Mr Edward Robinson

To what extent has ASEAN succeeded in enhancing economic andpolitical development and security across Southeast Asia?

1

Abstract

This dissertation examines the effectiveness of ASEAN as a

forum for regional integration. It seeks to achieve this by

examining the models for studying and measuring the

effectiveness of regional organizations and establishing the

criteria for exploring ASEAN’s record since its inception in

1967. It explores the historical evolution of ASEAN over the

last forty years and seeks to explain some of the factors

which have driven its institutional transformation. This paper

then focuses on the role that economics and trade

(particularly RTA’s) in achieving ASEAN’s stated goal of a

ASEAN Economic Community. It considers the organisations

security arrangements and the changing shape of security

challenges it faces. The paper questions whether ASEAN’s

ambitions can be achieved given the constraints mentioned and

the organisations ability to create the structures necessary

to deliver them.

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TABLE OF CONTENTS

Introduction page 4

Chapter1: Regionalism and the South East Asian Context page9

Chapter 2: The Rise of ASEAN and its Role in EconomicDevelopment page 20

Chapter 3: The Challenge of Evolving Security Needs. page33

Conclusions page 50

Bibliography Page 57

Total Word Count: 15,176

.

Introduction:

4

What is Southeast Asia? Defining the boundaries of the term

is in itself problematic and a matter of some debate. Should

it include Sri Lanka or Papua New Guinea? The former is

usually associated with India but has become increasingly

politically closely associated with China and the later is

heavily influence by Australia but geographically shares its

landmass with Indonesia. In most modern interpretations it is

bound by the geographic limits of being East of India, South

of China and North of Australia, but this crude geographical

measure does not really go very far in defining what the

region is in terms of how it fits into a the complex world of

political, economic and social interactions. Regionalism is

not a physical but an intellectual construct, one which

compartmentalises the relationships between groups of peoples

and defines those differences through a set of commonalities.

There is in fact a strong argument for the case that the

process of defining regions is, in itself, a produce of

cultural and ethnic bias, and that we define regions in terms

of the relationship they have with dominant hegemons. As a

consequence the concept of regions is in continuous flux. The

‘Levant’, ‘The Indies’ and even ‘The Balkans’ are terms of

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regional identity that have fallen, to greater extent, out of

use, no longer relevant to the geopolitical needs of the age.

(WIGEN, 1997).

The idea of SE Asia as a discreet entity is a relatively

modern construct, dating back only as far as the post WW2 era.

(Emmerson, 1984) Its emergence was to some extent a response

to the geo-political shifts brought about the decline of

European Empires and as such was essentially framed by those

very same Europeans. The departure of the British from India

and the Dutch from the East Indies (Modern Indonesia)

necessitated a re-defining of the nature of the region.

Amitav Acharya (Acharya, 1999) argues that defining the nature

and limits of Southeast Asia’s region identity is in part

linked to the influences of the cold war struggle and the

desire of the regional actors to retain some measure of

autonomous influence and avoid the negative influences of such

asymmetric relationships. Proponents of Structuralism would

argue that the evolution of relationships between the

constituent nations, and the institutions they have formed to

manage those interactions, have in part acted to define the

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region. As a consequence our perception of what Southeast Asia

is, has been intrinsically linked to a study of its

institutions and especially ASEAN.

ASEAN itself is a far more diverse and complex and diverse

regional environment than the more homogenous and historically

interconnected European Union. Whereas The European Union

overwhelmingly has a common Christian heritage to shape its

cultural, ethical and spiritual outlook and form a common

perspective around which to construct institutions, no such

unifying feature binds together the Southeast Asian landscape.

ASEAN membership includes a wide variety of religious

experiences from Thailand (Buddhist) through Indonesia (the

world’s largest Muslim country) to The Philippines

(Christian). Perhaps more significantly the political systems

are equally diverse, including Vietnam (communist), Indonesia

(Democratic) and Myanmar (Military). (Acharya, 2012)

Why study ASEAN and it role in Southeast Asia at all?

Southeast Asia has a population of over 600 million (8% of the

global total and twice that of the USA) and a GDP of $1.8

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trillion (greater than India’s) as well as a greater

concentration of natural resources than either the EU or North

America. As a consequence the region represents a crucial

element of the future of the world’s economy, not only as a

source of natural resources but also as a market for goods.

Consumer spending is being fuelled by an emerging middle class

and as result the region is increasingly both significant for

MNC’s (Multi-National Corporations) but must develop

collective responses to this growing trade interdependence.

The average growth rate for ASEAN members is 5% whilst The

United States and EU are 0.5% (2012). The OECD suggests that

“Indonesia, Malaysia, the Philippines, Thailand and Viet Nam –

are poised to join Japan, Korea and Singapore in the ranks of

the advanced high-income countries within the next few

decades” (OECD, 2013) helping to elevate not only the region’s

economic potential but making its voice all the more powerful

in the international political arena. It sits astride the

Malacca straights, through which a third of all the world sea

traffic moves, and which acts as a pipeline for most of the

oil needs of China and Japan as well as exports to and from

the worlds markets for several dozen countries. Southeast Asia

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lies at the nexus of India and China and particularly one of

its potentially most destabilizing hotspots in the South China

Sea (Acharya, 2012).

The financial crisis of 1997 spurred the development of a new

group of sub-regional institutions such as the Asian Regional

Forum and an unprecedented number of FTA (Free Trade

Agreements) highlighting the need for greater co-operation

between Asian states in order to prevent some of the

destabilizing consequences of global and regional crisis. The

ethnic clashes which were witnessed in Indonesia and the

political instability which followed in Thailand during 1997-

2000 had the potential to de-rail the enormous economic and

political strides which had been made in the previous decade.

The regions political leaders recognised the vital need to

create mechanisms which strengthened the economic and

political security of the regions state actors. Added to this

was the growing influence of other regional governance models

such as NAFTA (The North American Free Trade Association) and

The European Union. The emergence of such collective

approaches to governance gave impetus to the needs of

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Southeast Asian states to develop a counter weight to these

powerful economic blocs.

This paper will seek to examine the theoretical approaches to

the study of regionalism in order to provide a framework

within which we can provide an analysis of the evolution of

Southeast Asia as a discreet geo-political entity it will

examine the origins, goals and actions of ASEAN in relation to

economic and security since its inception. The dissertation

will evaluate the relevance of and suitability of ASEAN to

meet the challenges of collective regional governance faced by

SE Asian nations in the next twenty years.

Chapter one will provide a review of the theoretical models of

regional governance and seek to explain their various

influence and perspectives on the study of regionalism. A

comparison will be drawn between the realist, neo-liberalist,

structuralism and complex interdependence approaches to

regional governance. This will then become the basis for a

discussion of the historical background of regional

organizations in general and ASEAN in Southeast Asia in

particular.  

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Chapter two will focus on the role of ASEAN in fostering

intra-regional economic development and trade with a

particular reference to its regional FTA’s (Free Trade

Agreements) and the institution building such as ASEAN plus 3,

the ASEAN Regional Forum (ARF), and the stated goal of

creating an ASEAN Economic Community by 2015 (Katada, 2007).

The impact and limitations of inter-regional relationships

will be considered and the influence of globalization and of

the emerging significance of India and China has on ASEAN’s

ability to act as an economic bloc.

Chapter three will reflect on ASEAN’s transformation from a

cold war warrior into a 21st century regional security and

order actor and to what extent it can influence and mitigate

inter-regional tensions. The influence of cultural and

political diversity will be considered as will the external

role of other significant state actors such as The USA, China

and India. The re-polarization of international politics and

the impact of increased security rivalry between China and The

United States will be examined with special reference to the

work of Evelyn Goh (Goh, 2007/2008). The Cambodia-Thailand and

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South China Sea disputes will be examined in order to judge

how far ASEAN can act as a peacekeeper.

The paper will conclude by considering the future of ASEAN and

reflect on some of the existing literature concerning possible

scenarios and models for future regional governance in

Southeast Asia. Particular consideration will be given to

Amitav Acharya’s ‘Asian Way’ and to what extent ASEAN can

evolve successfully to meet the challenges of globalization

and the re alignment of global perspectives in the Asian

century.

Chapter One: Regionalism and the South East Asian Context.

This chapter offers a brief explanation for the nature of

regionalism as an area of study and a review of the

theoretical models used to study regionalism as well as its

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role in the international political system. It will then

outline the historical evolution of ASEAN itself.

Regionalism has to a large extent, both as geopolitical

phenomena and as a field of Academic study, been a product of

the post-World War two era. The term itself has struggled to

develop a generally accepted and non- contested definition

which can act as a working framework through which academic

debate can proceed. Geographical norms are the most commonly

agreed upon means to define regions but is it entirely

meaningful to separate out South East Asia from the Pacific

countries? Does Turkey belong to the European model of

governance or that of the Middle East? Equally Louis Fawcett

has suggested that organisations which have at times been

classified as international (such as the Islamic Cooperation

Organisation and The Commonwealth) display many of the

features of regional entities. Although they are not bound by

a unitary geographic commonality they do share a cultural and

historic identification which draws them together, beyond a

shared set of policy objectives (Fawcett, 1996). For the

purposes of this study I intend to adopt a fairly geographical

definition of regionalism and use the widely accepted one for

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South East Asia, that it is bound by those countries which are

south of China, West of India and North Of Australia.

If one includes regional trade associations (FTA’s) then since

1945 there has emerged somewhere in the order of 300 such

institutions and the list grows with every passing year. There

functions include Trade, cultural ties, security, political

cooperation and technical transference. The reasons for the

rise of regional governance have much to do with the changes

in the International System brought about by the development

of the cold war from 1945 onwards. The identification of 1945

as a catalytic point for the development of regionalism is in

part a recognition that institutions evolve and emerge at

points when the International system is in a state of crisis.

Thus the vacuum of power left by the collapse of the great

colonial empires of France, Britain and The Netherland in the

years after 1945, and there replacement as hegemons,

encouraged the formation of new institutional responses.

Regionalism could provide a layer of state interaction capable

of addressing problems and opportunities which were particular

to geographical areas rather than universal, and therefore the

concern of the newly minted United Nations Organisation.

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Whilst the United Nations became a battleground of the cold

war, regional nodes could act to develop coalitions of mutual

interest and a productive means by which to conduct business

that abrogated the more serious ideological tendencies towards

bipolarization and conflict.

The division of the international system into two broad

ideological camps, led by two hegemonic powers (The United

States and The Soviet Union), forced smaller states to act in

order to improve their own security and in order to amplify

their ability to act on a more complex world stage. The

shadow of these behemoths, if anything, forced states to do

two things. Firstly, to form institutions which reflected

their ideological and political commitments in the great

struggle (NATO and The Warsaw Pact) and secondly to define

their own state policy objectives in ways which could allow

them to redress the wholly asymmetric nature of this new

global political landscape. The League of Arab States (LAS,

1945) and The Organisation of African Unity (OAU, 1963)

(Fawcett, 1996, p. 6) both were birthed from a desire create

some form of counter weight to the influence of the

superpowers. SEATO (1954) represented the opposite, a

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regional, security led, institution created by The United

States with the purpose of acting as a conduit for the

continuance of the cold war in South East Asia.

Although these early forms of regionalism were always seen as

limited by their need to act within the environment of a

bipolarized international system, which heavily restricted

their capacity to act effectively, they did provide

opportunities for states to develop models for institutional;

development. They also allowed for the expression of shared

concerns and some might argue fostered the growth of

regionalization itself through such work as The LAS’s support

for Palestine and The OAU’s crusade against apartheid in South

Africa.

By the 1960’s several theoretical approaches were developed to

explain the emergence of regional organizations but it was the

work of Ernst Haas which became the driving force for the

conceptualization of regionalism. Haas’s book "International

Integration: The European and the Universal Process,"

International Organization (1961) set out the basis for what

has become known as “Neo-functionalism”. Neo-functionalists

argued that the development of region institutions was

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characterized by three predominant causal factors. Over time

States experienced growing economic interdependence between

themselves and therefore had a need to regulate this activity

through institutionalisation. This then necessitated the

development of organizational capacity to resolve disputes and

build international legal regimes, and as a consequence of

this, supranational legal regimes replaced redundant national

regimes. The dynamic force in this process is not

predominantly national policy but a ‘spill over effect’ which

saw integration in one sector prompt incentives for further

integration in other areas. The development of the Common

Agricultural Policy necessitated integration of food

processing and labelling regulation and of course

transportation of good as well as border and customs

uniformity. As regulatory complexity increases so does the

development of further institutions on the regional level to

manage the increased functional complexity. Neo-functionalism

sees a form of organic growth to regional structures, each

level of growth deepening the need for greater integration.

The primary impetus for regionalization could therefore be

seen to be the functional needs of states to regulate their

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interactions and that this evolution is to a large extent

driven not by realist considerations of individual state power

but a form of interdependence and mutual desire to improve the

functionality of relations. This was to a certain extent

challenged by Stanley Hoffmann who argued that states remained

the prime actors in the development of regional institutions.

‘Inter-governmentalism’ recognises the role of institutions

(as do neo-functionalists, in opposition to realist

approaches) but argues that the progress and extent of

regional integration and governance is driven by convergence

and divergence of state policy preferences. In other words

during period s when the wishes of governments are in tune

regionalism undergoes growth but when they are not aligned

that growth declines or pauses.

The cause of Regionalization received its greatest stimulus,

as did its development as an area of academic study, through

the emergence of European Integration and the process of the

formation of the EU (European Union). The Marshall Aid Plan

was quickly institutionalized and transformed into the

Organisation For European Economic Co-Operation (OEEC)

(Calvocoressi, 2009, p. 158) acted as an early model of what

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might be achieved if the Western European states pooled their

resources. The formation of the European Coal and Steel

Community (1951) (Calvocoressi, 2009, p. 187)and it evolution

through the European Economic Community (1958) and into the EU

(1993) provided a powerful model for how regionalism could

work and became the focus for academic study of

regionalization and regional institutional development.

In retrospect Europe seemed the obvious place for

regionalization to be field tested. It had all the widely

recognised preconditions for successful metamorphosis. The

events of World War two had left the continent devastated, not

just its cities and populations but also its sense of

confidence and its willingness to act as a global hegemonic

force. Britain, France and Germany were all economically

ruined by the cost of fighting the war, foreign troops

occupied much of the continent and the former two had to face

the rapid disintegration of their global empires. Added to

this was the realization that they all were to a large extent

no longer first rate powers and their international freedom to

act was limited by the need to placate Washington and /or

Moscow. What Amitav Acharya points out about the emergence of

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Asian regionalisation as a product of decolonization (Acharya,

1999), is equally true of the dynamic of post war Europe. The

boundaries of state formation and disintegration are fertile

ground for the re configuration of national and regional

identity. Put simply when people are forced to consider what

it is to be a German (or an Indonesian) they can begin to

redefine their own geo-ethnic identity.

Western Europe, of course, had more than a shared political

experience of post-war recovery, Marshall Aid or the threat of

Soviet expansion to encourage collective efforts. She also had

a number of commonalities to help smooth the way to regional

development. Perhaps most crucially, they shared a common

Christian and Greco-Roman cultural heritage which formed the

foundations of public and private ethics and cultural

reference. When German politicians speak to their counterparts

in France it may be done through the medium of an interpreter

but they both form their ideas with the backdrop of a common

intellectual tradition and landscape.

The development of European Regional Institutions such as The

Council of Europe (1949), The Western European Union (WEU,

1948), The European Free Trade Association (EFTA, 1960) and

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the Organisation for Economic Co-Operation and Development

(OECD)1 were driven by mutual economic needs as much as shared

cultural sentiment. Greater regional cooperation would create

growth by eliminating inefficiencies in costs (most notably

the effect of tariffs on price competition) and offer a

greater influence on global trade negotiations because of

market share. As a united economic block, Europe could out

punch The United States or Japan and therefore increase its

influence over international agreements such as the GATT

talks.

It is perhaps not a surprise therefore that the European

Union had its genesis in the European Coal And steel Community

(ECSC), whose primary function was to regulate and administer

the production and utilization of primary industrial resources

between France, Germany, Italy, Belgium, Luxemburg and The

Netherlands. Closer integration on economic sectors would

encourage trade links and improve the quality of European

goods. The budget emphasis of the European Union today remains

1 The OECD replaced the OEEC as a permanent conduit for structural investment and planning.

21

overwhelmingly economic rather than culturally or militarily

orientated.2

The figures can however be misleading. Robert Schuman, The

French Foreign minister whose idea the ECSC was, declared that

its primary function was not to simply provide a supranational

institution to regulate resource management, but to tie the

countries into an economic union which would make war

“materially impossible”. From the outset, the path of

regional integration was about security. It was also about

responding to the influence of Europe’s regional history, two

devastating world wars made it a matter of survival that

Europe find some way to cure itself of the destructive scourge

of modern inter-state conflict.

A key factor in the emergence of the EU must be the fact in

1950 many ordinary citizens (and their political masters)

might have little faith, or commitment to, the goals of

regional integration; they did generally recognise each other

as fellow Europeans.3 Europe was a long established and 2 In the 2006, of the EU budget, 46% went on the Common Agricultural Policy, a further 30% on Regional Economic Development and a tiny 0.1% on cultural projects. Perhaps highlighting just how significant a common culture is to the leaders of Europe. 3 Mrs Thatcher , of course, once famously said "We have not successfully rolled back the frontiers of the state in Britain, only to see them re-imposed at a European level, with a European super-state exercising a new

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recognisable region. Its precise boundaries were (and still

are) under debate4 but few would argue that Europeans did not

consider themselves as belonging to a global region based on

certain geographical precepts just as Americans would. The

same cannot be said of South East Asian. The path to regional

development and governance has had to be laid using different

tools and in an intellectual and political landscape markedly

different from that experienced by Europeans.

Amitav Acharya in his recent book on regional Identity in

Southeast Asia (Acharya, 2013) quotes D.G.E Hall as saying

that Southeast Asia is a “chaos of races and languages”. He

goes on to say that in order to build functioning region

institutions it has been necessary for Southeast Asians to

‘imagine’ a regional identity. By this he means that unlike

Europeans or North Americans, Asians have had to build from

scratch a sense of what and who they are. A task which it

strikes me has much more in common with the ‘nation build’ or

national myth’ of US history than the integration of Europe.

dominance from Brussels,". (BBC, 8 April 2013)4 The contentious issue of Turkey and it credentials as a European state (not including Football) is a powerful reminder of how regionalization is constantly evolving process.

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According to Acharya, Imperialism and colonization have had a

great deal of influence in forming the preconditions for the

emergence of a uniquely Asian form of regionalism. The

struggle to achieve independence has made Southeast Asian

states protective of their nationhood and as a consequence

reluctant to surrender sovereignty to supranational

institutions. As a consequence regional governance was always

likely to be initially, institutionally weak. Opting instead

for a less formalized set of relationships which acted at the

inter-governmental level, focused on dialogue, rather than

formalized legislation and procedure. (BAOGANG HE INOGUCHI,

2011). Added to this was the lack of compatible institutions

on a regional level that any pan –regional association could

create policy or functional nodes with. The Common Market

could plug into a pre-existing set of institutions in which to

engage in a process of integration (WEU, EFTA, and OECD).

A cultural basis for regional independence had been suggested

much earlier than the formation of ASEAN, in the immediate

post-colonial era. Maphilindo5 (the vision of President of the

Philippines Manuel Quezon) sought to achieve regional

5 Maphilindo was the shortening of the states involved: Malaysia, Philippines and Indonesia.

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integration through the medium of pan-Malay cultural identity.

Its failure came as the result of three major influences, the

religious divisions between the Philippines and

Malaysia/Indonesia caused fundamental societal governance

issues, outstanding territorial differences and President

Sukarno of Indonesia’s policy of ‘Konfrontasi’ (Sakai, 2010)

(opposition to the formation of the Malaysian Federation).

Gillian Goh (Goh, 2003 ) however does point out that

Maphilindo did provide some early values which were to appear

in the ‘ASEAN way’ model. Most noticeably the rejection of

participation in military activities of the major powers (i.e.

avoiding dragging the superpowers into Southeast Asian

affairs. Also, the commitment to a procedural philosophy that

emphasised the ‘ASEAN way’ of ‘seek agreement and harmony, the

principle of sensitivity, politeness, non-confrontation and

agreeability’. A further attempt at regional coordination,

The Association of Southeast Asia (ASA, created by Thailand,

Malaya and the Philippines in 1961) (Calvocoressi, 2009, p.

489) fell apart over the sovereignty issue of Sabah and SEATO

was proven to lack the military teeth or political will to

act.

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ASEAN was therefore formed in 1967 with a series of challenges

and constraints which did not bode well for its survival,

indeed it looked destined to be as much a ‘paper tiger’

(Franklin, 2006) as SEATO had proven to be. Edward best and

Thomas Christiansen point out ( Baylis, Smith,& Owens, 2011)

that the timing of the creation of ASEAN had much to do with

the form it took. The on-going Vietnam conflict convinced the

founding members (Indonesia, Malaysia, Philippines, Singapore

and Thailand) that intra-regional conflict could lead to

greater ‘foreign intervention’ in their sovereign affairs by

external powers (particularly the USSR and The United States).

It was therefore desirable to find some medium to solve

disputes internally ( Baylis, Smith,& Owens, 2011, p. 436).

ASEAN, at its inception, would therefore predominantly be

about political and security issues, in stark contrast to the

EU, which began life as a series of economic regulatory

authorities.

This concern for sovereignty, lack of institutionalism,

preoccupation with the political rather than legal or

economic, and informality led to what has commonly become

known as the ‘ASEAN way’. This conceptualisation of

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regionalisation and regional governance would, it was

believed, reflect the different cultural norms of Asian

peoples when compared to the European model. Decision making

would be informal, flexible and consensual. This would result

in a process which was mindful of the cultural and political

differences between Southeast Asian nations and would

therefore be driven at a slower and more incremental pace.

Although ASEAN was formally established in 1967 it did not

hold its first summit until 1976 ( Baylis, Smith,& Owens,

2011, p. 436), out of which came the Treaty of Amity and

Cooperation Southeast Asia. This treaty was a vague and

symbolic declaration of ideals to which very few of its

signatories had any appearance of intending to aspire to. This

was after all the same Suharto who had masterminded the 1965

slaughter of Indonesia’s communist party and the same Marcos

who was engaged in systematically stripping his nation of much

of its economic assets. Indeed the declarations main function

was to demonstrate to the world that ASEAN intended not to

interfere in the internal affairs of their neighbours, thus

allowing each to safely continue their own agendas no matter

how oppressive. In its defence, the treaty was never intended

27

as an attempt to reform the governance practices of its

members, but to regulate their international dialogue and

avoid regional conflicts. This also represented a departure

from the methodology of European integration, The European

process deliberately used forced conformity in areas of

political and civil rights as well as harmonisation of

governance practices as a means to prevent inter-state

conflict and build regional identity.

In order to make a judgement on the effectiveness of ASEAN as

a regional organization and the process of Southeast Asian

regionalization as a whole it is necessary to put aside the

norms of European integration. Equally there is a need to

treat with a degree of caution, the theoretical models, which

whilst useful were conceived in response to European

experiences. The development of an ASEAN way is recognition

that cultural norms are potent forces in shaping the form and

function of institutions and relationships between states. In

the remainder of this article it is my intention to look at

how the actions of ASEAN, in the areas of economic development

and security, have helped shaped its evolution as a regional

influence.

28

Chapter Two: The Rise of ASEAN and its role in economic

Development.

29

ASEAN has undergone a great deal of transformation in the

first forty five years of its existence. It has fundamentally

altered its purpose from the original goal of regulating

relationships between its members in order to reduce the

influence of the superpowers and provide the peace necessary

to undergo the process of nation building. In those forty

years it has dramatically increased in size and fundamental to

this has been a move towards greater economic collaboration.

This change has been, to a large extent, the consequence of

the economic rise of Southeast Asia, the increasing political

stability of the young nations which make up the region, and

the rising significance of those nations to the world economy.

The aim of this chapter is explain the genesis of ASEAN and

its guiding principles, with an eye to explaining how its

guiding principles shaped its youth and adolescence. From the

early 1990’s it will be argued, ASEAN experienced economic and

geo-political events which combined to transform its nature

and shape the consequent growth of the organisation. The

question of how far economic integration and globalisation

helped influence the direction of ASEAN will be central to

this examination.

30

Indonesia’s GDP is 9.90 times greater than it was in 1967,

whilst in the same period The United States has grown 3.33

times. (Angus Maddison, 2010). This growth rate is reflected

in other members of ASEAN and combined with the end of the

Vietnam conflict and the fall of the communist regime in

Cambodia as well as reduced tension between Indonesia and

Malaysia resulted in a pocket of relative security. The period

from 1984 to 2000 saw an expansion in the organisation’s

membership and a deepening of its formal ties with wider Asian

and global actors. In January 1984 Brunei joined ASEAN (soon

after its independence from The United Kingdom was

recognized), Vietnam in 1995, Laos and Myanmar followed in

1997 and final Cambodia in 19996.

The non-institutional nature of ASEAN, its emphasis on

informal and collective decision making and its preoccupation

with maintaining the independent action of member states has

led to a starkly different structure to the EU. In obedience

to the ASEAN Way, ASEAN prefers to base the majority of policy

construction through summit diplomacy rather than legislative

assemblies or councils which are invested with any degree of

6 The Hun Sen coup briefly delayed Cambodia entry.

31

sovereign authority and power. A summit structure has allowed

the political elite of ASEAN countries to retain tight control

of the policy system. ( Baylis, Smith,& Owens, 2011, p.

436)During the life of ASEAN these meetings have become more

formalized and regular, from the first summit in Bali until

the Vietnam summit in 1998 there were a mere six summits. From

2001 onwards they became an annual event and after the

launching of the ASEAN charter in 2008 the meetings became

biannual. This increase in summits, It could be argued, has

made it more difficult to retain the informal and collegiate

nature of the meetings and as a consequence brought greater

public scrutiny to the policy formation process.

Following the withdrawal of Russian influence in Vietnam

(1979) and Vietnamese involvement in Cambodia, ASEAN began to

develop a more coordinated approach to external actors

(Calvocoressi, 2009, p. 490). The enlargement of ASEAN made

deeper engagement desirable. Singapore’s decision to allow US

navy vessels to resupply using its port made its neighbours

nervous, as did the creation in 1989 of APEC (Asian Pacific

Economic Cooperation). Instigated by Australia and including

The Unites States, Japan and South Korea, some Southeast Asian

32

nations saw it as an attempt to impose a western led control

of free trade in the region. Malaysian leader Dr Mahathir

counter proposed an alternative ‘East Asian Economic Caucus’

which would exclude Western countries (Australia, Canada, New

Zealand and The United States) ( Baylis, Smith,& Owens, 2011,

p. 437). This proposal was eventually killed off by the USA

bringing pressure to bear on South Korea and Japan to oppose

it, but the experience did force ASEAN to recognise the need

to engage in an increasingly globalized system.

In 1994 ASEAN responded by creating the Asian Pacific Forum

(APF), this formal 27 country ministerial meeting takes place

annually and discusses regional issues. For the first time

rather than an internal dialogue between members of ASEAN, a

global relationship of external conversations would take place

including the EU, China, Japan, India and the United States,

among others. ASEAN was moving beyond nation building and

fending off the encroachment of previous colonial powers to

engaging in a positive dialogue about the future direction of

the region with other interested parties. The collapse of

communism, globalization and increasing degrees of

interdependence apparent in the world economy made it

33

essential for ASEAN to construct a new web of relationships. A

plethora of new summits emerged, ASEAN Free Trade Area (AFTA)

was created in 19927 , the ASEAN plus three (APT, comprising

ASEAN plus Japan, Korea and China) in 1997, ASEAN-China also

in December 1997 and finally in 2005 ASEAN plus six ( also

called the East Asia Summit, also added India, Australia and

New Zealand). The Bali Summit of 2003 had seen the “Bali

Concord II” declaration in which ASEAN members announced the

intention of creating an ‘ASEAN community’ comprising of a

three pillar security community, economic, community and

socio-cultural community.

The creation of AFTA in 1992 represented a fundamental

departure for the mission statement of ASEAN, a paradigm shift

from a passive and reflexive, security focused institution,

primary concerned with preventing intra-regional conflict: to

a pro-active, trans-national regulatory authority. The

stimulus for the significant shift in the function of ASEAN,

it has been suggested, is the economic transformation of

7 with ominous echoes of Imperial Japan Singapore’s home Affairs minister George Yeo described it as “a new East Asian Co-Prosperity Sphere”! (D Jones, M. Smith, 2007, p. 160) George Yeo, "A New Greater East Asia Co-Prosperity Sphere?" in Greg Sheriden, ed., Living with Dragons: Australia Confronts Its Asian Destiny (Sydney: Allen and Unwin, 1995), p. 55

34

Southeast Asia itself since the 1970’s (L Cuyvers, W

Pupphavesa, 1996). The Southeast Asian economic area, moved

rapidly from being a collection of peripheral and

underdeveloped nations (whose primary function in the world

economy was as a source of raw materials) to become the

driving force for economic growth and the world’s fastest

growing market. AFTA symbolised the shift from Cold War

‘balance of power to economic powerhouse. Through the Common

Effective Preferential Tariff (CEPT) AFTA would allow ASEAN to

re-invent itself as a more interventionist body using trade

harmonization to reshape regional governance (L Cuyvers, W

Pupphavesa, 1996, p. 6).

The end of the Cold War may have produced global political

change, and therefore encourage greater integration of ASEAN

as an international organisation, but as both Calvocoressi and

Jones and Smith point out, it was the catalyst of the 1997

financial crisis that sparked a re-examination of ASEAN’s

regional position. ASEAN as a concept fed on the remarkable

rise of Southeast Asia’s ‘tiger’ economies. Singapore,

Malaysia, Indonesia and Thailand had all seen spectacular

growth rates in primary education levels, structural

35

development, increased GDP, export driven manufacturing and

perhaps ominously massive financial borrowing and Foreign

Direct Investment (FDI) (Calvocoressi, 2009, p. 490).

The 1997 financial crisis was partially the consequence of

large deficits being created by, at times unwise investment on

the parts of the regions governments, amounting to as much as

3-11% of GDP (Mukim, 2005). This coupled with the

devaluation of the Chinese Yuan and the yen made the pegging

of the Thai baht to the dollar unsustainable. When it was

floated the baht lost a quarter of its value, relative to the

dollar, in a matter of weeks. Suddenly dollar loans, which had

to reconvert into dollars on payment, forced many companies to

spectacularly lose market value. Since domestic banks often

acted as guarantors for such loans there was a wave of bank

collapses and the Thailand government lost most of its

reserves in a failed attempt to prop up the baht

(Calvocoressi, 2009, pp. 491-2).

The shock waves of fiscal meltdown rippled throughout the

region, Thailand’s $10 Billion of oversees debt was dwarfed by

Indonesia’s and the Rupiah lost four fifths of its value in

36

two months. The IMF was forced to lend $17 Billion to Thailand

and $43 Billion to Indonesia. Attached to these were stringent

growth capping rates and fiscal measures. Unemployment rose

steeply and vast amounts of accumulated wealth from a

burgeoning Asian middle-class was swept away in the collapse

of companies, banks and share prices. $115 Billion worth of

FDI fled the region in the aftermath, and as much as, the

equivalent of, 18% of GDP disappeared from Southeast Asia. (D

Jones, M. Smith, 2007)

The response of ASEAN to the 1997 financial crisis has been to

deepen institutional cooperation whilst retaining the ‘ASEAN

way’ of voluntary, consensual and informal policy

construction. The Chiang Mai initiative tried to rectify some

of the problems by developing a reserve fund which by 2003 had

exceeded $ 100 billion US, more than double the reserves

available to the Eurozone. This would act as a currency

exchange support mechanism that could offset fluctuations in

the base value of member currencies. Trade liberalisation and

a new vision of an ASEAN economic community by 2015 (or

possibly 2020) were official objectives, but allowing its

members to go at their own pace, pursue these common

37

objectives when and how they liked and change course if they

felt it necessary. This strategy has led to a high degree of

scepticism as to the effectiveness of economic integration.

There are a number of arguments which suggest that, although

the financial crisis did increase structural integration on

the surface, it also fundamentally altered the economic

relationships in the region. There was, according to David

Jones and Michael Smith, a divergence in the economic

direction and profile of Southeast Asian countries which

successively, over time, caused them to seek markedly

different economic policies. This drift away from

commonalities of experience and policy has undermined ASEAN’s

ability to create greater integration in the region. They and

others point to a number of factors which work to undermine

economic integration.

AFTA’s creation, it was argued, would deepen the nature and

extent of ASEAN’s programme of regional integration. The

leaders of ASEAN created the Asian Investment authority, Asian

Development Fund and other organisations with the intention of

using such institutions in a neofunctionalist way, according

to Solis and Katada. It was hoped that a regional,

38

multilateral, FTA, would stimulate intra-regional trade,

increase internal investment, encourage Foreign Direct

Investment (FDI) and reduce costs and thereby would naturally

cause a network of organisational structures to arise to

stimulate and regulate those activities (Solís M & Katada S,

2007, p. 247).

The desire to create a regional economic regulatory body was

also a response to global trends and pressures. Stephen

Hoadley points out that the further development of the

European Market, with the Treaty of the European Union (1992),

brought with it the fear of powerful trade blocs. This sense

of being out punched in global trade negotiations was further

heightened by the signing of the North American Free Trade

Agreement (NAFTA) in 1994. It seemed desirable and

strategically essential for ASEAN and the countries of

Southeast Asia to respond in kind (Hoadley, 2007). The

creation of AFTA was therefore in keeping with the original

function of ASEAN i.e. a fear of the influence of global

hegemonic (economic) powers which could interfere in the

region at the cost of smaller countries recently acquired

independence. AFTA has continued to benefit from the issue of

39

hegemonic rivalry and particular external powers desires to

counteract the influence of the United States and China in the

region. Both Japan and China have continued their cold war

antipathy into the twenty first century (of which more later)

by seeking to encourage institution building in Southeast Asia

( Solís M & Katada S, 2007, p. 245). Japan’s proposed Asia

Monetary fund and china’s massive degree of FDI in the region

are matched both countries attempts to woe ASEAN and form

FTA’s with its members. The China-ASEAN Free Trade Area ( the

world’s largest in terms of square miles) came into effect in

2010, and is as much about stabilizing China’s external

environment and projecting influence as a rising hegemon, as

it is about trade. Solis and Kadana suggest this is a form of

FTA diplomacy; it encourages regional integration but really

as a means of realist balance of power politics.

Free Trade agreements (FTA) exist to reduce tariffs,

eliminate quotas and regulate the traffic of goods and

services between constituent members. They can exist as

multilateral agreements between international bodies or as

bilateral agreements between individual states. It is the

proliferation and use of the later at the expense of the

40

former (in this instance AFTA) that could be said to undermine

the regional integration process in Southeast Asia. The

decline in economic commonalities within the region as the

states cease to be newly emerging economy and begin to diverge

in their experiences has led to a number of those same states

embarking on a process of developing bilateral FTA’s.

A number of ASEAN countries have been energetically spinning a

web of bilateral FTA’s since the mid-nineties which have not

only adversely affected the balance of trade within AFTA but

made negotiating as a collective more difficult. Partially

this is simply because these independent deals need to be

taken into account when ASEAN initiates any collective

negotiations which might involve the same nations. China for

instance has a FTA in effect with AFTA but also independently

with Singapore and Thailand. Singapore has a well-founded

reputation of enacting external economic policy in its own

interests and 15 of its 18 FTA partners lie outside of the

region (Hoadley, 2007, p. 305). Jones & Smith refer to John

Ravenhill’s8 argument that the Japan-Singapore Economic

8 John Ravenhill, "A Three Bloc World? The New East Asian Regionalism," International Relations of the Asia-Pacific, Vol. 2, No. 2 (August 2002), p. 181

41

Partnership Agreement of 2003 constituted a move towards

preferential trade partnerships in direct contradiction to the

stated objective of the Bali Concord II. Singapore is not an

isolated example of the tendency towards bilateral FTA’s in

the region. Thailand has been just as aggressive in forging

FTA’s, firstly with Bahrain in 2002, and then with China and

India in 2003. This ambitious start was just an opening salvo;

by 2005 it had entered into, or begun to negotiate, FTA’s with

Australia, New Zealand, The USA, Japan and EFTAi. Jones and

Smith voiced strong doubts about whether the philosophy and

loss institutionalism of ASEAN and AFTA made meaningful

regional integration possible. They argue that adherence to

the ‘ASEAN way’ of voluntary and informal action means that

AFTA and other ASEAN based economic institutions will remain

“largely cosmetic” (D Jones, M. Smith, 2007, p. 147)

The role of FTAs’ and of economic and trade ties is not

however exclusively a matter of fiscal benefit and internal

integration, as the experience of China and Japan has clearly

shown. The purpose of developing and deepening such links is

as much about pursuing, state actors, wider foreign relations

objectives, as it is about trade. The experience of India and

42

its enthusiasm for deepening ties with ASEAN is a case in

point. India annually has a trade deficit of almost $18

Billion dollars (2012), three years ago this figure was $six

Billion dollars ( P PAL and M DASGUPTA, 2009). This is a

considerable deterioration since the introduction of the ASEAN

– India FTA at the end of 2009 (Internatioal Enterprise

Singapore, 2012). Why then, if it was clearly going to lead to

a progressive decline in her balance of trade with ASEAN, was

India willing to engage in a FTA which promised few obvious

benefits? The answer may lie in the negative benefits, not in

what it does for trade with ASEAN, but what it signals about

India’s own intentions and her interests. It is noticeable

that in Pal & Dasgupta’s article quoted above there is a

significant amount of time spent not to the position of India

in Southeast Asia but the role that China plays.

As stated at the start of this article the traditional

definition of Southeast Asia is framed in terms of it being

east of India and South of China (WIGEN, 1997), indeed

Indonesia itself has India as the origin of its name and

Vietnam, Laos, Cambodia and Thailand were previously referred

to as Indo-China. The nations of ASEAN are caught neatly

43

between the two mostly likely candidates for global hegemonic

influence as the century progresses. Both China and India’s

size, potential economic imprint and population (India’s

population is expected to overtake China by 2050) make them

crucial factors in the economic and political future of

regional governance in Southeast Asia (Panda, 2010).

India is already a member of the ASEAN + 6 group and has

concluded a number of bilateral arrangements with members of

ASEAN (Malaysia and Thailand). India has been guided by a

‘look east’ foreign policy since the turn of the century. This

is in part recognition of the growing significance both

economically and strategically of Southeast Asia in the next

fifty years and partly because of the perceived significance

(or possibly threat) posed by China. India’s engagement is

about building the foundations of relationships which although

not particularly profitable now, will show enormous benefit

both politically and financially, in the long term. The

tendency of China and India to seek to combine both bilateral

and Multilateral RTA’s as a means of influencing relationships

might imply that the role of ASEAN has been enhanced and

economic relationships are influencing the significance of

44

regional governance, not only in economic activity, but also

diplomatic relations as well. Set against that is the

tendency for external powers to use bilateral RTA’s to support

that relationship, particularly with Singapore and Thailand.

Does this suggest an emerging two tier integration process,

with the some states retaining an asymmetric degree of

influence within ASEAN? Has the inclusion of the CLMV

(Cambodia, Laos, Myanmar and Vietnam) countries unbalanced the

distribution of influence within ASEAN itself?

Joshua Kurlantzick’s paper for the Council on Foreign

Relations9 regards the 1990’s expansion as having the potential

to adversely affect the capacity of ASEAN to pursue its goal

of a more integrated and less heterogeneous ASEAN community.

He argues that “enormous…… economic disparities exist between

the original and new members” (Kurlantzick, 2013, p. 9) and

points to the fact that capita GDP in Singapore is $48,357 by

purchasing power parity, while per capita GDP in Myanmar is a

mere $3,585 by purchasing power parity. He compares the

situation with the difficulties encountered by the ‘eastern’

enlargement of Rumania, Bulgaria etc. into the EU. Noting that

9 ‘ASEAN’s future and Asian-integration’

45

this resulted in complex trade, harmonization, labour movement

and corruption issues which helped contribute to the Eurozone

crisis. Yet economic inequalities and structural differences

are far sharper between Myanmar and Singapore (or Laos and

Malaysia) than between members of the EU, Mercosur, NAFTA or

even the African Union.

These differences make a single track integration of economic

sectors difficult and the situation is further hampered

because in order to manage and implement these changes the

CLMV states need to be fully engaged in the process at a

regional administrative level. Kurlantzick suggests that the

four new members, because of long periods of relative

international Isolation and lack of sufficient skill sets,

possess few skilled diplomatic staff capable of fully

participating in the process of regional economic integration.

This diplomatic and institutional disparity is reflected in

the economic and institutional infrastructure of states. Using

the Index of Economic Freedom as a measure Kurlantzick makes

the point that Singapore is one of the most liberalized and

dynamic economies in the world whereas Laos is its most

heavily protected and closed. This has the potential to retard

46

the development of AFTA because the member’s economies bare

such little resemblance to each other that transfer and

coordination inefficiencies escalate.

Kurlantzick does however admit there are some positive

indicators in the integration of the CLMV nations. Since

Vietnam joined ASEAN in 1995 it percentage of intra-regional

trade has grown from 2.8% to 17% by 2010. Considerable inroads

have also been made in developing the countries trade

infrastructure and upgrading economic and technical skills in

its bureaucracy. By upgrading civil administration to a

supranational level some of the disparity between quality and

efficiency of governance may be mitigated (Owen, 2013).

Writing for the Asian Development Bank, Professor Robert

Owen10, examined the degree to which differences in levels of

economic governance efficiency, have restricted integration

and development within ASEAN. Using World Bank ‘aggregate

Governance Indicators’ from 1996-2009, Owen sought to

establish the degree to which ASEAN countries were above or

10 ADBI Working Paper Series. Governance and Economic Integration: Stakes for Asia Robert F. Owen No. 425May 2013

47

below the efficiency frontier11. As a base line he compared the

ASEAN experience with that of the EU (which assumes that they

can be compared, meaningfully) and consequently drew some

conclusions about the steps necessary to improve ASEAN’s

chances of further integration. In order to narrow the scope

of the data, Owen focused on indicators which reflected levels

of public corruption.

In 1996, Brunei Darussalam, Malaysia, the Philippines, and

Singapore were on or above the frontier; whilst Cambodia,

Indonesia, Lao PDR, Thailand, and Vietnam fell well below it.

By 2009, both Malaysia and The Philippines had fallen (in The

Philippines case, considerably) below it. Only Thailand saw an

improvement in its corruption score. When Owen compared this

with the post Berlin Wall (1989) European expansion he found

that The Baltic States, Romania and Bulgaria all rose

significantly, with Romania moving from well below to well

above the frontier. He concluded that EU ‘adhesion’ had

significantly upgraded the capacity of states to integrate

into a regional community.

11 A sort of event horizon for national economic efficiency, you don’t really want to be below it.

48

Development in Eastern Europe came as a result of direct

regional intervention in the governance of member states;

coordinated, funded and legitimized through the movement of

power and authority from the national to the supranational

level. The ‘ASEAN way’ once again appears to be the focus of

criticism in the capacity for ASEAN to reach the next level of

integration. The commitment to respecting the independence of

each state and holding their sovereignty as inviolate means

that the power to harmonize economic activity is unlikely to

occur. The vested interest of parochial, and powerful,

national groups, and individuals, resist the movement of

governance authority because it undermines their ability to

retain their economic interests. On a higher, regional level,

the decision by richer countries, within the EU, to underwrite

integration costs through direct wealth transfer (subsidies)

is also a crucial factor. Intra-ASEAN direct fiscal

development aid is far lower than in Europe and this

significantly reduces the capacity of poorer states to improve

governance efficiency. There are many reasons for revamping

cooperative and multi-layered governance structures in Asia

while transferring decision-making authority to more

49

centralized regional institutions. Not only would this have

the tendency to create a level of regional governance and

management which is more technically trained in the field of

international governance but the would be increasingly less

tied to the agendas and interest nodes of domestic political

leaders. Put simply, they are less likely to act in particular

national interests or be swayed by such pressure.

Chapter Three: The Challenge of Evolving Security needs.

This chapter will seek to explain the origin and history of

regional security arrangements as they pertain to Southeast

Asia and the role of ASEAN in shaping those arrangements. This

will involve an exploration of how ASEAN has responded to a

variety of security challenges and to what degree it has

50

succeeded in meeting those challenges. Through a consideration

of the Third Indo-Chinese War and the Cambodia – Thailand land

dispute we will consider the effectiveness of ASEAN at dealing

with inter-state conflict in Southeast Asia. We will then

compare this with its experience and success at balancing

external actor influence on Southeast Asian affairs with

particular reference to the growing influence of China and

Evelyn Goh’s omni-enmeshment thesis.

Security studies as a discipline has changed dramatically

since the formation of ASEAN, it no longer is exclusively or

indeed primarily concerned with the relationships between

individual states nor conforms to the realist model of

consideration of purely power relationships between them

(Buzan, 1983). The increased interdependence of states

relationships and the forms of influence on their security has

expanded greatly. In considering security we must now add to

this original remit other non-conventional areas, such as

intra-regional security, environmental security, human

security, and resource security. ASEANs current security

arrangements have been influenced, and evolved in response to,

this expansion of demands as much as by events of the last

51

forty five years. This chapter will therefore conclude by

considering the emerging significance of non-traditional

security threats (human, environmental and resource security)

and make some observations on possible future demands on ASEAN

in terms of Southeast Asian security needs.

Security and conflict avoidance (if not resolution) lay at the

heart of the genesis and reason for being, of ASEAN. It was

foremost in its creators’ thoughts and central to their core

purpose. ASEAN, no more or less than any other International

Organization, was both a product of its time and shaped by the

formative experiences of the men and women who brought it into

being. These individuals were influenced, collectively, by

two powerful contemporary political processes. They, by and

large, had their political education in the shadows of

decolonization and their own nations struggle for

independence, and were (with the possible exception of

Thailand) engaged in the process of nation building

(Calvocoressi, 2009). As a consequence they looked to create

an Organization which would not impinge on that newly achieved

sovereignty and help to ensure its survival in the future. As

52

mentioned previously this helped shape the philosophy of ASEAN

right at its inception.

The founding fathers of ASEAN sought to create an informal

community of states who would seek to avoid engagements in the

internal affairs of each other and avoid conflict in order for

those states to focus on the process of securing their own

internal integrity as nations. The original concept of ASEAN

in fact sprang from the peace negotiations mediated by

Thailand between Malaysia, Indonesia and The Philippines over

territorial claims which threatened the intra-regional

stability and the capacity of those states to settle into

stable post-independence governance. This core concern is

reflected in the Treaty of Amity and Cooperation (TAC) signed

in 1976 at the organisations first conference. Here they made

clear that the guiding concerns of ASEAN were:

Mutual respect for the independence, sovereignty, equality,

territorial integrity, and national identity of all nations;

The right of every State to lead its national existence free

from external interference, subversion, or coercion;

Non-interference in the internal affairs of one another;

53

Settlement of differences or disputes by peaceful manner;

Renunciation of the threat or use of force; and

Effective cooperation among themselves. (ASEAN, 2013)

A brief perusal of these goals makes clear that ASEAN’s key

concerns were sovereignty, settling disputes, non-interference

in each other’s affairs and preventing external involvement

and influence in the independent sovereignty of member states.

Adam Malik, representing Indonesia, went on to described

Indonesia's vision of a Southeast Asia developing into "a

region which can stand on its own feet, strong enough to

defend itself against any negative influence from outside the

region." ( Jamil Maidan Flores and Jun Abad., 2012). This

strikes at the second core goal of ASEAN. The ideological

struggle between Communism and Capitalism had resulted in

foreign involvement becoming an ever increasing reality.

United States, Russian and Communist Chinese engagement in

Vietnam, Cambodia and Laos (not to mention communist and anti-

communist internal struggles in Malaysia, The Philippines and

Indonesia) had begun to seriously undermine stability and

development of the region. It became obvious that in order to

54

avoid becoming puppets in the superpower rivalry of the cold

war, and the ground upon which they could safely engage in a

series of proxy wars, the new nations of Southeast Asia needed

to group together in order to discourage external control of

their shared future security.

There were attempt, by ASEAN, in the 1970’s and 80’s, to

balance the desire to pursue an ‘ASEAN Way’ of maintaining the

‘soft’ institutionalism whilst at the same time coordinating

their response to external pressures and creating collective

security. This led to criticism that the organisation was

little more than a’ talking shop’ whose inertia encourages the

influence of major hegemonic powers (Goh, 2003 , p. 115).

Certainly the experience of the Third Indo-Chinese War between

Vietnam and Cambodia did not strengthen the suggestion that

ASEAN was capable of a more potent influence in relation to

regional inter-state tensions.

As a case study, the Vietnam – Cambodia conflict has been used

to both support the success of ASEAN’s strategy and to condemn

its role. The attempts to find a diplomatic resolution to the

conflict were both tortured and indicative of the issues which

have plagued the reputation of ASEAN as an adequate forum for

55

peacekeeping in Asia. Amitav Acharya wrote extensively about

the role of ASEAN in his 2001 book ‘Constructing a Security

Community in Southeast Asia’ (Acharya, 2001). He argues that

the experience of ASEAN in the peace process highlighted

important issues for ASEAN but also proved significant in its

development.

The Invasion of Cambodia by Vietnam (1979) in order to

overthrow Pol Pot’s regime was conducted, both in support of

domestic Cambodian groups in sympathy with the Vietnamese

regime, and in order to secure its own sovereignty against

what it saw as a rough state with close connections to China,

a growing regional power whose influence Vietnam feared.

Ironically these concerns, of external influence, were ones it

shared with ASEAN itself, although its support in this venture

by The Soviet Union was to lie at the root of the division

within ASEAN as to how to respond to the crisis. According to

Acharya, despite growing regional ties with ASEAN, Vietnam’s

invasion of Cambodia violated ASEAN’s norms of non-

intervention in other states’ affairs (despite the fact that

both nations were not in fact members of ASEAN) (Acharya,

2001, p. 81). The Invasion had two immediate repercussions on

56

ASEAN members; it risked drawing major powers into Southeast

Asian affairs and prompted the influx of large numbers of

ethnic Chinese refugees into neighbouring states.12 Vietnam’s

increasingly acrimonious relationship with China had led to

the expulsion of approximately 200,000 ethnic Chinese from

Northern Vietnam. The invasion of Cambodia by The Vietnamese

Army prompted not only a stampede of fleeing Chinese from

Cambodia but a policy of expulsion carried out by The

Vietnamese forces and their allies saw Cambodia ethnic Chinese

population as potential Communist Chinese sympathizers (Path,

2011).

ASEAN was divided as to what constituted the best response to

the conflict. Indonesia and Malaysia, perhaps because of their

relative distance from the conflict, and their domestic

antipathy to ethnic Chinese refuge incursion, sought a

diplomatic solution. This would be based on minimizing

external powers intervention and strict adherence to ASEAN

norms of non-involvement in domestic issues of other states.

12 It should be noted that tension between ethnic Chinese and other ethnic groups, is a constant cause of volatility in the region. The perceived relative wealth and influence of Chinese communities in Thailand, Malaysia and Indonesia is in itself a significant cause of security instability. Thereaction to the economic crisis of 1997 in Indonesia, which saw significantant-Chinese violence and human rights abuses together with hostility to Singapore, is evidence of this tendency.

57

Singapore and Thailand, as a result of proximity and

relatively higher amounts of Chinese ethnic make-up, sought a

more engaged approach. Whereas the non-intervention approach

aimed at isolating Vietnam, within the international community

and applying pressure to bring about a regional solution. The

Singapore led response believed ASEAN should develop a

coalition of intra-ASEAN military pressure to bring the

Vietnamese into a position of compliance. This would

inevitably rely upon a degree of extra-regional (USA) support

and therefore violate (according to Acharya) the goals of

ASEAN. It was this tension between the desire to regionalise

and internationalise the conflict which lay at the heart of

ASEAN’s hesitation and timidity in its response. Perhaps a

sign of the inherent flaw in the consensual approach to crisis

management which has at times plagued ASEAN.

ASEAN’s diplomatic focus was to deny legitimacy to the Heng

Samrin government (Acharya, 2001, p. 83) and to support the

existing Pol Pot government, a path which in retrospect did

not perhaps enhance ASEAN’s reputation for objective support

for human rights over the sovereignty of despotic ( not to

mention genocidal) governance. The Kuatan principle if

58

anything merely muddied the water. It recognised Vietnamese

strategic interest whilst seeking to encourage their military

disengagement, a solution unacceptable to either side. China’s

ill-fated and aborted invasion of Vietnam in March of 1979

only hardened Vietnamese position and strengthened Indonesia’s

view that the greater threat to Southeast Asia was represented

by China’s hegemonic desires. A ‘softer’ approach, from this

point of view would leave Vietnam as a buffer to the perceived

threat of Chinese expansionist policy. This stood in contrast

to the Singapore/Thailand position that The Soviet Union posed

the greater long term threat to Southeast Asia. The

consequence, for ASEAN, was an internal stalemate which

greatly reduced its ability to form an effective conduit to

the resolution of the conflict.

Whilst Acharya sees the actions of ASEAN as a constructive

(although not necessarily effective) attempt to uphold its

founding principles of respecting national sovereignty and

non-intervention, Jones and Smith draw a more pessimistic

conclusion (D Jones, M. Smith, 2007, p. 151). The Treaty of

Amity and Cooperation (TAC) was less concerned with Human

Security (the safety of the Cambodian people for instance),

59

nor in international security (in so far as it pertained to

the threat posed by a state who did not respect international

norms of behaviour, such as Pol Pot’s regime); but in the

sovereign security of states regardless of the their hue and

the moral repugnancy of their internal policy. In essence,

their existed within the points set out by the TAC a hierarchy

of principles. The Khmer Rouge’s ‘Democratic Kampuchea’

government had the right to freedom from interference and this

superseded the rights of their neighbour (Vietnam suffered

continuous border infringements from the Khmer Rouge between

1974-1979) (Path, 2011) or the human rights of ordinary

Cambodians, of whom 1.7 million died) . Using Non-Interference

as a basis for regional cooperation, it is argued by Jones and

Smith, led to not only division within ASEAN, and to a marked

decline in the reputation of ASEAN as a medium for conflict

resolution, but also exposed the flaw of working to a set of

principles which were not inherently concerned with conflict

resolution but with sovereignty protection. The main crucible

of concern for ASEAN members (and the primary source of

internal disagreement) was the role of external hegemonic

forces. The role of China in Pol Pot’s purge of pro-Vietnamese

60

elements in the Khmer Rouge and Vietnamese fear of

encirclement were the primary factors in Vietnam’s decision

to invade (according to Path (Path, 2011, p. 209) Cambodia.

This fear was shared by both Indonesia and Malaysia.

Vietnamese military and technological reliance of the USSR was

of great concern for Singapore. A desire to prevent major

power extension into Southeast Asia lay at the heart of

ASEAN’s vacillations during the 1980’s.

Amitav Acharya does make the point that despite the material

failure of ASEAN to bring about a resolution to the Vietnam-

Cambodia conflict the process did allow for the organisation

to develop its diplomatic experience through such events as

the Jakarta Informal Meetings (JIM 1 and 2) at Bogor in 1988

(Acharya, 2001). Equally Acharya concedes that non-

interference in internal affairs whilst paramount in the case

of Cambodia, is not in fact as sacrosanct as may be supposed.

The case of Cambodia- Thai relations is a case in point.

ASEAN’s new members have not always adhered to the established

norms as set out by TAC and Cambodia’s sheltering of Thai ex-

prime minster Thaksin Shinawatra from serious charges in

Thailand have led to tensions (Acharya, 2013, p. 7).

61

ASEAN’s ability to integrate new members to ASEAN norms of

behaviour, with regards to conflict resolution, has also been

tested by the Cambodian-Thai border dispute relating to the

Preah Vihear Temple complex issue. The border dispute

highlights historic and cultural dimensions to many on-going

areas of dispute in the region. Both countries have claimed

historic rights to the area and see the temple as a vital

cultural symbol. In 1962 the International Court of Justice

(ICJ) ruled in favour of the temple belonging to Cambodia, but

significantly was silent on the land surrounding the temple

site. This has been the nexus of claims and counter claims,

leading to outbreaks of violence since 2008 (European

Institute For Asian Studies, 2011). Significantly for ASEAN,

the United Nations Security Council (UNSC) called on both

parties to use ASEAN as a medium for resolving the issue,

indicating its desire to enhance the role of ASEAN in regional

governance and demonstrating the increased significance and

legitimacy of ASEAN in such matters. In response to this (and

in accordance with ASEAN’s charter which sets out guidance

focused on the role of the rotating chairmanship of the

organisation) Indonesia’s Foreign Minister Mr. Natalegawa was

62

instrumental in arranging talks involving the organisations

members and also APT and the APF.

Although the role of ASEAN could not be said to have ended the

Preah Vihear dispute it has helped expand and energise the

dialogue. Similarly ASEAN has helped, through its method of

informal dialogue, to push members to seek outside arbitration

over a range of other regional disagreements, most noticeably

through the ICJ. In 2003 ASEAN helped convince Malaysia and

Singapore to seek ICJ arbitration over the sovereignty of

Pedra Branca and Pulau Batu Puteh islands. Also, Indonesia and

Malaysia sought ICJ help in resolving disagreement over the

possession of both Ligitan and Sepadan islands (International

Institute For Sustainable Development, 2007, p. 6). Despite

both sets of disputes having been in existence since at least

the 1970’s, it could be argued that increased institutions

convergence, represented by APT, APF and the ASEAN Concord II,

helped create a climate of political will for resolution of

the issues and regional territorial stability.

If balancing ASEAN’s commitment to internal non – intervention

has provided challenges to her capacity to form a meaningfully

63

integrated regional security arrangement in Southeast Asia,

then balancing the intensions and influences of external

actors ( a goal that lies at the very heart of ASEAN’s

founding principles) has proven equally complex. Since the end

of the Cold War, and freed from the attendant need to resist

West/Soviet desire to use the region as a geo-political forum

for balance of power, ASEAN has been presented with the

opportunity to redefine its role. In doing so it has had to

respond to a number of significant changes in the landscape in

the region. Most pressing of these has, perhaps, been the

emergence of China as an economic, political and military

hegemonic influence and how the United States and domestic

actors can respond to its rise.

Since the collapse of Communism and the bipolarised world of

the Cold War era ended, the International system has had to

form new networks of interaction to cope with a number of

interconnected and influential forces in international

relations. These include economic globalization of capital,

increased non-state violence and terrorism, the rise of China

as a regional (if not global) hegemonic power and the

emergence of new non-traditional security issues that

64

challenge states such as environmental and resource

degradation. The response to these by ASEAN has been mixed

but has powerfully influenced the reconstitution of its

mission with regards to security. Having been founded as a

security alliance aimed at minimizing the impact of the Cold

War on Southeast Asia and suppressing the threat of Communism,

ASEAN has had to reinvent itself since this initial raison

d’etre ceased to have relevance post 1991. The old certainties

of the Cold War have given way to what Philip G Cerny13 called

the ‘durable disorder’ of the twenty first century.

Jones and Smith argued that prior to the end of the Cold War

ASEAN represented a weak group of states who sought to achieve

a passive security arrangement in the region through a soft

process of dialogue and agreed non-interference in each

other’s affairs. Although they did recognise Nicholas Busse’s14

argument that the region was acquiring a sense of “shared

identity” (D Jones, M. Smith, 2007, p. 152) and through social

13 See Philip G. Cerny, ‘Plurality, pluralism and power: elements of pluralist analysis in an age of globalization’,in Rainer Esifeld, ed., Socio-political pluralism, ‘Pluralism: developmentsin the theory and practice of democracy’,no. 16 (Opladen and Farmington Hills: Barbara Budrich for International Political Science AssociationResearch Committee, 2006), pp. 81–111.14 Nikolas Busse," Constructivism and Southeast Asian Security, Pacific Review Vol.1 2,N o. 1(1999)p, . 59

65

and political interaction via ASEAN’s ‘talking shop’ had

evolved a sense of shared “political culture”. Indeed since

1991 ASEAN has been seen to be prolific in developing a number

of institutions and mechanisms for the reconfiguration and

management of regional security arrangements. The creation of

the ASEAN Regional Forum, in 1994, brought together a wide

variety of stake holders in the region in order to foster

peace and security and seek resolution to areas of conflict

and tension. The ARF includes the original ASEAN nations, and

regional Asian powers such as, China, Japan, and South Korea,

as well as the U.S., Russia, India and Australia. (Beeson,

2010). The forum has managed to place ASEAN at the heart of

formal security arrangements in the region and in this sense

has done much to improve the image of ASEAN as a legitimate

focus for international dialogue. Beeson does point out

however that the constituent make up of ARF can be a source

for difficulties in making it effective. There is a perceived

gap between its Asian member’s preference for consensus and

non-binding (‘ASEAN way’) discussion and the Anglo-American

approach of problem solving and demonstrative engagement.

66

The ARF has formed the foundations for a wider and deeper

commitment to collective security arrangements, given focus

and clarity in the Bali Concord II and the publication of the

ASEAN charter which envisages a ASEAN Security Community (ASC)

by 2020. In essence, this is a reworking of the TAC but with

clearer commitment to working collectively to solve regional

issues and prevent intra-regional conflict. Evelyn Goh has

suggested that ASEAN’s development has been an attempt to

balance the range of pressures outlined above with a need to

respond to a transforming balance of power hierarchy in the

region. She explains that any analysis of regionalization in

Southeast Asia “defies straight forward applications of

realist or liberal logic because the strategic thinking here

has been aimed at facilitating the transition to a certain

kind of regional order rather than simply responding to

systemic changes by choosing sides” (Goh, 2007/2008, p. 118).

In other words seeking to explain away the approach of ASEAN

in terms of western realist or neoliberal constructs fails to

recognise that the priority from an Asian perspective is not

to solve the problem, but to inculcate changing realities and

adapt in order to absorb them.

67

Far from sitting on the fence, Goh argues that the states of

ASEAN are seeking to influence the flow of events, and the

shape of future relationships, using norms which encourage the

extra-regional hegemonic powers to become ‘enmeshed’ in

Southeast Asia. This reversal of the previous cold war

philosophy of ‘arm’s length’ security dynamic aimed at

reducing ‘great power’ engagement in the region, to a new

interaction which encourages those same powers to become

involved in the regions strategic affairs is referred to by

Goh as ‘Omni-enmeshment’. This strategy is in part recognition

of the differences within ASEAN as to which of the major

influences poses the greatest threat to regional order.

Whereas Indonesia, The Philippines and Vietnam all see the

China as the greatest potential dominant force, Singapore is

concerned about the economic influence of Japan and Laos and

Myanmar to lesser extent fear US interference. In full

compliance with the ‘ASEAN way’ philosophy of allowing states

to follow their own course; the APF is used as a vehicle to

engage all the powers in the process whilst allowing

individual states to conduct bilateral arrangements with

external powers. Thus Vietnam conducts joint military

68

exercises with China whilst Singapore signs a naval exchange

and basing programme with the US navy.

Whilst there has been doubts raised by scholars such as David

Jones as to the impact of the ARF and ASEAN Plus Three (APT)

forums as a means of influencing the regional policy of China

or The United States it has deepened their commitment to the

process of using ASEAN as a medium of engagement. China signed

up to TAC in 2003 (as did India), Australia followed suit in

2005 and The United States signed the third protocol in 2011.

Goh (Goh, 2007/2008, p. 114) quotes James Kelly (assistant

Secretary of State for East Asian and Pacific Affairs as

saying that China foreign policy is aimed at "expanding its

influence in Southeast Asia by enhancing its diplomatic

representation in, creating foreign assistance and signing new

bilateral and regional agreements”. The real test of this

approach is, however, the degree to which this ‘locking in’ of

major powers into the ASEAN system has any impact of improving

wider security and dispelling tensions. The South China Sea

dispute has in some senses become both a test case for the

effectiveness of the model and an ever present shadow looming

over the organisations plans for the future.

69

The dispute centres around an area of enormous economic and

strategic significance on both a regional and global level.

The South China Sea is bordered by four members of ASEAN

(Malaysia, Vietnam, The Philippines and Brunei) and is host

to, not only some of the world’s most significant trade routes

(approx. 80% of Japan’s oil needs travel through the area),

but also significant oil and gas reserves. The area includes

many submerged and semi-submerged reefs, the Spratly and

Parcel Islands and a large area of open water. Vietnam claims

both sets of Islands and occupies 21 of the Spratly group; The

Philippines claims The Spratly Islands and occupies most of

the remaining group. China and Taiwan claims almost the entire

South China Sea area including both sets of Islands and the

remaining nations claim areas within their Exclusive Economic

Zone (EEZ) (Acharya, 2013, p. 9). There have been a number of

incidents which resulted in military clashes the worst of

which saw 65 Vietnamese military personnel killed in 1988 a

naval encounter with China (PRC) ( McDevitt, Fravel & Stern,

2013).

According to Acharya the dispute both demonstrates the

efficacy of ASEAN strategy for dealing with disputes and the

70

potential future problems for resource security in particular.

After a protracted process of negotiation in the 1990’s, ASEAN

managed to convince China and other interested parties to

subscribe to a Declaration on the Code of Conduct in the South

China Sea (DoC 2002), whilst failing to achieve a larger

objective of a Code of Conduct. This has been broadly

successful in managing the problem whilst failing to solve any

long term issues. In essence the problem has been shelved

whilst each country has little ability to exploit the

resources under the seas of the area. Acharya, however, points

out that as capacity to deep drill for gas and oil improves,

the issue is likely to become more critical. He suggests that

ASEAN has a tendency to deal with contentious issues by having

them “swept under the carpet”. The growth of China, its

creation of a blue ocean naval capacity, and the increasing

need for oil in its domestic economy are all pressures likely

to re-ignite the problem.

China’s regional strategic intentions are crucial here. If

China is content to work in a collaborative and equitable

manner with its neighbours to achieve increased wealth and

influence then the South China Sea issue has every chance of

71

being solved by regional negotiations. If, however, China

wishes to achieve an asymmetric position of dominance as a

hegemonic power, control of the South China Sea will allow it

to excerpt powerful economic and strategic influence over its

neighbours. Chinese control of maritime traffic or exclusive

economic rights are unlikely to be accepted by Vietnam, The

Philippines and especially Japan. Recent events in the North

China Sea, where China declared a new air defence zone (ADIZ

which covers the Senkaku/ Diaoyu islands that Japan

administers, do not bode well for the future (BBC, 2013). A

move towards a more aggressive policy by China (partially in

response to perceived growing nationalism in Japan) could

easily be a test bed for Chinese policy in the South China Sea

area.

The United States has a complex and multi-faceted interest in

the region and its history of engagement continues to inform

and influence its current and future stance. The Vietnam

conflict has made The United States cautions of military

quagmires and has made it reluctant to become over committed.

Equally, the ASEAN states are even more cautious of

encouraging the world foremost military power to become

72

interested in the regions problems. Set against this is the

obvious need to secure the vital trade routes that criss-cross

the area and pre-existing, strategic commitments to defend

Taiwan. The policy of the United States has been by and large,

been a preference to create bilateral relationships and

agreements with states within the region. This is reflected in

the fact that it did not sign up to the TAC agreement until

2011 and by its unwillingness to engage in the forum framework

developed by ASEAN in the 1990’s.

The September 11 attacks and the subsequent ‘War on Terror’

proved the catalyst for the United States to restore its

interest in Southeast Asian affairs. Not only did it seek to

gain a broad base of international support for it response to

the attacks, but Indonesia, and to a lesser extent Malaysia,

represent a very large portion of the world’s Islamic

populations. Despite early success, such as, the Joint

Declaration for Cooperation to Combat International terrorism

signed with ASEAN in 2002, Relationships have been difficult.

Whilst Malaysia and Indonesia have welcomed US support for

their continued conflict with domestic extremist group ‘Jemaah

Islamiah’, US foreign policy has alienated much f the Islamic

73

element of the region’s population (Kurlantzick, 2013, p. 8).

The Bush administrations invasion of Iraq and Afghanistan and

its use of extra-judicial means, to pursue its enemies in

Pakistan, Yemen and across the globe, have made it difficult

for Islamic ASEAN states to ignore negative public opinion.

The Obama administrations signing of TAC, dispatch of an ASEAN

ambassador and re-engagement with Myanmar (all part of the so

called ‘Pacific Pivot’) have gone some way to repairing

fences. Added to this, The U.S. - Indonesia Comprehensive

Partnership agreement signalled a willingness to offer clear

support to the organisations states that are involved in the

South China Sea dispute, and we see a possible pattern for US

regional strategy. Build relations with ASEAN, increase US

military presence through bilateral exchanges, and in doing so

reassure the region of the US commitment to preventing Chinese

aggression.

Increased resource interdependence and disputes which are

based on access to natural resources are increasingly

significant in the region beyond the South China Sea. Water

access has become an issue along the Mekong River,

particularly with the construction of dams in China and Laos

74

which affect water flow in Vietnam. The environmental impact

of slash and burn (haze pollution) crop replacement in Sumatra

has caused a noticeable souring of relations between Indonesia

and Singapore. ASEAN has sought to address these issues

through both the APF and using EEP (eminent Expert Panels)

conferences such as the ASEAN Regional Conference on Food

Security 2013 to create opportunities for dialogue. However,

Jones and Smith suggest that the root of these security risks

for the future lie with the economic development disparity

between the wealthy ASEAN states (Singapore for instance) and

those with higher levels of wealth disparity (Indonesia).

Indonesia for instance has responded to complains from

Singapore over haze pollution by pointing out that the

practice is to large extent carried out on behalf of farmers

who are encouraged to use the methods by Singaporean food

companies (Faridz, D, 2013). ASEAN’s efforts to mediate the

haze programme have drawn criticism for the likes of Jones and

Smith in the past who point out that the 1995 Regional Action

Plan on Tran’s boundary Haze did little to improve the

situation (D Jones, M. Smith, 2007, p. 175).

75

ASEAN’s future as a security community is dependent on its

ability to balance a desire to avoid interference in domestic

affairs and policies of its members whilst recognising the

increasing Trans state nature of security issues themselves.

Environmental, resource and Human Security not to mention

terrorism are areas that demand coordinated approaches which

should be perfectly suited to a regional response. Issues such

as Avian flu are perfect examples of the transformation of

security from, a conventional concern, centred around national

sovereignty, to a broader and globalized concern which

requires a more pro-active and co-ordinated response.

Unfortunately the lack of institutionalization in ASEAN, makes

this very difficult in practical terms (D Jones, M. Smith,

2007, p. 169). The reluctance to move beyond consensus and

soft influence has severely restricted the degree to which it

can influence events. Security is as much about the reduction

of asymmetric power relationships as it is about addressing

tangible and concrete present day threats, or future fears.

Haacke points out that, in some senses, the original goal of

ASEAN, was not only about discouraging the hegemonic ambitions

of external powers but constraining the ambitions of domestic

76

and local powers. Indonesia (and to a lesser extent Vietnam)

represent a potent influence on their neighbours, one which by

tying down and binding in, to a shared regional architecture,

it is hoped can be diluted. If the EU exists, in part to

answer the ‘German question’, and diffuse Germanic hegemonic

influence, into a peaceful European whole, then ASEAN has, to

a lesser degree perhaps, been inspired by the parallel need to

restrain the economic, cultural and military potential of

Indonesia.(Jürgen Haacke and Paul D. Williams, 2009, p. 7).

Conclusion:

The purpose of this paper has been to explore the history of

ASEAN, chart its course since it set out on the high seas of

international diplomacy, in 1967, consider to what extent it

has changed course (and indeed form) and attempt to ascertain

what future may lie over the horizon for it. In doing so this

paper has sought to look for signs that the organization has

grown and evolved from a weak and timid security organisation,

who simply wanted to be left alone, into a mature, confident

and pro-active forum for regional governance. In order to

limit the scope of the investigation, it has been necessary to

focus on economic integration and issues relating to security.

77

In doing so, it is certain that we have neglected ways in

which the ASEAN has succeeded and failed, but it is these

areas which are crucial in forming the backbone of a Southeast

Asian regional identity and are indeed defined as such in the

ASEAN charter itself.

In coming to any conclusions about the success of ASEAN in

using greater integration and regional governance as a means

to development in Southeast Asia, we need to reflect on the

process of change. The economic and security environment which

faced the original members of ASEAN have changed, as much as

they themselves have changed, each under the influence of the

other. In 1967 ASEAN was an organisation of undemocratic,

authoritarian and poor states that had little in common except

mutual mistrust. By 2013 the organisation has expanded

significantly and Indonesia, Thailand, The Philippines and

Singapore have all moved down the path of democratic

institution building. Recent developments in Myanmar hold out

the hope that it too has seen its darkest days behind it. Is

this the influence of norm creation? Has ASEAN gently nudged

its members towards a more peaceful and pluralistic, political

society? The ASEAN charter (2008) may have been criticised for

78

being wildly ambitions and unrealistic, but the fact that it

committed the member states to “the principles of Democracy

and constitutional government” is a significant step. It

represents the emergence of political norms which did not

exist before, by subscribing to a set of agreed political and

civil ideals ASEAN’s members are setting out a road map of

political development which they share. Does this commitment

to democracy really matter? No democratic nation has fought

another since the dawn of the twentieth century; no ASEAN

state has engaged in conflict with another since it was

formed, Norms creation and democracy are a key mechanism for

the creation of stability and security.

This paper has sought to deal with the question of integration

and regional development by dividing the discussion in to two

areas, economics and security. It would therefore be best to

draw any conclusions by addressing these two areas separately

and then considering any factors they have in common at the

end. Poverty was perhaps the defining trait of ASEAN

membership (even Singapore was some way from its status as a

beacon of affluence in the region), since then its members

have undergone an unparalleled period of growth and expansion.

79

Indonesia, Malaysia, Thailand and Vietnam have consistently

posted growth rates two or three times those of the developed

world. Despite the 1997 economic crisis the region continues

to race head long towards developed nation states in many of

its members. ASEAN’s focus has shifted from one of regional

security to economic integration; a fact testified by the

plethora of mechanism it has created to regulate economic

discussions AFTA, CEPT, Chiang Mai Initiative, and ASEAN

Macro-economic and Research Office (AMRO).

What is clear from the content of this paper is that the

massive increase in economic activity in the region and the

globalization of trade has significantly changed the

relationship between economic activity and the nation state.

The degree to which it is desirable (especially on the part of

transnational companies) or even possible for nations to

regulate the flow and nature of commerce is now questionable.

This is because both individuals and institutions operate on a

global level, in complex webs of economic activity and it is

no longer relevant to regulate this at a state level. It is in

recognition of this, that economic regionalization has

occurred (The EU, NAFTA), ASEAN has seized the initiative

80

during the last twenty years to emerge as the preferred

mechanism for macroeconomic negotiation and dialogue within

the region. Much has been done by ASEAN to guide intra-state

policy with regards to trade, and although the goal 0f 2015

for the completion of CEPT based tariff reduction is unlikely

to be met it is remarkable that it has happened at all given

the profound differences between members (Singapore, a liberal

economic state and Laos a communist command economy).

Kurlantzick and Owen’s points about the problems associated

with divergent economic development between regional states

are significant, and likely to become more so in the future.

ASEAN goals have to be suitably vague in order to allow for

the economic realities of Singapore not to clash with those of

Laos or Myanmar. As integration advances the need for these

states to work to the same rules and within the same patterns

of behaviour is likely to give rise to tensions. A common

market would demand common standards of behaviour, economic

norms creation, if you will. For this to operate, political

convergence is essential as is standards of legal practise and

interchange. It is highly questionable whether the CLMV states

81

are likely to be ready for integration of their economies with

those of Malaysia or Singapore in the near or even medium term

future.

Whilst the globalization of trade has, as previously

mentioned, led to a growth in regional dialogue it has also

led to the growth of bilateral FTA’s which have emerged as a

rival means of regulation to the work of AFTA. FTA’s act as

much more than mechanisms for bilateral trade, they also act

to create transnational forms of regulation and economic

justice which weaken collective norm creation and diffuse

attempts at regional integration (Jones, 2008, p. 740).

Wealthier states have shown a preference for independent

economic ties with extra-regional economic powers and

organisations. This pattern has reduced the degree to which

ASEAN can deepen its ability to direct the shape of future

markets. ASEAN nations still trade much more with other

nations than they do with each other, the growing influence of

India and China has accentuated this and despite agreements

brokered by ASEAN they both continue to develop separate

networks of trade. This is also reflected in FDIs’, which is

82

not only imbalanced within the region but increasingly

asymmetrical between China and ASEAN. Since 2000 Southeast

Asia has been superseded by China as the preferred destination

for FDI (Jones, 2008, p. 742) and this has not only slowed

economic development but led to an increase in the disparity

of development within the region.

Without the development of more robust regulatory institutions

and an equal willingness for ASEAN members to cede the

necessary economic regulatory authority and sovereignty (which

would require a move away from the informality of the ‘ASEAN

way’) it is hard to see how a common market can be achieved.

Acting as a single economic bloc capable of negotiating in an

equal footing with China or Europe will become progressively

harder as the globalization of the world’s economy creates

ever more complex patterns of interdependence which threated

to bypass the more informal institutionalism of ASEAN.

What is true concerning economic integration is even more so

in the more politically charged area of security. On the

surface ASEAN has been very successful at fulfilling its

83

original purpose, as a vehicle for peace and security. The

regional has been relatively free from conventional conflicts

in the last thirty years, more so than even Europe (the

Yugoslav conflict has shattered Europe’s record in this

respect) and the tide of intervention by external powers

receded with the end of the Vietnam War. This record however

looks set to be tested by two influences. Firstly, the nature

and scope of security has evolved to embrace a wider range of

forms, environmental, human and resource conflict all pose

serious threats to the region. The capacity of ASEAN’s non-

intervention, low impact philosophy to adequately deal with

these is in some doubt. Secondly, the tide for external

engagement may be turning once again, and this may prove to be

the greatest test that ASEAN faces over the next ten years.

Both of these factors are the consequence of Southeast Asia

increasing interdependence in a shrinking and globalized world

community.

ASEAN’s ambition to create an ASEAN Political-Security

Community is tied to the creation of shared norms for

political and security behaviour and by the creation of

84

institutions that can realize and regulate these norms. The

increasing pressure on resources and ownership of those

resources challenge the capacity to do this. Furthermore the

considerable cultural differences of the member states make

agreement on what forms those norms take are likely to be

difficult. Islamic fundamentalism is still a transnational

issue for Malaysia and Indonesia which threatens to continue

to undermine the political hegemony of these states. The

tensions between Muslim minorities in Thailand and Myanmar and

there governments look likely to cause problems for relations

between the governments of the effected states.

President Obama’s re-pivot towards the pacific is as much

about addressing international non-state terrorism as it is

about China. The continued conflict between The United States

and Islamic fundamentalism is likely to continue to create

tensions between Indonesia, Brunei and Malaysian domestic

sensitivities and the West. The rise of China, its regional

influence and its relationship with the USA have the potential

to cause a new Cold War in Southeast Asia, particularly with

regards to its stated desire to achieve strategic control of

85

the vital South China Sea trade route. Recent events in The

North China Sea suggest that the other Asian powers of Korea

and Japan are equally nervous of China’s intensions. Should

ASEAN seek to be part of the process of reducing tensions or

seek to keep at arm’s length from the issue? Certainly Japan,

China, Korea and the United States will seek to co-opt their

support and in doing so make Southeast Asia more involved in

global strategic affairs, a situation that ASEAN has

previously sought to avoid.

The South China Sea is an issue ASEAN cannot avoid. China’s

claim to the whole area and the failure to resolve the issue

on a permanent basis despite the best efforts of ASEAN, leave

it the most likely arena for conflict. Satisfying China’s

territorial ambitions and the conflicting claims of four other

ASEAN members may prove intractable. At present ASEAN does not

possess the political will, or the military teeth to deal with

China on an equal footing. Recent pressure by China concerning

economic rights to the area (BBC, 2014) suggest that the

situation will deteriorate, ASEAN is not a military alliance

86

and her ambitions are not reflected in her capacities, events

may well leave the goals of ASEAN redundant.

ASEAN has changed, as the regional and the international

system has changed. Whether ASEAN’s new aspirations are

realistic, given the level of current integration, and can be

achieved under the present philosophy of soft institutionalism

characterized by the ‘ASEAN way,’ is doubtful. If we are to

believe the rhetoric of the ASEAN charter, ASEAN appears to be

increasingly interested in being an Asian EU, but its cultural

norms, far greater cultural and economic diversity and its

geo-political environment do not suggest this is a realistic

or even desirable aspiration. Southeast Asia will become more

integrated but what form that takes is unlikely to be dictated

by the dreams of ASEAN.

87

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