ASEAN way: Survival through decades

Those who critically complain of ASEAN and the ASEAN Economic Community (AEC) as being slow to achieve its goals must bear in mind that targets set 50 years ago by its 10 member-countries are the workings of a collegial body committed in “friendship and cooperation” to “secure for their people and for posterity the blessings of peace, freedom and prosperity.”

Just that.

In that sense, there is no goal to create an empire that is ruled by one head or to have a unified currency just like what the European Union aspired when it created the euro.

Since its beginnings in 1967, it has only to show as a tangible result the formation of the AEC in 2015, and this had been more forced by the 1997 Asian financial crisis that resulted in the collapse of Asian stock markets and the devaluation of domestic currencies.

Neither can ASEAN solely claim that the combined statistical performance of its members – Indonesia, Malaysia, the Philippines, Singapore, Thailand, plus Brunei Darussalam, Cambodia, Laos, Myanmar and Vietnam – has shaped it to an acknowledged force in global affairs.

Or that it is responsible for raising the poverty levels in its member-countries from an average of 14 percent in 2000 to just three percent in 2013 as reflected by the growing middle class and its ability to purchase consumer goods beyond basic necessities.

Somehow, just by keeping peace and believing in mutual, unforced cooperation, ASEAN member countries have continued to grow, albeit at different paces, that has leveraged on the strength of its strong 600-million population.

Taking off

AEC was formally established in 2015 after successive discussions and delays on the ASEAN level. A one-ASEAN economy, however, continues to be an aspiration rather than a done deal.

For its “take-off,” AEC adheres to a blueprint, the latest in a series which now aims at having an AEC by 2025 that is highly integrated and cohesive; competitive, innovative and dynamic; with enhanced connectivity and sectoral cooperation; a more resilient, inclusive, and people-oriented, people-centered community; and integrated with the global economy.

Lofty as the goals may seem, the realities are too huge to ignore. Many challenges lie ahead.

It is widely accepted that ASEAN’s biggest achievement has been on tariffs. Member countries have 96 percent of their tariff lines at zero percent, and even with the continued rise in non-tariff measures (NTM), only 98.7 percent of products will have zero tariff by 2018.

The imposition of non-tariff measures remains high on the agenda this week after impediments have been reported to have risen from 1,634 to 5,975 over a 15 year period, almost tripling from year 2000 to 2015.

Among the measures eyed to whittle down the unwanted interventions that delay the establishment of a higher rate of zero tariffs on products would be simplifying rules of origin, as well as accelerating and deepening the implementation of trade facilitation measures.

A monitoring system to keep track of changes in non-tariff measures would also be needed to stem the alarming rise of trade barriers that governments set up to protect their own interests and sectors.

Alignment of laws for service liberalization

While the AEC blueprint has always been clear on the need to remove all restrictions on trade in services, some ASEAN countries, including Thailand, the Philippines, and Indonesia, have not been compliant.

Interconnection of telecom services and access to ATMs for banking, for example continue to be a dream before a one-ASEAN community can be realized.

There will be much work needed by member states to align their respective laws and regulations so that the region’s service sector will be able to seamlessly interconnected.

One of the areas that have seen little or no progress has been in promoting cross-border movement of labor. Currently, only eight professions – doctors, dentists, nurses, architects, engineers, accountants, surveyors, and tourism professionals – are allowed to work freely in any ASEAN member country.

Opening up unskilled labor markets, given the relative abundance of unskilled labor in many ASEAN countries, has also been an aspiration, but the AEC blueprint continues to focus only on the eight skilled professionals.

Even on this, many ASEAN members impose conditions, like basic knowledge of the local language. In an environment that contains diverse and distinctly unique cultures, it is not difficult to see why there is no real cross-exchange of professionals.

Hopefully, over time, we shall see schools and universities among ASEAN members coming up with licensure tests that are guided by that AEC dream of cohesiveness.

Moving target

The AEC blueprint will continue to be moving targets as hopefully, awareness of a true one-ASEAN economy will become ingrained in laws and cultures of each member country. We can ask for no more without forcing the issue, without going against the “ASEAN way,” principles that place extreme emphasis on national sovereignty and the commitment to non-intervention in the affairs of member countries.

This fraternity of Asian nations founded 50 years ago takes great pride in the fact that community decisions are made through extreme consensus. It may seem like a bad thing that causes all this slow decisions and actions, but it is also a good thing because it could mean we will still be discussing ASEAN and AEC 50 years hence while continuing to enjoy individual growth.

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