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ASEAN – OVERVIEW

ASEAN was formed on 8 August 1967 by Indonesia, Malaysia, the Philippines,


Singapore and Thailand. Since then, membership has expanded to include
Brunei, Burma (Myanmar), Cambodia, Laos, and Vietnam.
Its aims include –
• The acceleration of economic growth, social progress, cultural
development among its members.
• The protection of the peace and stability of the region.
• To provide opportunities for member countries to discuss differences
peacefully.
ASEAN spans over an area of 4.46 million km2 with a population of
approximately 580 million people, 8.7% of the world population. In 2009, its
combined nominal GDP had grown to more than USD $1.5 trillion. If ASEAN
was a single country, it would rank as the 9th largest economy in the world
in terms of nominal GDP.
The founders of the Association of Southeast Asian Nations (ASEAN)
envisioned it as eventually bringing together all the countries of Southeast
Asia and getting them to cooperate in securing the region’s peace, stability
and development. At the time the region was in tumult; several countries
were struggling for national survival or independence. Thus, only five
countries - Indonesia, Malaysia, the Philippines, Singapore and Thailand
signed the ASEAN Declaration of 8 August 1967.
Thirty-two years later-on 30 April 1999-ASEAN encompassed all ten countries
of Southeast Asia by admitting Cambodia. (Brunei Darussalam had been
admitted in 1984, Viet Nam in 1995, and Laos and Myanmar in 1997). Not
only has the association achieved the inclusion of all of Southeast Asia within
its fold, a goal that it had set for itself at its birth. It has also evolved into one
of the most influential regional associations in the world.
ASEAN has embraced a new vision of itself as “a concert of Southeast Asian
nations, living in peace, stability and prosperity, bonded together in
partnership in dynamic development and in a community of caring
societies.”
ASEAN’s success is all the more remarkable because it began at a time of
poverty and conflict, and because recently the region was deep in financial
crisis. The crisis, which began in July 1997, threatened to reverse the
region’s economic and social gains of two de-cades. That the ASEAN
economies have bounced back after two years of crisis vividly shows their
fundamental strength and resilience.

Today the ASEAN region stretches across three time zones and incorporates
a key part of Asia’s continental landmass and several archipelagos.
Economically, it belongs to the developing world, but some of its member
countries have joined the world’s top 20 most competitive economies. Its
population of about 500 million constitutes a huge, increasingly middle-class
market, half the size of China’s. One of every ten persons in the world today
is a Southeast Asian.
Besides its economic importance and the natural resources its marine
territories are believed to hold, Southeast Asia is also of global strategic
importance. It is the bridge between the Indian and Pacific Oceans. It
straddles some of the busiest sea-lanes in the world. The oil tankers and
freighters that pass daily through these sea-lanes buttress Japan’s status as
an industrial power.

HISTORY
ASEAN was preceded by an organisation called the Association of Southeast
Asia, commonly called ASA, an alliance consisting of the Philippines,
Malaysia, and Thailand that was formed in 1961. The bloc was established on
8 August 1967, when foreign ministers of five countries – Indonesia,
Malaysia, the Philippines, Singapore, and Thailand – met at the Thai
Department of Foreign Affairs building in Bangkok and signed the ASEAN
Declaration, more commonly known as the Bangkok Declaration.
The five foreign ministers –Adam Malik of Indonesia, Narciso Ramos of the
Philippines, Abdul Razak of Malaysia, S. Rajaratnam of Singapore, and Thanat
Khoman of Thailand – are considered as the organisation's Founding Fathers.

The motivations for the birth of ASEAN were


• the desire for a stable external environment
• the common fear of communism, reduced faith in or mistrust of
external powers in the 1960s, as well as the aspiration for national economic
development;
• ASEAN was designed to serve nationalism.

In 1976, the Melanesian state of Papua New Guinea was accorded observer
status. Throughout the 1970s, the organisation embarked on a program of
economic cooperation, following the Bali Summit of 1976. This floundered in
the mid-1980s and was only revived around 1991 when Thai proposed for a
regional free trade area. The bloc then grew and Brunei Darussalam became
the sixth member on 8 January 1984. On 28 July 1995, Vietnam became the
seventh member. Laos and Burma (Myanmar) joined two years later in 23
July 1997. Combodia joined on 30 April 1999.

During the 1990s, the bloc experienced an increase in both membership as


well as in the drive for further integration. In 1992, the Common Effective
Preferential Tariff (CEPT) scheme was signed as a goal to increase the
region’s competitive advantage since production base geared for the world
market. After the East Asian Financial Crisis of 1997 Chiang Mai Initiative was
taken which calls for better integration between the economies of ASEAN as
well as the ASEAN Plus Three countries (China, Japan, and South Korea).

At the turn of the 21st century, issues shifted to involve a more


environmental prospective. The organisation started to discuss
environmental agreements. These included the signing of the ASEAN
Agreement on Transboundary Haze Pollution in 2002, the Cebu Declaration
on East Asian Energy Security, the ASEAN-Wildlife Enforcement Network in
2005, and the Asia-Pacific Partnership on Clean Development and Climate. In
2006, ASEAN was given observer status at the United Nations General
Assembly.In 2007, ASEAN celebrated its 40th anniversary since its inception,
and 30 years of diplomatic relations with the United States. On 26 August
2007, ASEAN stated that it aims to complete all its free trade agreements
with China, Japan, South Korea, India, Australia and New Zealand by 2013, in
line with the establishment of the ASEAN Economic Community by 2015. In
November 2007 the ASEAN members signed the ASEAN Charter, a
constitution governing relations among the ASEAN members and
establishing ASEAN itself as an international legal entity. During the same
year, the Cebu Declaration on East Asian Energy Security in Cebu on 15
January 2007, by ASEAN and the other members of the EAS (Australia,
People's Republic of China, India, Japan, New Zealand, South Korea), which
promotes energy security by finding energy alternatives to conventional
fuels.

ASEAN CHARTER
On 15 December 2008 the members of ASEAN met in the Indonesian capital
of Jakarta to launch a charter, signed in November 2007, with the aim of
moving closer to "an EU-style community".
The charter turns ASEAN into a legal entity. It aims to create a single free-
trade area for the region. The charter is divided into various chapters.

PURPOSES
1. To maintain and enhance peace, security and stability and further
strengthen peace-oriented values in the region;
2. To enhance regional resilience by promoting greater political, security,
economic and socio-cultural cooperation;
3. To preserve Southeast Asia as a Nuclear Weapon-Free Zone and free of all
other weapons of mass destruction;
4. To ensure that the peoples and Member States of ASEAN live in peace with
the world at large in a just, democratic and harmonious environment;
5. To create a single market and production base which is stable,
prosperous, highly competitive and economically integrated with effective
facilitation for trade and investment in which there is free flow of goods,
services and investment; facilitated movement of business persons,
professionals, talents and labor; and freer flow of capital;
6. To alleviate poverty and narrow the development gap wthin ASEAN
through mutual assistance and cooperation;
7. To strengthen democracy, enhance good governance and the rule of law,
and to promote and protect human rights and fundamental freedoms, with
due regard to the rights and responsibilities of the Member States of ASEAN
8. To respond effectively, in accordance with the principle of comprehensive
security, to all forms of threats, transnational crimes and trans-boundary
challenges;
9. To promote sustainable development so as to ensure the protection of the
region’s environment, the sustainability of its natural resources, the
preservation of its cultural heritage and the high quality of life of its peoples;
10. To develop human resources through closer cooperation in education
and life-long learning, and in science and technology, for the empowerment
of the peoples of ASEAN and for the strengthening of the ASEAN Community;
11. To enhance the well-being and livelihood of the peoples of ASEAN by
providing them with equitable access to opportunities for human
development, social welfare and justice;
12. To strengthen cooperation in building a safe, secure and drug-free
environment for the peoples of ASEAN;
13. To promote a people-oriented ASEAN in which all sectors of society are
encouraged to participate in, and benefit from, the process of ASEAN
integration and community building;
14. To promote an ASEAN identity through the fostering of greater
awareness of the diverse culture and heritage of the region; and
15. To maintain the centrality and proactive role of ASEAN as the primary
driving force in its relations and cooperation with its external partners in a
regional architecture that is open, transparent and inclusive.

FUNDAMENTAL PRINCIPLES
i. respect for the independence, sovereignty, equality, territorial integrity
and national identity of all ASEAN Member States
ii. shared commitment and collective responsibility in enhancing regional
peace, security and prosperity
iii. renunciation of aggression and of the threat or use of force or other
actions in any manner inconsistent with international law
iv. reliance on peaceful settlement of disputes
v. non-interference in the internal affairs of ASEAN Member States
vi. respect for the right of every Member State to lead its national
existence free from external interference, subversion and coercion
vii. enhanced consultations on matters seriously affecting the common
interest of ASEAN
viii. adherence to the rule of law, good governance, the principles of
democracy and constitutional government
ix. respect for fundamental freedoms, the promotion and protection of
human rights, and the promotion of social justice
x. upholding the United Nations Charter and international law, including
international humanitarian law, subscribed to by ASEAN Member States
xi. abstention from participation in any policy or activity, including the use
of its territory, pursued by and ASEAN Member State or non-ASEAN
State or any non-State actor, which threatens the sovereignty,
territorial integrity or political and economic stability of ASEAN Member
States
xii. respect for the different cultures, languages and religions of the
peoples of ASEAN, while emphasizing their common values in the spirit
of unity in diversity
xiii. the centrality of ASEAN in external political, economic, social and
cultural relations while remaining actively engaged, outward-looking,
inclusive and non-discriminatory
xiv. Adherence to multilateral trade rules and ASEAN's rules-based regimes
for effective implementation of economic commitments and
progressive reduction towards elimination of all barriers to regional
economic integration, in a market-driven economy.

POLICIES
Apart from consultations and consensus, ASEAN’s agenda-setting and
decision-making processes can be usefully understood in terms of the so-
called Track I and Track II. Track I refers to the practice of diplomacy among
government channels. The participants stand as representatives of their
respective states and reflect the official positions of their governments
during negotiations and discussions. All official decisions are made in Track I.
Therefore, "Track I refers to intergovernmental processes". Track II differs
slightly from Track I, involving civil society groups and other individuals with
various links who work alongside governments. This track enables
governments to discuss controversial issues and test new ideas without
making official statements or binding commitments, and, if necessary,
backtrack on positions.

Although Track II dialogues are sometimes cited as examples of the


involvement of civil society in regional decision-making process by
governments and other second track actors, NGOs have rarely got access to
this track, meanwhile participants from the academic community are a
dozen think-tanks. However, these think-tanks are, in most cases, very much
linked to their respective governments, and dependent on government
funding for their academic and policy-relevant activities, and many working
in Track II have previous bureaucratic experience. Their recommendations,
especially in economic integration, are often closer to ASEAN’s decisions
than the rest of civil society’s positions.

The track that acts as a forum for civil society in Southeast Asia is called
Track III. Track III participants are generally civil society groups who
represent a particular idea or brand. Track III networksclaim to represent
communities and people who are largely marginalised from political power
centres and unable to achieve positive change without outside assistance.
This track tries to influence government policies indirectly by lobbying,
generating pressure through the media. Third-track actors also organise
and/or attend meetings as well as conferences to get access to Track I
officials. While Track II meetings and interactions with Track I actors have
increased and intensified, rarely has the rest of civil society had the
opportunity to interface with Track II. Those with Track I have been even
rarer.

Looking at the three tracks, it is clear that until now, ASEAN has been run by
government officials who, as far as ASEAN matters are concerned, are
accountable only to their governments and not the people.

ASEAN COMMUNITY
At its Ninth Summit in October 2003 the Association of South East Asian
Nations (ASEAN) announced its intention to create an ASEAN Community
based upon three pillars: ASEAN Security Community, ASEAN Economic
Community and an ASEAN Socio-Cultural Community. A year later ASEAN
established the Vientiane Action Program to realize this goal.

The process of ASEAN community building is a result of the considerable


change in the association’s mission in the recent two decades. The end of
the Cold War, the advance of globalization, the rise of China and India in
economic size and political influence as well as the Asian financial crisis have
forced ASEAN to shift from its original preventive diplomacy of maintaining
peace and harmony among its members and in the region to the
constructive diplomacy of community building to cope with increasing
political and economic competition in a globalised world.

In more details, one of the most notable threats to ASEAN members is China,
whose robust economy is in direct competition with those of its Southeast
Asian neighbors, especially in trade and foreign direct investment.
Meanwhile, in recent years, the sleeping dragon has also tried to enhance its
economic and political influence and presence in the region, particularly in
Myanmar, Laos, Vietnam and Cambodia. This important change has
increasingly drawn ASEAN states, which share the common fear of intrusive
outside powers, into the long-term strategic competition between the United
States and China in Asia Pacific. In order to cope with China and avoid
external intervention, Southeast Asian countries feel the need to act
collectively and to lean on each other, so that they can have combined
strengths as well as better bargaining power in both economic and political
issues. The same will work when dealing with an amalgamated or regional
community such as the United States and the European Union, or with
international organisations such as the United Nations and the World Trade
Organization.
Besides, in the time of economic globalisation and after it was hit hard by the
Asian financial crisis, forming an economic community will help Southeast
Asia boost its economic competitiveness and attractiveness to investors
inside and outside the region (Almonte, 2006). In a 2003 study done for the
ASEAN economic ministers by McKinsey & Company warned that “The region
is falling behind its rivals. Turning it into a true single market would... help
restore its economic luster”.
In terms of political and security issues, internal ethnic and religious tensions
(most dangerously in Myanmar, Southern Thailand, Eastern Indonesia and
Southern Philippines) have led to cross-border instability, terrorism, illegal
migration and drug-trafficking. These and other problems such as air
pollution, avian flu, AIDS all require regional concerted and coordinated
actions.

Against this backdrop, the future of the region and of ASEAN will be, to a
considerable extent, contingent on the degree of success of community
building. The ASEAN Community is based on three intertwined and mutually
reinforcing pillars: ASEAN Security Community (ASC), ASEAN Economic
Community (AEC) and ASEAN Socio-Cultural Community (ASCC). The ASC is
expected to maintain and strengthen peace, security and stability and
enhance ASEAN’s capacity for self-management of regional security. It
includes maritime cooperation and fight against terrorism, but no plan for a
regional military bloc or defence pact. Besides, member countries are free to
pursue their own foreign policies and defence arrangements. Meanwhile, the
mission of the AEC is to develop a single market and production base that is
stable, prosperous, highly competitive and economically integrated with
effective facilitation for trade and investment in which there is free flow of
goods, services investment, skilled labours, and freer flow of capital. But it
will not adopt a common currency like the European Union. And last but not
least, the ASCC is for a Southeast Asia bonded together in partnership as “a
community of caring and sharing societies”. The ASCC Plan of Action
contains four core elements: Building a community of caring societies,
managing the social impact of economic integration, enhancing
environmental sustainability, and strengthening the foundations of regional
social cohesion towards an ASEAN Community. In 2005, member countries
agreed to establish an ASEAN Charter, which would serve as the legal and
institutional framework for the regional organisation and the ASEAN
Community. Although it will not take on any supranational functions, with its
ambitious goals, the ASEAN Community is believed to have far-reaching and
important impacts on the lives of the people in Southeast Asia.

ASEAN ECONOMIC COMMUNITY


ASEAN has emphasised regional cooperation in the “three pillars” of security,
sociocultural and economic integration. The regional grouping has made the
most progress in economic integration, aiming to create an ASEAN Economic
Community (AEC) by 2015. The AEC would have a combined population of
over 560 million and total trade exceeding US$ 1,400 billion.

Free Trade Area


The foundation of the AEC is the ASEAN Free Trade Area (AFTA), a common
external preferential tariff scheme to promote the free flow of goods within
ASEAN. The ASEAN Free Trade Area (AFTA) is an agreement by the member
nations of ASEAN concerning local manufacturing in all ASEAN countries. The
AFTA agreement was signed on 28 January 1992 in Singapore. When the
AFTA agreement was originally signed, ASEAN had six members, namely,
Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand.
Vietnam joined in 1995, Laos and Myanmar in 1997, and Cambodia in 1999.
The latecomers have not fully met the AFTA's obligations, but they are
officially considered part of the AFTA as they were required to sign the
agreement upon entry into ASEAN, and were given longer time frames in
which to meet AFTA's tariff reduction obligations.

Comprehensive Investment Area


The ASEAN Comprehensive Investment Area (ACIA) will encourage the free
flow of investment within ASEAN. The main principles of the ACIA are as
follows:

• All industries are to be opened up for investment, with exclusions to be


phased out according to schedules
• National treatment is granted immediately to ASEAN investors with a
few exclusions
• Elimination of investment impediments
• Streamlining of investment process and procedures
• Enhancing transparency
• Undertaking investment facilitation measures
• Full realisation of the ACIA with the removal of temporary exclusion
lists in manufacturing agriculture, fisheries, forestry and mining is
scheduled by 2010 for most ASEAN members and by 2015 for the
CLMV (Cambodia, Lao PDR, Myanmar, and Vietnam) countries.

Trade in Services
An ASEAN Framework Agreement on Trade in Services was adopted at the
ASEAN Summit in Bangkok in December 1995. Under AFAS, ASEAN Member
States enter into successive rounds of negotiations to liberalise trade in
services with the aim of submitting increasingly higher levels of
commitments. The negotiations result in commitments that are set forth in
schedules of specific commitments annexed to the Framework Agreement.
These schedules are often referred to as packages of services commitments.
At present, ASEAN has concluded seven packages of commitments under
AFAS.

Single Aviation Market


The ASEAN Single Aviation Market (SAM), proposed by the ASEAN Air
Transport Working Group, supported by the ASEAN Senior Transport Officials
Meeting, and endorsed by the ASEAN Transport Ministers, will introduce an
open-sky arrangement to the region by 2015. The ASEAN SAM will be
expected to fully liberalise air travel between its member states, allowing
ASEAN to directly benefit from the growth in air travel around the world, and
also freeing up tourism, trade, investment and services flows between
member states. Beginning 1 December 2008, restrictions on the third and
fourth freedoms of the air between capital cities of member states for air
passengers services will be removed while from 1 January 2009, there will be
full liberalisation of air freight services in the region, while by 1 January 2011,
there will be liberalisation of fifth freedom traffic rights between all capital
cities.

Free Trade Agreements with Other Countries


ASEAN has concluded free trade agreements with PR China, Korea, Japan,
Australia, New Zealand and most recently India. The agreement with
People's Republic of China created the ASEAN–China Free Trade Area
(ACFTA), which went into full effect on January 1, 2010. In addition, ASEAN is
currently negotiating a free trade agreement with the European Union.
Republic of China (Taiwan) has also expressed interest in an agreement with
ASEAN but needs to overcome diplomatic objections from China.

ASEAN six majors


ASEAN six majors refer to the 6 largest economies in the area. These
countries are: Indonesia, Thailand, Malaysia, Singapore, the Philippines and
Vietnam. These countries own the economies which are many times larger
than the other 4 countries.
GDP nominal 2009 (billions USD)

Indonesia: 514,900
Thailand: 266,400
Malaysia: 191,463
Singapore: 177,132
Philippines: 160,991
Vietnam: 91,760
ASEAN SECURITY COMMUNITY
There has been a low level of international conflict in the area, although
there are concerns about non-national actors, including ideologues and
traditional pirates. Agreements and conflict resolution mechanisms were
established both among the members, and in a broader ASEAN Regional
Forum. ASEAN, with some pride, observes that while there has been tension,
there have been no armed conflicts, since its founding, among its members.
Building on this experience, ASEAN is forming the ASEAN Security
Community (ASC).
The members of the Community pledge to rely exclusively on peaceful
processes in the settlement of intra-regional differences and regard their
security as fundamentally linked to one another and bound by geographic
location, common vision and objectives. It has the following components:
political development; shaping and sharing of norms; conflict prevention;
conflict resolution; post-conflict peace building; and implementing
mechanisms.

ASEAN established the ASEAN Regional Forum (ARF) in 1994. The ARF’s
agenda aims to evolve in three broad stages, namely the promotion of
confidence building, development of preventive diplomacy and elaboration of
approaches to conflicts.

Regional agreements
The 1967 ASEAN Declaration, by the five founding members, established a
pattern of cooperation. It was followed by a Zone of Peace, Freedom and
Neutrality Declaration, Kuala Lumpur, 27 November 1971;

Next, there was a 1976 Declaration of ASEAN Concord and a Treaty of Amity
of Cooperation.
On a wider level, there were declarations on the South China Sea in 1992,
and a Southeast Asia Nuclear Weapon Free declaration 1997.
A forward looking plan formed ASEAN Vision 2020, declared on 15 December
1997; and a redeclaration of ASEAN Concord II in 2003.

ASEAN regional forum


Formed in 1994, present participants in the ARF include: Australia, Brunei
Darussalam, Cambodia, Canada, China, European Union, India, Indonesia,
Japan, Democratic Republic of Korea, Republic of Korea (ROK), Laos,
Malaysia, Mongolia, Myanmar, New Zealand, Pakistan, Papua New Guinea,
the Philippines, the Russian Federation, Singapore, Thailand, the United
States, and Viet Nam.

In 1994, ASEAN created a larger ASEAN Regional Forum (ARF), charged with
evolution, in three steps, to "the promotion of confidence building,
development of preventive diplomacy and elaboration of approaches to
conflicts."

Besides the ASEAN members, the ARF members are:


•Australia
•Canada
•China
•European Union
•India
•Japan
•Democratic People's Republic of Korea (DPRK, North Korea)
•Republic of Korea (ROK, South Korea)
•Mongolia
•New Zealand
•Pakistan
•Papua New Guinea
•Russian Federation
•United States
The ARF discusses major regional security issues in the region, including the
relationship amongst the major powers, non-proliferation, counter-terrorism,
transnational crime, South China Sea and the Korean Peninsula, among
others. Given the geographical realities, such as Singapore's small size, there
are mutual basing agreements; some of the Singapore military is in Malaysia
and the Philippines. This is particularly important given the ASEAN concern
over piracy.

There are annual ASEAN intelligence summits. With respect to intelligence


cooperation, John Margeson poses the challenge, "Do arrangements such as
ECHELON exist outside the relationships between "great" powers? Literature
shows that broad relationships exist among regional powers for various
reasons. In the case of ASEAN, states brought together to fight communist
insurgency find that they can maximize security by cooperating in covert
operations and intelligence sharing." See external security relationships for a
discussion of alliances beyond the ASEAN members.

Technology has accelerated ASEAN intelligence cooperation. For example,


Malaysia and Singapore jointly monitor the South China Sea electronically,
presumably with SIGINT, maritime patrol by ships and aircraft, and possibly
IMINT from commercial satellites.

External security relationships


There are both political and technical sensitivities in forming additional
alliances, which can be useful but challenging. One regional alliance has
obvious common interest and even overlapping membership, the Five Power
Defence Arrangements (FPDA) of Australia, Great Britain, New Zealand,
Singapore and Malaysia, which includes three members of the UKUSA
alliance with strong national SIGINT organizations.

Regional conflict resolution


A series of conflicts directly involving two ASEAN members, Vietnam and
Cambodia, as well as China, began to flare in 1978. These have been called
the Third Indochina War. ASEAN diplomacy helped work toward a 1991 peace
treaty, although the last Cambodian fighters did not surrender until 1999.
When the Vietnamese invaded Cambodia, the action was "deplored" with a
statement from the then-chairman of the ASEAN Standing Committee,
Indonesian Minister of Foreign Affairs Mochtar Kusumaatmadja; this became
the ASEAN position. ASEAN members brought the matter to the United
Nations Security Council. In this situation, Thailand, an ASEAN member, was
the "frontline state". ASEAN faced a problem of showing support for Thailand,
the "frontline state," but Indonesia decided that the apparent strategy there,
of prolonging the war and "bleeding Vietnam white", was not in the interest
of Southeast Asia as a whole. While always insisting on the central demand
of Vietnamese withdrawal and Khmer (i.e., Cambodian) self-determination,
Indonesia encouraged the Khmers and Vietnamese and their external
sponsors to a more stable settlement. Negotiations for such a settlement
began in 1982, and ended formally with the Final Act of the Paris
International Conference on Cambodia on October 23, 1991. Mochtar and the
next Indonesian foreign minister, were key in these negotiations.

Even though the eventual 1991 Paris Peace Accords for Cambodia mandated
elections and a ceasefire, which was not fully respected by the Khmer Rouge,
UN-sponsored elections in 1993 helped restore some semblance of normalcy
under a coalition government. Factional fighting in 1997 ended the first
coalition government, but a second round of national elections in 1998 led to
the formation of another coalition government and renewed political
stability. The remaining elements of the Khmer Rouge surrendered in early
1999.

Counterterrorism
Spurred by terrorism concerns, the ASEAN states, in May 2002, agreed on an
Action Plan that provided for enhanced cooperation in intelligence sharing
and coordination of anti-terror laws.

In August 2002, ASEAN and the United States issued a “Joint Declaration to
Combat International Terrorism," which was followed by an ASEAN Regional
Forum (ARF) meeting on terrorism, to be jointly sponsored by Malaysia in the
US. The US proposed that a regional counterterrorism training center be
established in Malaysia. Accompanying the Anti-Terrorism Center is an
intelligence-sharing agreement among Indonesia, the Philippines, Malaysia,
Cambodia, and Thailand, a first meeting of which was held in Manila in
January 2003. An obvious question, without a simple answer, is how much
SIGINT capabilities these countries have.

Concerns of national identity, and in some cases domestic Islamic


constituencies, find cooperation with the U.S. to be a delicate matter for the
Philippines, Malaysia, and Indonesia. Of the ASEAN members, Singapore
seems most comfortable in exchanging intelligence information with the US,
especially receiving SIGINT in return for HUMINT.

Singapore has established sharing between the United States Pacific


Command Joint Intelligence Center and Singapore’s Joint Counterterrorism
Center, and Singapore also is leading in accepting US goals for maritime
security, with a Strategic Goods Control law in January 2003. That law made
Singapore the first major port to meet US homeland security rules for cargo.
Singapore wants more US X-ray equipment, and possibly MASINT sensors.

US relations to an ASEAN or other group may be more domestically


acceptable, in countries suspicious of the US, than bilateral arrangements.
There are obvious reasons for regional nations wanting US intelligence
support, including SIGINT. Nevertheless, the eagerness of the US to help
against Islamic groups strikes at local sensitivities.

ASEAN SOCIO-CULTURAL COMMUNITY


The ASEAN Socio-Cultural Community, in consonance with the goal set by
ASEAN Vision 2020, envisages a Southeast Asia bonded together in
partnership as a community of caring societies and founded on a common
regional identity. The Community shall foster cooperation in social
development aimed at raising the standard of living of disadvantaged groups
and the rural population, and shall seek the active involvement of all sectors
of society, in particular women, youth, and local communities.

ASEAN shall ensure that its work force shall be prepared for, and benefit
from, economic integration by investing more resources for basic and higher
education, training, science and technology development, job creation, and
social protection.

ASEAN shall further intensify cooperation in the area of public health,


including in the prevention and control of infectious and communicable
diseases. The development and enhancement of human resources is a key
strategy for employment generation, alleviating poverty and socio-economic
disparities, and ensuring economic growth with equity.

Among the on-going activities of ASEAN in this area include the following:
* ASEAN Work Programme for Social Welfare, Family, and Population;
* ASEAN Work Programme on HIV/AIDS;
* ASEAN Work Programme on Community-Based Care for the Elderly;
* ASEAN Occupational Safety and Health Network;
* ASEAN Work Programme on Preparing ASEAN Youth for Sustainable
Employment and Other Challenges of Globalisation;
*ASEAN University Network (AUN) promoting collaboration among seventeen
member universities ASEAN;
* ASEAN Students Exchange Programme, Youth Cultural Forum, and the
ASEAN Young Speakers Forum;
* The Annual ASEAN Culture Week, ASEAN Youth Camp and ASEAN Quiz;
* ASEAN Media Exchange Programme; and
*Framework for Environmentally Sustainable Cities (ESC) and ASEAN
Agreement on Transboundary Haze Pollution.

Cultural activities
The organisation hosts cultural activities in an attempt to further integrate
the region. These include sports and educational activities as well as writing
awards. Examples of these include the ASEAN University Network, the ASEAN
Centre for Biodiversity, the ASEAN Outstanding Scientist and Technologist
Award, and the Singapore-sponsored ASEAN Scholarship.
S.E.A. Write Award
The S.E.A. Write Award is a literary award given to Southeast Asian poets
and writers annually since 1979. The award is either given for a specific work
or as a recognition of an author's lifetime achievement. Works that are
honoured vary and have included poetry, short stories, novels, plays, folklore
as well as scholarly and religious works. Ceremonies are held in Bangkok and
are presided by a member of the Thai royal family.

ASAIHL
ASAIHL or the Association of Southeast Asian Institutions of Higher Learning
is a non-governmental organisation founded in 1956 that strives to
strengthen higher learning institutions, especially in teaching, research, and
public service, with the intention of cultivating a sense of regional identity
and interdependence.
Heritage Parks
ASEAN Heritage Parks is a list of nature parks launched 1984 and relaunched
in 2004. It aims to protect the region's natural treasures. There are now 35
such protected areas, including the Tubbataha Reef Marine Park and the
Kinabalu National Park.

Scholarship
The ASEAN Scholarship is a scholarship program offered by Singapore to the
9 other member states for secondary school, junior college, and university
education. It covers accommodation, food, medical benefits & accident
insurance, school fees, and examination fees.

University Network
The ASEAN University Network (AUN) is a consortium of Southeast Asian
universities. It was originally founded in November 1995 by 11 universities
within the member states. Currently AUN comprises 21 Participating
Universities.
Official song
The ASEAN Way - the official regional anthem of ASEAN.

Sports
Southeast Asian Games
The Southeast Asian Games, commonly known as the SEA Games, is a
biennial multi-sport event involving participants from the current 11
countries of Southeast Asia. The games are under regulation of the
Southeast Asian Games Federation with supervision by the International
Olympic Committee (IOC) and the Olympic Council of Asia.

ASEAN Para Games


Logo of the ASEAN Para GamesThe ASEAN Para Games is a biennial multi-
sport event held after every Southeast Asian Games for athletes with
physical disabilities. The games are participated by the 11 countries located
in Southeast Asia. The Games, patterned after the Paralympic Games, are
played by physically challenged athletes with mobility disabilities, visual
disabilities, who are amputees and those with cerebral palsy.

FESPIC Games/ Asian Para Games


The FESPIC Games, also known as the Far East and South Pacific Games for
the persons with disability, was the biggest multi-sports games in Asia and
South Pacific region. The FESPIC Games were held nine times and bowed out,
a success in December 2006 in the 9th FESPIC Games in Kuala Lumpur,
Malaysia. The Games re-emerges as the 2010 Asian Para Games in
Guangzhou, China. The 2010 Asian Para Games will debut shortly after the
conclusion of the 16th Asian Games, using the same facilities and venue
made disability-accessible. The inaugural Asian Para Games, the parallel
event for athletes with physical disabilities, is a multi-sport event held every
four years after every Asian Games.

Football Championship
The ASEAN Football Championship is a biennial Football competition
organised by the ASEAN Football Federation, accredited by FIFA and
contested by the national teams of Southeast Asia nations. It was
inaugurated in 1996 as Tiger Cup, but after Asia Pacific Breweries terminated
the
sponsorship deal, "Tiger" was renamed "ASEAN".

ASEAN MEETINGS
The ASEAN Summit is an annual meeting held by ASEAN in relation to
economic, and cultural development of Southeast Asian countries. The
grouping regularly conducts dialogue meetings with other countries in an
organization collectively known as the ASEAN dialogue partners. ASEAN + 3
adds China, Japan and South Korea after the agreement of ASEAN+3 Heads
of Government Summit on Nov. 2001 in Brunei. The formal summit is held in
three days. The usual itinerary is as follows:
• ASEAN leaders hold an internal organization meeting.
• ASEAN leaders hold a conference together with foreign ministers of the
ASEAN Regional Forum.
• Leaders of 3 ASEAN Dialogue Partners (also known as ASEAN+3) namely
China, Japan and South Korea hold a meeting with the ASEAN leaders.
• A separate meeting is set for leaders of 2 ASEAN Dialogue Partners (also
known as ASEAN+CER) namely Australia and New Zealand.

HISTORY
The first ASEAN summit was held in February 1976 in Bali. At this summit,
ASEAN expressed its readiness to "develop fruitful relations" and mutually
beneficial co-operation with other countries of the region. The ASEAN leaders
signed the Treaty of Amity and Cooperation in Southeast Asia.
The 2nd ASEAN summit in Kuala Lumpur in 1977 was the occasion for the
first summit meeting between Japan and ASEAN. Japan expressed its
intention to promote co-operation with ASEAN. The ASEAN heads of
government also met the heads of government of Australia and New
Zealand. The summit called for expanding cooperation on human resource
development; integrating women and youth in human resource
development; eliminating poverty, disease and illiteracy; integrating
population with rural development policies; providing productive jobs for low-
income groups, especially in rural areas; and taking concerted action to curb
the abuse and traffic in narcotics and drugs.

EAST ASIA SUMMIT


The East Asia Summit (EAS) is a forum held annually
by leaders of 16 countries in the East Asian region.
EAS meetings are held after annual ASEAN leaders’
meetings. The first summit was held in Kuala Lumpur
on December 14, 2005.
The summit has discussed issues including trade,
energy and security and the summit has a role in
regional community building. The members of the summit are all 10
members of ASEAN together with China, Japan, South Korea, India, Australia
and New Zealand who combined represent almost half of the world's
population. Russia has applied for membership of the summit and in 2005
was a guest for the First EAS at the invitation of the host - Malaysia.

COMMEMORATIVE SUMMIT
A commemorative summit is a summit hosted by a non-ASEAN country to
mark a milestone anniversary of the establishment of relations between
ASEAN and the host country. The host country invites the heads of
government of ASEAN member countries to discuss future cooperation and
partnership.
REGIONAL FORUM
The ASEAN Regional Forum (ARF) is a formal, official,
multilateral dialogue in Asia Pacific region. As of July
2007, it is consisted of 27 participants. ARF
objectives are to foster dialogue and consultation,
and promote confidence-building and preventive
diplomacy in the region. The ARF met for the first
time in 1994. The current participants in the ARF are as follows: all the
ASEAN members, Australia, Bangladesh, Canada, the People's Republic of
China, the European Union, India, Japan, North Korea, South Korea, Mongolia,
New Zealand, Pakistan, Papua New Guinea, Russia, Timor-Leste, United
States and Sri Lanka. The Republic of China (also known as Taiwan) has been
excluded since the establishment of the ARF, and issues regarding the
Taiwan Strait is neither discussed at the ARF meetings nor stated in the ARF
Chairman's Statements.

Aside from the ones above, other regular meetings are also held. These
include the annual ASEAN Ministerial Meeting as well as other smaller
committees, such as the Southeast Asian Fisheries Development Center.
Meetings mostly focus on specific topics, such as defense or the environment
and are attended by Ministers, instead of heads of government.

PLUS THREE
The ASEAN Plus Three is a meeting between
ASEAN, China, Japan, and South Korea, and is
primarily held during each ASEAN Summit.

Asia – Europe Meeting


The Asia-Europe Meeting (ASEM) was officially
established in 1996 at the first summit in
Bangkok. ASEM is an interregional forum which consists of the European
Commission, the twenty-seven members of the European Union (EU), the
thirteen members of the ASEAN Plus Three regional grouping, and, as of
2008, India, Mongolia, and Pakistan.
The main components of the ASEM process, which has so far been loosely
organized, include:-
• political dialogue
• security and the economy
• education and culture
or the so-called three pillars.
In general, the process is considered by the parties involved to be a way of
deepening the relations between Asia and Europe at all levels, which is
deemed necessary to achieve a more balanced political and economic world
order. The process is enhanced by the biannual meetings of heads of state,
alternately in Europe and Asia, and political, economic, and cultural meetings
and events at all kinds of other levels.

Asean Russia Summit


The ASEAN-Russia Summit is an annual meeting between leaders of member
states and the President of Russia.
ASEAN-Russia dialogue partnership could be traced back to July 1991 when
the then Deputy Prime Minister of the Russian Federation attended the
Opening Session of the 24th ASEAN Ministerial Meeting (AMM) in Kuala
Lumpur as a guest of the Malaysian Government. Russia was subsequently
elevated to a full Dialogue Partner of ASEAN at the 29th AMM in July 1996 in
Jakarta.
In 2006, ASEAN and Russia held special activities to commemorate 10th
Anniversary of ASEAN-Russia Dialogue Partnership.
ASEAN and Russia maintain good political and security relations. A milestone
in ASEAN-Russia Dialogue Relations was when Russia acceded to the Treaty
of Amity and Cooperation in Southeast Asia (TAC) on 29 November 2004.
Russia’s accession to the TAC reflects her strong commitment to regional
peace, stability and a significant contribution to the TAC as an important
code of conduct governing inter-state relations.

16TH ASEAN SUMMIT AT VIETNAM


The 16th ASEAN Summit was held in Ha Noi from 8 to 9
April 2010, with the theme “Towards the ASEAN
Community: From Vision to Action”.
Among the highlights of the Summit, the Secretary-
General touched on the ASEAN Leaders’ determination to
maintain ASEAN’s central role in the emerging regional
architecture and the inauguration of the ASEAN
Commission on Promotion and Protection of the Rights of Women and
Children.
The Leaders agreed that ASEAN would act swiftly at the national, regional
and global levels to achieve sustained economic recovery and development
for ASEAN in the aftermath of the global economic and financial crisis. ASEAN
Connectivity was high on the agenda of the 16th ASEAN Summit, and the
Leaders took note of the on-going efforts in developing a Master Plan on
ASEAN Connectivity, which is to be submitted to the 17th ASEAN Summit in
October 2010. The first meeting of the High Level Task Force on ASEAN
Connectivity which was held on 9-10 March 2010 in Ha Noi had produced the
key elements and principles for the Master Plan. The Leaders emphasised
that priority should be given to enhancing intra-ASEAN connectivity,
including the need to complete the missing air, sea and land transportation
links in Mekong and other sub-regions of ASEAN building on achievements of
existing frameworks. It was further reaffirmed that priority would be given to
transport, information communication technology (ICT), energy and cross
border facilitation for the smooth movement of people, goods and services.
In the area of climate change, the Leaders also reaffirmed their strong
commitment to intensify efforts to address climate change and in this regard
adopted the ASEAN Leaders’ Statement on Joint Response to Climate
Change. An ASEAN Action Plan on Climate Change will be explored.
The issue of ASEAN Centrality continued to be on the agenda of the Summit
and the Leaders stressed the importance of and determination to maintain
ASEAN’s central role in the emerging regional architecture. They agreed to
adopt a two-pronged approach with priority given to the acceleration of
ASEAN’s integration and community building while intensifying ASEAN’s
external relations and ensuring ASEAN’s role as the driving force in regional
cooperation frameworks. The Leaders also said that any new regional
framework or process should be complementary to and built upon existing
regional mechanisms and the principle of ASEAN’s centrality.
The Leaders further endorsed the exchange between Indonesia and Brunei
Darussalam in their turns for the ASEAN Chairmanship and welcomed
Indonesia as the ASEAN Chair in 2011.

TRANSNATIONAL ISSUES
The processes of globalization, interdependence and regional integration
have made cooperation on transnational issues an imperative. The Third
ASEAN Informal Summit held in Manila in November 1999 had recognized
how the evolving regional security environment during the last decade had
given rise to new forms of security challenges for ASEAN. In this light, the
Heads of Government have reaffirmed their commitment to move forward
ASEAN's cooperation in transnational issues, such as environment,
transboundary haze, transnational crime, drugs and narcotics, immigration
and legal matters.

Environment
ASEAN has adopted the Strategic Plan of Action on the Environment (SPAE)
to support the objectives laid down in the Ha Noi Plan of Action. The 1999-
2004 Plan covers the following areas: (a) Land and Forest Fires and
Transboundary Haze; (b) Nature Conservation and Biodiversity; (c) Coastal
and Marine Environment; (d) International Environment Issues; (e) Other
Environment Activities. The Plan of Action includes measurable benchmarks
in terms of timeframes and targets. A monitoring system has been
established to track the progress of each of the activities. As environmental
issues are interdisciplinary and cross-sectoral, there is a critical need to
interface and coordinate with other sectoral bodies in ASEAN in the
implementation of the SPAE. Similarly, environmental considerations should
be incorporated into the development plans of the other sectors if the goals
of sustainable development are to be achieved. The ASEAN Secretariat plays
a key role in integrating environmental factors into the other development
activities of ASEAN.

Transnational Crime
With the rapid advances in technology and the greater mobility of people
and resources across national boundaries, transnational crime has become
increasingly pervasive, diversified and organized. The ASEAN region has to
deal with many new forms of organized crimes that transcend national
boundaries, such as terrorism, new types of drug abuse and trafficking,
innovative forms of money laundering, arms smuggling, trafficking in women
and children, and piracy. ASEAN's resolve to fight transnational crime can be
traced to the Declaration of ASEAN Concord of 1976, which called for the
intensification of cooperation among Member Countries and with
international bodies to prevent and eradicate narcotics abuse and the illegal
trafficking in drugs. Having consistently addressed the issue of transnational
crime for more than two decades, the Meeting of ASEAN Ministers of
Interior/Home Affairs on Transnational Crime adopted the ASEAN Declaration
on Transnational Crime in December 1997, which underscored the
Association's resolve to adopt a comprehensive approach to fighting
transnational crime through greater regional collaboration and by forging
international cooperation. In a further step to fight transnational crime, the
ASEAN Plan of Action to Combat Transnational Crime was adopted in June
1999. The Plan of Action established mechanisms for information exchange,
cooperation in legal and law enforcement matters, institutional capacity
building, training and extra-regional cooperation. Consultations are
proceeding on the proposed establishment of the ASEAN Centre for
Combating Transnational Crime (ACTC). As envisioned, the Centre will
promote data resource sharing, assist in the implementation of programs
outlined in the proposed action plan, and serve as a repository of information
on legislation, regulatory measures and jurisprudence of individual member
countries. It is envisaged that the ACTC will conduct research and analysis of
transnational crime activities and to recommend regional strategies.

Drugs and Narcotics


The Hanoi Plan of Action calls upon the Member Countries to implement the
ASEAN Work Programme to Operationalize the ASEAN Plan of Action on Drug
Abuse Control by 2004, and to continue developing and implementing high-
profile flagship programmes on drug abuse control, particularly those related
to prevention education for youth and to treatment and rehabilitation.
Responding to this call, the ASEAN Senior Officials on Drug Matters (ASOD)
endorsed eight projects: (a) Training on Intelligence Operations Management
and Supervision; (b) Training on Financial Investigations; (c) Enhancement of
Community Based Drug Prevention Activities; (d) Youth Empowerment
Against Drug and Substance Abuse; (e) Promotion of Drug Control Activities
in the Workplace; (f) Promoting Drug Abuse Prevention Activities among Out-
of- School Youth; (g) ASEAN Seminar on Precursor Chemicals; (h) Training of
Trainers in Interpersonal Skills and Peer Support Counseling in Drug
Education. The Youth Empowerment Against Drug and Substance Abuse
project aims to equip young people with the knowledge, decision-making
skills and values to stay away from drugs. Apart from developing regional
cooperation to enhance youth capability and participation in the prevention
of drug abuse through positive activities, this project is also on the look-out
for real-life role models who can lead organized youth movements against
drug abuse. Meanwhile, the Promoting Drug Abuse Preventive Activities
Among Out-of-School Youth project aims to make use of peer group
discussions to assist ASOD in the development of more targeted prevention
activities.

Immigration Matters
The ASEAN leaders have directed the ASEAN Heads of Immigration to discuss
ways of cooperation in immigration matters, including the simplification of
immigration clearance procedures. The Directors General of Immigration
Departments and Heads of Consular Divisions of the Ministries of Foreign
Affairs of ASEAN Member Countries (DGICM) are now considering the
following areas for cooperation: opening ASEAN lanes at the international
airports, visa-free entry for ASEAN nationals, possible use of smart cards as
travel documents within the region, harmonization of ASEAN immigration
embarkation and disembarkation cards, and the facilitation of the movement
of yachts, leisure boats and private aircraft within the ASEAN region.
Cooperation in immigration is expected to contribute significantly to
facilitating the movement of people and promoting tourism in the region. It
can contribute to the implementation of the ASEAN Investment Area (AIA) by
promoting freer flow of capital, skilled labor, professionals and technology. A
more efficient immigration system can also facilitate the Visit ASEAN
Campaign, which is expected to draw a large number of tourists from North
America, Europe and East Asia as well as within the region. Cooperation in
immigration can help in the implementation of the ASEAN Plan of Action to
Combat Transnational Crime, particularly with respect to trafficking in
persons. ASEAN has agreed to establish an Institutional Framework for
ASEAN Cooperation on Immigration Matters. A Plan of Action for Cooperation
on Immigration Matters is being developed. In addition, an ASEAN Directory
of Immigration Focal Points is being put together to facilitate networking
among the immigration authorities in ASEAN.

Law and Legal Matters


Although there is a great diversity in the legal and constitutional systems of
the Member Countries, globalization has revealed the close nexus between
economic growth and the legal system. A sound legal system and the
effective administration of justice are seen as a key requirement for attaining
economic and social growth and a building block for regional economic
integration. In order to facilitate closer cooperation on law and legal matters,
the ASEAN Law Ministers adopted several measures in 1999 comprising the
ASEAN Government Law Directory, the Government Legal Officers Program,
the Exchange of Visits by ASEAN Law Officials, and the Exchange of Legal
Information. The ASEAN Government Law Directory will identify the key
office holders in the legal establishment of each ASEAN Member Country and
their specific responsibilities. After the first edition is completed, the
directory will be published on the ASEANWEB. Public legal officers in each
Member Country will have the opportunity to learn about the legal
environment of other ASEAN countries and their laws and regulations under
the Government Legal Officers Program. This would provide an opportunity
for the participants to build relationships and foster appreciation of the
workings of other government agencies in ASEAN. The Exchange of Visits by
ASEAN Law Officials aims to promote solidarity and enhance mutual
understanding of the legal and constitutional systems of ASEAN Member
Countries. The Law Ministers adopted the Exchange of Legal Information
program. Under this program, each Member Country will nominate an officer
or an agency to be the ASEAN Legal Information Authority (ALIA) for its
jurisdiction. The officer or agency will be responsible for facilitating the
exchange of legal information in ASEAN and be the repository of ASEAN legal
information.
ASEAN Free Trade Area
ASEAN Free Trade Area (AFTA) is a trade bloc agreement by the Association
of Southeast Asian Nations supporting local manufacturing in all ASEAN
countries.
The AFTA agreement was signed on 28 January 1992 in Singapore. When the
AFTA agreement was originally signed, ASEAN had six members, namely,
Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand. Vietnam
joined in 1995, Laos and Myanmar in 1997 and Cambodia in 1999. AFTA now
comprises ten countries of ASEAN. All the four latecomers were required to
sign the AFTA agreement in order to join ASEAN, but were given longer time
frames in which to meet AFTA's tariff reduction obligations.
The primary goals of AFTA seek to:
• Increase ASEAN's competitive edge as a production base in the world
market through the elimination, within ASEAN, of tariffs and non-tariff
barriers; and
• Attract more foreign direct investment to ASEAN.

The primary mechanism for achieving the goals given above is the Common
Effective Preferential Tariff (CEPT) scheme, which established a schedule for
phased initiated in 1992 with the self-described goal to increase the
"region’s competitive advantage as a production base geared for the world
market".
Contents
1. History
2. The Common Effective Preferential Tariff (CEPT) scheme
3. Rule of Origin
4. Administration
5. Dispute resolution
6. Further trade facilitation efforts
7. Membership
8. ASEAN Plus Three
9. Related free trade areas
10. References
History
A proposal to set up a Free Trade Area in ASEAN was first mooted by the Thai
Prime Minister Anand Panyarachun, which was agreed upon with
amendments during the ASEAN Seniors Economic Official Meeting (AEM) in
Kuala Lumpur. In January 1992, the ASEAN members signed the Singapore
Declaration at the heart of which was the creation of AFTA in 15 years. This
is a comprehensive program of tariff reduction in the region, which is to be
carried out in phases through the year 2008. This deadline was subsequently
moved forward and AFTA became fully operational on 1 January 2003.
Over the course of several years, the initial program of tariff reductions was
broadened and accelerated and other "AFTA Plus" activities were initiated.
This includes efforts to eliminate non-tariff barriers, harmonization of
customs nomenclature, valuation, and procedures and development of
common product certification standards.
The Common Effective Preferential Tariff (CEPT) scheme
Unlike the EU, AFTA does not apply a common external tariff on imported
goods. Each ASEAN member may impose tariffs on goods entering from
outside ASEAN based on its national schedules. However, for goods
originating within ASEAN, ASEAN members are to apply a tariff rate of 0 to 5
percent (the more recent members of Cambodia, Laos, Myanmar and
Vietnam, aka CMLV countries, were given additional time to implement the
reduced tariff rates). This is known as the Common Effective Preferential
Tariff (CEPT) scheme.

ASEAN members have the option of excluding products from the CEPT in
three cases:
1. Temporary exclusions; 2.Sensitive agricultural products; 3.General
exceptions. Temporary exclusions refer to products for which tariffs will
ultimately be lowered to 0-5%, but which are being protected temporarily by
a delay in tariff reductions.
Sensitive agricultural products include commodities such as rice. ASEAN
members have until 2010 to reduce the tariff levels to 0-5%.
General exceptions refer to products which an ASEAN member deems
necessary for the protection of national security, public morals, the
protection of human, animal or plant life and health, and protection of
articles of artistic, historic, or archaeological value. ASEAN members have
agreed to enact zero tariff rates on virtually all imports by 2010 for the
original signatories, and 2015 for the CMLV countries.
Rule of Origin
The CEPT only applies to goods originating within ASEAN. The general rule is
that local ASEAN content must be at least 40% of the FOB value of the good.
The local ASEAN content can be cumulative, that is, the value of inputs from
various ASEAN members can be combined to meet the 40% requirement.
The following formula is applied:
Raw material cost + Direct labor cost + Direct overhead cost + Profit +
Inland transport cost x 100% FOB value
However, for certain products, special rules apply:
• Change in Chapter Rule for Wheat Flour;
• Change of Tariff Sub-Heading for Wood-Based Products;
• Change in Tariff Classification for Certain Aluminum and Articles
thereof.
The exporter must obtain a “Form D” certification from its national
government attesting that the good has met the 40% requirement. The Form
D must presented to the customs authority of the importing government to
qualify for the CEPT rate. Difficulties have sometimes arisen regarding the
evidentiary proof to support the claim, as well how ASEAN national customs
authorities can verify Form D submissions. These difficulties arise because
each ASEAN national customs authority interprets and implements the Form
D requirements without much coordination.
Administration
Administration of AFTA is handled by the national customs and trade
authorities in each ASEAN member. The ASEAN Secretariat has authority to
monitor and ensure compliance with AFTA measures, but has no legal
authority to enforce compliance. This has led to inconsistent rulings by
ASEAN national authorities. The ASEAN Charter is intended to bolster the
ASEAN Secretariat’s ability to ensure consistent application of AFTA
measures.
ASEAN national authorities have also been traditionally reluctant to share or
cede sovereignty to authorities from other ASEAN members (although ASEAN
trade ministries routinely make cross-border visits to conduct on-site
inspections in anti-dumping investigations). Unlike the EU or NAFTA, joint
teams to ensure compliance and investigate non-compliance have not been
widely used. Instead, ASEAN national authorities must rely on the review and
analysis of other ASEAN national authorities to determine if AFTA measures
such as rule of origin are being followed. Disagreements may result between
the national authorities. Again, the ASEAN Secretariat may help mediate a
dispute but has no legal authority to resolve it.
ASEAN has attempted to improve customs coordination through the
implementation of the ASEAN Single Window project. The ASEAN Single
Window would allow importers to submit all information related to the
transaction to be entered electronically once. This information would then be
shared with all other ASEAN national customs authorities.

Dispute resolution
Although these ASEAN national customs and trade authorities coordinate
among themselves, disputes can arise. The ASEAN Secretariat has no legal
authority to resolve such disputes, so disputes are resolved bilaterally
through informal means or through dispute resolution.
An ASEAN Protocol on Enhanced Dispute Settlement Mechanism governs
formal dispute resolution in AFTA and other aspects of ASEAN. ASEAN
members may seek mediation and good offices consultations. If these efforts
are ineffective, they may ask SEOM to establish panel of independent
arbitrators to review the dispute. Panel decisions can be appealed to an
appellate body formed by the ASEAN Economic Community Council.
The Protocol has almost never been invoked because of the role of SEOM in
the dispute resolution process. SEOM decisions require consensus among all
ASEAN members, and since both the aggrieved party and the alleged
transgressor are both participating in SEOM, such consensus cannot be
achieved. This discourages ASEAN members from invoking the Protocol, and
often they seek dispute resolution in other fora such as the WTO or even the
International Court of Justice. This can also be frustrating for companies
affected by an AFTA dispute, as they have no rights to invoke dispute
resolution yet their home ASEAN government may not be willing to invoke
the Protocol. The ASEAN Secretary General has listed dispute resolution as
requiring necessary reform for proper administration of AFTA and the AEC.

Further trade facilitation efforts


Efforts to close the development gap and expand trade among members of
ASEAN are key points of policy discussion. According to a 2008 research brief
published by the World Bank as part of its Trade Costs and Facilitation
Project, ASEAN members have the potential to reap significant benefits from
investments in further trade facilitation reform, due to the comprehensive
tariff reform already realised through the ASEAN Free Trade Agreement.
This new analysis suggests examining two key areas, among others: port
facilities and competitiveness in the Internet services sector. Reform in these
areas, the report states, could expand ASEAN trade by up to 7.5 percent
($22 billion) and 5.7 percent ($17 billion), respectively. By contrast, cutting
applied tariffs in all ASEAN members to the regional average in Southeast
Asia would increase intra-regional trade by about 2 percent ($6.3 billion).

Membership
Countries that agree to eliminate tariffs among themselves:
• Brunei
• Indonesia
• Malaysia
• Philippines
• Singapore
• Thailand
• Myanmar
• Cambodia
• Laos
• Vietnam
Regular Observers
• Papua New Guinea
• Timor-Leste
The most recent ASEAN meeting was observed also by :
• China
• Japan
• South Korea
• India
• Australia
• New Zealand

The ASEAN Free Trade Area (AFTA)


The ASEAN Free Trade Area (AFTA) has now been virtually established.
ASEAN Member Countries have made significant progress in the lowering of
intra-regional tariffs through the Common Effective Preferential Tariff (CEPT)
Scheme for AFTA. More than 99 percent of the products in the CEPT Inclusion
List (IL) of ASEAN-6, comprising Brunei Darussalam, Indonesia, Malaysia, the
Philippines, Singapore and Thailand, have been brought down to the 0-5
percent tariff range.
ASEAN’s newer members, namely Cambodia, Laos, Myanmar and Viet Nam,
are not far behind in the implementation of their CEPT commitments with
almost 80 percent of their products having been moved into their respective
CEPT ILS. Of these items, about 66 percent already have tariffs within the 0-5
percent tariff band. Viet Nam has until 2006 to bring down tariff of products
in the Inclusion List to no more than 5 percent duties, Laos and Myanmar in
2008 and Cambodia in 2010.
Following the signing of the Protocol to Amend the CEPT-AFTA Agreement for
the Elimination of Import Duties on 30 January 2003, ASEAN-6 has committed
to eliminate tariffs on 60 percent of their products in the IL by the year 2003.
As of this date, tariffs on 64.12 percent of the products in the IL of ASEAN-6
have been eliminated. The average tariff for ASEAN-6 under the CEPT
Scheme is now down to 1.51 percent from 12.76 percent when the tariff
cutting exercise started in 1993.
The implementation of the CEPT-AFTA Scheme was significantly boosted in
January 2004 when Malaysia announced its tariff reduction for completely
built up (CBUs) and completely knocked down (CKDs) automotive units to
gradually meet its CEPT commitment one year earlier than schedule.
Malaysia has previously been allowed to defer the transfer of 218 tariff lines
of CBUs and CKDs until 1 January 2005.
Products that remain out of the CEPT-AFTA Scheme are those in the Highly
Sensitive List (i.e. rice) and the General Exception List. The Coordinating
Committee on the Implementation of the CEPTScheme for AFTA (CCCA) is
currently undertaking a review of all the General Exception Lists to ensure
that only those consistent with Article 9(b)1 of the CEPT Agreement are
included in the lists.
ASEAN Member Countries have also resolved to work on the elimination of
non-tariff barriers. A work programme on the elimination of non-tariff
barriers, which includes, among others, the process of verification and cross-
notification; updating the working definition of Non-Tariff Measures
(NTMs)/Non-Tariff Barriers (NTBs) in ASEAN; the setting-up of a database on
all NTMs maintained by Member Countries; and the eventual elimination of
unnecessary and unjustifiable non-tariff measures, is currently being
finalized.
In an effort to improve and strengthen the rules governing the
implementation of the CEPT Scheme, to make the Scheme more attractive to
regional businessmen and prospective investors, the CEPT Rules of Origin
and its Operational Certification Procedures have been revised and
implemented since 1 January 2004. Among the features of the revised CEPT
Rules of Origin and Operational Certification Procedures include: (a) a
standardized method of calculating local/ASEAN content; (b) a set of
principles for determining the cost of ASEAN origin and the guidelines for
costing methodologies; (c) treatment of locally-procured materials; and (d)
improved verification process, including on-site verification.
In order to promote greater utilization of the CEPTAFTA Scheme, substantial
transformation has also been adopted as an alternative rule in determining
origin for CEPT products. The Task Force on the CEPT Rules of Origin is
currently working out substantial transformation rules for certain product
sectors, including wheat flour, iron and steel and the 11 priority integration
sectors covered under the Bali Concord II. Direction of Trade ASEAN’s
exports had regained its upward trend in the two years following the
financial crisis of 1997- 1998 reaching its peak in 2000 when total exports
was valued at US$ 408 billion. After declining to US$ 366.8 billion in 2001, as
a result of the economic slowdown in the United States and Europe and the
recession in Japan, ASEAN exports recovered in 2002 when it was valued at
US$ 380.2 billion. The upward trend for ASEAN-6 continued up to the first
two quarters of 2003. Intra-ASEAN trade for the first two quarters of 2003
registered an increase of 4.2 and 1.6 percent for exports and imports
respectively.
Direction of Trade
ASEAN's exports had regained its upward trend in the two years following the
financial crisis of 1997-1998 reaching its peak in 2000 when total exports
was valued US$ 408 billion. After declining to US$ 366.8 billion in 2001, as a
result of the economic slowdown in the United States and Europe and the
recession in Japan, ASEAN exports recovered in 2002 when it was valued at
US$ 380.2 billion. The upward trend for ASEAN-6 continued up to first two
quarters of 2003. Intra-ASEAN trade for the first two quarters of 2003
registered an increase of 4.2 and 1.6 percent for exports and imports
respectively.
ASEAN Trade with Selected Trading Partners
The United States, the European Union and Japan continued to be ASEAN’s
largest export markets. Japan, followed by the U.S. and EU, were the largest
sources of ASEAN imports. During the first half of 2002-2003, ASEAN-6 trade
with major markets as a whole increased by 11.71 percent for exports and
6.91 percent for imports. However, ASEAN exports to the U.S. and India and
imports from Canada and India declined during the same period.

ASEAN-India FTA signed in Bangkok


ASEAN and India finally signed the long-awaited free trade agreement (FTA)
in Bangkok, ending more than six years of intensive negotiations. Signed at
the 7th ASEAN Economic Ministers (AEM)-India meeting, held in conjunction
with the 41st AEM meeting from August 13 to 16, the agreement is set to
take effect starting Jan. 1, 2010.
Trade between ASEAN and India is expected to increase to US$60 billion
after the agreement goes into effect. The signing in Bangkok marks ASEAN's
fifth such agreement after the ASEAN-Japan FTA, the ASEAN-China FTA, the
ASEAN-Korea FTA and the ASEAN-Australia and New Zealand FTA.
Under the agreement ASEAN and India will lift import tariffs on more than 80
percent of traded products between 2013 and 2016. Tariffs on sensitive
goods will be reduced to 5 percent in 2016 and those on up to 489 very
sensitive products will be maintained.
In 2008, trade between ASEAN and India was valued at about US$47 billion,
with Indonesia ranking third behind Singapore and Malaysia. The agreement
was very important for ASEAN considering India imposed relatively high
tariffs on imported goods. On average tariffs are more than 30 percent, and
some commodities even have tariffs of up to 90 percent. The signing of the
free trade agreement would certainly benefit Indonesia, especially with
India's commitment to reduce the tariffs on CPO (crude palm oil) and RPO
(refined palm oil), Indonesia's main non-oil and gas exports to India.
Indonesia's second main export to India, coal, will enjoy 0 percent tax
starting January 1, 2013. For defensive purposes, Indonesia only gave a
commitment to open its market to Indian commodities for up to 42.5 percent
of its total traded goods by 2013. The tariffs of commodities deemed
sensitive will be reduced to 5 percent by 2019. This means there would still
be enough time for anticipatory measures to improve the country's
competitiveness within the region.

CRITICISMS AGAINST ASEAN


Non-ASEAN countries have criticized ASEAN for being too soft in its approach
to promoting human rights and democracy in the junta-led Myanmar. Despite
global outrage at the military crack-down on peaceful protesters in Yangon,
ASEAN has refused to suspend Myanmar as a member and also rejects
proposals for economic sanctions. This has caused concern as the European
Union, a potential trade partner, has refused to conduct free trade
negotiations at a regional level for these political reasons. International
observers view it as a "talk shop", which implies that the organization is "big
on words but small on action". Head of the International Institute of Strategic
Studies – Asia, Tim Huxley cites the diverse political systems present in the
grouping, including many young states, as a barrier to far-reaching
cooperation outside the economic sphere. He also asserts that in the
absence of an external threat to rally against with the end of the Cold War,
ASEAN has begun to be less successful at restraining its members and
resolving border disputes such as those between Burma and Thailand and
Indonesia and Malaysia.
During the 12th ASEAN Summit in Cebu, several activist groups staged anti-
globalisation and anti-Arroyo rallies. According to the activists, the agenda of
economic integration would negatively affect industries in the Philippines
and would cause thousands of Filipinos to lose their jobs. They also viewed
the organisation as imperialistic that threatens the country's sovereignty. A
human rights lawyer from New Zealand was also present to protest about
the human rights situation in the region in general.

ASEAN has been criticized, in the past, of being a mere talk shop. However,
leaders such as the Philippines' Foreign Affairs Secretary, Alberto Romulo,
said it would be a workshop not a talk shop. Others have also expressed
similar sentiment.

The conventional wisdom regarding the Association of Southeast Asian


Nations is that the organization has become unwieldy and weak. Critics
blame the rapid expansion of the 1990s that added new members such as
Vietnam and Cambodia, and the lack of a single unifying mission for leaving
it adrift. The failure of ASEAN to address effectively the Asian financial crisis,
the collapse of Indonesia, and China's creeping annexation of the South
China Sea are cited as evidence of the group's weakness.

While these criticisms of ASEAN are largely correct, they tend to overstate
the limitations of the group. It is also necessary to examine the individual
actions of the ASEAN member states, not just the high-profile initiatives that
it carries out as an organization. The individual members have their own
separate foreign-policy initiatives. These initiatives may actually serve the
broader interests of ASEAN, despite not being publicly justified as supporting
organizational goals.

While it is not strongly emphasized, one of the primary missions of ASEAN is


to prevent the domination of Southeast Asia by external powers - specifically
China, Japan, India, and the United States. This mission is an extension of the
Cold War goal of preventing the spread of communism in the region.

The individual actions of the ASEAN states, as well as the high-profile


initiatives of the organization itself, have allowed the members to balance off
the major external powers. ASEAN states have been successful at taking
advantage of the fears and ambitions of the major external powers to
counter-balance each of them, while extracting concessions along the way.
They have done this without greatly sacrificing either their own
independence.

ASEAN VISION 2020


Vision of ASEAN as a concert of Southeast Asian nations, outward looking,
living in peace, stability and prosperity, bonded together in partnership in
dynamic development and in a community of caring societies.
The ASEAN Vision 2020 affirmed an outward-looking ASEAN playing a pivotal
role in the international community and advancing ASEAN’s common
interests.

Building on the Joint Statement on East Asia Cooperation of 1999,


cooperation between the Southeast and Northeast Asian countries has
accelerated with the holding of an annual summit among the leaders of
ASEAN, China, Japan, and the Republic of Korea (ROK) within the ASEAN Plus
Three process.

ASEAN Plus Three relations continue to expand and deepen in the areas of
security dialogue and cooperation, transnational crime, trade and
investment, environment, finance and monetary, agriculture and forestry,
energy, tourism, health, labour, culture and the arts, science and technology,
information and communication technology, social welfare and development,
youth, and rural development and poverty eradication. There are now
thirteen ministerial-level meetings under the ASEAN Plus Three process.
Bilateral trading arrangements have been or are being forged between
ASEAN Member Countries and China, Japan, and the ROK. These
arrangements will serve as the building blocks of an East Asian Free Trade
Area as a long term goal.

ASEAN continues to develop cooperative relations with its Dialogue Partners,


namely, Australia, Canada, China, the European Union, India, Japan, the ROK,
New Zealand, the Russian Federation, the United States of America, and the
United Nations Development Programme. ASEAN also promotes cooperation
with Pakistan in some areas of mutual interest.

Consistent with its resolve to enhance cooperation with other developing


regions, ASEAN maintains contact with other inter-governmental
organisations, namely, the Economic Cooperation Organisation, the Gulf
Cooperation Council, the Rio Group, the South Asian Association for Regional
Cooperation, the South Pacific Forum, and through the recently established
Asian-African Sub-Regional Organisation Conference.

Most ASEAN Member Countries also participate actively in the activities of


the Asia-Pacific Economic Cooperation (APEC), the Asia-Europe Meeting
(ASEM), and the East Asia-Latin America Forum (EALAF).
REPORT SUBMITTED BY:
DEEPIKA AMESAR
PRITI SURJAN
MANGALA MISHRA
KIRAN WADHWA
ABHA DESHKAR
TRUPTI KANEKAR
PRIYANKA SHAH
SURBHI TYAGI
NEEMA CHATURVEDI
PRIYANKA NIKARGE
AKANSHA KHARE
SHARAN RAO
ANKUSH GADROO
ABHASH ROSHAN