Laying a foundation for a new East Asia By ERIC TEO CHU CHEOW Special to The Japan Times
SINGAPORE -- Optimism for East Asian integration and community building ran high at the conclusion of the 10th ASEAN Summit on Nov. 30 in Vientiane, Laos, and the back-to-back meetings between the 10-member Association of Southeast Asian Nations and its Asia-Pacific partners -- China, Japan, South Korea, India, Australia and New Zealand. The year 2005 may see a firm foundation laid for an East Asian community after seven developments: First, ASEAN leaders in Vientiane decided to speed up economic integration by signing pacts calling on the "original" five ASEAN countries -- Indonesia, Malaysia, Philippines, Singapore, Thailand -- and Brunei to abolish trade tariffs in 11 sectors by 2007 (three years ahead of schedule). These 11 sectors constitute more than half of current intra-ASEAN trade. The other four economies -- Vietnam, Cambodia, Laos and Myanmar -- will join the pact by 2015 (five years ahead of schedule). Second, the four newer ASEAN members held a pre-summit meeting and pledged to work together to narrow the wealth gap with other members. They also pledged to move quickly toward linking their four economies and attracting foreign investment. Their first summit-level meeting within the greater ASEAN framework marked recognition of a "two-tier ASEAN." Third, ASEAN leaders formalized their intentions to tie up more closely with China and India (represented at the summit by their respective prime ministers) to ensure their own prosperity and more global clout. Of particular significance was the speech by Malaysian Prime Minister Abdullah Badawi on this to business leaders. It was ASEAN's first official acknowledgment of Beijing's and New Delhi's importance to Southeast Asia. ASEAN last month completed negotiations on "goods liberalization" for a future ASEAN-China Free Trade Agreement. It is expected to meet its FTA schedule by 2010. Fourth, India was officially inducted into the Asian economic integration process. In fact, ASEAN was negotiating an FTA with India just as Indian Prime Minister Manmohan Singh declared in Vientiane that two-way trade between India and ASEAN should more than double to $30 billion by 2007. Fifth, ASEAN will begin FTA negotiations with Japan and South Korea next year to speed up trade flows, thus giving further impetus to the ASEAN-Plus-Three process. In Vientiane, Chinese, Japanese and South Korean leaders met at the summit level to strengthen Northeast Asian cooperation, notably in energy security and in the drive to resolve the North Korea nuclear crisis through "six-party talks." Sixth, ASEAN is set to begin negotiating FTAs with both Canberra and Wellington next year. ASEAN invited Australia and New Zealand to its summit for the first time, although Australian Prime Minister John Howard later refused to sign the ASEAN Treaty of Amity and Cooperation (China, India, Japan and South Korea have already inked the treaty). Despite some unhappiness within ASEAN, Australia and New Zealand may yet join an Asian regional political and economic grouping next year. Last, the concept of a bigger Asian economic bloc got a big boost in Vientiane. Philippine President Gloria Macapagal Arroyo called on ASEAN to accelerate its efforts to integrate the group by 2020 or earlier, and then "embrace China, Japan, South Korea and India." Such an economic bloc, according to Arroyo, could "hold its own" in future negotiations with the United States, Europe and other emerging economic entities. ASEAN reached consensus on holding an East Asian summit in Kuala Lumpur next year -- when Malaysia takes over the group's chairmanship -- after Indonesia accepted the idea of extending the ASEAN-Plus-Three process to additional countries. This new impetus could forge a longer-term Asian economic, social, cultural and political community. However, the East Asian summit framework should not be exclusive. It should not be guided by feelings of rampant Asian nationalism; it should instead seek better cooperation with the U.S. and the EU in a global partnership. The Vientiane ASEAN Summit has taken the first step forward toward building a 3 billion-strong East Asian community. More political will and vision will be required in 2005 to continue building a new Asia in Kuala Lumpur. Eric Teo Chu Cheow, a business consultant and strategist based in Singapore, is council secretary of the Singapore Institute for International Affairs. 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