GREAT POTENTIAL, GREATER RESPONSIBILITIES

Malaysia 2017 | DIPLOMACY | FOCUS: THE ASEAN ECONOMIC COMMUNITY

Often overlooked for its nexus at one of the most peaceful junctures of the world—and hence as somehow less dynamic than the Middle Kingdom or as awe-inspiring as the ever-exciting Middle East—the ASEAN block is nonetheless not to be taken lightly.

With 625 million people, ASEAN comprises nearly 9% of the world's population, and with a real GDP of USD7.6 trillion and a PPP of over USD12,000, is more than a 21st Century force to be reckoned with. Add to this the fact that many ASEAN nations were mired in total war a generation or two ago (Vietnam, Indonesia, Laos, Vietnam) makes the transformation in the past three decades all the more remarkable. That this massive and yet miraculously peaceful block is also straddled by three of the world's four largest religions, Buddhism, Islam, and Christianity, makes its unity—whether present or potential—all the more remarkable. If anything, the ASEAN countries are on pace to being the most successful of the 21st Century: dynamic, prosperous, democratic, hard-working, diverse, tolerant, and fun-loving, they have all the qualities that drive success—the aforementioned—without many that fuel destruction (belligerence, racial animosity, imperial ambitions, or grievances). All of this makes the recent passage and implementation of the ASEAN Economic Community (AEC) in January of 2016 all the more important.

Echoing to no small degree the European Economic Community from the 1950s, which segued almost seamlessly into the EU in the 1970s, the AEC is a major step in the evolution of what was originally only a political organ for peaceful regional integration. Now that the latter seems almost perfectly assured (apart from some intra-national violence in select pockets of Burma, Thailand, and the Philippines—each of which have in one way or another to with each respective state's long-term struggle to forcibly pacify if not subdue its Muslim minorities' political aspirations for more autonomy), AEC seems the logical next step in facilitating the free movement of goods, services, and skilled labor. This does not mean it will come easily: with a paltry staff of merely 400 people and a measly annual budget of USD17 million (barely half the value of most minor league American baseball teams), ASEAN will need to step up its bureaucratic game if the AEC is to actually have benefits. But worth trying it certainly is: combined, the ASEAN countries would make the sixth largest economy in the world, a figure that is only likely to grow all the more as their robust individual economies continue to outpace shrinking giants like the UK, especially with the (gradual) liberalization of places like Burma, Laos, and Cambodia into more global economic networks.

That being said, the challenges will be legion. For one, although 95% of tariff lines hover near zero, a litany of non-tariff barriers on goods and services make cross-border trade particularly costly and cumbersome. Worse, consumer laws, land codes, property rights, and investment rules are a long way from being harmonized at the regional level, and the lack of agreement on common and acceptable currencies—not to mention integrated banking structures—will only hamper small and medium-sized enterprises in the region. Moreover, the AEC has yet to address the question of the free movement of labor, including the purportedly “high-skilled” sector, and many countries impose prohibitive restrictions on individual firms looking to bring on foreign workers, skilled or not. Finally, though brand-new, the AEC has yet to address the question of migrant unskilled labor; until it does, millions of laborers, domestic workers, fisherman, and farmhands illegally flit between nations, their rights as precarious in one as the next.

That ASEAN combines some of the planet's greatest disparities does not make the task any easier—nay, they make it all the more urgent. To take but one extremely stark example: the trade of Burma (population 53 million) in 2013 was USD23 billion compared to Singapore's (population 5.3 million) USD783 billion, a glaring fact that only underscores the urgency of the task at hand all the more. If the AEC is to succeed in the years to come, it will have reach certain minimum benchmarks of uniformity in political, economic, and cultural standing among its members. If it does not take certain key steps toward mitigating these extremities, as people at the ASEAN Civil Society Conference recently warned, further economic integration may only lead to “worsening poverty, inequalities of wealth, resources, power and opportunities between countries, between the rich and the poor, and between men and women.” Like the AEC's potential strength as a block, an auguring that ought not be taken lightly.