Challenges to SE Asian resilience

Challenges to SE Asian resilience

By Juwono Sudarsono

This is the first of two articles on Southeast Asia based on a
paper presented at the 30th Anniversary of Indonesia Petroleum
Ltd., (INPEX) in Tokyo on Sept. 25.

TOKYO: At the threshold of the 21st Century, it is worth
remembering that in the past 30 years the Southeast Asian region
was fortunate enough to have been at the center of the East Asia
economic growth process. At the strategic level, Southeast Asia's
success was the result of the successful Japanese-U.S.
partnership which helped transform the area from an arena of Cold
War confrontation to a model of regional cooperation and North-
South dialog between rich and poor countries.

From SEATO in 1954 to the ASEAN Regional Forum (ARF) in 1994,
the trajectory of regional stability and economic cooperation was
made possible by the underpinnings: Japan's powerful economic
"pull" to the region since the mid-1960's; the accelerated growth
of the economic tigers of Northeast Asia in the 1970s and the
subsequent economic growth of the ASEAN grouping beginning in the
early 1980s. Japan provided the economic underpinning whilst the
United States assumed the strategic nuclear and conventional
assurance. From the Japan-U.S. Treaty in Northeast Asia down to
the ANZUS grouping in the South Pacific, the ensuing arc of
security and development survived the many crises and tensions of
the Cold War and post-Cold War era. What the United States lost
in Vietnam is gained in ASEAN.

The Japan-United States connection is important because the
future course of Southeast Asia in the 21st Century may well
depend on how the countries in that region follow through on the
success of building a more coherent Southeast Asian identity. In
fact, ASEAN's success is currently being tested in the distinct
but intertwined twin processes of APEC/AFTA and the ARF. Can the
economic growth of the countries in the region, which had been
geared for 30 years to exporting more than 35 percent of its
products to the United States and Japan, survive the shift toward
more than 37 percent intra-regional trade within the East Asian
and Southeast Asian context? Can strategic stability survive the
retrenchment of American military interest and rising East Asian
nationalism?

Southeast Asia's success has been a product of its geo-
strategic importance, its abundant and varied natural resources
and its potential as vibrant markets for the Japanese and
American economies matching both opportunity and self-
advancement. That success has also been underpinned by the
constant flow of 60 percent of energy resources from the Middle
East, allowing key economies such as Thailand, Malaysia,
Singapore, Indonesia and the Philippines to benefit from the
Japanese economic powerhouse and American military power.

Success breeds success. The original "ASEAN-5" now aims at
incorporating all of Indochina and Myanmar into "ASEAN-10" by the
year 2000. But success brings new strategic imperatives and new
priorities to the forefront. After 30 years of regional economic
cooperation based on the trinity of political stability, economic
growth and social justice, a new generation of Southeast Asians
are now taking charge of their governments and their economies.
These young leaders, officials in government and the military,
professionals and technicians in the private sector are only too
aware that the region must play a more assertive role in facing
and cooperating with the great powers -- China, Japan, the United
States and Russia.

In the past, Southeast Asian leaders were aware that the great
powers tended to view the region as an area of secondary
strategic importance, and to a degree that view may politically
still be valid. But the imperatives of geo-economic interaction
and more importantly, global business activity, make it
inevitable that the region will play a more significant role in
determining the terms and conditions of trade, investments,
finance and human resources. Certainly Southeast Asians would not
want their region to remain mere recipients and consumers of
products and services provided by powerful external powers and
their multinational corporations.

Another important dimension is that the energy market in the
region is changing fast. In the past, energy requirements were
met from the Middle East and supplemented by local production,
principally from China and Indonesia. But in the next 15 years,
the Malacca and Singapore Straits, as well as the Lombok and
Makassar waterways, will see two to three times the current
amount of oil traffic from the Gulf. By the year 2010, it is
estimated that the dependence ration will reach 60 percent of
OPEC-produced oil. Barring new oil strikes in the South China
area, this means that many countries in Southeast Asia will have
to reach agreements on security which would guarantee the flow of
energy to Southeast and Northeast Asia.