3 - ASEAN in Introspect and Retrospect

Summary

INTRODUCTION

There is extant literature on the Association of South East Asian Nations (ASEAN-10). ASEAN's continued success as a group of developing countries seems to be by default. It had the right initial conditions internally and externally, galvanized by good leadership, relative to the speed and record of other under-performing groupings. Its progress towards its free trade area (AFTA) and ASEAN Economic Community (AEC) has been variously diagnosed. Grand ASEAN plans seem paradoxically retarded rather than boosted by individual economies' nationalist-driven success or marginalized by the Asia-Pacific Economic Cooperation (APEC21) or ASEAN+3 (APT, China, Japan, Korea).

Intra-ASEAN trade is one reason for ASEAN integration. Free trade remains the best policy. ASEAN's greater extra-regional dependence on the United States and Japan may simply be replaced by China. In other words, unless intra-ASEAN trade becomes significant, the best scenario may realistically be to have AFTA-AEC diversify to more intra-Asian trade. Whether the Asian growth engine will be more powerful and sustainable than that of the triad (United States, Europe and Japan) is one unknown, whether AFTA-AEC is better off with exclusive Asian trade pacts, is another. The geometry of regional trade agreements (RTAs) gets more complicated and fuzzy as China, India and the synergy of information communication technology (ICT) join up with globalization and hyper competition. The ascendancy of RTAs and bilateral free trade agreements (FTAs) is both a cause and effect of the dysfunctional World Trade Organization (WTO), a victim of its own success in multilateralism as quantity enlarged through membership, is not commensurate with quality, given the increasing northsouth diversity.

After its first thirty years, ASEAN's comfortable momentum, or the ASEAN Way as a de facto regional hegemony and monopoly, is challenged. This chapter will argue that instead of viewing ASEAN in a success-failure dichotomy, ASEAN's pragmatic and realistic re-invention and re-engineering3 may retain it as a lynchpin in the East Asian-Pacific equation.