Aug 10, 2012

Malaysia - Let economic sense prevail to nurture 'Aseanness'

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ASEAN celebrates its 45th anniversary this week but it comes in the shadow of a possible return to the bad old days when the region was the stomping ground of strategic rivalry by outside great powers.

Politics has never been Asean's forte. The region is heterogeneous as are many of the nations that make up the grouping. If nation-building is still a great challenge for such nations on account of their heterogeneity, what more region-building?

It is for this very reason that the grouping's founding fathers agreed in 1967 to focus on the economic rather than the political although Asean has since grown to take in three tracks: the economic, political/security and the social/cultural.

It is on all these three tracks that Asean aspires towards being a genuine "community" by the seemingly ambitious target date of 2015.

Testament to the enduring wisdom of the grouping's founding fathers can be found in the fact that the economic track looks to be the one that still holds out the brightest prospects for a budding community in the making.

Build on what all Asean nations can unite around seems to be the ageless advice from the grouping's founders. And no nation within the grouping denies the imperative of economic progress and development. As regional economic giants China and India carve out their rightful shares of the regional and global economic pie, it behoves Asean nations to hang together if they are not to be crowded out completely in the new global economic and political architecture taking shape.

Rather oddly, if we are talking about Asean economic integration, Malaysia stands out as clear leader. At a recent gathering in Jakarta, it was revealed that the only two truly Asean "brands" around originate in Malaysia: CIMB Bank and AirAsia. It is instructive hearing what the head of one of these regional economic pioneers, Datuk Nazir Razak of CIMB Bank, had to say. Sadly, he recounted of his difficulties growing his bank into an Asean franchise: that as far as policymakers and bureaucrats in Asean are concerned, there is only "national" or "foreign" and nothing in-between in terms of rules. In the eyes of officialdom all across Asean, therefore, anything originating from Asean might as well be from outside the region since it will get the same "foreign" treatment.

Asean may be one giant free trade area but it is not a customs union and in any case, there is no free flow across national boundaries of Asean people and, as Nazir observed, neither the free flow of information.

It is particularly irksome from the personal experience of this writer that he gets an automatic month-long stay in Singapore, the only developed economy within Asean, while he gets three weeks on each of his many visits to the Philippines.

A piece of unsolicited advice to the Philippines and other Asean nations in the same boat wishing to see more tourists on their shores: take a page out of Malaysia and junk the rule of reciprocity on visas and other restrictive immigration rules. Americans do not need visas coming into Malaysia even though Malaysians need them to get into America.

Sometimes good economics just require some plain good common sense from nations and their official gatekeepers.

But even Malaysia is not exactly overflowing with economic common sense either. Notice how the decision of AirAsia to base its Asean headquarters in Jakarta raised the hackles of even some sober Malaysians.

There is obvious logic in the decision to have Jakarta as the regional base of AirAsia, given that the city is the capital of Asean's biggest nation and one where the airline hopes to create an even bigger impact than the one it has already achieved.

That concession to Indonesia -- despite the flak AirAsia gets from some in Malaysia -- appears not entirely sufficient for the airline not to meet headwinds as it seeks expansion within Indonesia. AirAsia is discovering what CIMB Bank has apparently gone through: that it is being regarded as a foreign airline trying to buy over an Indonesian one even as AirAsia carries the branding as an "Asean" airline on account of its genuine regional reach and not just the fact its major owners are Malaysians.

So, Asean may proclaim in a little more than two years that it has finally become a "community". It probably will be just the beginning of a new road for Asean that holds promise just so long as we all remain wise by building on what can unite us and leaving for another day what may divide us.

John Teo


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