more about their day-to-day survival than care to give room for thought on something as grand as ASEAN Community.

The reality is that ASEAN Economic Community (AEC), one of the three pillars of ASEAN Community 2015, is a potential economic monster. AEC comprises of five core elements: (i) free flow of goods; (ii) free flow of services; (iii) free flow of investment; (iv) free flow of capital and (v) free flow of skilled labor.

AEC is a very ambitious project and is becoming a two-edge sword: it can either bring prosperity for Indonesians or big failure. The removal of import duties will reduce state incomes and threaten local products. More factories are being moved to other ASEAN countries due to its cheap labor and making more Indonesians unemployed. Job competition is becoming fierce as many foreign workers are free to access the Indonesian labor market. The arrival of ASEAN giant industries will be considered a threat for our small and medium companies.

The interesting point of the impact of AEC is that ASEAN member states will prefer collective agreements with external actors. We knew about ASEAN-China Free Trade Area and ASEAN-Australia-New Zealand Free Trade Area. Later ASEAN countries will implement ASEAN-Korea Free Trade Area and negotiate ASEAN-EU Comprehensive Economic Partnership. Despite these agreements that have provoked intense debate on the advantage and the disadvantage; in the future there will be more agreement between ASEAN member states and their counterparts using ASEAN framework.

ASEAN Economic Community 2015 promises to make ASEAN a single market and production base. For external actors like China and Korea, this has a huge potential economic benefit to reap and for ASEAN member states, collective agreement in ASEAN framework will give them time and financial savings, bigger bargaining power and a bigger chance for win-win solutions. It is also in line with AEC blueprint that ASEAN shall work towards maintaining “ASEAN centrality” in its external economic relations.

If ASEAN is getting bigger and bigger, who controls ASEAN? Who will be held responsible if ASEAN’s decisions create economic disaster to the whole region? The problem of accountability is even worse if we know that most of the Indonesian people are not aware of the presence of ASEAN.

Research conducted by Abdullah and Benny (2011) show that only 42 percent of Indonesian respondents claim to have heard of, or read about the ASEAN Community. Even in Jakarta, 71 percent of the respondents say they have not heard or read about the regional agenda. The number of respondents who claim to have read or heard about the Bali Concord II is even lower at only 16 percent. Meanwhile, the majority of respondents say they have not yet heard about the ASEAN Charter.

This is a democratic deficit; a situation refers to a perceived lack of accessibility to the ordinary citizens, representation of the ordinary citizens and accountability of certain institution. In the ASEAN case, people know nothing about ASEAN Community 2015 but sooner or later they will be affected by it. However, this problem is not unique to ASEAN. The notion of democratic deficit is firstly popularized by the European social scientists in regard to the idea of the European Union (EU). Having multi-layered, multi-centered, division-of-power governance, as the EU has right now, is a big puzzle for the ordinary Europeans on the accountability of the EU’s policies.

In Sweden, national politicians sometimes see how decisions come in through the back door. European politicians don’t talk about what’s being decided and the consequences. In France, leaders at the national level denied the significance of the EU institutions in national political economy and they named it an “offensive denial”.

The problem of ASEAN’s democratic deficit needs to be addressed through three quick solutions to marketing ASEAN to its citizens. First, there should be an ASEAN corner in many public places where computers, leaflets, posters, booklets and reports are available. From a screen, citizens can access real-time information on all current ASEAN legislations and know and understand them by having attractive and simple leaflets, posters or booklets.

Second, ASEAN can invite college students, local non-governmental organizations (NGOs), or politicians to visit ASEAN institutions. Such a trip will allow them to feel the presence of ASEAN.

Lastly, candidates contesting the legislative and presidential election in 2014 should gain the momentum of the political events to market ASEAN Community 2015. There should be many forums, seminars and campaign toolkits about the plan of ASEAN Community 2015. These tools will help their constituents understand the impact and opportunities of ASEAN Community.

The writer is a lecturer in international relations at the Christian University of Indonesia (UKI) and researcher at the UKI’s Institute of ASEAN Studies (IAS) and Marthinus Academy.

From :

The Jakarta Post

Promotion and Protection: ASEAN’s Human Rights Role

11 09 2013

By Ngurah Swajaya

Cooperation to promote and protect human rights within the Association of Southeast Asian Nations is constantly evolving. It all started with the adoption of the Joint Communique of the 26th Asean Foreign Ministers’ Meeting in 1993 in which Asean pledged, for the first time, its commitment to promote and protect human rights and fundamental freedoms.

This commitment would be reiterated in subsequent documents like the Hanoi Plan of Action of 1997 and the Vientiane Action Program of 2004. Both documents charted measures to achieve Asean Vision 2020, which is described as “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.”

When the Asean Summit of 2003 agreed on the establishment of an Asean Community standing on the pillars of political-security cooperation, economic cooperation and socio-cultural cooperation, that commitment further strengthened and led to the formulation of an Asean Charter, which entered into force at the end of 2008. This gave Asean new impetus to establish mechanisms that would more vigorously promote and protect human rights and fundamental freedoms. The Asean Political-Security Community Blueprint in particular provides the roadmap for the strengthening of Asean’s commitment to promote and protect human rights.

In implementation of the Asean Charter, the Asean Intergovernmental Commission on Human Rights (AICHR) was subsequently established as Asean’s overarching mechanism to promote and protect human rights and fundamental freedoms in close collaboration with other mechanisms, including the Asean Commission on Women and Children (ACWC).

At present the focus of the AICHR is on human rights promotion and its major achievement is the formulation of the Asean Human Rights Declaration, which was adopted by the Asean Leaders during their summit in Phnom Penh last year.

The entry into force of the Asean Charter, the establishment of the AICHR and the adoption of the AHRD are important milestones in human rights cooperation both among Asean members and between them and their Dialogue Partners. These represent the strengthening of collective efforts to promote and protect human rights in Asean. These same efforts can also reinforce Asean’s efforts to promote the establishment of a people-centered and people-oriented Asean Community. Meanwhile, more Asean member states are establishing national human rights commissions.

Human rights cooperation is also one of the important activities under the Bali Concord III Plan of Action toward the development of the Asean Community in a Global Community of Nations. Thus Asean is fostering cooperation in the promotion and protection of human rights with its external partners, including international organizations. Moreover Asean always includes cooperation in the promotion and protection of human rights as one of the components of all partnership plans of action with all of its dialogue partners.

One of the greatest challenges to Asean today is how to ensure the effective implementation of the declaration and the mainstreaming of the values embodied in the declaration into the activities undertaken by all Asean Organs under the Three Pillars of the Asean Community.

To mobilize civil society organizations in support of the protection of human rights in the Asean region, it is necessary to raise public awareness of the issue. Cooperation should also be promoted between Asean mechanisms and the relevant national commissions in the respective member states as a way of mainstreaming human rights into Asean activities. A good example of this is the panel discussion recently organized for the first time jointly by the AICHR and the Committee of Permanent Representatives to Asean (CPR) in observance of the 46th anniversary of Asean.

The member states should intensify their efforts to further develop the AICHR and to establish Asean’s legally binding instrument for the promotion and protection of the rights of migrant workers. In addition to completing the development of new human rights related instruments, ensuring the implementation of the Asean Human Rights Declaration by all Asean Member States is essential.

Last but not least, efforts to promote and protect human rights in Asean should be coupled with the development of stronger Asean mechanisms. A review of the terms of reference of the establishment of the AICHR, scheduled to be held next year, could be utilized to strengthen Asean’s mechanisms, particularly in the field of human rights protection.

The dialogue between the government of Indonesia and the AICHR held in June 2013 is an important step toward strengthening the work of the AICHR, particularly on the protection aspect of human rights. Strengthening of the commission’s capacity is crucial.

Forty-six years ago, it would have been difficult to imagine that Asean could achieve significant progress, not only in the maintenance of peace and stability and in the promotion of peoples’ prosperity but also in the development of the evolving regional architecture. It would have been even more difficult to imagine that it could achieve so much in terms of the promotion and protection of human rights.

These achievements provide Asean no reason for complacency. Challenges ahead are formidable and complex. In line with its efforts to build a people-centered and people-oriented Asean Community, Asean should sustain the momentum of its efforts to promote and protect human rights and fundamental freedoms. This thought should be foremost in Asean’s mind as it navigates the 46th year of its remarkable life.

Ambassador Ngurah Swajaya is the permanent representative of Indonesia to ASEAN

From : The Jakarta Globe

ASEAN Development Cooperation

11 09 2013

By Amb. Jose V. Romero, Jr., Ph.d

Promoting Agriculture

Agriculture contributes a substantial portion of total goods and services in Asean countries. It is but proper therefore that the community cooperate to make this sector, specifically its food production component, an important part of its cooperative planning effort. Along these lines the community is working towards enhancingits competitivenessof itsfood, agricultural and forestry products in international markets, and the empowerment of its farmers through the promotion of agricultural cooperatives. Emerging and cross-cutting issues such as food security, mitigation of an adaptation to climate change for the agriculture and forestry sector and sanitary and phytosanitary (SPS) are also addressed within its priorities.

Through the harmonisation of quality and standards, assurances of food safety and standardisation of trade certification, ASEAN agricultural products are expected to be ready to compete in the global market by offering safe, healthy and quality foods. Accompanying this priority is to ensuring food security
Production of tradable agriculture and forest products at the national level is an essential component for the realisation of the above priorities. This calls for an appropriate set of macro-economic policies; country-specific economic conditions; quality education for farmers; adoption of suitable technology and communication and marketing arrangements to enable farmers to access information, capital and inputs for efficient production at reduced cost.

The increase of economically and environmentally sustainable agricultural and forest production, in terms of both quantity and quality, also needs to be addressed.

Strengthening food security and emergency/shortage relief is a core measure in addressing food security in the region. It is aimed at strengthening national food security programmes and activities, and developing regional food security reserve initiatives and mechanisms.

Sustainable food production is an important aspect of securing food security, which could be achieved through improving agricultural infrastructure development, minimising post-harvest losses, reducing transaction costs, maximizing agricultural resources potential, promoting agricultural innovation including research and development on agricultural productivity and accelerating transfer and adoption of new technologies.

In addition, food security-related initiatives will be identified and promoted. These include providing an effective market to encourage sustainable growth in food production, encouraging greater public and private sector investment in food and agro-based industry development and strengthening integrated food security information systems (i.e. early warning, monitoring and surveillance mechanisms).

Ensuring a Level-Playing Field

ASEAN Member States have, in the ASEAN Economic Community (AEC) Blueprint, committed to endeavour to introduce nation-wide Competition Policy and Law (CPL) by 2015. This is to ensure a level playing field and incubate a culture of fair business competition for enhanced regional economic performance in the long run. Paralleling this effort the enactment of consumer protection laws ensures fair competition and the free flow of correct information in the marketplace.

Protecting Intellectual Property Rights

Intellectual Property (IP) and IP Rights (IPRs) creation, commercialisationand protection have been a significant source of comparative advantage of enterprises and economies and hence a major driver of their competitive strategies.

Transport Cooperation

ASEAN cooperation in the transport sector aims to realise an efficient and integrated transport system to support the realisation of the ASEAN Free Trade Area (AFTA) and for ASEAN to integrate with the global economy. Under the current ASEAN Transport Action Plan (ATAP) 2005-2010, transport cooperation in ASEAN is focused, amongst other areas, on enhancing multimodal transport linkages and interconnectivity, promoting the seamless movement of people and goods and promoting further liberalisation in the air and maritime transport services. To facilitate seamless movement of goods in the region, transport facilitation framework agreements to implement the current action plan have been concluded.

From :

The Negros Chronicle

Abe’s ASEAN tour

8 09 2013

By Dennis D. Trinidad

Abe’s recent trips to Southeast Asia show that Japan is turning once again to the region. Abe travelled to Indonesia, Thailand and Vietnam in January — his first foreign tour since his re-election as prime minister.
He visited Myanmar in May, and then Malaysia, Singapore and the Philippines in July. Abe is also set to visit Brunei, Cambodia and Laos in October. While many observers interpret such visits primarily as a strategy to counter China, it can be argued that Japan’s major motive for this diplomacy is a mix of both commercial and strategic interests.

Abe’s Southeast Asia visits are not unprecedented. Japan has turned to Southeast Asia numerous times in the past, evident in foreign policy changes orchestrated by Prime Ministers Sato, Tanaka and Fukuda. Each time Japanese leaders have approached Southeast Asia the main issues have usually involved China, concerns over Japan’s economy, or both. While it was not accompanied by a tour, Japan’s first turn to the region in the post-war period happened in the 1950s under Prime Minister Yoshida. The motive for the turn was mainly commercial, as the Southeast Asian region was seen then as a substitute for the ‘loss’ of the Chinese market after it shifted to a socialist system. Since then, Japanese leaders have consistently attached great importance to its relationship with countries in Southeast Asia. This observation is reinforced by Japan’s huge economic presence in the region in the form of aid, trade and investment, which have grown progressively over the years.

The first three countries that Abe chose to visit in January reflect his intention to maintain these valuable relationships. Among ASEAN member countries, Thailand was the most popular destination for Japanese investment in 2010, followed by Vietnam, while Indonesia has the biggest market among ASEAN member countries. Another reason for these visits was to monitor the disruptive effects of natural disasters on Japan’s regional supply chain; after the flooding in Thailand and the Tohoku earthquake, some Japanese manufacturers have contemplated shifting their operations to Indonesia and Vietnam. Moreover, the third arrow of Abe’s ‘three arrows strategy’ calls for a reform program that promotes private sector investment-led growth. This conforms to the New Growth Strategy launched in 2010, which emphasises the promotion of ‘superior’ Japanese technology, such as railways and water technology. The growing affluence of Southeast Asian societies and the high demand for regional infrastructure are conducive to Japanese leaders ‘peddling’ Japan’s own products and technology, which can be funded through loans and Japanese development assistance.

The strategic component of the visits is also manifested by Cambodia’s and Laos’ inclusion in the itinerary, Abe’s constant reference to ‘shared values’ in his dialogue with regional leaders, and a proposal to promote maritime cooperation, particularly with the Philippines. China’s economic and military assistance to Cambodia and Laos have strengthened bilateral ties and Chinese influence within these countries. The latter was made evident during the July 2012 ASEAN Ministerial Meeting in Phnom Penh, in which Cambodia, acting as chair, opposed the inclusion of the South China Sea/West Philippine Sea issue in the concluding joint statement. Cambodia’s stand was a diplomatic victory for China, which prefers to settle territorial disputes via bilateral talks rather than multilateral forums. This episode also reveals the divisive effect of China’s charm offensive on ASEAN. Great economic dependence by any ASEAN member on China could potentially damage the association’s cohesion and unity in the long run. This possibility leads to the second strategic motivation of Abe’s Southeast Asian tour.

By further strengthening ties with ASEAN members, Japan could help mitigate China’s charm offensive by resorting to a strategy of soft containment. This subtle version of containment is different from the policy used by the United States against the spread of communism during the Cold War. Japan knows that it has nothing to gain by containing China, now its largest trading partner. Instead, this flexible strategy allows both engagement and curtailment of China’s expanding influence. There are two ways by which Japan could achieve this: value diplomacy and institution building. During his dialogue with Southeast Asian leaders, Abe constantly referred to a set of shared values, such as democracy, human rights and rule of law. Abe declared that he ‘wants to emphasise the importance of strengthening ties with [Southeast Asian] countries that share such values’. China could not seek to realise these values, and nor does it have the credibility to pursue them — although if ‘value’ diplomacy works, it may put pressure on China to eventually embrace those values.

Meanwhile, the proposal for strengthened maritime cooperation represents Japan’s desire for long-term regional stability through institution building. During his Philippines visit, Abe reiterated the importance of cooperation on maritime and oceanic affairs. Abe can use this opportunity to take the lead in building institutions for a maritime code of conduct (including a fisheries code). Building maritime institutions in order to reduce tension complements Japan’s strategy, since participation in any form of collective security or military deterrence is constrained by constitutional and other domestic factors.

Dr Dennis D. Trinidad is Associate Professor and Head at the International Studies Department, De La Salle University, Manila, Philippines.

From :

East Asia Forum


ASEAN, China brace for a diamond decade

6 09 2013

By Li Keqiang

China and ASEAN are close neighbors that share affinitive cultures, blood and common interests. Over the past decade since the establishment of the China-ASEAN strategic partnership, the relations between the two sides have always featured mutual respect, equal treatment, neighborliness and mutual benefit.

Nevertheless, we have also noticed that there exist some factors in the region that disrupt stability and development, but they are not mainstream issues. Regarding the South China Sea disputes, China has always firmly held that the immediate disputing parties should seek sound solutions through friendly negotiations on the basis of respecting historical facts and international laws.

The Chinese government is one of accountability and is willing to seek sound solutions through friendly negotiations. The Chinese side maintains that the South China Sea disputes are not an issue between China and ASEAN, and they should not and will not affect overall China-ASEAN cooperation.

Here, on behalf of the Chinese government, I solemnly declare that China’s good-neighborly policy toward ASEAN is not a matter of expediency, but a long-term strategic option for China. China will prioritize ASEAN member countries in the country’s peripheral diplomacy, deepen the strategic partnership with ASEAN and firmly cooperate with ASEAN to jointly safeguard peace and stability in the region, including the South China Sea.

Meanwhile, China will keep supporting the development of ASEAN, the establishment of the ASEAN community, as well as upholding the dominant role of ASEAN in East Asian cooperation.

During these couple of days, I have held wide-ranging and profound exchanges with leaders of the ASEAN countries and we have reached an important consensus. We unanimously agree that our common interests are expanding. We had the capabilities to create a “golden decade” in the past, we also have the power to create a “diamond decade” in the future.

Standing at a new starting point in history, we should seek new strategic breakthroughs, constantly deepening pragmatic cooperation, and working together to upgrade the level of China-ASEAN cooperation on the basis of enhancing mutual political trust and promoting the spirit of openness and inclusiveness, so as to promote the advancement of the bilateral strategic partnership. Hence, I raise the following proposals for cooperation:

The first is to create an upgraded version of the China-ASEAN Free Trade Area. The establishment of the China-ASEAN Free Trade Area has created a precedent for trade and investment cooperation in the Asia-Pacific region, which has greatly boosted the rapid development of bilateral economic and trade relations.

Looking into the future, China will uphold traditions in the establishment of the free trade area over the past 10 years, prioritize ASEAN’s representation of its interests, and create more favorable conditions for ASEAN’s development.

We are willing to upgrade and expand the content and scope of the China-ASEAN free trade area agreement based on the principles of mutual benefit and common development. Both sides can consider deepening talks on further lowering tariff rates, cutting non-tariff-related measures, launching dialogue for a new round of service trade pledges and pushing forward the actual opening-up for investment through policies concerning access and personnel travel, so as to boost the liberalization and facilitation of trade and investment.

This will enable the China-ASEAN Free Trade Area keep up with the times and upgrade it to cover more areas and with higher quality. We are willing to sign long-term trade agreements for agricultural products with ASEAN, actively expand the imports of ASEAN products that are competitive and appealing to the Chinese market.

We aim to expand bilateral trade volume to US$1 trillion by 2020, meanwhile, increase bilateral investment by $150 billion during the next eight years. Just as ASEAN is the priority in China’s peripheral diplomacy, ASEAN is also the priority of China’s outbound investment. We also welcome enterprises from ASEAN countries to invest and start businesses in China.

Meanwhile, China is willing to join hands with ASEAN to advance talks on the Regional Comprehensive Economic Partnership (RCEP), and discuss exchanges and interaction with frameworks such as the Trans-Pacific Partnership (TPP) Agreement, so as to create an open, inclusive and mutually beneficial climate to “make the two wheels of regional and global trade roll together”.

The second proposal is to boost mutual connectivity. We need to speed up cooperation in boosting mutual connectivity in areas such as roads, railways, water transportation, aviation, telecommunications and energy.

More efforts will be made to facilitate the gradual launch and construction of a pan-Asian railway network and effectively carry out certain key projects. China will initiate a new round of targeted loans and give full play to the China-ASEAN Investment Cooperation Fund, and work actively with various sides to establish a financing platform in Asia to fund large-scale infrastructure projects.

While stepping up the “hardware link”, China and ASEAN will also beef up efforts to improve the rules-of-origin implementation mechanism, and boost “software connection” in standard systems such as information exchange, customs clearance and quality control, in order to create conditions for the gradual building of an infrastructure-connected Asia.

The two sides should also expand investment and industrial cooperation, jointly foster a batch of green and highly efficient industrial parks to realize mutual integration.

The third proposal is to boost financial cooperation. This is extremely crucial to safeguard financial and economic stability in the region. In recent years, China-ASEAN financial cooperation has made profound achievements and the overall scale of the “Chiang Mai Initiative” multilateralization agreement has expanded to $240 billion.

The Chinese side is willing to continue to work with ASEAN members to strengthen the multi-layer regional financial security network, promote the substantial implementation of the bilateral local-currency swap agreement, encourage cross-border trade and investment settlements in local currencies, facilitate ASEAN institutions’ investment in Chinese bond markets and constantly improve early-warning and bail-out mechanisms on regional financial risks.

The fourth proposal is to carry out maritime cooperation. This is a key field for the two sides to expand cooperation. The Chinese side proposes to set up a “China-ASEAN maritime partnership”. At the forum, the China-ASEAN harbor city cooperation network will be launched. We have input 3 billion yuan (US$490 million) in setting up the China-ASEAN maritime cooperation fund.

We are conducting research into carrying on a series of cooperation projects, giving priority to the construction of fishery bases, environmental protection for maritime ecology, seafood production and trade, navigation safety and search and rescue, and facilitation of maritime transportation. We are expecting the active participation of ASEAN countries.

The fifth proposal is to promote people-to-people and cultural exchanges. The Chinese side has initiated 2014 as the “China-ASEAN Friendly Exchange Year”. China will offer 15,000 government scholarships to ASEAN countries in the next three to five years.

China will also invest in a special fund for Asian regional cooperation to deepen people-to-people and cultural cooperation. We will further make the China-ASEAN Youth Society and China-ASEAN Think Tank Network play more active roles.

The article is an abridged version of a speech by Prime Minister of the People’s Republic of China
Li Keqiang at the opening of the 10th China-ASEAN Expo and the China-ASEAN Business and Investment Summit in Nanning, China on Sept. 3.

From :

The Jakarta Post

ASEAN economies facing sharp slowdown

6 09 2013

By Paolo G. Montecillo

Southeast Asian economies like the Philippines face a sharp deceleration in growth as a result of a credit crunch brought on by a shift in the monetary policy of the US Federal Reserve.
The Institute of Chartered Accountants in England and Wales (Icaew) also warned that, although Southeast Asian economies have more stable economic foundations, the countries might also have to deal with the slowdown in China—Southeast Asia’s largest trading partner.
“While we believe that the strong underlying fundamentals for the region…mean that the onset of tighter monetary policy in the US will not trigger the currency crises we saw in the late 1990s, volatility is creating a more uncertain environment,” said Icaew.
Citing a study by the Centre of Economics and Business Research, the group said that a repeat of the Asian crisis of 1997 was unlikely given the lower debt-to-gross domestic product (GDP) ratios of the countries in the region.
But the slowdown in capital inflow “is acting as a serious pressure on regional markets,” said Icaew, which has 140,000 members around the world.
The report noted that the Philippines’ GDP growth for 2013 could hit 5.3 per cent in 2013, slowing down from the 6.8 per cent reported the year before.
The slower growth rate for the year implies a sharp deceleration in growth in the second half, following a first half expansion of 7.6 per cent—the fastest in Southeast Asia.
Icaew’s forecast is also lower than the Philippine government’s 6 to 7-per cent target for the year, and the International Monetary Fund’s projection of 7 per cent.
But Icaew remains optimistic, expecting the country’s growth to be higher by six-tenths of a percentage point than the average GDP expansion the Philippines has recorded in the last five years.
The Philippines “has huge scope for increases in productivity. Even though the country may experience an initial lag as workers are retrained, new capital is invested and new supply chains are developed, strong growth in consumption and government spending will drive GDP up,” Icaew said.
“However, beyond this, high unemployment and poverty levels, as well as a need to lift interest rates in response to tighter monetary conditions in the US may drag growth down to 4.6 per cent in 2015.”

From :

Philippine Daily Inquirer

ASEAN Should Reject a Code of Conduct in the South China Sea

5 09 2013

Be afraid, ASEAN countries. Of a South China Sea code of conduct, I mean. The only code of conduct worth having would be one by which China renounces its nine-dashed line of the region and the associated territorial claims; matches its words with deeds by evacuating sites it has poached from other countries’ exclusive economic zones; stops asserting the right to proscribe certain foreign naval activities within the nine-dashed line; and agrees that the purpose of any code of conduct is to lock in the UN Convention on the Law of the Sea as the regional status quo.

Anyone want to place odds on Beijing’s doing any one of these things? Me neither. All of them? Fuggedaboutit. If ASEAN consents to a code of conduct anyway, it will have ratified the current state of affairs, including China’s seizures of Scarborough Shoal and Mischief Reef, deep within the Philippine EEZ. Southeast Asian countries will have consented to a region wide protection racket, in hopes that letting China keep its past gains will purchase its forbearance and goodwill in the future.

Good luck with that one. It’s rather as though a less kind, gentle Naval Diplomat pointed a gun at you and demanded money to protect you from … me! Such bargains with the Family seldom work out well in gangster films. Life imitates art in this case. The international relations counterpart is what scholars call bandwagoning. Weaker states prefer to band together to offset strong, domineering powers prone to trampling their interests and security. But if the weak are unable to balance a would-be hegemon, they may align themselves with it. They agree to the hegemon’s demands in hopes of buying peace while retaining as much of their sovereignty and preserving as many of their interests as they can.

Trouble is, such arrangements are perishable. They only last until the Family decides it needs more. Then the leg-breakers up their demands. Needless to say, the price of protection has a way of going up over time.

Philippine foreign minister Albert del Rosario understands the dynamics at work in the South China Sea. “We think that China is trying to stay ahead of the CoC,” del Rosario told Reuters this week. The code of conduct will look forward in an effort to defuse future controversies, not back to reverse past offenses. Beijing, accordingly, is pushing “an assertion agenda.” It will grab what it can, then agree to a code that guarantees it can keep what it just grabbed. That becomes the new normal.

There’s ample precedent for using laws or international covenants to cement your gains. British scholar Ken Booth recalls that seafaring states scrambled for maritime territory during the 1970s and early 1980s, at the same time they were negotiating UNCLOS. And one doubts that was the first time states gamed international law in such fashion.

So Manila is right to cry foul about Beijing’s agenda. Don Xi Jinping and his Family are a particularly demanding, unforgiving lot. If they won’t let the explicit text of a treaty — a treaty to which China has consented — restrain their ambitions, why expect a code of conduct to? Beware of bandwagoning, Southeast Asians, unless you’re prepared to pay up — again and again.

From :

The Diplomat

ASEAN unity vital to combat drug trafficking

5 09 2013

by Quratul-Ain Bandial

Asean drug bodies need to cooperate with international drug agencies in order to effectively combat drug trafficking within Southeast Asia, said a senior official at the Prime Minister’s Office (PMO) yesterday.

Speaking at a gathering of Asean ministers responsible for drug matters, Energy Minister at PMO Yang Berhormat Pehin Datu Singamanteri Colonel (Rtd) Hj Mohd Yasmin Hj Umar said drug syndicates were becoming increasingly sophisticated in methods to manufacture and traffic drugs.

“Drug trafficking activities are also being carried out in the Asean region by non-Asean nationals, our cooperation should not be confined to agencies within the region but also those from beyond,” he said at the opening of the meeting at The Empire Hotel & Country Club.

“To effectively address these emerging trends, our national and regional policies and strategies must be constantly reviewed and developed we must strive to remain one or more steps ahead of these criminals.”

Representatives from all 10 Asean countries met in the capital for a mid-term review of the bloc’s plan for a drug-free Asean by 2015.

The minister added that the ministerial meeting on drugs was an important platform to monitor progress towards this vision.

As Asean aims to forge a single economic community by 2015, drug syndicates could take advantage of greater connectivity between states.

“Therefore, it will no longer be sufficient for domestic law enforcement agencies to act alone to combat cross-border drug trafficking,” said YB Pehin Hj Mohd Yasmin.

The grouping aims to tackle three areas illicit cultivation of drugs; manufacturing and trafficking of drugs, and the prevalence of illicit drug use.

The minister commended officials for setting up the Airport Interdiction Task Force (AITF) which he said has made “significant progress” in combating the drug trade.

He also urged member countries to forge ahead with an Asean treaty that would provide member states with mutual legal assistance on criminal matters. Such a treaty could also pave the way for partnerships with non-Asean states.

“Seeing that the menace of drugs extends beyond our Asean borders, working closely with our dialogue partners is necessary. Hence, cooperation between the Asean senior officials meeting on drug matters and our dialogue partners must be enhanced and more initiatives should be developed.”

From :

The Brunei Times

Defence cooperation crucial for ASEAN integration

29 08 2013

Prevailing regional and international defence and security issues were extensively discussed by Asean Defence Ministers and the Asean Deputy Secretary General during the Asean Defence Ministers’ Meeting (ADMM) Retreat yesterday.

A statement issued by the Defence Ministry (MinDef) pointed out that Ministers had also underlined the importance of defence cooperation in building an Asean Political-Security Community by 2015 and beyond.

Unwavering in their commitment onto the matter, the ministers reiterated in their commitment to address these challenges collectively through cooperation in the Asean Defence Ministers’ Meeting (ADMM) and the Asean Defence Ministers’ Meeting-Plus (ADMM-Plus) mechanisms.

The Ministers agreed to continue working on addressing non-traditional security challenges such as in the area of humanitarian assistance and disaster relief (HADR) and maritime security, noted the statement.

The statement further mentioned that the ministers retreat also focused on how to further develop and enhance the ADMM and ADMM-Plus process with suggestions for this to be steered towards new areas that need to be explored such as cyber security, and look into the synergy between defence and security cooperation.

MinDef also noted that the Ministers also agreed to enhance confidence building measures by developing practical measures, such as open lines of communications, “to reduce miscalculations and misunderstanding, particularly with regard to incidents at sea”.

Ministers viewed that growing military-to-military relations remains the main thrust of defence cooperation, said MinDef.

They agreed that interactions at all levels would further foster a sense of belonging, reaffirm commitment towards shared responsibility and embed a regional identity. The Ministers further noted Brunei Darussalam’s intention to host a defence dialogue for young defence and military officials.

The Ministers also stressed on the importance of Asean centrality in driving the ADMM process. In this regard, Ministers agreed to stock take the progress of the ADMM especially in light of the 10th anniversary of the ADMM in 2015, Kuala Lumpur, Malaysia.

Meanwhile the third Asean-US Defence Ministers Informal Meeting also took place yesterday, chaired by the Energy Minister and attended by US Defence Secretary Chuck Hagel alongside other Asean Defence Ministers.

At the informal meeting, Asean Defence Ministers welcomed the US engagement in the region and expressed appreciation on its contribution to the ADMM-Plus. Both sides exchanged views on the overall regional security and defence issues including strategic relations in the region, according to MinDef.

They reaffirmed their commitment to maintain peace and stability in the Asia Pacific region. In this regard, the Ministers reiterated the ADMM-Plus as the platform to strengthen their defence cooperation and engagement.

From :

The Brunei Times

Unlocking ASEAN potential

28 08 2013

By Noel Quinn

In its fascination with all things China, much of the world seems to have overlooked one of the great trading opportunities of the post-crisis global economy: The potential of Southeast Asia.  

It is a strange omission: The 10 members of the Association of South East Asian Nations (ASEAN) comprise a market of 600 million people with a combined gross domestic product (GDP) of US $ 2.1 trillion, solid growth, low manufacturing costs and a rising middle class, hungry for the consumer experience.

We expect these trends to be amplified when the ASEAN Economic Community (AEC) comes into existence at the end of 2015. The AEC is designed to eliminate tariffs and other trade barriers between Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, The Philippines, Singapore, Thailand and Vietnam, effectively creating, could be one of the world’s biggest single markets.

Part of Southeast Asia’s attraction is the range of opportunities it offers, both as manufacturing base and market. ASEAN spans the spectrum from Singapore, a financial and high-tech industrial hub with a higher GDP per capita than Switzerland, through the established offshore manufacturing centres of Thailand and Malaysia, via the newly industrialised economies of Vietnam and Cambodia, to the natural resources of Indonesia and the raw potential of Myanmar.

But the heart of Southeast Asia’s potential lies in the middle class, both as consumers and as a source of highly educated, high-productivity labour. A recent report from Ernst & Young estimated that there were 529 million middle-class Asians in 2009 – 28 percent of the global total – and that will grow to 3.2 billion by 2030 or 66 percent of the global total. Much of that growth will be in China and India but Southeast Asia will also play a key role.

Southeast Asia has not been immune to the global headwinds – we forecast regional GDP growth of 3.9 percent this year – but that growth is robust, driven largely by domestic consumption and growing intra-regional trade.

Intra-regional trade has grown from 19 percent of total trade in 1993 to 25 percent in 2012 but its potential is vastly greater. Growth has been blunted by poor connectivity: For years there has been no rail link between Vietnam on the eastern seaboard and Thailand on the Andaman Sea for example and until recently goods travelling by road used to have to change trucks three times to comply with local legislations.

But Southeast Asia has used the global economic crisis to embark on a major infrastructure upgrade, building roads, ports and railways while dismantling the bureaucratic barriers to trade to allow the region to reap the full economic benefits of its diversity.

It is also working to improve the efficiency of its capital markets, which will have a major role to play in financing future growth. Although there is some way to go, today there is greater regional cooperation than there has ever been and overseas investors are looking closely at the possibility of public-private partnerships as a way to buy into the region’s growth.

In many instances Western companies identified China as a preferred option when setting up manufacturing facilities, encouraged by competitive wages, well-developed foreign direct investment (FDI) infrastructure and the bonus of the potential domestic market.

But this is beginning to change as Southeast Asian markets become more accessible and increasingly competitive on costs. Foreign direct investment into ASEAN grew 24 percent year-on-year in 2012 to reach US $ 114 billion.

The dismantling of the economic, physical and regulatory barriers between Southeast Asian nations envisaged by the ASEAN Economic Community will help unleash the full potential of what is already one of the world’s most dynamic regions. As the world’s economic centre of gravity moves inexorably eastward, Southeast Asia is sitting in the cockpit of growth: The diversity which critics had assumed was one of its weaknesses will become a strength and a growing middle class will drive both consumption and innovation.

Noel Quinn is Group General Manager, Regional Head of Commercial Banking Asia Pacific for the HSBC group

From :

Daily Mirror

Building China-ASEAN sea of peace and amity

28 08 2013

By Jin Yongming

The Special China-Asean Foreign Ministers’ Meeting, to be held in Beijing on August 29 to mark the 10th anniversary of the establishment of the China-Asean strategic partnership, will focus mainly on deepening of relations between the two sides.

China and some Asean member states have been involved in territorial disputes in the South China Sea. To defuse the tensions, however, Foreign Minister Wang Yi has proposed that the parties work out a Code of Conduct and ensure the success of the Beijing meeting on the key documents related to dispute management .

Wang’s proposal has four key elements. First, each party should have a realistic expectation from the talks. He said that it would be neither realistic nor serious to talk about a “quick fix (solution)”. Since a COC concerns the interests of all the parties, its formulation will be a process of sophisticated and complex coordination.

Second, to reach a consensus on a COC, the parties should draw inspiration from the Declaration on the Conduct of Parties in the South China Sea (DOC) to push ahead the consultations on a COC. The idea, however, should be to seek a broad consensus to take care of the interests of all parties and ensure that no party imposes its will on others.

Third, China and Asean member states should prevent non-regional countries from interfering in their disputes. The interference of external parties has for years thwarted the efforts of China and Asean members to give shape to a COC. For instance, a joint working group was founded in 2004 for the implementation of the DOC, followed by eight meetings since 2005. But these efforts have failed to facilitate an agreement on a regional COC because of some irrelevant parties’ interference. So China and Asean member states should make concerted efforts to build an atmosphere conducive to the formulation of a COC.

Fourth, the two sides should take a step-by-step approach to formulate a COC. The South China Sea disputes are extremely sensitive and cannot be resolved overnight. Therefore, the two sides have to work on a COC within the framework of the DOC and keep in mind that a COC is not intended to replace the DOC.

Wang’s four-point proposal is based on international laws. It conforms to the guidelines for the implementation of the DOC that China and Asean member states agreed upon in 2011. The proposal is consistent with Beijing’s long-held stance that China and Asean member states should resolve the maritime disputes step by step.

Besides, the two sides should cooperate in less sensitive fields to build mutual trust. And based on enhanced mutual trust and maritime cooperation in less sensitive fields, the two sides should make further efforts to enact legally binding agreements such as a COC.

Of course, it will take time for the complete resolution of the disputes, but that does not mean the parties cannot seek ways of common development on a mutually beneficial basis. As Wang said, joint development is not only for economic interests, but also to show the rest of the world that the disputing countries are willing to resolve the disputes through peaceful means.

China’s approach to the disputes meets the basic requirements for the exploration and exploitation of resources in the South China Sea. On the one hand, all the parties have the right to exploit resources in the region, especially through deeper cooperation in less sensitive fields. On the other hand, the parties should make joint efforts to enact legally binding documents like a COC for reasonable exploitation of the marine resources.

This is particularly important because the DOC has some technical problems when it comes to implementation; it cannot help resolve the disputes because of its non-legally binding nature.

A legally binding code can help regulate the activities of the countries in the region and ensure that the marine resources are exploited reasonably. For instance, although maritime cooperation in developing fishery resources is not included in the DOC, China and Asean member states can hold discussions to establish a regional cooperation framework for fishery resources management and emergency response. This will not only protect the rights of fishermen, but also prevent further disputes, which in the past have been mostly triggered by incidents involving fishermen.

The formulation of a COC will accelerate the process of building a sound legal regime in the South China Sea for the common interests of all stakeholders. As always, China will strive to make its due contribution to regional peace and stability and realise its goal of evolving into a regional maritime power.

Jin Yongming is the director of the centre for China Marine Strategy Studies, Shanghai Academy of Social Sciences.

From :

China Daily