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Background Brief: ASEAN Unity, Economic Integration and a New Secretary General Carlyle A. Thayer November 29, 2012

[client name deleted] Is the unity of ASEAN is at risk? The last summit closed with ambivalent results that seem to cast doubt on the common destiny of the Association, at least at political level. Despite the opposition of Beijing, the South China Sea is an international issue anyway and at the moment Asia's biggest potential military trouble spot. 'Minor' issues like the construction of dams in Laos and in the upstream Mekong could erode the political relationships among four ASEAN members (Vietnam, Cambodia, Laos and Thailand). 1. Up to you, are the common economic aims of the Association sufficient to hold ASEAN together? ANSWER: ASEAN is in no danger of falling apart or stagnating. ASEAN suffered a setback on the South China Sea issue due to Cambodia's handling of this issue. ASEAN is moving at its own pace to form an ASEAN Community by 2015 and there are extensive programs underway to reach the goals set for each of its three pillars: political-security community, economic community and socio-cultural community. Brunei will play a strong yet low-key role as Chair and will work hard to forge consensus. Indonesia has revived its efforts As with anything ASEAN does, the end result will contain some elements of progress and some elements of shortcomings. 2. Some analysts strongly believe that common political aims are necessary to forge economic unity. ASEAN seems to prefer to give more importance to economic and trade relationships. But how is it possible to forge an economic community with different political goals, where national interests--at least at political level--differ from ASEAN ones? ANSWER: ASEAN has already spent many years establishing an ASEAN Free Trade Area. It has also negotiated and is now implementing a China-ASEAN Free Trade Area. The differences are mainly over whether individual countries should seek further economic integration through the Trans-Pacific Partnership or the recently announced Regional Comprehensive Economic Partnership. The bottom line is that while China weighs heavily on all, ASEAN countries still need access to the US and European markets. Already ASEAN has adopted the formula N - x to deal with economic matters. The N means that the number of countries who agree on an

2 economic proposal can advance while the x - the number of countries who are not yet prepared to move forward can remain outside until they decide otherwise. Such a formula does not exist for political issues. 2. Apart from the two above mentioned issues (South China Sea and dams), do you think there are other issues that could erode ASEAN political unity? ANSWER: Human rights is an issue that has the potential to be divisive should any country engage in major human rights violations. But it is presently a latent issue. How to handle relations with the major powers has dimensions that extend beyond the South China Sea issue and could be divisive. 3. Le Luong Minh will be the next Secretary General. He will be called to face not only the great challenges inherited from the previous tenure--like the Burmese democratic process and the promotion of human rights as established by the Declaration adopted in Phnom Penh by the ten membersbut also the South China Sea issue in which his country is directly involved. Surin Pitsuwan has been considered neutral in the South China Sea dispute. Do you think that the appointment of Le Luong Minh could create problems among the ASEAN claimants? or in the relationships between ASEAN and China? ANSWER: Le Luong Minh was the unanimous choice of all ASEAN states. He is a highly experienced professional diplomat with service at the United Nations. Recall that during the Cambodia-Thai border war Cambodia claimed that ASEAN Secretary General Surin Pitsuwan, a Thai, was not an independent actor. Minh will acquit himself well. He cannot afford to be partisan.

Suggested citation: Carlyle A. Thayer, ASEAN Unity, Economic Integration and a New Secretary General, Thayer Consultancy Background Brief, November 29, 2012.