Tuesday, August 8, 2017

Happy 50th ASEAN Day!

Today is ASEAN Day, the 50th anniversary of the founding of ASEAN on August 8, 1967 with the signing of the Bangkok Declaration by Indonesia, Malaysia, the Philippines, Singapore and Thailand.  These founding members were later joined by Brunei (1984), Vietnam (1995), Laos (1997), Myanmar (1997) and Cambodia (1999).

In celebration of ASEAN Day, today’s AEC Blog entry forgoes the usual commentary and instead provides the lyrics and tune of the ASEAN Anthem:


Raise our flag high, sky high 
Embrace the pride in our heart 
ASEAN we are bonded as one 
Look-in out to the world. 
For peace, our goal from the very start 
And prosperity to last. 
We dare to dream we care to share. 
Together for ASEAN 
we dare to dream, 
we care to share for it's the way of ASEAN.

Tuesday, May 16, 2017

Philippines Suggests that Turkey and Mongolia Can Join ASEAN

This week Philippine President Rodrigo Duterte said that the leaders of Turkey and Mongolia had approached him about joining ASEAN.  Duterte said that they made the request to him, as the Philippines is currently ASEAN Chair, and that he was happy to “sponsor” their membership applications.

The difficulty with this request is that neither country is part of Southeast Asia, which was noted by Myanmar’s Aung San Suu Kyi.  President Duterte responded,

They are. I would say that they are. Turkey, it seems to be ambivalent to whether to be a bridge sa (to) Europe and Asia or being an Asian. Wala silang klaro diyan (There is nothing definite there.) There has always been an ambivalent view. Sometimes they say that they are part of Asia, sometimes they say that they are the bridge of Asia to Europe.”

However, a “definite” concept of Southeast Asia underpins the membership criteria for ASEAN.  Article 6.2(a) of the ASEAN Charter states that new members must have a “location in the recognised geographical region of Southeast Asia.”  Neither Turkey nor Mongolia could objectively be considered part of Southeast Asia. 

Blurring the “recognised” area of Southeast Asia, furthermore, would result in difficulties regarding Papua New Guinea and the Indonesian province of Irian Jaya.  

By comparison, Timor-Leste is recognised as geographically part of Southeast Asia, meaning that it easily satisfies Article 6.2(a).

Thus, although the ASEAN Charter can be amended by the ASEAN Summit (which was done, for example, by changing the order of the ASEAN Chair terms), it is difficult to imagine ASEAN leaders agreeing to Turkey and Mongolia joining the grouping.

This is not the first time countries far removed from Southeast Asia have been suggested for membership in ASEAN.  Sri Lanka (at the beginning of ASEAN), Fiji, and most recently Australia have been mooted as potential members.  However, these proposals did not go very far.  The prospects for Turkey and Mongolia look similarly dim, meaning similar outcomes of either politely ignoring the proposal, or clarifying (diverting) them into the ASEAN Regional Forum or free trade agreement talks with ASEAN.

The episode demonstrates, once again, why ASEAN needs the rules and rules-based order established by the ASEAN Charter.  Without the Charter, this discussion of membership would be governed by the politics and diplomacy of the moment, rather than legal and institutional foundations.

Wednesday, May 10, 2017

ASEAN-X Risks Diluting RCEP

This week the Philippines proposed an alteration to the negotiating paradigm of the Regional Comprehensive Economic Partnership (RCEP), in an effort to relieve the logjam currently affecting the RCEP free trade agreement (FTA) talks involving 16 countries, ASEAN plus India, China, Japan, Korea, Australia and New Zealand.  The difficulty is that the Philippine proposal may add more complications to what is already a complex set of trade talks and increases the likelihood that those talks will result in a weaker FTA.

The Philippine proposal basically calls for the RCEP parties to apply “variable geometry” to the RCEP commitments.  Variable geometry, in FTA terms, allows parties to apply trade liberalization commitments on an asymetrical basis, e.g., not all FTA parties implementing their commitments at the same time or to the same extent.

In ASEAN, this is known as “ASEAN-X,” provided in Article 21.2 of the ASEAN Charter. A subset of ASEAN members can proceed with faster economic integration, with the understanding that other ASEAN members can later join the subset when they are ready. In this way, the integration process can continue and achieve the same end result, albeit at varying speeds. 

Thus, ASEAN-X is a useful tool to promote economic integration. The problem comes when not all parties share the understanding that the non-participating ASEAN members will eventually join the subset. As I explained in previously, this can happen when there are multiple subsets of ASEAN countries, or subsets which result from fundamentally incompatible policies. 

This is difficult enough in the ASEAN context, where at least there are regional institutions and processes in ASEAN to move the process along, however slowly.  Application of the ASEAN-X formula to the RCEP process could be even more problematic.  The RCEP talks have stalled because China, Japan, India, and Korea have no FTAs among them, whereas ASEAN has FTAs with those countries.  As a result, the RCEP talks have had difficulties “squaring the circle,” both among the three northeast Asian countries and, for all countries involved, in negotiating with India.  Application of the ASEAN-X formula could thus result in multiple subsets of RCEP being created for these countries.

That of course, undermines one of the fundamental objectives of the RCEP, which was to streamline the trading and investment relationships among the RCEP partners.  Furthermore, if the variable geometries are baked into the RCEP agreement, it will be more difficult for the RCEP parties, operating without established institutions and processes, to move the outliers into the main body of the RCEP commitments.

If applied to the RCEP talks, therefore, ASEAN-X and variable geometry could end the negotiating impasse.  But doing so carries the risk of diluting what already promises to be a relatively weak product from the RCEP talks.