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ASEAN Community 2015 -  beginnings, opportunities and challenges  Ambassador Ong Keng Yong Director, Institute of Policy S...
Association of Southeast Asian Nations <ul><li>Brunei Darussalam </li></ul><ul><li>Cambodia </li></ul><ul><li>Indonesia </...
Beginnings <ul><li>ASEAN did not start as economic grouping </li></ul><ul><li>Politics, particularly Cold War dynamics dro...
Opportunities (1970s / 1980s) <ul><li>China's development under Deng Xiaoping's strategy </li></ul><ul><li>Multinational c...
ASEAN’s Response <ul><li>Focus on economic cooperation </li></ul><ul><li>Develop economy of scale  </li></ul><ul><li>Liber...
<ul><li>All led ASEAN Leaders to move collectively  </li></ul><ul><li>First, do the ASEAN Economic Community as it was eas...
Towards an ASEAN Community ASEAN Vision 2020 (1997) “ A concert of Southeast Asian nations, outward looking, living in pea...
I N  C O N C E R T  D Y N A M I C C A R I N G  OUTWARD LOOKING  SECURITY POLITICAL ECONOMIC CULTURAL SOCIO External  Relat...
Strategic Moves <ul><li>ASEAN Leaders recognise the challenges and constraints of building ASEAN Community by 2015 </li></...
ASEAN Charter:  Meeting Global Changes ASEAN’s way of operating: With change: <ul><li>Informal and flexible </li></ul><ul>...
Trade Liberalisation and Market Opening <ul><li>Started with AFTA </li></ul><ul><li>Supplemented by FTAs with key trading ...
ASEAN Community  APSC AEC ASCC Enhance rules and good governance Enhance integration and competitiveness Enhance well-bein...
Opportunities in ASEAN <ul><li>Global Trade </li></ul><ul><li>ASEAN total trade with the world in 2009:  </li></ul><ul><li...
ASEAN’s Challenges <ul><li>Implications of enlargement </li></ul><ul><ul><li>Narrowing development gap </li></ul></ul><ul>...
ASEAN’s Challenges <ul><li>Competing claims/interests of countries in the South China Sea </li></ul><ul><li>Bilateral prob...
ASEAN’s Challenges <ul><li>China’s rise </li></ul><ul><li>India’s role  </li></ul><ul><li>USA’s distractions </li></ul><ul...
Going forward… <ul><li>National ego (big country/small country) </li></ul><ul><li>Bureaucratic culture (corruption/use tec...
Lessons learned <ul><li>Stay open and inclusive (ASEAN economic integration) </li></ul><ul><li>Be transparent (regular mee...
Lessons learned (2) <ul><li>Focus on practical projects first (start with capacity building, then economic cooperation, la...
Success depends on… <ul><li>Implementing plans and projects in a timely manner </li></ul><ul><li>Keeping the &quot;ball ro...
Bear in mind… <ul><li>Political will is everything </li></ul><ul><li>Design of plan or mechanism not at fault </li></ul><u...
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Presentation by Ong Keng Yong

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Presentation by Ong Keng Yong, Ambassador-at-Large, Singapore

“Looking Towards ASEAN community 2015: Constraints, Obstacles and Opportunities” seminar on 21 April 2011 at Chulalongkorn University

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  1. 1. ASEAN Community 2015 - beginnings, opportunities and challenges Ambassador Ong Keng Yong Director, Institute of Policy Studies, Singapore
  2. 2. Association of Southeast Asian Nations <ul><li>Brunei Darussalam </li></ul><ul><li>Cambodia </li></ul><ul><li>Indonesia </li></ul><ul><li>Lao PDR </li></ul><ul><li>Malaysia </li></ul><ul><li>Myanmar </li></ul><ul><li>Philippines </li></ul><ul><li>Singapore </li></ul><ul><li>Thailand </li></ul><ul><li>Viet Nam </li></ul>
  3. 3. Beginnings <ul><li>ASEAN did not start as economic grouping </li></ul><ul><li>Politics, particularly Cold War dynamics drove 5 Southeast Asian countries to set up ASEAN </li></ul><ul><li>Easier to use “economics” to inculcate habit of consultation and cooperation </li></ul><ul><li>(Five founding members of ASEAN : Indonesia, Malaysia, Philippines, Singapore and Thailand) </li></ul>
  4. 4. Opportunities (1970s / 1980s) <ul><li>China's development under Deng Xiaoping's strategy </li></ul><ul><li>Multinational companies’ strategy of manufacturing in low-cost locations </li></ul><ul><li>Japan's strategy of shifting its production of manufactured goods to Southeast Asia </li></ul><ul><li>Oil-rich countries’ cash flow (from dramatic increase in oil prices) </li></ul><ul><li>European economic integration and offshore manufacturing </li></ul><ul><li>USA's globalisation drive </li></ul>
  5. 5. ASEAN’s Response <ul><li>Focus on economic cooperation </li></ul><ul><li>Develop economy of scale </li></ul><ul><li>Liberalise trade and open market (ASEAN Free Trade Area or AFTA) </li></ul><ul><li>Strengthen vision of one economic region </li></ul><ul><li>Capitalise on Southeast Asia's strategic geography and inherent strengths </li></ul>
  6. 6. <ul><li>All led ASEAN Leaders to move collectively </li></ul><ul><li>First, do the ASEAN Economic Community as it was easier to start and the business/market conditions already there </li></ul><ul><li>Later, ASEAN Leaders added the ASEAN Political-Security Community and the ASEAN Socio-Cultural Community </li></ul>- End of Cold War - Globalisation - China's economic growth - Trade Liberalisation - Free flow of capital Different world . . . 21 st Century
  7. 7. Towards an ASEAN Community ASEAN Vision 2020 (1997) “ A concert of Southeast Asian nations, outward looking, living in peace, stability and prosperity, bonded together in partnership in dynamic development and in a community of caring societies” Bali Concord II (2003) “ An ASEAN Community shall be established comprising three pillars, namely political and security cooperation, economic cooperation, and socio-cultural cooperation that are closely intertwined and mutually reinforcing for the purpose of ensuring durable peace, stability and shared prosperity in the region”
  8. 8. I N C O N C E R T D Y N A M I C C A R I N G OUTWARD LOOKING SECURITY POLITICAL ECONOMIC CULTURAL SOCIO External Relations NARROWING THE DEVELOPMENT GAP
  9. 9. Strategic Moves <ul><li>ASEAN Leaders recognise the challenges and constraints of building ASEAN Community by 2015 </li></ul><ul><li>ASEAN need to be seen as “serious” </li></ul><ul><li>ASEAN Leaders moved quickly on: </li></ul><ul><ul><ul><li>Having an ASEAN Charter </li></ul></ul></ul><ul><ul><ul><li>Accelerating economic integration </li></ul></ul></ul><ul><ul><ul><li>Enhancing ASEAN connectivity </li></ul></ul></ul>
  10. 10. ASEAN Charter: Meeting Global Changes ASEAN’s way of operating: With change: <ul><li>Informal and flexible </li></ul><ul><li>Deadline not always clear </li></ul><ul><li>Implementation subjective/non-confrontational </li></ul><ul><li>Low priority </li></ul><ul><li>Inadequate resources </li></ul><ul><li>Formal (ASEAN Charter) </li></ul><ul><li>Clear targets (2015; roadmaps with milestones) </li></ul><ul><li>Rules-based and accountability (report card to ASEAN Leaders) </li></ul><ul><li>Compliance-oriented (success stories) </li></ul>
  11. 11. Trade Liberalisation and Market Opening <ul><li>Started with AFTA </li></ul><ul><li>Supplemented by FTAs with key trading partners </li></ul><ul><li>China's offer to set up Free Trade Area with ASEAN led to ASEAN-China FTA, then FTAs with Korea, Japan, Australia/New Zealand, India </li></ul><ul><li>Such momentum created a high profile on the international scene for ASEAN and facilitated ASEAN's broader diplomatic initiatives </li></ul>
  12. 12. ASEAN Community APSC AEC ASCC Enhance rules and good governance Enhance integration and competitiveness Enhance well-being of ASEAN citizens Narrowing the Development Gaps People-to-People Connectivity Tourism, Education, Culture Physical Connectivity Hard Infrastructure Transportation, Logistics Facilities, ICT, Energy (Power Grid and Pipelines), Special Economic Zones Institutional Connectivity Soft Infrastructure Trade facilitation, ASEAN Single Window, Investment facilitation, Services Liberalisation, Regional Transport Agreements, Capacity-building programmes ASEAN Connectivity Resource Mobilisation
  13. 13. Opportunities in ASEAN <ul><li>Global Trade </li></ul><ul><li>ASEAN total trade with the world in 2009: </li></ul><ul><li>US$ 1.537 trillion </li></ul><ul><li>Growth of 19% of total trade from 2008 to 2009 despite global economic slowdown </li></ul><ul><li>Foreign Direct Investment (FDI) </li></ul><ul><li>Total net inflow to ASEAN in 2009: US$ 39.6 billion </li></ul>
  14. 14. ASEAN’s Challenges <ul><li>Implications of enlargement </li></ul><ul><ul><li>Narrowing development gap </li></ul></ul><ul><ul><li>Slow progress on ASEAN agenda: decision making by consensus </li></ul></ul><ul><ul><li>Bigger countries in ASEAN projecting beyond ASEAN </li></ul></ul><ul><li>Myanmar </li></ul><ul><ul><li>Affect engagement with ASEAN Dialogue Partners </li></ul></ul>
  15. 15. ASEAN’s Challenges <ul><li>Competing claims/interests of countries in the South China Sea </li></ul><ul><li>Bilateral problems remain, eg border disputes </li></ul><ul><li>Ambitions of ASEAN Dialogue Partners, eg China, USA </li></ul>
  16. 16. ASEAN’s Challenges <ul><li>China’s rise </li></ul><ul><li>India’s role </li></ul><ul><li>USA’s distractions </li></ul><ul><li>Japan’s stagnation </li></ul><ul><li>EU’s inward-looking orientation </li></ul>
  17. 17. Going forward… <ul><li>National ego (big country/small country) </li></ul><ul><li>Bureaucratic culture (corruption/use technology) </li></ul><ul><li>Domestic politics (leadership changes) </li></ul><ul><li>Insufficient institutional set-up to champion ASEAN agenda (only small secretariat in Jakarta) </li></ul><ul><li>Rule of Man; not enough Rule of Law (ASEAN Charter) </li></ul>
  18. 18. Lessons learned <ul><li>Stay open and inclusive (ASEAN economic integration) </li></ul><ul><li>Be transparent (regular meetings at all levels - Leaders, Ministers, Senior Officials, Experts) </li></ul><ul><li>Give sense of ownership/stakeholdership (ASEAN agenda) </li></ul><ul><li>Adhere to principle of equality (equal shares of operational budget) </li></ul>
  19. 19. Lessons learned (2) <ul><li>Focus on practical projects first (start with capacity building, then economic cooperation, later political/security issues) </li></ul><ul><li>Pick low-hanging fruits and have early harvest (ASEAN-China FTA)  </li></ul><ul><li>Use existing mechanisms as much as possible; avoid new structures till all ready to accept </li></ul>
  20. 20. Success depends on… <ul><li>Implementing plans and projects in a timely manner </li></ul><ul><li>Keeping the &quot;ball rolling&quot;; no harm with small steps and small yields </li></ul><ul><li>Building on any &quot;common factor&quot; </li></ul><ul><li>Getting the top leadership to weigh in and even drive projects, where necessary </li></ul><ul><li>Sharing the &quot;dividends&quot; </li></ul>
  21. 21. Bear in mind… <ul><li>Political will is everything </li></ul><ul><li>Design of plan or mechanism not at fault </li></ul><ul><li>Seize the opportunity </li></ul><ul><li>Capitalise on any favourable circumstances </li></ul><ul><li>Engage positively those who matter </li></ul>
  22. 22. Thank You.
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