EAGA: Charting the linkages

EAGA: Charting the linkages

By Pushpa Thambipillai

The East ASEAN Growth Area (EAGA) seems set to proceed on a shared but varying pace of cooperation.

SINGAPORE: According to an Indonesian minister, his country's vision is to ensure that at least 18 of its provinces will be involved in some form of growth triangle with its neighbors. It is no surprise then that Indonesia (like Malaysia) is currently in all three growth areas in ASEAN: the Indonesia-Malaysia- Singapore Growth Triangle (IMS-GT), the Indonesia-Malaysia- Thailand Growth Triangle (IMT-GT) and the Brunei-Indonesia- Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA).

The BIMP-EAGA is particularly significant in that Indonesia dominates in terms of the participating provinces - 10 out of the 16 members come from the Indonesian provinces of Kalimantan, Sulawesi, Maluku and Irian Jaya. But numbers alone may not be the answer to a successful growth area; while IMS-GT started off with three members, EAGA took off with three times that number.

The East ASEAN Growth Area (EAGA) was set up in March 1994, largely on the initiative of President Ramos. He had persuaded the leaders of Brunei, Indonesia and Malaysia to develop the eastern parts of ASEAN through collective efforts. Of special interest to him were his own depressed regions in southern Philippines beset by poverty and insurgency.

Manila on its own was unable to deliver the much needed economic package. An attractive option was to cooperate with the neighbors to promote cross border trade and investment.

Thus was born EAGA, originally grouping Brunei, West and East Kalimantan, North Sulawesi, Sabah, Sarawak, Labuan, Mindanao and Palawan, to be joined by seven other Indonesian units in July 1996 (two each from Kalimantan and Sulawesi plus Maluku and Irian Jaya). The Indonesian minister cited above was no doubt taking note that all of Kalimantan, Sulawesi, Maluku and Irian Jaya were linked up with the neighboring provinces of ASEAN - a move to supplement its national development efforts.

While the three years since its inception is a short time to assess the impact of sub-regional cooperation, it is illustrative of the direction EAGA has adopted. A modest level of joint activities is underway. But the main focus is still on charting the framework for substantive cooperation.

The Asian Development Bank has completed a major study identifying areas for collaboration. The "getting to know you" agenda seems to be of prime concern. A mini ASEAN is already in the making; to date, EAGA has held numerous meetings and trade expositions. Where ASEAN failed to integrate the far reaches of the association into its mainstream activities, EAGA is attempting to do so; where ASEAN only looked at the capital cities or posh resorts for its gatherings, EAGA is convening in far off destinations, thereby exposing other ASEAN areas of interest to the tourist world - Manado, Davao, Kota Kinabalu, Kuching, Balikpapan and Puerto Princesa - to cite a few.

Like the other two ASEAN growth triangles, EAGA does not have a central secretariat.

Instead its policy proposals are coordinated through a series of meetings in different locations, at the ministerial and senior officials levels, with participation from the private sector as well.

The various regional chambers of commerce established the East ASEAN Business Council (EABC) in November 1994, leading to the establishment of a Secretariat in Bandar Seri Begawan in 1996; half of EABC's operating cost is borne by the Brunei government. EABC's task is to encourage cross border investment by collecting and disseminating information. Representation from the various members' private sectors is now a permanent fixture in all the committee meetings as they are the vital component of any growth area strategy.

Public-sector backing and private sector-led growth is the slogan of the growth area. But will it move further than sloganeering? EAGA extends from West Kalimantan in the west to Irian Jaya in the East, stretching for about 3,500,km in length and 2,000,km in width.

One wonders if there is anything in common between Palawan in the north and Jayapura in the south or Kuching in the west and Ternate in the east.

While the grouping represents a population base of 40 million, it also depicts extremes in income distribution, from about US$16,000 in Brunei, the third highest per capita income state in Asia, to about US$40 in the least developed areas of Indonesia where subsistence economy is the norm.

The abundant natural resources alone will not propel the ambitious target areas of cooperation that the policy makers have adopted. The sub-region has lacked a consistent pattern of formal political interactions, transport and communication links, trained labor force and an enterprising entrepreneurial community that could look beyond its national borders.

The private sector's lack of a regional business strategy is not entirely to blame; the various provincial governments have to concentrate on their respective territories in line with national directives from their centers of power. Direct official links, even if they affect the subregion need to originate from the centers of BIMP before descending to EAGA. A reduction of the strict control from the center would assist in a more effective sub regional cooperation for mutual benefit; on the other hand, central assistance in terms of political and economic contribution is crucial.

Expansion

Expansion of air and sea linkages, fisheries cooperation and joint tourism development have been targeted as priority areas for cooperation. There are nine other areas for cooperation: construction, agroindustry, capital formation and financial services, forestry, telecommunications, energy, people mobility, human resource development, and environmental protection. The expansive area under EAGA would definitely need more lines of communication if the goals of EAGA's framers are to be realized - to facilitate the freer movement of people, goods and services.

Infrastructure development in transportation is seen as a basic requirement for EAGA to succeed. For example, on the island of Borneo, a coastal road link has been lacking because of gaps in certain sections. Over the past six months, there has been political interest to ensure that the Pan Borneo Highway becomes a reality within the next five years. The positive attitude could have been inspired by the proposed rail link from Singapore to Yunnan, a much more complex scheme than the Borneo road link. Direct air links are also under study; government and business leaders while planning their itineraries realize the cumbersome methods of having to fly to a capital city in order to reach a neighboring one.

Improved air links will spur tourism and people mobility, especially migrant labor moving from the exporting to the importing regions.

A visible phenomenon is for micro geo-economic entities to emerge, clustered around contiguous urban centers. Capitalizing on common interests and physical proximity, air/sea linkages and tourism are advancing urbanization in EAGA. Miri-Bandar Seri Begawan, Kuching-Pontianak, Davao-Manado, are a few of the paired centers that are beginning to record shared activities. Consequently, the more distant and isolated areas would be left behind and not drawn into the linkages, thereby remaining on the periphery of EAGA, as they have in pre-EAGA time. That could further divide the developed EAGA from the undeveloped EAGA.

Successful growth areas thrive on existing patterns of interaction. Within EAGA, one can see historic and cultural links being strengthened along the Sabah-Brunei-Sarawak corridor.

It is inevitable that familiar affinities will take precedence while other opportunities will emerge for the other areas. They could be the providers of labor and other resources to the developed corridors and thus participate in enjoying the spill overs, rather than seeking an equitable share of the action, hoping for investment and jobs to arrive. Like the concept of the 6-X formula in ASEAN or the staggered application of CEPT in AFTA, EAGA seems set to proceed on a shared but varying pace of cooperation.

The size of the participating units or the number of MOUs signed will not by themselves contribute to the success of the EAGA. The political will for policy reform, a transparent economic system and a positive attitude on the part of entrepreneurs both from within and outside to engage across borders will be crucial for the dynamism of the sub-region.

The writer teaches Politics and International Relations at the Department of Public Policy and Administration, Universiti Brunei Darussalam.

Window: Within EAGA, one can see historic and cultural links being strengthened along the Sabah-Brunei-Sarawak corridor.