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Asean’s re-emergence as a local and global leader

By Frank-Jürgen Richter

Business Times, 21 September 2011

It was Henry Ford, a prominent American industrialist and the founder of Ford Motor Company, who was alleged to have stated ‘. . . history is bunk’. But Asean does not, and did not, arrive on a green and fertile land with no legacy to encumber its progress. Its member states had, and still have, many individual programmes for their own development and continued identity. What therefore is needed is effective leadership promoting a strongly focused vision for the future. But its situation today is cloudy.

First, Asean is not the only ‘local’ regional group. It grew to be the Asean+3 (with China, Japan and South Korea, set up in 1997) which undoubtedly helped stabilise the regional financial crisis of that time, and a plurilateral free trade agreement set up with Australia and New Zealand in 2008.

Yet there are other groups such as the South Asian Association for Regional Cooperation (Saarc, formed in 1980) that have had limited regional success since most of their group members are involved in some conflict with each other notwithstanding their commonalities: And so indeed are some members of Asean.

India, in Saarc but not in Asean, is an important case, nearly having a two-digit growth but also with 300 million poor people hoping for a better life. India is a major beneficiary of globalisation, and a major driver in the future of globalisation: Its role should be regarded as an opportunity for all.

Second, there are inhibitions within Asean that slow its smooth development. Asean could not fully achieve a resounding economic partnership with India, partly because of India’s independent interactions with members of Asean, and partly because Asean is also cooperating with China – India’s rival for regional supremacy.

Asean’s unfulfilled promise is illustrated by its interactions with China which strategically deals with Asean member states while pursuing its own long-term interests. Thus Asean plans dialogues on many fronts: of course with China – creating better land links by rail and road, and keeping truly open the sea-ways of the South China Sea; with its calls for economic and trade openness, and for a non-nuclear pact.

As Asean is committed to ‘growth by trade’, their discussions could be fruitful. However, the fast-paced Western world becomes fretful over the Asian, and Asean’s politeness and slow dialogues maintaining ‘face’ within its membership.

Third, there are major difficulties for Asean posed by groups elsewhere in the world. The Brics – Brazil, Russia, India, China and South Africa – exert global influence, being economically quite ‘well off’ so they provide extended opportunities for investment.

In fact, the developed world is seeing what may be described as ‘reverse globalisation’ where both physical and service sector work is passing more into the developing nations. This has to be a nuanced investment as too rapid a change will bring a generation of hardship to those in the developed world as they grapple with this new reality.

Nevertheless entrepreneurs, investors and consumers should enter a true partnership relationship with Asean, India and China making reverse globalisation a win-win proposition for our global economy.

In fact, Mr Ford said ‘. . . history is more or less bunk. It’s tradition. We don’t want tradition. We want to live in the present, and the only history that is worth a tinker’s damn is the history that we make today.’

This is what is needed within Asean: moving towards a more assertive leadership supported by an efficient governance structure able to act across the whole region that would define daily progress, and be able to describe its future in ways that give hope to all of its 600 million people; and show to them and the rest of the world that its strength lies in cooperation.

The writer is chairman of Horasis, an independent international organisation that provides thought leadership on ideas for a sustainable future