On Jan 1, Malaysia officially began its year-long chairmanship of the Association of Southeast Asian Nations (Asean), succeeding Myanmar.
This event did not exactly dominate headlines and understandably so. Malaysians at the time were (and still are) grappling with the floods in many states, the tragic loss of Indonesia AirAsia flight QZ8501 and question marks over the future of our economy in light of tumbling oil prices.
Indeed, Asean – and Malaysia’s role in it – is a matter that only regularly exercises the minds of academics and policymakers. Still, Asean matters. It matters to its 10 members. And it certainly matters a lot to Malaysia, who now helms it. Why?
The most obvious reason is economic. Statistics from the Ministry of International Trade and Industry (Miti) reveal that 27% of Malaysia’s global trade is with Asean countries. In 2013, Malaysian exports to Asean countries amounted to US$64 billion, or 28% of our total global exports.
As for investment, foreign direct investment (FDI) inflows from Asean into Malaysia in 2013 stood at US$6.2 billion. Malaysia’s FDI into Asean that year stood at US$5.8 billion. Tourist arrivals from Asean from January to July 2014 alone stood at 11.9 million, a 10.8% year-on-year increase.
More importantly, 2015 will see the realisation of the Asean Economic Community (AEC). The AEC, as we have been told, will result in a 600-million-strong single market and production base in Southeast Asia. Collectively, Asean would be the third largest economy in Asia and the seventh largest in the world with a GDP of around US$2.4 trillion. The AEC will also result in the easier movement of goods, skilled labour, capital, services and investment between member states.
Asean matters to Malaysia because they are crucial trading and investment partners. Economic integration will make this all the more so. The AEC – while increasing competition – will also open up new opportunities for our companies and human capital.
Then there’s also the political dimension to consider. Asean was founded in 1967 initially as a grouping of anti-communist Southeast Asian nations. Since then, the Cold War has ended and Asean expanded from its original five to 10.
While the process has been uneven, Asean has arguably contributed to greater peace and stability in the region. This in turn has facilitated the remarkable economic development Southeast Asia has witnessed over the decades. It’s likely no accident that the combined poverty rate of Asean (i.e. under US$1.25 per capita per day) shrunk from 45% to 15% in 2010.
And while deep divisions persist over these issues, Asean remains the best forum for Southeast Asian nations to articulate their stance on crucial issues such as the South China Sea and transnational terrorism.
Of course, this is not to say that Asean is a bed of roses. Prime Minister Datuk Seri Najib Razak (pic) in 2014 said that “Malaysia’s job next year is to make Asean as close as possible to the people” referring to our agenda to create a “people-centred Asean”.
This may sound trite but there is arguably a need to make Asean real to its people. It cannot – if it is to be truly effective – remain an elite-driven phenomenon, an annual talking shop for regional leaders.
The stability and prosperity Asean has brought is a house of cards if people-to-people ties cannot be improved and strengthened. Gestures like the creation of an “Asean lane” in KLIA’s Immigration may seem small but they go a long way in building regional solidarity.
We need more initiatives like this, especially ones which facilitate contact between the youth of our nations. But deeper, existential questions remain. In Malaysia’s case, are we truly ready for the AEC given how allergic we often are towards even the concept of competition?
Is the idea of the AEC even viable given growing economic nationalism across the region? Moreover, Asean insiders are fond of repeating their mantra that “Asean is not the European Union”. But is economic integration possible without some measure of political union and policy coordination?
Can we speak with one voice in the face of great power rivalry? Is the principle of non-interference in each other’s affairs still relevant given how global threats now ignore borders? Asean also has a lot of catching up to do in terms of protecting human rights and civil liberties as well as increasing the public space in general.
The world is very different from what it was in 1967 and the old way of doing things are slowly become outdated, even destructive. These are the challenges that Asean faces and which Malaysia will be called to provide leadership for.
Are we up to the task?
We certainly will be hearing a lot more about Asean in the months ahead.