Building an ASEAN-China strategic partnership<\/p>\n
S. Pushpanathan, Jakarta<\/p>\n
ASEAN-China relations started to pick up pace with the
\nnormalization of relations between China and Indonesia and then
\nSingapore and Brunei Darussalam. China became a participant of
\nthe ASEAN Regional Forum (ARF) in 1994 and a dialogue partner of
\nASEAN in 1996. There has been no turning back in the relations
\nsince then.<\/p>\n
In fact, the partnership has expanded and deepened. The
\n\"China threat\" has gradually given way to the \"China Opportunity\"
\nand the South-China Sea is seen less as a \"flashpoint\" in the
\nregion now compared with a decade ago.<\/p>\n
While formal relations with ASEAN were established in 1996, it
\nwas not until 2001 that the relationship started to witness a
\nsubstantive content with China's proposal to establish a free
\ntrade area (FTA) and to focus priority cooperation in the areas
\nof agriculture, information technology, human resource
\ndevelopment, mutual investments and Mekong river basin
\ncooperation.<\/p>\n
This led to the signing of the Framework Agreement on
\nComprehensive Economic Cooperation in November 2002 to realize a
\nFree Trade Area by 2010. The \"early harvest\" plan under the FTA
\ncomprising over 500 commodities commenced in January 2004 and the
\nnegotiations for the trade in goods component of the FTA is
\nexpected to be concluded soon. The negotiations for services,
\ninvestment, and the dispute settlement mechanism (DSM) have
\ncommenced.<\/p>\n
Trade between ASEAN and China had grown substantially since
\n1995. In 2003, it grew by 43 percent to a new high of US$ 78.2
\nbillion. ASEAN and China are targeting to hit the $100 billion
\nmark in two-way trade by 2005.<\/p>\n
Bilateral investments are also growing. In 1991, ASEAN's
\ninvestment in China was only US$90 million and it reached $4.8
\nbillion in 1998. By 2001, the total FDI stood at $26.2 billion,
\naccounting for 6.6 percent of total FDI utilized by China. On the
\nother hand, China's investment into ASEAN is small but
\nincreasing. By 2001, China's investment in ASEAN reached $1.1
\nbillion accounting for 7.7 percent of China's overseas
\ninvestments.<\/p>\n
Peace and security in the region received a boost with China's
\nsigning of the Declaration on the Conduct (DOC) of Parties in the
\nSouth China Sea in November 2002 in Cambodia and its accession to
\nthe Treaty of Amity and Cooperation in Southeast Asia in 2003 in
\nBali. Both the events signaled the mutual desire to promote trust
\nand confidence and to secure the peace and stability of the
\nregion.<\/p>\n
ASEAN-China relations were raised to a new level with the
\nsigning of the Joint Declaration on the Strategic Partnership for
\nPeace and Prosperity in 2003 in Bali paving the way for a more
\nintensive and substantive interaction between ASEAN and China. A
\nplan of action to implement the strategic partnership is being
\ndrawn up.<\/p>\n
Development cooperation, which acts as a gel to further cement
\nthe relationship, has deepened and widened with agreements
\nconcluded in agriculture, non-traditional security issues and
\ninformation and communications technology. More are being
\nplanned. Close to 40 projects have been implemented and China
\ncontinues to assist ASEAN in narrowing the development gaps
\nthrough the Initiative for ASEAN integration (IAI).<\/p>\n
The strategic partnership will be mutually beneficial for a
\nnumber of reasons. ASEAN and China are showing strong growth
\npotentials and can benefit from closer economic ties. ASEAN is
\nexpected to grow by 5-6 percent a year up to 2008 and China is
\nexpected to grow by 8-9 percent between 2004 and 2008.<\/p>\n
ASEAN views China as more an opportunity than a competitor.
\nChina is now the global factory and the largest market with more
\nthan a billion consumers. ASEAN could be the service provider and
\nexporter of goods to the increasingly sophisticated markets in
\nthe coastal cities of China.<\/p>\n
China is important to maintaining peace and stability in the
\nregion. Any incidents in the Taiwan Straits and the Korean
\nPeninsula or fluctuation in the Chinese economy will have a
\nbearing on the region and its economies. Thus, engaging China and
\nworking with China will be of interest to ASEAN.<\/p>\n
Security dialog should be promoted for better appreciation of
\nthe positions of ASEAN and China on various issues concerning the
\nregion and the world so that common positions could be forged in
\nareas of mutual interest.<\/p>\n
High level interactions should be promoted for better
\nunderstanding and to enhance the comfort levels among government
\nleadership, top policy makers, bureaucrats and technical experts
\nto facilitate candid discussions and identification of concrete
\ncooperative activities.<\/p>\n
ASEAN and China should do more in strengthening the economic
\npartnership. Both sides should work towards a high standard FTA
\ncovering not only commodities but also services and investments.
\nThe FTA should serve as a template for other regional FTAs being
\nnegotiated in the Asia Pacific region.<\/p>\n
China can do more in terms of investing in the manufacturing
\nand service sectors of ASEAN where there are comparative
\nadvantages to be tapped so that ASEAN can contribute to China's
\neconomic growth and at the same time receive economic gains.<\/p>\n
China should increase its assistance to ASEAN, especially for
\nthe Initiative for ASEAN Integration, to narrow the development
\ngaps within ASEAN, as this is important for the closer economic
\npartnership between ASEAN and China.<\/p>\n
ASEAN and China should work towards the realization of an East
\nAsian community in the long-run together with Japan and the ROK.
\nImplementing the East Asia Study Group's 26 measures and
\nstrengthening sectoral cooperation under the ASEAN Plus Three
\nprocess in the fields of monetary and finance cooperation,
\nenergy, public health and others will be crucial for the building
\nof an East Asia community for the future.<\/p>\n
ASEAN and China has turned the corner around in the last
\ndecade to establish a more fruitful partnership. However, new
\nchallenges and problems could emerge in the region that will test
\nthe strength of the partnership. ASEAN and China will have to
\ntake them on their stride as they forge a strategic partnership
\nto benefit the present and future generations in the region.<\/p>\n
The writer is Head of External Relations and ASEAN Plus Three
\nRelations at the ASEAN Secretariat. The views expressed are
\npersonal.<\/p>",
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