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What Is ASEAN?
John Walsh, Shinawatra University, April 2007

The Association of Southeast Asian Nations (ASEAN) is a regionally-based international organisation with ten members. ASEAN was created in 1967 with five members: Thailand, Singapore, Malaysia, Indonesia and the Philippines. In a region divided by the Cold War and with warfare threatening Vietnam, Cambodia and Laos, there was a need for an international forum to promote peace and security, as well as economic growth. Since the governmental types of its members were both different and antagonistic towards each other, ASEAN has functioned from the beginning on the principle of non-interference. That is, no ASEAN government will criticize in public what another ASEAN government does in its own territory. Of course, private conversation is quite a different matter, although even so few heads of state in the region have ever been willing to listen to criticism from anyone else.

In addition to the five original members, Brunei joined in 1984, Vietnam in 1995, Laos and Myanmar (Burma) in 1997 and Cambodia in 1999. The ten members have a total population of half a billion people and a combined GDP of some $700 billion. Although many people in the region are poor, there are millions of wealthy people, while the island state of Singapore is one of the most advanced economies of the world.

ASEAN has been reasonably successful in preventing conflicts among its member nations. The Vietnamese invasion of Cambodia, for example, took place before either were members and the then ASEAN membership reached a unified diplomatic stance about the issue. The 1987-8 war between Thailand and Laos occurred prior to Laos’s accession to ASEAN. Confrontation between member states reduced considerably after Mikhail Gorbachev ended the Soviet Union’s support for Communist regimes in Southeast Asia and those states have all subsequently become involved in the capitalist economic system in one way or another. ASEAN has provided a forum in which governments have been able to communicate with each other when ideology would otherwise have kept them apart.

Economic Integration

From an early stage in its life, ASEAN also focused on economics in addition to security issues. In the years since 1967, most of Southeast Asia has been growing economically at quite a rapid pace, based on a greatly increased export industry which has relied on agricultural produce and manufactured items. The increases in Japanese labour costs meant that Southeast Asia became an attractive place for Japanese companies to relocate their basic manufacturing facilities and they were joined by Korean and European companies. Some investment was structured according to previous colonial links: for example, much British investment went to Malaysia while Dutch investment was focused on Indonesia, since companies from those countries had access to good quality information about those destinations. In any case, a new generation of workers across the region entered factories rather than stayed working in rice fields. They and their successors have helped in the enormous expansion of the middle classes in Southeast Asia and these are the people who are the consumers of imported goods and services.

ASEAN has been successful in reducing the level of tariffs operating in the region and, as part of the 2020 ASEAN Vision, the countries of the organisation committed themselves to creating an ASEAN Economic Community, which will by the year 2020 be a single, economic market in which free movement of goods and services will take place, easier movement of capital and promotion of investment. In some key sectors, economic integration will be accelerated, including air travel, e-commerce, automotives, textiles and apparel among others. Currently, there is a wide disparity in wealth between the ten members and in many cases between regions within the same country. Since the free movement of labour is not scheduled (although it is a very important economic reality), there are likely to remain important opportunities for investment in different parts of ASEAN for those companies already established inside.

Various attempts have been made to create sub-regional integration or co-operation areas within Southeast Asia. For example, Singapore has joined with Riau and Johor with a view to combining Singaporean capital and management skills with the abundant land and labour resources of its neighbours. Similarly, the Greater Mekong Sub-Region has aimed to promote a high level of integration among the riverine states of the River Mekong. To date, sub-regional initiatives have foundered owing to political differences. It seems that ASEAN as a whole offers a better forum for such discussions than smaller groupings.

The Three Partners

The three main external partners of ASEAN are China, Japan and South Korea. There are now regular meetings between ASEAN +3 aimed at promoting security, economic and transboundary concerns. A long-term vision is to create an East Asian Free Trade Zone, although there remain concerns that one country may be dominating others to an unacceptable extent. Previously, ASEAN states were concerned that they were threatened by the economic primacy of Japan; now countries are more likely to be concerned about dominated by China. Nevertheless, countries are committed to bringing about the partnership and steps are being taken, albeit often slowly. Problems remain with low levels of confidence between members and partners and the issues of low levels of technical capacity also hinder co-operation. Large amounts of Southeast Asia have still not been properly mapped, for example, while millions live in informal sectors of the economy about which little is known.

Future issues to discuss with the three partners include pollution and the environment, transnational crime such as human trafficking, money laundering and organised crime and movement of labour between different countries. These issues are potentially divisive and may assume greater importance in the future: the damming of the River Mekong on its upstream waters in China is already having an important negative impact on downstream users of the river in Cambodia, Laos and Vietnam. Much more communication and diplomacy will be required.


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