Nov 17, 2012

ASEAN - ASEAN Struggles to Hold Its Own Against U.S., China, Report Says

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A new report released as the 10-member Association of Southeast Asian Nations prepares for its annual summit says that the bloc is poorly equipped to defend its interests in relation to Asia-Pacific powers the United States and China, ranging from overlapping territorial claims in the South China Sea to demands for more trade and engagement in the region.

The report by LSE IDEAS, the London School of Economics’ center for the study of international affairs, analayzed how each of the region’s countries is responding to the differing strategic interests of the United States and China. It found that most states held a “more benign” view of American interests but that overall, their desire for bilateral gains – including increased trade with China – could reduce Southeast Asia’s overall bargaining power.

China’s neighbors and friends in the region have welcomed US engagement in the region, but largely want to maintain cordial ties with Asia’s largest economy, and in some cases, particularly the Philippines, have had to carefully balance China’s interest in the South China Seas or risk conflict, the report said.

The report comes as ASEAN will host its annual summit and a series of other gatherings in Cambodia starting Sunday that will be joined by U.S. President Barack Obama and Chinese Premier Wen Jiabao and the leaders of Japan, South Korea, Australia and India.

“ASEAN represents a market of over half a billion people, with a combined GDP growth currently double the global average,” the report says, but Southeast Asian states have so far been unable to form a regional strategy. “Regional member states need to empower ASEAN to represent their collective strategic interests” or the region risks surrendering its future to the two giant powers.

Southeast Asia has increasingly been on the radar of governments, investors and business leaders in recent years, a process accelerated by the recent U.S. defense “pivot” to the region, relative political stability in most countries and record growth rates for important players like Indonesia.

The report argues that China’s economic rise has forced the bloc to “see imperatives of geo-economics trump issues of geopolitics” despite territorial issues in the South China Sea, a hot-button issue that pits China, which claims all of the strategic waters for itself, and competing claims by ASEAN members Vietnam, the Philippines, Brunei and Malaysia.

China’s most reliable ally in ASEAN, Cambodia, prevented the bloc from adopting a common position on the issue at an important meeting in July, and Nicholas Kitchen, editor of the report, said that the U.S. resurgence in Asia has also provoked suspicions among some members.

ASEAN has drawn members closer in economic arrangements in recent years, with a regional trade pact that, among others, will allow free movement of manufactures goods, services and labors across the 10 countries, due to be in place by the end of 2015, but the report suggested that the organization needs unity to carry its members interests forward by prioritizing the region instead of individual countries. Bottlenecks to implementing closer economic integration include addressing domestic reforms, gaps in infrastructure and differing levels of protectionism.

Shibani Mahtani

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