EXECUTIVE SUMMARY
- Despite being the premier regional organisation in Southeast Asia, ASEAN remains a bystander in the imminent collapse of the Mekong River ecosystem which runs through five of its member states.
- ASEAN’s compartmentalised sub-regional approach characterises and justifies its heretofore indifference to Mekong environmental woes despite their impact on the region’s food security and climate change action.
- The successful mainstreaming of transboundary haze pollution in ASEAN’s legal and institutional frameworks should be an instructive example for invigorating ASEAN’s engagement in the Mekong issues.
- Most ASEAN member states remain reluctant to place Mekong issues on the regional agenda due to their sensitivity towards China and their reluctance to be embroiled in geopolitical competition in the Mekong basin.
- To stay relevant and central to the region, ASEAN needs to recognise its stakes in the Mekong basin by overcoming its current sub-regional mentality and by embracing Southeast Asia in its totality as a strategic theatre.
* Hoang Thi Ha is Fellow and Lead Researcher (Political-Security Affairs) and Farah Nadine Seth is Research Officer at the ASEAN Studies Centre, ISEAS – Yusof Ishak Institute.
INTRODUCTION
The Mekong River runs from the Tibetan Plateau through China, Myanmar, Laos, Thailand, Cambodia and Vietnam before discharging into the South China Sea. The territory of Laos covers 25% of the Mekong basin, followed by Thailand (23%), China (21%), Cambodia (20%), Vietnam (8%) and Myanmar (3%).[1] The Mekong basin is one of the richest areas of biodiversity in the world, sustaining around 66 million people, i.e. 10% of ASEAN’s total population, including “most of the population of Laos and Cambodia, one-third of Thailand’s 65 million, and one-fifth of Vietnam’s 90 million people.”[2]
ASEAN’s expansion to include all Southeast Asian mainland states in the 1990s brought the Mekong region well within the grouping’s geographical coverage. Upon its enlargement, ASEAN’s focus was not on the river system itself but on narrowing the development gap between the old and the new member states, namely Cambodia, Laos, Myanmar and Vietnam (CLMV). In 1996, ASEAN established the ASEAN-Mekong Basin Development Cooperation (AMBDC), which included China among its members. One of the AMBDC’s objectives was to “strengthen the interconnections and economic linkages between the ASEAN member countries and the Mekong riparian countries”.[3] The AMBDC, however, gradually lost its momentum and became inactive, with no ministerial meeting convened since 2014. ASEAN’s well-intentioned developmental approach that focused on connectivity and trade with the Mekong sub-region never quite took off because the grouping did not have the economic mass to finance its initiatives. The AMBDC’s flagship project Singapore-Kunming Rail Link (SKRL) made little headway and headline for two decades until China made a splash in recent years with a number of high-speed train projects under its Belt and Road Initiative (BRI).
ASEAN’s approach towards the Mekong region has thus far been consigned to the sub-regional category that receives ASEAN’s implicit blessing but does not fall under its active institutional purview. These sub-regional frameworks cover both maritime and mainland Southeast Asia, including the Brunei-Indonesia-Malaysia-Philippines-East ASEAN Growth Area (BIMP-EAGA), the Riau islands Indonesia-Malaysia-Singapore Growth Triangle, the Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT), the Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS), the CLMV Cooperation, and the Cambodia, Laos, Vietnam Development Triangle Area (CLV), among others. These frameworks have a development-connectivity focus with a view to linking “geographically proximate areas with different factor endowments, and hence different comparative advantages, to form an economically dynamic sub-region”.[4]
Although this sub-regional approach makes economic sense, it is often used to excuse ASEAN from taking a more proactive role where Mekong-related issues are concerned.[5] As the regional grouping, ASEAN remains a marginal player with regard to a multitude of environmental challenges and geopolitical developments unfolding in the Mekong basin. As ASEAN continues to stand on the side-lines, other Mekong-related frameworks initiated by various major powers have sprouted up, in keeping with the growing economic, environmental and strategic importance of the sub-region. These include, among others, the China-led Lancang-Mekong Cooperation (LMC), the Mekong-US Partnership (expanded from the earlier Lower Mekong Initiative), the Mekong-Republic of Korea Cooperation (Mekong-ROK), the India-led Mekong-Ganga Cooperation (MGC), the Mekong-Japan Cooperation (MJC), and most recently the Japan-US Mekong Power Partnership (JUMPP).
In 2020, Vietnam tried to utilise its ASEAN chairmanship to bring Mekong issues into ASEAN’s agenda, but with very limited success.[6] Hanoi’s attempt to mainstream the Mekong into the ASEAN-wide discourse met with reservations from some maritime and mainland Southeast Asian states for different reasons.[7] For maritime ASEAN states, the Mekong issues are viewed from the sub-regional lens – i.e. they affect only the mainland states and should be best addressed through their existing sub-regional frameworks.
This Perspective challenges this sub-regional approach to the Mekong issues on two accounts: (i) The impact of the environmental crisis in the Mekong River ecosystem goes beyond the sub-regional confines and affects ASEAN’s food security and climate change action as a whole; and (ii) The transboundary haze pollution provides an instructive precedent in mobilising ASEAN frameworks for an essentially sub-regional problem. This article also examines the geopolitical considerations that underlie the reluctance of most ASEAN member states to include Mekong issues in ASEAN’s agenda, hence their default relegation to sub-regional mechanisms.
THIN LINE BETWEEN ‘SUB-REGION’ AND ‘REGION’
In the final passage of his book “Last Days of the Mighty Mekong” published in 2019, Brian Eyler highlights the concept of connectivity – i.e. “the river itself doesn’t have an Upper or Lower Mekong. The system is one” – as the most potent paradigm shift to save the drying Mekong River.[8] The connectivity concept should likewise apply to lift ASEAN out of its “bystander” mode with regard to the unfolding ecological and environmental crisis in the Mekong basin which has taken on an unprecedented level of urgency in recent years.
The Mekong River ecosystem is on the verge of irreversible collapse due to the accumulative effects of climate change and increased numbers of upstream dams as well as other human-made activities such as deforestation, sand mining, extensive irrigation for agriculture and wetland conversion. In 2019, severe droughts caused water levels in the river to drop to their lowest in more than 100 years.[9] Low inflows from the Mekong and its tributaries in the summer of 2020 sent the water volume of Cambodia’s Tonle Sap Lake down to a “very critical situation”, according to the Mekong River Commission (MRC).[10]
The changing hydrological conditions of the Mekong River with unpredictable droughts and floods and reduced river sediments have wreaked havoc on agricultural production and inland fishery. Tonle Sap Lake accounts for two-thirds of Cambodia’s fish-catch – the main source of its population’s protein intake. Yet, increasing numbers of local fishers have reported dwindling fish catches. In December 2020, Cambodia’s Ministry of Agriculture, Forestry and Fisheries announced that the freshwater fish catch among some of the country’s licensed fishers dropped by 31% compared to 2019.[11] In the first quarter of 2021, freshwater fisheries along the Tonle Sap river yielded 1,310 tonnes, a decrease of 190 tonnes while freshwater products caught by families were 56,800 tonnes, a decrease of 12,600 tonnes.[12] Meanwhile, in early 2020, Vietnam’s Mekong Delta suffered its worst drought and saltwater intrusion which affected 42.5% of its land area, or 1,688,600 hectares, a steep increase from 2016’s 50,376 hectares.[13] The river sediment reaching the delta is estimated to be a third of what it was in 2007, critically impacting the country’s agricultural production.[14] The delta produces more than 50% of Vietnam’s rice output and 60% of its total fishery.[15]
According to the State of Southeast Asia: 2021 Survey Report by the ASEAN Studies Centre of ISEAS – Yusof Ishak Institute, many Southeast Asians are concerned about the Mekong’s environmental problems and their impact on regional food security, which underlie their support for ASEAN to pay greater attention to the Mekong. 72.2% of the survey’s 1,032 respondents agreed that ASEAN should include Mekong River issues in its agenda. This sentiment was not only pronounced in the downstream riparian states, namely Vietnam (92.6%), Thailand (87.8%) and Cambodia (73%), but also in maritime Southeast Asian states such as Singapore (74%), Malaysia (67.5%) and the Philippines (67.2%).[16] The survey results demonstrate that food security challenges in the Mekong basin are a cause for region-wide concern because these riparian countries are among the world’s biggest rice exporters, including to maritime ASEAN states (Table 1).
Given the transboundary impact of the Mekong environmental degradation, especially on regional food security systems and forced migrations to urban centres and neighbouring states, ASEAN needs to revisit the arbitrary distinction between ‘sub-region’ and ‘region’ that has characterised and justified its heretofore indifference to the Mekong problems. Apart from food security, the Mekong ecosystem is an indispensable part of ASEAN’s climate change action going forward. The climate change impact and adaptation measures by the Mekong riparian states should be synergised with similar undertakings in other parts of the region. One example is the recommendation that the Mekong basin climate monitoring system set up by the MRC to disseminate data on the hydrological conditions of the river be built upon for extension in the Philippines and other southern parts of Southeast Asia.[17]
TRANSBOUNDARY HAZE POLLUTION: FROM A SUB-REGIONAL PHENOMENON TO THE REGIONAL AGENDA
ASEAN set a precedent when it mainstreamed transboundary haze pollution into its regional agenda. Before the 1990s, haze pollution caused by land and forest fires in Indonesia had been largely dealt with at the sub-regional or bilateral levels between directly affected countries, namely Brunei, Indonesia, Malaysia and Singapore. However, dangerous levels of smoke haze blanketing maritime Southeast Asia in the mid-1990s transformed the largely sub-regional transboundary pollution issue into an ASEAN-wide concern.
As the most seriously affected countries, Singapore and Malaysia took the lead in regionalising the haze problem and pushing forward a coordinated ASEAN approach in this respect. In 1994, Malaysia and Singapore’s joint proposal for a regional early haze warning system was adopted at the First Informal ASEAN Ministerial Meeting on the Environment in Sarawak, Malaysia. In 1995, ASEAN passed the Cooperation Plan on Transboundary Pollution with haze mitigation as one of its central tenets. Shortly after, the Haze Technical Task Force (HTTF) was established. These initiatives set out measures for expertise-sharing and capacity-building between ASEAN countries to mitigate haze and forest fires, while strengthening haze monitoring and warning systems.[18]
Following the dangerous haze pollution which blanketed maritime Southeast Asia for months in 1997, the ASEAN Ministerial Meeting on Haze was established, according transboundary haze a position of importance under a dedicated ASEAN ministerial body.[19] The signing of the ASEAN Agreement on Transboundary Haze Pollution (AATHP) in 2002[20] was the culmination of decade-long efforts by the affected states in leveraging ASEAN frameworks to address the transboundary haze issue. Such efforts are attributed to these states’ realisation that a multilateral ASEAN approach was needed due to limited levers at the domestic level to counter the transboundary pollution and the need for burden-sharing in mitigation actions.[21]
Having ASEAN in the game levelled up the peer-group pressure and the effect of suasion vis-à-vis Indonesia, the source country of the haze but also a big neighbour with which Singapore must handle bilateral ties with care. In this regard, ASEAN was considered “the best platform for Singapore to channel pressure and help to Indonesia, without seeming overly condescending”.[22] Although it has been rightly pointed out that haze management in ASEAN has been less effective given the constraint of the ASEAN Way,[23] the achievement of a common regional approach to haze should not be underestimated. As in the case of many other regional challenges, ASEAN is not meant to be the solution but part of the efforts towards reaching a solution. As remarked by the late Southeast Asia scholar Michael Leifer, “regionalism is not a ready-made panacea for security and prosperity but merely an approach to such ends with possibilities for success.”[24]
Given the precedent set with the mainstreaming of the haze issue in the region-wide agenda, consigning the Mekong environmental crisis to a sub-regional category to justify ASEAN’s non-engagement does not hold water. Mainland ASEAN states rose to the call when its maritime counterparts pushed for a more regional approach to the haze problem. Myanmar, Thailand and Vietnam joined Singapore, Malaysia and Brunei in ratifying the AATHP early to enable its entry into force in November 2003. Given the urgency of the Mekong ecosystem’s imminent catastrophe, it is time that maritime ASEAN members revisit their detached approach now when it is mainland Southeast Asia that “catches fire”.
Of note, ASEAN’s region-wide instruments on haze action do not supplant but supplement and support existing sub-regional arrangements. There are two Sub-regional Ministerial Steering Committees on Transboundary Haze Pollution (MSCs) for the southern circuit (maritime states plus Thailand) and northern circuit (CLMV plus Thailand). These MSCs meet annually and discuss practical actions that are tailored to their sub-regions, and then report back to the Conference of the Parties (COP) to the AATHP.[25] This regional–sub-regional synergy is instructive for ASEAN to step up its engagement on the Mekong.
GEOPOLITICS AND ASEAN’S QUEST FOR ‘ONE SOUTHEAST ASIA’
ASEAN’s approach to the transboundary haze pollution provides an instructive precedent to help overcome the sub-regional mentality in addressing transboundary issues in the region. However, geopolitics sets the Mekong River apart and makes it far more complicated and difficult for ASEAN to take a forward-leaning approach. The transboundary haze issue is confined to ‘low politics’ and can be neatly placed under the environment sector. The Mekong issues represent a cocktail of low and high politics that involve water resources management, energy development, food security, economic connectivity as well as geopolitical competition. For the haze issue, one mainly has to deal with non-state actors, e.g. plantation owners clearing forests for commercial use and small farmers doing slash-and-burn agriculture. For the Mekong challenge, one has to live with an ascending great power which not only controls the river’s headwaters but also wields predominant economic and strategic influence over all ASEAN member states, especially those in the mainland.
With the exception of Vietnam, most Southeast Asian states remain reluctant to put the Mekong issues onto ASEAN’s agenda for fear of displeasing Beijing. China has built 11 dams in the Upper Mekong and Chinese companies are involved in numerous hydropower projects downstream, especially in Laos. The most recent study of these upstream dams’ impact on the Mekong’s natural flows is The Eyes on Earth report from April 2020. The report concludes that “the severe lack of water in the Lower Mekong during the wet seasons of 2019 is largely influenced by the restriction of water flowing from the Upper Mekong during that time.”[26] China has since disputed the findings of the report. The MRC also released a critique of the report and appealed to the Mekong countries to share data and information on water use and infrastructure operation.[27] The Vientiane Declaration of the third LMC Leaders’ Meeting in August last year hardly addressed the damming issue other than with a fleeting mention of “dam safety”. The document instead focused on climate change, cross-border trade and inter-regional connectivity including power connectivity and power trade.[28]
The increased interest and involvement in the Mekong basin by other major powers, especially the US, also add to this sensitivity of the ASEAN states. Most do not want to be embroiled in another arena of major power competition over yet another body of water apart from the South China Sea. On top of that, there is a competitive dynamic at play as some maritime ASEAN states would not want to see external attention and resources flow into the Mekong basin at the expense of their own sub-regional frameworks such as the BIMP-EAGA. Keeping the Mekong issues within the confines of sub-regional frameworks therefore conveniently justifies ASEAN’s detachment from Mekong geopolitics.
This apathy toward the Mekong issues, especially on the part of non-riparian ASEAN states, represents “a narrow transactional approach” that fails to grasp “Southeast Asia holistically as one strategic theater”, according to Bilahari Kausikan.[29] The coming together of ‘one Southeast Asia’ with ASEAN being its premier regional organisation has become even more fraught with the return of major power rivalry and the deepening of political-strategic incoherence within ASEAN. From the South China Sea issue to the ongoing Myanmar crisis, ASEAN is becoming increasingly divided along the maritime-mainland bifurcation.[30] ASEAN’s reluctance to raise its stakes in tackling the Mekong challenge will further deepen this fault line in both geography and geopolitics. While the geography of Southeast Asia and its inherent diversity may be structural, ASEAN’s unity and relevance are also a function of agency. For its centrality to Southeast Asia and to the lives of the people inhabiting across the region, ASEAN should raise its stakes in the Mekong. To do that, its member states must, first of all, overcome the sub-regional mentality and embrace the region in its totality.
ISEAS Perspective 2021/69, 19 May 2021
ENDNOTES
[1] CGIAR – Research Program on Water, Land and Ecosystems, “Mekong River Basin”, https://wle-mekong.cgiar.org/changes/where-we-work/mekong-river-basin.
[2] Brian Eyler, Last Days of the Mighty Mekong (London: Zed Books, 2019).
[3] Basic Framework of ASEAN- Mekong Basin Development Cooperation, Kuala Lumpur, 17 June 1996, https://www.asean.org/storage/images/2013/economic/mbdc/basic%20framework%20of%20ambdc.pdf.
[4] Sree Kumar and Sharon Siddique, Southeast Asia: The Diversity of Dilemma (Singapore: Select Publishing 2008), p. 39.
[5] The Mekong issues refer to a host of intertwined environmental, ecological, developmental and strategic challenges facing the Mekong riparian states.
[6] Hoang Thi Ha, “Flying the ASEAN Flag in a Pandemic Year: Vietnam’s 2020 Chairmanship”, ISEAS Perspective 2020, No. 137 (3 December 2020), /wp-content/uploads/2020/11/ISEAS_Perspective_2020_137.pdf.
[7] Author Hoang Thi Ha’s interviews with ASEAN member states’ officials 2020.
[8] Brian Eyler, op. cit.
[9] Stefan Lovgren, “Mekong River at its lowest in 100 years, threatening food supply”, National Geographic, 31 July 20219, https://www.nationalgeographic.com/environment/article/mekong-river-lowest-levels-100-years-food-shortages.
[10] Sao Da, “Water volume in Tonle Sap Lake at dangerous levels”, Khmer Times, 21 August 2020, https://www.khmertimeskh.com/50755781/water-volume-in-tonle-sap-lake-at-dangerous-levels.
[11] “Cambodia’s Tonle Sap shows what’s at stake in the Mekong’s dam-fueled decline”, ASEAN Today, 28 December 2020, https://www.aseantoday.com/2020/12/cambodias-tonle-sap-shows-whats-at-stake-in-the-mekongs-dam-fueled-decline.
[12] “Waning fish-catch in Cambodia’s Tonle Sap region”, The Star, 8 April 2021, https://www.thestar.com.my/aseanplus/aseanplus-news/2021/04/08/waning-fish-catch-in-cambodia039s-tonle-sap-region.
[13] “Đợt hạn, mặn nghiêm trọng nhất trong lịch sử ĐBSCL”, Nhân Dân Điện tử, 20 June 2020, https://nhandan.com.vn/chuyen-lam-an/dot-han-man-nghiem-trong-nhat-trong-lich-su-dbscl-475180.
[14] Hiebert, M., “Upstream Dams Threaten the Economy and the Security of the Mekong Region”, ISEAS Perspective 2021, No 34 (22 March 2021), /wp-content/uploads/2021/02/ISEAS_Perspective_2021_34.pdf.
[15] Cosslett, Tuyet L., Cosslett, Patrick D., Water Resources and Food Security in the Vietnam Mekong Delta (London: Springer, 2014), p. xiv.
[16] Seah, S. et al., The State of Southeast Asia: 2021 (Singapore: ISEAS – Yusof Ishak Institute), /wp-content/uploads/2021/01/The-State-of-SEA-2021-v2.pdf.
[17] Mely Caballero-Anthony, Paul Teng, Goh Tian, Maxim Shrestha, Jonatan Lassa, “Linking Climate Change Adaptation and Food Security in ASEAN”, ERIA Discussion Paper Series, 2015, https://www.eria.org/ERIA-DP-2015-74.pdf.
[18] Muhamad Varkkey, H., “Addressing Transboundary Haze Through ASEAN: Singapore’s Normative Constraints”, Journal of International Studies, [S.l.], v. 7, pp. 92, (Jan 2011); Nguitragool, P., Environmental cooperation in Southeast Asia: ASEAN’s regime for transboundary haze pollution (New York: Routledge, 2011), p. 58-59.
[19] Heilmann, D., “After Indonesia’s Ratification: The ASEAN Agreement on Transboundary Haze Pollution and its Effectiveness As a Regional Environmental Governance Tool”, Journal of Current Southeast Asian Affairs, 34, 3, p. 101, (2015), https://journals.sagepub.com/doi/pdf/10.1177/186810341503400304.
[20] ASEAN Agreement on Transboundary Haze Pollution, https://haze.asean.org/asean-agreement-on-transboundary-haze-pollution.
[21] Paruedee Nguitragool, Environmental cooperation in Southeast Asia : ASEAN’s regime for transboundary haze pollution (Routledge, 2011), p. 66.
[22] Muhamad Varkkey, op. cit.
[23] Heilmann, op. cit.
[24] Michael Leifer, Selected Works on Southeast Asia, compiled and edited by Chin Kin Wah and Leo Suryadinata, (Singapore: Institute of Southeast Asian Studies, 2005), p. 97.
[26] Basist, A. and Williams, C. (2020); Monitoring the Quantity of Water Flowing Through the Mekong Basin Through Natural (Unimpeded) Conditions, Sustainable Infrastructure Partnership, Bangkok, https://data.opendevelopmentmekong.net/dataset/monitoring-the-quantity-of-water-flowing-through-the-upper-mekong-basin-under-natural-unimpeded-con/resource/8433a305-8c7a-49d0-af8b-8778ec289b46.
[27] The Mekong River Commission, Understanding the Mekong River’s hydrological conditions, 2020, https://www.mrcmekong.org/assets/Publications/Understanding-Mekong-River-hydrological-conditions_2020.pdf.
[28] Vientiane Declaration of the Third Mekong-Lancang Cooperation (MLC) Leaders’ Meeting, Xinhuanet, 24 August 2020, http://www.xinhuanet.com/english/2020-08/24/c_139314536.htm.
[29] Bilahari Kausikan, “Why Asean should treat the Mekong like the South China Sea”, South China Morning Post, 17 July 2020, https://www.scmp.com/week-asia/opinion/article/3093546/why-asean-should-treat-mekong-south-china-sea.
[30] Vietnam is the exception because the country has national interests at stake in both the South China Sea (maritime) and the Mekong river (mainland).
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EXECUTIVE SUMMARY
- While investment facilitation is part and parcel of investment treaties and trade agreements, current WTO Investment Facilitation for Development (WTO IFD) negotiations include far more dimensions than those in existing ASEAN agreements.
- ASEAN is proposing an ASEAN Framework Agreement on Investment Facilitation (AFAIF) as part of its regional economic recovery plan.
- Although ASEAN has included investment facilitation in its internal and external agreements for more than a decade, the associated action plans indicate that implementation is left at the unilateral level.
- Measurements of investment facilitation show that ASEAN member states lag behind their Plus partners in the domestic adoption of investment facilitation measures.
- Therefore, ASEAN should consider a regional investment facilitation action plan besides pushing for an AFAIF.
- Such an action plan would allow ASEAN member states that are participating in an AFAIF and a WTO IFD to avail of the WTO IFD’s development provisions to meet overlapping commitments in both agreements.
* Tham Siew Yean is Visiting Senior Fellow at ISEAS – Yusof Ishak Institute and Professor Emeritus, Universiti Kebangsaan Malaysia.
INTRODUCTION
Globally, the volume of foreign direct investment (FDI) has been on a downward slide since 2015. The Covid-19 pandemic’s negative impact on the 2020 earnings of multinationals (MNCs) will worsen the decline, especially since more than 50 percent of global FDI are reportedly financed by reinvested earnings. Based on UNCTAD,[1] global FDI fell by 42 percent from USD1.5 trillion in 2019 to an estimated USD859 billion in 2020. This is 30 percent lower than the investment after the global financial crisis in 2008. Inflows of FDI into the Association of Southeast Asian Nations (ASEAN) are likewise affected, shrinking by 31 percent to USD107 billion. The effects of the pandemic on global FDI are expected to persist as investors continue to adopt a cautious attitude towards committing to new investments overseas. Enhancing investment facilitation to improve investment retention and re-investment are key strategies for countering the slowdown in global FDI as it plays an important complementary role to investment promotion.
According to the World Trade Organisation (WTO),[2] investment facilitation aims to ease the conduct of business and investments of domestic and foreign investors by making the business climate more transparent, efficient and predictable. Essentially, investment facilitation strives to remove investment impediments that arise from unnecessary red tape, bureaucratic overlap or out-of-date procedures. Similar to trade flows, simplifying, speeding up and coordinating processes in investment approvals can potentially lead to an expansion of investment flows, ceteris paribus. Empirically, the World Bank’s Global Investment Competitiveness (GIC) Survey of 2,400 companies in 2019, from ten countries, support extant empirical literature which indicates that a transparent and predictable regulatory environment is crucial for attracting new investments and retaining existing ones.[3] Not surprisingly, investment facilitation is an important component of investment treaties and agreements, be it at the bilateral, regional and multilateral level. These commitments, being binding and irreversible, provides stability and predictability in terms of future policy directions valued by investors, especially as uncertainty in the global economic climate increases.[4]
This paper maps the items in the proposed WTO Investment Facilitation for Development (IFD) with existing initiatives in ASEAN to explore possible synergies between the two.
WTO: PROPOSED INVESTMENT FACILITATION FOR DEVELOPMENT (IFD)
In 2017, encouraged by the entry into force of the WTO Trade Facilitation Agreement (TFA), some WTO members proposed for a multilateral initiative on investment facilitation, leading to a call for “structured discussions with the aim of developing a multilateral framework on investment facilitation”.[5] Subsequently, formal negotiations on a multilateral framework on Investment Facilitation for Development (IFD) started in September 25, 2020 with 106 members, with the aim of achieving a concrete outcome by the 12th WTO Ministerial Conference (MC12) in November 2021.[6] Out of the 106 participants in the WTO negotiations for IFD, seven are AMS[7], and all the Plus partners in RCEP-15 are involved as well. The goal of the negotiations is to agree to a framework of rules that will promote transparency and predictability by requiring participating members to publish investment laws and regulations, and provide information about their investment authorisation procedures; introduce certain minimum standards in countries’ administrative procedures and requirements; and encourage international cooperation, information sharing, and exchange of best practices.
Despite not having an agreed definition on investment facilitation, different WTO members have submitted various proposals for a multilateral initiative, with differing elements.[8] These include definitions of investment facilitation, regulatory transparency and predictability, streamlining and simplifying the administrative process, non-discrimination, single-window processing, e-application, protection of confidential information, facilitation of outward investment, appeals and reviews of administrative decisions, national institution arrangements, multilateral institution arrangements, institutional cooperation, special and differential treatment, technical assistance, corporate social responsibility, dispute prevention and/or dispute settlement, as well as future disciplines on market access and treatment.[9] Subsequent additional proposals include authorisation fees in the financial sector; “firewall provisions”, which aim to insulate the future investment framework from international investment agreements; and revised proposals for a single portal, domestic supplier databases and investment facilitator.[10]
Importantly, three key disciplines on investment are excluded from the current negotiations, namely market access, investment protection and Investor-State dispute settlement (ISDS), which allow companies to seek damages from governments.[11] Investment promotion is also deemed as separate from IFD in these negotiations, with the former linked to image building and marketing of a country/region as an investment destination.
The measures under current negotiations are summarised in Table 1. They cover seven key dimensions: transparency, streamlining and speeding up administrative processes and requirements, contact point, development, sustainable development, cross cutting issues, institutional and final provisions as well as “firewall” provisions, based on the list of proposed measures from different WTO members.[12]
However, investment facilitation is not a new issue in trade and investment agreements as it is covered in numerous international investment agreements (IIAs) as well as ASEAN’s trade and investment agreements.
ASEAN AGREEMENTS
The idea of investment facilitation in ASEAN has a long history. It was first mooted in the 1998 Framework Agreement on the ASEAN Investment Area (AIA) as one of the objectives. The agreement aimed to progressively reduce or eliminate investment regulations and conditions which may impede investment flows and the operation of investment projects in ASEAN.[13] Schedule 1 of the Framework Agreement has a cooperation and facilitation programme whereby individual member countries intend to: (i) increase transparency of Member State’s investment rules, regulations, policies and procedures through the publication of such information on a regular basis and making such information widely available; (ii) simplify and expedite procedures for applications and approvals of investment projects at all levels; and (iii) expand the number of bilateral Double Taxation Avoidance Agreements among ASEAN Member States.
In the subsequent ASEAN Comprehensive Investment Agreement (ACIA)[14] that replaced the earlier AIA Framework as well as the Investment Guarantee Agreement (IGA) signed in 2009 and ratified in 2012, investment facilitation is explicitly included as an article in the agreement. Five other elements in the discussions in the WTO IFD are also found in the ACIA. These are: transparency; development, as in the provision of Special and Differential Treatment (SDT) for newer ASEAN members which includes technical assistance; cross-cutting such as the facilitation of entry and stay of business persons for investment purposes; and dispute settlement, as shown in Table 2. Since the exact provisions in the proposed WTO IFD are still under negotiation, Table 2 is merely illustrative and not comprehensive in coverage.
ASEAN-Plus agreements such as ASEAN-Japan Comprehensive Economic Partnership (AJCEP) agreement, ASEAN-Korea Investment Agreement and ASEAN-Australia-New Zealand Free Trade Agreement, which were signed prior to the signing of the ACIA in 2009 do not have provisions on investment facilitation. However, they may include some of the other provisions in the ACIA. Although the ASEAN-China Investment agreement included investment facilitation, there are no provisions for SDT for the newer ASEAN member states. In contrast, the ASEAN-Plus agreements signed and ratified after the ACIA tend to follow the provisions of the ACIA.
It should be noted that while some of the provisions may not be in the investment chapter, they can be included in other parts of an agreement with partner countries. Notably, the entry and stay of business persons for investment purposes may be included in a trade in services agreement under Mode 4 or a separate agreement on the movement of natural persons (MNP). The Regional Comprehensive Economic Partnership (RCEP) which has been signed but not ratified at the time of writing, is an example. While specific provisions are made for investment facilitation, the other provisions are not in the investment chapter, but there are related dimensions in other chapters (Table 2).
COMPARING THE PROPOSED WTO TFA AND ASEAN AGREEMENTS
When comparing the provisions in ASEAN (Table 2) with the proposed elements under discussions at the WTO (Table 1), one sees that the four common provisions for investment facilitation in ASEAN agreements (Appendix 1) do cover some aspects in the proposed provisions for a WTO IFD. These are streamlining and simplifying procedures for investment applications and approvals and contact/focal point as in the establishment of one-stop centres. The RCEP also contains additional provisions for the focal point such as addressing investor aftercare by providing assistance in the resolution of conflicts and grievances, which is in fact another aspect covered in the on-going WTO negotiations.
In the ACIA, investment facilitation is expanded to cover three additional elements, namely: (i) strengthening databases on all forms of investments for policy formulation to improve ASEAN’s investment environment, (ii) undertaking consultation with business community on investment matters; and (iii) providing advisory services to the business community of the other member states. These correspond with the proposed elements of the WTO on transparency requirements and contact point (Table 1).
As can be observed from Chart 1, there are overlaps between ASEAN and some of the ASEAN Plus agreements, and the proposed WTO IFD. These pertain to the elements on transparency, streamlining, contact point, development and cross-cutting issues. However, the discussions at the WTO include additional aspects within these elements, which exceed those in the existing ASEAN and ASEAN Plus agreements. Importantly, ASEAN’s commitments in investment facilitation are especially lacking in terms of provisions for sustainable investments as well as “firewall” provisions.
OPPORTUNITIES AND CHALLENGES
Despite ASEAN’s long-standing interest in investment facilitation, the Investment Facilitation Index, developed by The German Development Institute indicates relative shortfalls for ASEAN member states. The Investment Facilitation Index aims to measure the scope of investment facilitation measures used domestically.[16] It is a weighted average of measures taken along six policy areas: transparency and predictability, electronic governance, cooperation, application process, outward investment and focal point review. The index can range from a minimum score of 0 to a maximum of 2, with 0 denoting no implementation, 1 for planned or partial implementation and 2 for full implementation. As shown in Chart 2, there is a clear difference between ASEAN member states, including Singapore which has the highest score for ASEAN, and most of its Plus partners, namely Australia, New Zealand, Korea, Japan, and China. The index therefore shows that AMS have fewer investment facilitation measures in place compared with these Plus partners.
The results are not surprising since investment facilitation in ASEAN has focused on improving transparency through largely unilateral actions, despite the commitments in existing agreements. It can be clearly seen in ASEAN’s Consolidated Strategic Action Plan 2025,[17] where the main focus is on investment peer review, policy dialogues, databases, sharing of knowledge and best practices, with no substantive ASEAN-wide Action Plans for investment facilitation. This is very different from ASEAN’s trade facilitation initiatives which have several ASEAN-wide action plans to reduce trade costs such as the ASEAN Trade Repository, ASEAN Single Window and ASEAN Customs Transit System as well as the development of a databank of non-tariff measures (NTMs) at the ASEAN level. Hence, even though ASEAN has negotiated and listed investment facilitation in ASEAN’s internal and external agreements, it lacks concrete initiatives in terms of ASEAN-wide action plans.
Nevertheless, the Implementation Plan for the ASEAN Comprehensive Recovery Framework, 2021 has proposed a new ASEAN Framework Agreement for Investment Facilitation (AFAIF). It is part of ASEAN’s initiatives for maximising the potential for an intra-ASEAN market and broader economic integration, including attracting more FDI to the region to support economic recovery from the Covid-19 pandemic.[18]
POLICY IMPLICATIONS FOR ASEAN
A meaningful AFAIF will enhance ASEAN’s relevance in this important issue. The AFAIF should therefore go beyond the existing provisions in the ACIA and other ASEAN external agreements. Chart 1 indicates there is room for extending and deepening provisions in the five existing overlapping elements with the proposed WTO IFD, namely, Transparency, Streamlining, Contact Point, Development, and Cross-cutting issues. However, since not all AMS are parties to the current negotiations on a WTO IFD, it is unlikely that the provisions in an AFAIF will match all the proposed provisions in the WTO IFD, especially for non-overlapping elements such as sustainable development.
AMS that commit to both an AFAIF and a WTO IFD can potentially utilise both agreements synergistically, especially in the development dimension. This dimension is based on the WTO Trade Facilitation Agreement (TFA) which is the first WTO agreement to allow members to determine their own implementation schedule, with technical and financial support linked to the implementation of the core provisions. AMS that are also members of the WTO TFA are able to draw upon technical and financial support from the WTO TFA for the implementation of their ASEAN commitments in trade facilitation,[19] thereby killing two birds with one stone. ASEAN’s trade facilitation has specific ASEAN-wide initiatives to reduce trade costs such as the ASEAN Single Window, ASEAN Trade Repository which links the National Trade Depositories in one web-site, and ASEAN Customs Transit System. Since all AMS are also members of the WTO TFA, AMS can tap on technical support from the WTO TFA to fulfil ASEAN’s action plans in some of these areas.
The development dimension in the proposed WTO IFA indicates the possibility of using the SDT provisions in the agreement for implementing reforms to meet the commitments of such an agreement. If these commitments overlap with those in an AFAIF, ASEAN can potentially benefit from committing to a plurilateral agreement and an ASEAN-wide agreement on investment facilitation. For this to be possible, drawing on the example of the WTO TFA and ASEAN’s initiatives on trade facilitation, ASEAN will need to embark on a regional action plan for facilitating investment.
CONCLUSION
While investment facilitation is part and parcel of investment treaties and trade agreements, current negotiations for a WTO IFD have included in it far more dimensions than found in existing ASEAN agreements. In particular, the current negotiations have included sustainable investment, which is not part of any of ASEAN’s internal and external commitments in investment facilitation. Advancing towards an AFAIF that extends and deepens provisions beyond that found in current ASEAN agreements will nurture economic cooperation to further strengthen the region’s attractiveness for FDI. This will facilitate regional economic recovery from the Covid-19 pandemic.
Although ASEAN has included investment facilitation in its internal and external agreements for more than a decade, the action plans indicate that the implementation of investment facilitation has been left at the unilateral level. It is therefore not surprising to find that recent measures of investment facilitation in AMS show scores that are lower than the Plus partners.
Having a regional action plan in investment facilitation means that AMS that are participating in an AFAIF and a WTO IFD will be able to tap on the proposed development provisions of the WTO IFD to meet overlapping commitments in both agreements. ASEAN should therefore consider including a regional action plan in investment facilitation besides pushing for an AFAIF. The lack of region-wide action plans in investment facilitation in ASEAN means that ASEAN will not be able to obtain mutual gains from regional and multilateral/plurilateral commitments, as in the case of trade facilitation.
ISEAS Perspective 2021/64, 7 May 2021
ENDNOTES
[1] UNCTAD, 2021. “Global foreign direct investment fell by 42% in 2020, outlook remains weak”. https://unctad.org/news/global-foreign-direct-investment-fell-42-2020-outlook-remains-weak <Accessed 1 April 2021>.
[2] See WTO, 2020. “Negotiations on an investment facilitation agreement show high level of engagement”. https://www.wto.org/english/news_e/news20_e/infac_09oct20_e.htm <Accessed 1 April 2021>.
[3] See World Bank, 2020. Global Competitiveness Report 2019/20. https://pubdocs.worldbank.org/en/314571591134463825/211536-Chapter-1.pdf <Accessed 1 April 2021>. The ten countries covered in the survey are Brazil, China, India, Indonesia, Malaysia, Mexico, Nigeria, Thailand, Turkey, and Vietnam.
[4] See World Bank, 2020. Op cit. p. 43.
[5] See Zhang, Joe, 2018. Investment Facilitation: Making sense of concepts, discussions and processes. https://blogs.die-gdi.de/longform/investment-facilitation-for-sustainable-development <Accessed 2 April 2021>.
[6] See WTO 2020. “Structured discussions on investment facilitation for development move into negotiation mode”. https://www.wto.org/english/news_e/news20_e/infac_25sep20_e.htm <Accessed 2 April 2021>.
[7] Brunei, Thailand and Vietnam are not part of the current negotiations.
[8] These are proposals submitted by Russia (30 March 2017), MIKTA (4 April 2017), China (21 April 2017), Friends for Investment Facilitation (FIFD) (21 April 2017), Argentina and Brazil (April 24 2017) and Brazil (13 December 2017).
[9] Zhang, op cit. p.6.
[10] See WTO structured discussions on investment facilitation for development negotiating meeting held on 7 and 8 December 2020, https://docs.wto.org/dol2fe/Pages/SS/directdoc.aspx?filename=q:/INF/IFD/R19.pdf&Open=True <Accessed 15 April 2021>
[11] Locatelli, Claudia, 2021. “Negotiations on Investment Facilitation for Development (IFD) at the WTO.” https://www.unescap.org/sites/default/d8files/event-documents/Session%203_Claudia%20L_IF%20for%20Development_1.pdf <Accessed 2 April 2021>.
[12] This is to prevent spillover effects from similar provisions in the proposed WTO IFA with existing international investment agreements (IIAs). For more details, see Chi, M., 2020. Insulating a WTO investment facilitation framework for development from international investment agreements. International Trade Centre, Geneva, Switzerland. https://www.intracen.org/uploadedFiles/intracenorg/Content/Redesign/Events/Insulating%20an%20IFF4D%20from%20IIAs%20(Final)_as%20of%20Dec%2023%20FV%20.pdf <Accessed 2 April 2021>.
[13] See https://cil.nus.edu.sg/wp-content/uploads/2019/08/2.5-1998-Framework-Agreement-on-the-ASEAN-Investment-Area.pdf <Accessed 1 April 2021>. The other three objectives are: (i) substantially increase the flow of investments into ASEAN from both ASEAN and non-ASEAN sources; (ii) jointly promote ASEAN as the most attractive investment area, and (iii) strengthen and increase the competitiveness of ASEAN’s economic sectors.
[14] See ACIA at http://investasean.asean.org/index.php/page/view/asean-comprehensive-investment-agreement-acia—section-a/view/799/newsid/834/article-25–facilitation-of-investment.html <Accessed 2 April 2021>.
[15] I would like to thank Ms. Aidonna Jan Ayub, Deputy Director, Research at Khazanah Research Institute for her useful comments on improving this table.
[16] For more details, see https://blogs.die-gdi.de/longform/investment-facilitation-for-sustainable-development <Accessed 2 April 2021>.
[17] See ASEAN Economic Community 2025 Consolidated Strategic Action Plan. https://asean.org/storage/2012/05/Updated-AEC-2025-CSAP-14-Aug-2018-final.pdf <Accessed 2 April 2021>.
[18] See Implementation Plan for ASEAN Comprehensive Recovery Framework at https://asean.org/storage/ACRF-Implementation-Plan_Pub-2020.pdf <Accessed 6 April 2021>. Page 31.
[19 See Tham Siew Yean, 2017. “Trade Facilitation: Exploring Synergies between WTO and ASEAN initiatives”, Perspective 2017, No. 4. /wp-content/uploads/2015/07/ISEAS_Perspective_2017_47.pdf <Accessed 6 April 2021>.
| ISEAS Perspective is published electronically by: ISEAS – Yusof Ishak Institute 30 Heng Mui Keng Terrace Singapore 119614 Main Tel: (65) 6778 0955 Main Fax: (65) 6778 1735 Get Involved with ISEAS. Please click here: /support | ISEAS – Yusof Ishak Institute accepts no responsibility for facts presented and views expressed. Responsibility rests exclusively with the individual author or authors. No part of this publication may be reproduced in any form without permission. © Copyright is held by the author or authors of each article. | Editorial Chairman: Choi Shing Kwok Editorial Advisor: Tan Chin Tiong Managing Editor: Ooi Kee Beng Editors: William Choong, Malcolm Cook, Lee Poh Onn, and Ng Kah Meng Comments are welcome and may be sent to the author(s). |
EXECUTIVE SUMMARY
- Over the last decade, the East Asia Summit has established itself at the peak of the ASEAN-led regional architecture and key to ASEAN’s broader centrality aspirations.
- ASEAN has however had difficulties improving the institutional efficacy of the EAS and lifting it out of its default ‘talk shop’ mode.
- ASEAN dialogue partner developments also pose an EAS erosion threat. These include the deterioration in China’s relations with the Quad members, and the recent elevation of the Quadrilateral Security Dialogue to a regular leaders-level forum.
- Leveraging the EAS to address the aftermath of the Myanmar coup and to engage with the Quad Vaccine Partnership could help the EAS bolster its ability to deliver concrete results on pressing Southeast Asian issues.
* Hoang Thi Ha is ISEAS Fellow and Lead Researcher for Political-Security Affairs in the ASEAN Studies Centre, and Malcolm Cook is ISEAS Visiting Senior Fellow at ISEAS – Yusof Ishak Institute.
INTRODUCTION
All inter-state organisations are shaped and challenged by the changing engagement of their major stakeholders, the difficulties associated with consensus-based reform and consolidation, the inevitable gap between expectations and feasible delivery, and the evolving strategic environment within which they exist.
Where ASEAN is concerned, the mutually reinforcing effects of such challenges will test the East Asia Summit (EAS) and threaten its peak position in the ASEAN-led regional architecture in the coming years. How ASEAN member states and ASEAN itself respond will help determine the EAS’ future status.
Three developments illuminate these more challenging times. On 12 March, the Quadrilateral Security Dialogue (the Quad) was elevated from an informal discussion forum among the US, Japan, India and Australia to the inaugural Quad leaders’ summit; this presents a direct challenge to the EAS’ peak position. If the second Quad leaders’ summit that is to be held in-person by the end of 2021 takes place, likely before the EAS, this challenge will become clearer.[1]
Second, the 1 February military coup in Myanmar and its bloody aftermath are being viewed by many as an “existential crisis” for ASEAN intramurally and for ASEAN’s broader agenda.[2] ASEAN-led mechanisms that include Myanmar junta representatives could lead to some dialogue partners choosing to stay away or to use their presence to call for an immediate return to democracy in Myanmar.
Finally, the Covid-19 pandemic that continues to spread in many ASEAN member states has shown the EAS’ functional limitations. The smaller, more established and more functionally-oriented ASEAN+3 mechanism has been much more active and effective in addressing the pandemic in Southeast Asia.[3] The Quad may achieve the same with the launch of the Quad Vaccine Partnership at its inaugural summit.[4] Over the last decade, the EAS, by default and by ASEAN’s design, has been the peak mechanism in the ASEAN-led regional architecture. Keeping it so will not be easy.
EAS IDENTITY ISSUES
For all the acclaim of its premier status in the ASEAN-led regional architecture, the EAS has not yet settled on its own identity. It has its genesis in the ASEAN+3 process and the latter’s goal of building an East Asian community for East Asians. In its 2002 report assessing the establishing an EAS, the East Asia Study Group emphasised the “need for clarity of objectives and issues which the EAS should pursue.”[5] Yet, much of the diplomatic wrangling leading to the EAS’ inaugural meeting in 2005 was about which ASEAN dialogue partners to invite, and not.[6] The EAS did not become an “ASEAN+3 transformed”. The EAS’ broader original membership and subsequent addition of the US and Russia in 2011 give it a more “open, outward-looking and inclusive”[7] character. Neither were its objectives or its path forward clearly defined, making it “unclear to most what exactly the raison d’être for the inaugural meeting of the EAS was.”[8]
This continuing lack of a clear purpose is reflected in the mismatch between the broad strategic agenda at the leaders-level and the evolving seven priority areas of EAS cooperation involving multiple government ministries, namely energy, education, finance, global health including pandemics, environment and disaster management, ASEAN Connectivity and maritime cooperation. On the one hand, this Janus-faced identity allows for flexibility. China and its like-minded EAS partners can promote functional and development cooperation, while the US and its partners can raise traditional security issues including the South China Sea disputes and the Korean Peninsula. Individual EAS leaders have the prerogative to raise any issue of specific interest or concern to them.
On the other hand, it creates the dilemma of preserving the broad, free-flowing and informal nature of the leaders’ dialogue while enhancing the EAS’ institutional capacity to deliver concrete results. Last year, the EAS was almost invisible in initiating any specific collective action to tackle the COVID-19 pandemic, despite “global health including pandemics” being a priority area for cooperation.
The EAS Leaders issued their Statement on Strengthening Collective Capacity in Epidemics Prevention and Response only in November 2020,[9] and no concrete action to implement the statement under the EAS framework has been reported since then. Instead, the region is witnessing vaccine nationalism and competitive vaccine diplomacy among the major powers who are EAS members. This is not unexpected, as Southeast Asia is a frontline region for China’s vaccine diplomacy,[10] and the focus for the Quad Vaccine Partnership.[11] However, it shows that while the EAS assembles the main characters, the real action is elsewhere.
There has been no shortage of effort to strengthen the EAS’ efficacy and efficiency over the past 15 years, especially around milestone anniversaries. During the EAS’ tenth anniversary year in 2015, there was a major stock-taking and review of the EAS with active participation. Of innovative inputs coming from the EAS’ dialogue partner members, only a few of have been implemented, such as the establishment of the EAS Unit within the ASEAN Secretariat[12] and the EAS Ambassadors Meeting in Jakarta (EAMJ)[13] to facilitate coordination within the EAS on a regular basis. Other efforts to strengthen the EAS’ institutional capacity include the setting up of the EAS Foreign Ministers Meeting and EAS ministerial mechanisms in the economic, finance, energy, environment and education sectors.
However, these institutional reinforcements have had little impact in lifting the EAS out of its default leader-level ‘talk shop’ mode. So far, there has been no serious attempt to overhaul the EAS structure to preserve its “Leaders-led” nature and to manage overlaps with other ASEAN-led mechanisms in functional cooperation, including the ASEAN+3, ASEAN Regional Forum (ARF) and ASEAN Defence Ministers Meeting-Plus (ADMM-Plus).
As the only multilateral platform that brings together the leaders of Southeast Asian countries and other major powers to discuss issues of strategic significance to the region, the EAS’ leaders-led nature is highly prized by all of its members. However, while EAS leaders’ discussions can be frank and heated at times, it is also true that the leaders often read their set-piece talking points and hardly engage in interactive dialogue. Related to this is the persistent concern on a yearly basis over the attendance of the US president at the EAS. Washington’s presence adds critical strategic weight to the forum, but US presidents’ sporadic engagement has time and again raised legitimate questions about US commitment to ASEAN multilateralism and doubts about the relevance and credibility of the EAS itself.
DIALOGUE PARTNER DEVELOPMENTS
President Donald Trump’s decision not to attend any EAS plenary session deepened these latter concerns over the last four years. White House confirmation that President Joe Biden will attend the 2021 EAS would be most welcome. The almost complete absence of Russia’s and China’s top leaders[14] from the EAS has not triggered such criticism and concern, suggesting either the paramount importance of the US to the EAS or what increasingly looks like a double standard on the part of ASEAN with regard to these major powers.
Under President Vladimir Putin and President Xi Jinping, political power in Russia and China has become increasingly personalised, and each leader looks likely to remain in their current positions for the foreseeable future. Hence, the Russian prime minister/foreign minister and Chinese premier are increasingly less suitable representatives at the “leaders-level” EAS. Putin and Xi’s continued absence, combined with their regular participation in APEC Economic Leaders Meetings and G-20 Summits, threatens to erode ASEAN centrality claims and the EAS’ peak position in the regional strategic architecture.
The changing nature of relations between ASEAN dialogue partners in the EAS pose two more concerns that challenge both faces of the EAS’ identity. Relations between the US, Russia and China are increasingly defined by contestation and confrontation, not cooperation, as are China’s relations with Japan, India, and Australia. At the same time, relations between Russia and China have become more defined by cooperation in their overlapping rivalries with the US specifically, and with “the West” more generally.[15]
This greater Russia-China cooperation and China’s more confrontational relations with the US, Japan, India and Australia are already undermining the ASEAN-led architecture with the EAS at the peak along with its constituent units. In 2015, the ASEAN Defence Ministers’ Plus, a ministerial-level structure in the ASEAN-led regional architecture with the same membership as the EAS, failed to release its planned joint statement due to US-China disagreements over the mention of South China Sea disputes.[16] In 2020, Russia and China’s opposition to the term “Indo-Pacific” – including even reference to the ASEAN Outlook on the Indo-Pacific (AOIP) – was a key stumbling block in the drafting of the Hanoi Declaration on the 15th Anniversary of the EAS.
Putin and Xi’s respective hold on political power in Russia and China, and deepening public concern in the US, Japan, India and Australia with regard to China’s international behaviour make this unpeaceful strategic environment likely to persist. ASEAN’s commitment to open inclusive regionalism and “neutrality” in the deepening and more active rivalries among ASEAN dialogue partners in the EAS risk the EAS leaders-level meetings becoming more adversarial, and therefore less interactive and cooperative. This would further undermine the EAS’ ability to provide concrete outcomes for shared concerns.
These same growing major power rivalries make smaller, more exclusive leaders-level and ministerial-level arrangements among like-minded or like-threatened states more attractive. The revival of the Quad at the senior officials’ level in 2017, its elevation to a meeting of foreign ministers in 2019, and its further elevation to the same leaders’ summit level as the EAS in 2021 provide the best but not only example of the less inclusive but more responsive diplomatic architecture that is being built and retrofitted outside of the ASEAN-led multilateral one.
Other structures in this alternative architecture include the elevation and broadening of the Five Eyes intelligence sharing network between the US, Great Britain, Canada, Australia and New Zealand,[17] and discussions on expanding the Group of Seven (G7) leaders-level forum to include India, Australia and South Korea. The threat posed by Russia and China’s more aggressive international behaviour clearly provides many of the building blocks for this emerging architecture that does not include any ASEAN member state. The growing strategic partnership between Russia and China illuminated by the growing interaction between Putin and Xi is another, and the Shanghai Cooperation Organization that includes Cambodia as a dialogue partner could become one as well.[18] Russia and China’s growing rivalries with the US specifically and “the West” more generally provide many of the building blocks for these latter two.
LEADERS-LED TO WHERE?
As the architect and the driver of the EAS, ASEAN needs to face up to the erosion challenges facing this Leaders-led forum position “at the apex of the ASEAN-centred regional architecture”.[19] Simply repeating this tired mantra barely helps the EAS respond to the sharpening and broadening geopolitical rivalries among its dialogue partner members and address human security challenges such as the COVID-19 pandemic. To maintain the EAS’ relevance going forward, the EAS’ capacity to deliver results through concrete actions needs strengthening. It needs to go beyond being simply “Leaders-led” in order to answer the central question that has dogged it since inception: “Leaders-led to where?”.
For this, ASEAN’s comprehensive approach to security is instructive. The distinction between political-security and economic-development issues has become less clear-cut as all issues from health security to supply chain resilience, infrastructure development and energy security now affect both political power at home and geopolitical influence abroad. This provides a fitting vista for ASEAN – as the agenda setter – to present a more focused and action-oriented EAS agenda that corresponds to prevailing regional and global challenges. Instead of drafting multiple statements with only aspirational objectives and general prescriptions, ASEAN’s diplomatic capital should be better invested in mobilising collective action that delivers regional public goods. One recent example of this capability was the launch of the Regional Comprehensive Economic Partnership (RCEP) negotiations at the 7th EAS in November 2012 (although the RCEP is not an EAS process per se, given the absence of the US and Russia, and India at its later stage).
ASEAN should send a strong message to its dialogue partner members – especially the US, China and Russia – that they must live up to their statements of supporting ASEAN’s centrality with actions, not simply words. These actions include not only their participation in the annual EAS at the highest level but also their active support for ASEAN initiatives.
The EAS needs to function as an arena where the major powers compete when they must and collaborate when they should and could, especially on shared human security concerns. As such, the next critical test is for ASEAN to leverage the EAS – which comprises all the major powers that have influence on Myanmar, namely China, Russia, India and Japan – to persuade the Tatmadaw (Myanmar’s armed forces) to stop violence and resolve the country’s political crisis through dialogue and peaceful means.
More ambitiously, ASEAN should engage with the emerging alternative architecture, rather than consider the ASEAN-led architecture in exclusive and solely defensive terms. In 2005, the ASEAN Secretariat signed a memorandum of understanding with the Secretariat of the Shanghai Cooperation Organisation despite this body’s clearly anti-US potential. ASEAN could likewise engage with the Quad Vaccine Partnership and its strategic perception of Southeast Asia. If ASEAN fails to do so collectively, individual Southeast Asian states should not miss this opportunity to increase their access to badly needed Covid-19 vaccines. This splintering would not bode well for ASEAN centrality and the EAS.
ISEAS Perspective 2021/61, 3 May 2021
ENDNOTES
[1] Quad Leaders’ Joint Statement: ‘The Spirit of the Quad’, 13 March 2021, https://www.pm.gov.au/media/quad-leaders-joint-statement-spirit-quad
[2] Thitinan Pongsudhirak, “Asean’s Myanmar crisis out of control”, Bangkok Post, 26 March 2021, https://www.bangkokpost.com/opinion/opinion/2089727/aseans-myanmar-crisis-out-of-control
[3] Jusuf Wanandi, “ASEAN-China cooperation in time of COVID-19 pandemic”, Jakarta Post, 16 March 2020, https://www.thejakartapost.com/academia/2020/03/16/asean-china-cooperation-in-time-of-covid-19-pandemic.html
[4] Quad Summit fact Sheet, 12 March 2021, https://www.pm.gov.au/sites/default/files/files/quad-summit-fact%20Sheet.pdf
[5] Final Report of the East Asia Study Group at the ASEAN+3 Summit, 4 November 2002, https://www.mofa.go.jp/region/asia-paci/asean/pmv0211/report.pdf
[6] Rodolfo C. Severion, Southeast Asia in Search of an ASEAN Community: Insights from the former ASEAN Secretary-General, 2006 Institute of Southeast Asian Studies, Singapore, pp. 269-273
[7] Kuala Lumpur Declaration on the East Asia Summit, 14 December 2005, https://www.mofa.go.jp/region/asia-paci/eas/joint0512.html
[8] Ralf Emmers, Joseph Chinyong Liow and See Seng Tan, The East Asia Summit and the Regional Security Architecture, Maryland Series in Contemporary Asian Studies, Number 3 – 2010 (202), https://digitalcommons.law.umaryland.edu/mscas/vol2010/iss3/1
[9] East Asia Summit Leaders’ Statement on Strengthening Collective Capacity in Epidemics Prevention and Response, 14 November 2020, https://asean.org/storage/2020/11/32-EAS-Leaders-Statement-on-Strengthening-Collective-Capacity-in-Epidemics-Prevention-and-Response-FINAL.pdf
[10] Koya Jibiki and Tsukasa Hadano, “China pushes ‘vaccine diplomacy’ in Southeast Asia”, Nikkei Asia Review, 16 January 2021, https://asia.nikkei.com/Spotlight/Coronavirus/China-pushes-vaccine-diplomacy-in-Southeast-Asia
[11] US Embassy in Malaysia, Fact Sheet: The Quad Vaccine Partnership, 12 March 2021, https://my.usembassy.gov/fact-sheet-the-quad-vaccine-partnership
[12] This EAS Unit comprises one Assistant Director (who covers also the ASEAN Plus Three and ASEAN’s dialogue relations with the Plus Three countries), two Senior Officers and one Technical Officer, all of whom must be Southeast Asian nationals.
[13] Kuala Lumpur Declaration on the 10th Anniversary of the East Asia Summit, 22 November 2015, http://eastasiasummit.asean.org/wp-content/uploads/2018/02/Kuala-Lumpur-Declaration-on-The-Tenth-Anniversary-of-The-East-Asia-Summit.pdf
[14] The division of labour of Chinese leadership in foreign relations portfolio has the President attend the APEC Economic Leaders’ Meeting, and the Premier attend ASEAN-related summits. Except in 2018, Russia has never been represented at the EAS at the highest presidential level.
[15] Andrea Kendall-Taylor and David Shullman, “Navigating the deepening Russia-China partnership” CNAS, January 2021, https://s3.us-east-1.amazonaws.com/files.cnas.org/documents/CNAS-Report-Russia-China-Alignment-final-v2.pdf; “China-Russia cooperation has no upper limits”, Global Times , 22 March 2021, https://www.globaltimes.cn/page/202103/1219115.shtml
[16] “No joint statement as US, China clash over wording on South China Sea”, Today, 5 November 2015, https://www.todayonline.com/world/no-signing-joint-declaration-asean-defense-forum
[17] Ben Scott, “Five Eyes: Blurring the lines between intelligence and policy”, 27 July 2020, Lowy Interpreter, https://www.lowyinstitute.org/the-interpreter/five-eyes-blurring-lines-between-intelligence-and-policy
[18] Alexander Lukin, “Shanghai Cooperation Organization: looking for a new role, Valdai Papers, 9 June 2015, https://valdaiclub.com/a/valdai-papers/valdai_paper_special_issue_shanghai_cooperation_organization_looking_for_a_new_role
[19] Ha Noi Declaration on the 15th Anniversary of the East Asia Summit, 15 November 2020, https://asean.org/storage/2020/11/29-Ha-Noi-Declaration-on-the-15th-Anniversary-of-the-EAS-FINAL.pdf
| ISEAS Perspective is published electronically by: ISEAS – Yusof Ishak Institute 30 Heng Mui Keng Terrace Singapore 119614 Main Tel: (65) 6778 0955 Main Fax: (65) 6778 1735 Get Involved with ISEAS. Please click here: /support | ISEAS – Yusof Ishak Institute accepts no responsibility for facts presented and views expressed. Responsibility rests exclusively with the individual author or authors. No part of this publication may be reproduced in any form without permission. © Copyright is held by the author or authors of each article. | Editorial Chairman: Choi Shing Kwok Editorial Advisor: Tan Chin Tiong Managing Editor: Ooi Kee Beng Editors: William Choong, Malcolm Cook, Lee Poh Onn, and Ng Kah Meng Comments are welcome and may be sent to the author(s). |
EXECUTIVE SUMMARY
- Despite releasing the ASEAN Outlook on the Indo-Pacific in June 2019, ASEAN member states have yet to reach a coherent view on the Indo-Pacific.
- They remain ambivalent about the Indo-Pacific to different degrees due to the concept’s malleability and external pressures from China and Russia.
- As one of the more forward-leaning ASEAN members on the Indo-Pacific, Indonesia adopts a constructivist ASEAN-led approach focusing on maritime connectivity and marine resources. Vietnam’s approach has a realist balance-of-power anchor.
- ASEAN has been pragmatic in promoting different AOIP elements with different Dialogue Partners who hold divergent views on the Indo-Pacific.
- The Biden Administration’s proactive moves to consolidate the US’ Indo-Pacific strategy, especially through the first Quad summit, has injected further dynamism into the Indo-Pacific discourse with a broader and more positive agenda.
- ASEAN and its member states should continue to leverage the Indo-Pacific concept and its unfolding possibilities to promote and defend their interests.
*Hoang Thi Ha is Fellow and Lead Researcher (Political-Security) at the ASEAN Studies Centre, ISEAS –Yusof Ishak Institute.
INTRODUCTION
In June 2019, the ASEAN leaders adopted the ASEAN Outlook on the Indo-Pacific (AOIP)[1] to present their collective voice on the emerging Indo-Pacific discourse that had been actively promoted by the US, India, Japan and Australia – four members of the Quadrilateral Security Dialogue (Quad). The Outlook articulates ASEAN’s inclusive and cooperative “vista” on the Indo-Pacific with the hope to present “an inclusive meeting place for the competing visions of regional order offered by great and regional players” and to maintain ASEAN’s relevance and Southeast Asia’s strategic autonomy[2] in this discourse.
The Indo-Pacific maritime domain has since become more contested and crowded with increased risks of conflicts over critical flashpoints such as the Taiwan Strait, the South China Sea (SCS) and the East China Sea. Geopolitical tensions as well as trade and territorial disputes between China and the Quad members have increased sharply and have been exacerbated by the COVID-19 pandemic. Driven by their growing strategic concerns over a powerful and assertive China, the Quad countries have pushed forward their Indo-Pacific strategies and enhanced the Quad in both institutional and operational terms in the past two years. Of note, despite recent leadership change in the US and Japan, both the Biden and Suga administrations have made it clear by policy announcements and actions that the Indo-Pacific is here to stay.[3]
Whereas the Quad countries remain steadfast and perhaps even more determined in their Indo-Pacific strategies, the Indo-Pacific discourse in Southeast Asia is much more chequered. This Perspective examines the continued ambivalence within ASEAN towards the Indo-Pacific due to both internal incoherence and external sensitivities. It looks at Indonesia and Vietnam as examples of two different approaches within ASEAN on the Indo-Pacific. It also ponders what the future may hold for ASEAN member states (AMS) as the US, India, Japan and Australia continue to solidify their Indo-Pacific strategies through the Quad.
ONE TERM, MANY MEANINGS
The AOIP was expected to provide a common script for AMS amid mounting external pressures on them to take a stand on the Indo-Pacific. In reality, it remains the case that AMS have yet to internalise the Indo-Pacific to the same extent, and most still hold ambivalence towards the concept. Singapore Foreign Minister Vivian Balakrishnan was realistic about the modest impact of the AOIP at the time of its adoption: “The Outlook will not stop strategic forces from pulling individual ASEAN Member States in different directions. ASEAN unity – the pre-requisite for ASEAN Centrality – will be tested. Our inherent diversity will make internal coherence difficult, but ultimately more necessary too.”[4]
Developments in the past two years have borne this out. The AOIP is not a magic wand that instantly removes AMS’ reluctance to embrace the term “Indo-Pacific”. In their national submissions to the ARF Security Outlook 2020, all AMS, except Vietnam, continued to use the term “Asia-Pacific” to describe the broader region. Vietnam meanwhile used neither term – arguably a deliberate omission given that “Asia-Pacific” was still featured in its ARF Security Outlook 2019 submission.[5]
Much ambivalence among Southeast Asian countries towards the Indo-Pacific is attributed to the malleability of this concept. In the 2019 and 2020 editions of the State of Southeast Asia (SSEA) survey undertaken by the ASEAN Studies Centre of ISEAS – Yusof Ishak Institute, the majority of respondents – 61.3% (2019) and 54% (2020) – thought that “the concept is unclear and requires further elaboration.” Meanwhile, few of them – 17.2% (2019) and 28.4% (2020) – pinned their hope on the concept to present “a viable option for a new regional order.”[6]
There is a sense of déjà vu reminiscent of “Asia-Pacific” when the term was first trending in the early 1990s. Scholar Arif Dirlik then tried to address the question “What is the Pacific?” by specifying “whose Pacific and when”. He wrote: “In a fundamental sense, there is no Pacific region that is an “objective” given, but only a competing set of ideational constructs that project upon a certain location on the globe the imperatives of interest, power, or vision of these historically produced relationships.”[7] The same can be said for the Indo-Pacific which is even more geographically expansive and more amorphous in definition than the Asia-Pacific.
Furthermore, unlike the Asia-Pacific which has taken a relatively solid shape on the global map with both institutional and spatial representation, the Indo-Pacific remains much more malleable and open to “manipulation and interpretation in accordance with configurations of interest and power”.[8] The nouns attached to “Indo-Pacific” are elastic – such as “region”, “vision”, “vista”, “outlook”, “concept”, “construct”, “guidelines” and “strategy”. The adjectives that come with it are equally flexible – including, among others, the Trump Administration’s “free and open”, ASEAN’s “rules-based and inclusive”, or the Biden Administration’s “free, open, inclusive, resilient and rules-based” which combines all of the above.
Yet, no matter how “Indo-Pacific” has been qualified and appropriated by different players to fit their objectives, the overriding geopolitical fact remains that its champions – namely the US, India, Japan and Australia – share the strategic imperative for closer coordination and collective action in dealing with the China challenge even as their concerns over and disagreements with Beijing are not monochromatic. “China containment” may be too reductionist to describe the nuance and complexity in the Quad members’ emerging strategic alignments, but balancing China is arguably the most important rationale behind the Quad’s renaissance. Therefore, in the perceptions of many, the Indo-Pacific continues to carry the baggage of a US-led anti-China coalition, which is abetted by the Trump Administration’s markedly confrontational policy towards Beijing following the COVID-19 pandemic. As for China, its dismissive attitude towards the Indo-Pacific as “sea foam that will soon dissipate”[9] quickly morphed into alert and anger over what it calls the US’ “strategy of hegemony” and “Cold War zero-sum thinking”.[10] Beijing’s heightened sensitivity towards the Indo-Pacific has added to the reluctance of Southeast Asian countries to fully and officially endorse the Indo-Pacific concept.
The embrace of the Indo-Pacific in ASEAN’s dialogue relations and ASEAN-led mechanisms has been patchy, given that its Dialogue Partners are polarised on this issue. As demonstrated in the ARF Security Outlook 2020, China and Russia steadfastly hold on to “Asia-Pacific”; the Quad countries strongly advocate for “Indo-Pacific” and the remaining Dialogue Partners are caught in the middle of the spectrum.[11] Differences on whether the region should be called “Asia-Pacific” or “Indo-Pacific” almost derailed the issuance of the Joint Declaration to mark the 10th anniversary of the ADMM-Plus in December 2020.
ASEAN therefore has to sing different tunes with different Dialogue Partners when it comes to the Indo-Pacific. For example, ASEAN recognises the common principles and is exploring possible cooperation between its AOIP and Japan’s Free and Open Indo-Pacific (FOIP) and India’s Indo-Pacific Oceans Imitative (IPOI), as reflected in the Joint Statement of the 2020 ASEAN-Japan Summit on Cooperation on ASEAN Outlook on the Indo-Pacific[12] and the ASEAN-India Plan of Action 2021-2025.[13] The language in the ASEAN-US Plan of Action 2021-2025[14], on the other hand, is more guarded but there is a clear willingness to leverage the US’ Indo-Pacific vision to support the normative ballast of the AOIP. As for China, ASEAN takes a different tack focusing on development and connectivity, as reflected in the 2019 ASEAN-China Joint Statement on Synergising the Master Plan on ASEAN Connectivity (MPAC) 2025 and the Belt and Road Initiative (BRI).[15] This is indeed ASEAN’s promiscuous diplomacy at its best.
INDONESIA AND VIETNAM – A TALE OF TWO INDO-PACIFIC APPROACHES
Within ASEAN, Indonesia and Vietnam are arguably the most forward-leaning in embracing the Indo-Pacific construct, albeit from different perspectives. For Indonesia which saw its own Indo-Pacific cooperation concept reincarnated in the AOIP, embracing “Indo-Pacific” means giving full expression and effect to the Outlook. Indonesia has pushed, with little success, for follow-up to the AOIP at the East Asia Summit (EAS). Indonesia also actively promoted support for the AOIP at the ASEAN Regional Forum (ARF) and with ASEAN Dialogue Partners. Speaking at the 2020 ASEAN-US summit, foreign minister Retno Marsudi said: “Indonesia will always hope the US becomes an important and strategic partner in the Indo-Pacific region, including in the application of ASEAN Outlook on the Indo-Pacific”.[16]
Through the AOIP, Jakarta aims to promote a non-aligned Indo-Pacific that is led neither by America nor China but is ASEAN-centred, one that is anchored in the normative elements and four key cooperation areas of the Outlook. ASEAN centrality is both an end and a means in Indonesia’s Indo-Pacific vision, which befits the role that Indonesia sees for itself as “ASEAN’s leader and as a global middle power”.[17] As noted by Dewi Fortuna Anwar, the AOIP “underlines the importance that Indonesia places on ASEAN as the cornerstone of its foreign policy, emphasising ASEAN’s centrality as the primary vehicle for managing relations with the major powers in the Indo-Pacific region.”[18]
Also in line with President Jokowi’s foreign policy pragmatism, Indonesia prioritises the implementation of the AOIP’s four priority areas of maritime cooperation, connectivity, sustainable development, and economic cooperation. This is indeed the extension of Jakarta’s Indo-Pacific cooperation concept that focuses on promoting maritime trade and connectivity and protecting marine resources rather than diving into the narrative of great power rivalry.[19] Indonesia planned to host the Indo-Pacific Infrastructure and Connectivity Forum in 2020 as “a manifestation of Indonesia’s Indo-Pacific cooperation concept” and as part of its follow-up agenda on the AOIP.[20] The event is yet to take place, and was postponed due to COVID-19. Indonesia is also the proponent of the EAS Statement on Marine Sustainability in November 2020.[21]
Compared to Indonesia’s constructivist ASEAN-led approach, Vietnam’s embrace of the Indo-Pacific has a realist balance-of-power anchor that is more receptive to minilateral engagements outside the ASEAN framework. Hanoi is more interested in leveraging the Indo-Pacific discourse for its own security and economic interests than in promoting the AOIP for its own sake. Officially, Vietnam maintains the term “Asia-Pacific region” as reflected in the Political Report of the recent 12th National Congress of the Communist Party of Vietnam (CPV).[22] Yet, even as Hanoi stops short of an official endorsement of the Indo-Pacific, it has tacitly embraced this construct in both declaratory and substantive ways.
Vietnam’s worries over China’s assertive actions in the SCS, hence the imperative to find a counterbalance, is an underlying key factor for that embrace. Whenever Vietnam engages in the Indo-Pacific discourse, it always evokes the principles of independence and sovereignty, respect for legitimate rights and interests of all nations, and upholding of international law and rules-based order. Commenting on the Trump Administration’s declassified Strategic Framework for the Indo-Pacific on 14 January 2021, the spokeswoman of Vietnam’s Ministry of Foreign Affairs said: Vietnam “welcome[s] regional connectivity initiatives, contributing to peace, stability, cooperation and development of the region based on rules and respect for international law, as well as respecting the legitimate rights and interests of all countries, including ASEAN’s central role in the evolving regional structure.”[23]
The past year also witnessed the strengthening of Vietnam’s bilateral relations with the Quad countries, all of which attach increasing importance to Hanoi in their respective Indo-Pacific strategy. Hanoi welcomed Japan’s new Prime Minister Yoshihide Suga in his first overseas trip in October 2020 and US Secretary of State Mike Pompeo and National Security Advisor Robert O’Brien in the last few months of the Trump Administration. The Joint Vision Statement of the Vietnam-India Virtual Summit in December 2020 saw Vietnam embrace the term “Indo-Pacific” for the first time in a high-level joint statement. It says “enhanced defense and security partnership between Viet Nam and India will be an important factor of stability in the Indo-Pacific region” and highlights “the AOIP and India’s Indo-Pacific Oceans Initiative to further promote partnership in the Indo-Pacific region”.[24]
Notably, Vietnam’s engagement with the Quad members on the Indo-Pacific is as much about economics as it is about security. As part of their broader efforts to present an alternative to China’s Belt and Road Initiative and to reduce over-reliance on China-centred production networks, the US, Japan and Australia, individually or jointly, see Vietnam as a preferred destination for their infrastructure financing and supply chain resilience initiatives. In November 2020, the chief of the CPV Central Economic Committee Nguyen Van Binh held a virtual conference with the Japan Bank for International Cooperation (JBIC), the United States International Development Finance Corporation (DFC) and Australia’s Export Financing Agency (EFA) to promote infrastructure financing in Vietnam.[25] Another high-profile event was the Indo-Pacific Business Forum (IPBF) in November 2020 with the participation of Vietnam’s foreign and trade ministers. Such high-level political endorsement has been translated to a series of energy projects with American investors, especially power plants using liquefied natural gas (LNG) imported from the US.[26]
Of note, Vietnam does not shy away from the publicity and sensitivity of the Indo-Pacific narrative that underlie these initiatives. Another example is Vietnam’s participation in the 2020 ad hoc Quad plus three meetings (together with New Zealand and South Korea) to discuss cooperation on pandemic response and economic recovery.[27] This does not necessarily mean that Vietnam will be forthcoming in joining a Quad-plus arrangement proper. Yet, its participation sent an important signal about the range of strategic choices that Vietnam keeps available for itself.
A CONTENTIOUS BUT DYNAMIC DISCOURSE
While the Indo-Pacific concept is yet to be internalised as part of ASEAN’s strategic culture, there is a growing reckoning within the region that the Indo-Pacific is here to stay. Only 11.8% (2019) and 13.3% (2020) of the respondents to the SSEA survey thought that “the concept will fade away”. When we factor the Quad, the picture becomes even more dynamic and complex. According to the SSEA survey in 2020, 45.8% of the respondents thought that the Quad had ‘positive’ or ‘very positive’ impact on regional security versus only 16.2% choosing ‘negative’ or ‘very negative’ impact. Again, Indonesia’s development-oriented approach and Vietnam’s realism towards the Indo-Pacific also influence their respective perceptions of the Quad. 65.8% of Vietnamese respondents chose ‘positive’ and ‘very positive’ impact, compared to only 31.1% of Indonesian respondents.[28]
There is another layer of complexity when we zero in on what Southeast Asian foreign policy elites think about their respective country’s engagement with the Quad at the operational level. Even though they have divided opinions with regard to the Quad’s impact on regional security, the majority of them (61.6%) thought that their country should participate in security initiatives and military exercises under the Quad framework. Except for Laos and Cambodia, more than half of the respondents from the remaining eight AMS chose “Yes” for this proposition.[29]
The coming into power of the Biden Administration has injected further dynamism into the Indo-Pacific discourse. While inheriting the Trump Administration’s Indo-Pacific strategy, especially in continuing the US’ competitive and even adversarial approach towards China,[30] the Biden Administration has made significant updates to the Quad. Biden’s proactive moves in his very first months to consolidate the Quad through the first-ever Quad summit on 12 March 2021[31] sent a strong message that America is back, in close consultation and coordination with its allies and partners, and is pushing forward the Indo-Pacific strategy.
The current state of affairs has evolved significantly from where the Quad 2.0 was restarted in late 2017 or even where it was last year. The convergence of strategic interests among the four powers has become more solid. The Quad’s institutional set-up, albeit still nascent and ever evolving, is getting more dense and regular.[32] Most remarkably, the Quad’s agenda has been broadened beyond the heavily militarised maritime focus to “put forward a positive agenda and a positive vision”[33] that aims to address global issues and deliver global public goods in climate change, critical technologies and COVID-19 vaccines.
Arguably, the broadening of the Quad’s horizons does not dilute its China focus. Rather, its approach towards addressing the China challenge has become more holistic and multi-dimensional, involving not only raw hard power but also smart power and soft power. Such a positive agenda will help the Quad gain more currency. Especially, the Quad Vaccine Partnership with a focus on Southeast Asia[34] is a calibrated move that, if implemented effectively and in a timely manner, would go a long way in winning hearts and minds in the region. It will also help shift the prevailing narrative on the Quad as a China-containing NATO-like coalition, and demonstrates the collective strength of the Quad for global public goods if they can get their act together. The appeal of their positive agenda and their capacity to deliver would then be harder for other countries to resist.
CONCLUSION
The Indo-Pacific discourse over the past two years has proven to be dynamic and adaptable, with an evolving agenda that engages both Indonesia’s constructivist and Vietnam’s realist approaches. ASEAN and its member states should continue to be creative and adept in leveraging the Indo-Pacific to their interests. For instance, through ASEAN frameworks such as the EAS and ASEAN dialogue relations with the Quad members individually or collectively, they can amplify the Southeast Asia content/focus in the Quad Vaccine Partnership and the Supply Chain Resilience Initiative. Outside of ASEAN, states in the region should continue to utilise existing engagements and emerging platforms at bilateral, trilateral and minilateral levels to access resources and facilities made available by the major powers in the Indo-Pacific context. What is needed is grit and confidence from small states to look at the Indo-Pacific through the lens of unfolding possibilities rather than as a limited set of choices.
ISEAS Perspective 2021/49, 20 April 2021
ENDNOTES
[1] The ASEAN Outlook on the Indo-Pacific, June 2019, https://asean.org/storage/2019/06/ASEAN-Outlook-on-the-Indo-Pacific_FINAL_22062019.pdf.
[2] Rizal Sukma, “Indonesia, ASEAN and shaping the Indo-Pacific idea”, East Asia Forum, 19 November 2019, https://www.eastasiaforum.org/2019/11/19/indonesia-asean-and-shaping-the-indo-pacific-idea/.
[3] Malcolm Cook, David Engel and Huong Le Thu, “Suga signals commitment to ‘free and open Indo-Pacific’ with Vietnam and Indonesia visits”, The Strategist, Australian Strategic Policy Institute, 2 November 2020, https://www.aspistrategist.org.au/suga-signals-commitment-to-free-and-open-indo-pacific-with-vietnam-and-indonesia-visits/; Ken Moriyasu, “Biden’s Indo-Pacific team largest in National Security Council”, Nikkei Asia Review, 11 February 2021, https://asia.nikkei.com/Politics/International-relations/Biden-s-Asia-policy/Biden-s-Indo-Pacific-team-largest-in-National-Security-Council.
[4] Ministry of Foreign Affairs of Singapore, “Minister for Foreign Affairs Dr Vivian Balakrishnan’s Written Reply to Parliamentary Question”, 5 August 2019, https://www.mfa.gov.sg/Newsroom/Press-Statements-Transcripts-and-Photos/2019/08/05-Aug_Min-Written-PQ-Reply.
[5] ARF Annual Security Outlook 2019 and 2020, ARF website, https://aseanregionalforum.asean.org/librarycat/annual-security-outlook/.
[6] Tang, S. M. et al., The State of Southeast Asia: 2019 (Singapore: ISEAS-Yusof Ishak, Institute, 2019) and Tang, S. M. et al., The State of Southeast Asia: 2020 (Singapore: ISEAS-Yusof Ishak, Institute, 2020), /category/articles-commentaries/state-of-southeast-asia-survey/.
[7] Dirlik, Arif. “The Asia-Pacific Idea: Reality and Representation in the Invention of a Regional Structure.” Journal of World History, vol. 3, no. 1, 1992, pp. 55–79. JSTOR, www.jstor.org/stable/20078512. Accessed 7 Apr. 2021.
[8] Ibid.
[9] Ministry of Foreign Affairs of the People’s Republic of China, “Foreign Minister Wang Yi Meets the Press”, 9 March 2018, https://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1540928.shtml.
[10] “U.S. Indo-Pacific strategy “hegemonic”: FM spokesperson”, Xinhuanet, 13 January 2021, http://www.xinhuanet.com/english/2021-01/13/c_139664977.htm.
[11] ARF Annual Security Outlook 2020, op. cit.
[12] Joint Statement of the 23rd ASEAN-Japan Summit on Cooperation on ASEAN Outlook on the Indo-Pacific, 12 November 2020, https://asean.org/joint-statement-23rd-asean-japan-summit-cooperation-asean-outlook-indo-pacific/.
[13] Plan of Action to Implement the ASEAN-India Partnership for Peace, Progress and Shared Prosperity (2021-2025), https://asean.org/storage/2020/09/ASEAN-India-POA-2021-2025-Final.pdf.
[14] Plan of Action to Implement the ASEAN-United States Strategic Partnership (2021-2025), https://asean.org/storage/2020/09/ASEAN-US-Plan-of-Action-2021-2025-Final.pdf.
[15] ASEAN-China Joint Statement on Synergising the Master Plan on
ASEAN Connectivity (MPAC) 2025 and the Belt and Road Initiative (BRI), https://asean.org/storage/2019/11/Final-ASEAN-China-Joint-Statement-Synergising-the-MPAC-2025-and-the-BRI.pdf.
[16] “US strategic partner for ASEAN in Indo-Pacific region: Marsudi”, Antara News, 14 November 2020, https://en.antaranews.com/news/161432/us-strategic-partner-for-asean-in-indo-pacific-region-marsudi.
[17] Weatherbee, D. (2019, Indonesia, ASEAN, and the Indo‐Pacific Cooperation Concept. ISEAS Perspective No. 47.
[18] Anwar, D. F. (2020), Indonesia and the ASEAN outlook on the Indo‐Pacific, International Affairs, 96(1), 111–129.
[19] Jansen Tham, “What’s in Indonesia’s Indo-Pacific Cooperation Concept?”, The Diplomat, 16 May 2018, https://thediplomat.com/2018/05/whats-in-indonesias-indo-pacific-cooperation-concept/.
[20] Karl Lee Chee Leong, “What to Expect from Indonesia’s Indo-Pacific Push in 2020?”, The Diplomat, 6 March 2020, https://thediplomat.com/2020/03/what-to-expect-from-indonesias-indo-pacific-push-in-2020/.
[21] The East Asia Summit Leaders’ Statement on Marine Sustainability, 14 November 2020, https://asean.org/storage/2020/11/31-EAS-Leaders-Statement-on-Marine-Sustainability-FINAL.pdf.
[22] Political Report of the Vietnamese Communist Party at the 13th Party Congress, draft as of 10 October 2020, Vietnamese text, tuoitre.vn, https://tuoitre.vn/toan-van-bao-cao-cua-ban-chap-hanh-trung-uong-dang-khoa-xii-ve-cac-van-kien-trinh-dai-hoi-xiii-20210126103335381.htm.
[23] “Vietnam supports peaceful, stable Indo-Pacific region”, vov.vn, 14 January 2021, https://vov.vn/en/politics/diplomacy/vietnam-supports-peaceful-stable-indo-pacific-region-830705.vov.
[24] Viet Nam-India Joint Vision Statement for Peace, Prosperity and People, 21 December 2020, http://news.chinhphu.vn/Home/Full-Viet-NamIndia-Joint-Vision-Statement-for-Peace-Prosperity-and-People/202012/42482.vgp.
[25] “Trưởng ban Kinh tế Trung ương hội đàm trực tuyến với các tổ chức tài chính lớn” (Chief of the Central Economic Committee holds talks with major financing institutions), baochinhphu.vn, 30 October 2020, http://baochinhphu.vn/Utilities/PrintView.aspx?distributionid=412573.
[26] US Mission to ASEAN, Fact Sheet: 2020 Indo-Pacific Business Forum Promotes Free and Open Indo-Pacific, 29 October 2020, https://asean.usmission.gov/2020-indo-pacific-business-forum-promotes-free-and-open-indo-pacific/.
[27] Derek Grossman, “Don’t Get Too Excited, ‘Quad Plus’ Meetings Won’t Cover China”, RAND Corporation, 9 April 2020, https://www.rand.org/blog/2020/04/dont-get-too-excited-quad-plus-meetings-wont-cover.html.
[28] Tang, S. M. et al., op. cit.
[29] Ibid.
[30] Clarissa Yong, “Blinken singles out China as biggest geopolitical test for US”, The Straits Times, 5 March 2021, https://www.straitstimes.com/asia/se-asia/blinken-singles-out-china-as-biggest-geopolitical-test-for-us.
[31] The White House, Fact Sheet: Quad Summit, 12 March 2021, https://www.whitehouse.gov/briefing-room/statements-releases/2021/03/12/fact-sheet-quad-summit/.
[32] Tanvi Madan, “What you need to know about the “Quad,” in charts”, Brookings, 5 October 2020, https://www.brookings.edu/blog/order-from-chaos/2020/10/05/what-you-need-to-know-about-the-quad-in-charts/; “This week’s Quad ministerial meeting, in four charts”, Brookings, 8 October 2020, https://www.brookings.edu/blog/order-from-chaos/2020/10/08/this-weeks-quad-ministerial-meeting-in-four-charts/.
[33] Tanvi Madan and Adrianna Pita, “What does the Quad summit signal for U.S. engagement in the Indo-Pacific?” podcast, Brookings, 16 March 2021, https://www.brookings.edu/podcast-episode/what-does-quad-summit-signal-for-u-s-engagement-in-the-indo-pacific/.
[34] The White House, op. cit.
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