Indonesia, ASEAN and East Asia

By Jusuf Wanandi

JAKARTA (JP): Much criticism has been directed at ASEAN for its inability to overcome the malaise afflicting the institution. This is partly due to the financial crisis of 1997 and also to the addition of several new members. One result of the crisis is that a certain inward-lookingness has developed among ASEAN member states, except Singapore.

This is especially true of Indonesia, the anchor of the Association of Southeast Asian Nations and a country going through much turmoil. Indonesia's leadership will be limited for some time to come, but no other member state has been able to fill the gap. This is why an East Asian regional cooperation has become more important.

While Southeast Asia is stagnating, East Asia is in a more favorable situation as it starts to move again economically.

Countries such as China, South Korea and economies like Taiwan and Hong Kong are relatively well off. Even Japan has recovered somewhat from her decade-long recession. Strategically, there have been significant improvements in East Asia, particularly on the Korean peninsula following the North-South Summit. Although Taiwan still faces some uncertainties following Chun's election as president, there is no immediate threat of war with China.

Because of this more favorable situation, foreign direct investment is flowing again into East Asia. In the medium term, leadership for an East Asian regional cooperation will have to come from Northeast Asia. At present it is still based on the ASEAN Plus Three cooperation encompassing the 10 ASEAN countries plus China, Japan and South Korea.

There are two main driving forces for an East Asian regional cooperation. The first is economic. The economic interdependence of the region is a fact, based on trade, investment and technology. The contagious effect of the 1997 East Asian financial crisis is ultimate proof of this interdependence.

The second force is strategic. China's emergence has become a regional (and even a global) problem. The problem is how the region can cope with her as a great power. China has a legitimate interest in the region, and she has to be recognized as a great power by the region and the world. But she also has to show her responsibility to the region, and to the world as well.

There are three additional problems. The first is China-U.S. bilateral relations. Here Taiwan looms large as an obstacle, especially with a new president coming from the proindependence opposition party.

The second is relations between Asia and Japan. Here overcoming history and laying down the importance of future cooperation for both will be the defining factor for peace and stability in the region.

The third is the nonproliferation of weapons of mass destruction and arms control. Without overcoming this, peace and stability in East Asia will always be at risk. Here the problem is not only with East Asia, the Korean Peninsula in particular, but also with the South Asian subcontinent, namely the problem of nuclear weapons and the missile delivery systems of India and Pakistan, which could create havoc in East Asia.

And it is impossible for East Asia to do anything substantial about this. All these strategic factors make it imperative that there be an East Asian mechanism to support and assist bilateral efforts in overcoming them.

Without regional efforts these problems could become a real threat to peace and stability in the region.

In addition to the factors supporting East Asian regionalism, the political will for cooperation is also strong, after the financial crisis demonstrated the importance of cooperation.

The political will is also particularly strong because there is the need to cooperate in facing the challenges of globalization. Experience in regional cooperation, particularly ASEAN, the Asia Pacific Economic Cooperation Forum and the ASEAN Regional Forum, has been useful.

However, there are also factors inhibiting or limiting regionalism in East Asia. First, the bilateral relations between China and Japan are not entirely based on mutual trust due to history and a sense of competition for leadership of East Asia.

This could hinder deep regional cooperation in the future, and could also impede the emergence of leadership in East Asia.

An East Asian subregional organization will take some time to be realized, however, because East Asia's subregional cooperation has just began.

East Asia should come up with concrete programs of cooperation. It also needs a vision for the longer term, including its principles and objectives. A step-by-step approach, as was the case with ASEAN, is no longer adequate.

A vision should be established from the very beginning. East Asia is a vast region, where differences in values, political systems and stages of economic developments are real.

Common values as found in the European Union are nonexistent. However, Judeo-Christian values in Europe have not been able to prevent a few hundred years of wars. It was only the political will that arose out of the miseries of the two World Wars that made the creation of EU possible

The question for East Asia is whether the political will to cooperate regionally is strong enough to overcome the lack of common values.

What has been achieved so far and where is East Asian regional institutionalization heading?

The achievement is the establishment of the ASEAN Plus Three. This process consists of a summit, which met for the fourth time in Singapore last month.

There were also meetings of ministers of trade, ministers of finance and ministers of foreign affairs this year. The most remarkable result has been in financial cooperation, namely the creation of an arrangement to swap foreign currencies to prevent another financial crisis.

What can be expected from this regional cooperation? Some good ideas have been discussed in academic institutions and think tanks.

The following are among the issues which were discussed by the East Asian Vision Group: * The idea of a free trade arrangement for East Asia could be attractive. There is even talk of implementing it before AFTA (2008) or APEC (2010 and 2020). * On financial issues, the idea of an Asian Monetary Fund has been discussed and has been seemingly accepted, and should be gradually developed. * Some sort of mechanism could be established to formalize this process. * Open regionalism has been very much stressed as the only principle acceptable to the region. * The idea of establishing a community should be articulated. * Membership based upon the ASEAN Plus Three process should be maintained for the time being, but should be an open-ended one. * Some very important issues have been discussed, but no consensus has reached in the Vision Group; these include the question of how it should deal with other regional organizations (especially APEC) and other individual countries.

Political security issues and cooperation complicate the region. There has not been a consensus on human rights, sovereignty and humanitarian intervention. On these issues, there is obviously a divide among the countries of East Asia as well as ASEAN member states.

Therefore, cooperation on political and security issues should be left out in the initial phase. It is still unclear, for instance, as to how Japan and China will deal with each other and with other countries in the region.

Thus, the question of leadership in the region is still an open one. There is still disagreement among members of the Vision Group whether it should produce an action plan.

Membership in ASEAN Plus Three will likely be limited for the time being. If economic cooperation is the most important field of cooperation, then countries such as Australia and New Zealand cannot be ignored. Taiwan and Hong Kong should also be included.

In the area of financial cooperation, perhaps some of the new ASEAN members can join later when they are ready. Thus, the principle of "the coalition of the willing" could be employed.

An important issue is how this new regional entity relates to APEC and other regional institutions. APEC is particularly important, because it covers the wider region of the Asia Pacific, has real experiences in regional cooperation, has intellectual input and feedback, has private sector participation and, most importantly, has the United States as a member.

Since the U.S. still has some lingering doubts about an East Asian regional mechanism, it is important for this East Asian arrangement to support APEC. It should consult the U.S. at every stage of the cooperation, so as to avoid any misunderstanding. East Asian cooperation should become a catalyst for APEC's future development.

It should be made clear that countries and economies that support open regionalism can join the grouping. The East Asian cooperation arrangement is not an exclusive arrangement because as such it would be divisive for the Asia Pacific.

The U.S., on the other hand, is much more self-confident than 10 years ago, and will take this idea in stride, so long as the East Asian arrangement is based on open regionalism and as long as it becomes a catalyst in APEC.

For ASEAN, the East Asian regional cooperation would be important as a catalyst to get its act together, to help overcome the economic crisis, to reduce the divide between new and old members and to regain influence over East Asian regional affairs.

For Indonesia, the East Asian mechanism would be important because only with regional solidarity will she recover more quickly.

Last but not least, the participation of the private sector, academe and other section of civil society is important if an East Asian entity is going to get off the ground quickly.

Without such support, the idea of an East Asian cooperation arrangement will take much longer to be realized.

The writer is chairman of the Supervisory Board of the Centre for Strategic International Studies in Jakarta.