A ASEAN de olho na China

ASEAN tightens up to ride China's rise
By Brian McCartan

The 10-member Association of Southeast Asian Nations (ASEAN) launched a new joint charter on Monday that establishes mutual rules and commitments, moving the 41-year-old grouping one step closer to becoming a unified economic bloc.

Unwritten in the charter's text are hopes a more unified region will improve its bargaining position vis-a-vis China, whose rising economic might and concentrated soft-power diplomacy in the region has relied largely on bilateral rather than multilateral deals and pacts.

The new charter establishes ministerial-level councils to consider and resolve substantive matters and the stationing of a permanent representative from each member nation at ASEAN's secretariat in Jakarta, Indonesia. Designed specifically to strengthen regional integration, the charter moves ASEAN towards a more rules-based footing, although the grouping's famous policy of consensus-building has not been abandoned.

Greater regional integration is viewed as increasingly necessary to maintain global competitiveness as other regions of the world, including Europe and North America, have established coherent trade and investment blocs. The ASEAN charter significantly compels a regional recommitment to bring down trade barriers at a time when global economic turmoil threatens to spur a new era of global protectionism.

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ASEAN's attempt to build a single market without an empowered central executive or a binding body of laws and mechanisms for dispute settlement will inevitably lead to problems of non-compliance, critics contend. There has long been an institutional reluctance to strengthen or establish either, due to the grouping's enduring commitment to non-interference and consensus in its dealings.

The tension between the perceived need to integrate to remain globally competitive and attract foreign investors who prefer the economies of scale opportunities in larger destinations such as China or India, and a reluctance to yield national sovereignty, will likely hinder the realization of the AEC's full promise.

At the same time, governments will remain free to pursue bilateral trade and investment deals independent of ASEAN, which trade analysts note has the potential to undermine ASEAN's goal of increasing its collective bargaining power with regard to bigger trade partners, including China.

China's emergence as an economic superpower has served as both an incentive for ASEAN to integrate to remain competitive in luring foreign investments as well as impetus for policies of nationalistic self-interest. Analysts believe that China's participation in more institutional frameworks for regional economic integration - such as ASEAN+3, which also includes Japan and South Korea, and the East Asia Summit, including China, Japan, South Korea, Australia, New Zealand, India and ASEAN - will over time only lead to greater economic and political interdependence between China and ASEAN nations.

The theoretical upshot of the new charter and its envisioned integrated regional economy through the AEC would be a stronger collective bargaining position vis-a-vis China than possible as individual nations. China's much ballyhooed "soft-power" initiatives towards the region, combined with ASEAN member states' residual preference for national policies over regional ones, could still make the AEC a non-starter.

Deft deployments

China's deft deployment of bilateral aid, loans, investments and trade deals has become an integral part of Beijing's broad strategy to create a regional structure in Southeast Asia that is more in line with China's strategic interests. While the United States still bases much of its regional engagement through security mechanisms aimed at containing China's supposed threat, many in the regional now view Beijing as a power that needs to be courted rather than repelled.

Indeed, many ASEAN countries remember that China resisted devaluing its fixed currency during the 1997-98 Asian financial crisis, allowing regional countries to depreciate their local units and export themselves back to financial health. The gesture was in sharp contrast to Western governments' approach, including demands for economic and financial reforms to pave the way for greater foreign participation in their debt-ridden economies.

China's foreign policy towards the region has often played on this sympathetic theme, presenting itself as a willing provider of no-strings-attached assistance, while the West appends conditions of democracy, rapid economic liberalization and good governance on its aid. China's outright donations are still small compared to many Western donors.

But when its wide range of assistance, including low-interest loans and trade and investment privileges are taken into account, Beijing is one of the largest bilateral donors to the region. It has also generated much goodwill throughout the region with symbolic assistance, in the form of financing Chinese-language schools, scholarships to study in China, study tours for government officials and frequent well-publicized diplomatic visits by ranking officials.

Artigo completo no Asia Times