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ASEAN-CHINA BILATERAL RELATIONS WARMING UP

ASEAN-CHINA BILATERAL RELATIONS WARMING UP

Erle Frayne D. Argonza

ASEAN-China relations has been warm all along, save for the nuisance obtaining from the disputed territories. China’s flexing of its muscles by releasing its first aircraft carrier—indicative of its naval evolution from ‘brown water’ to ‘blue water’ navy—worked to escalate the tensions and insecurities of China’s neighbors particularly ASEAN, Taipeh, and Japan, tensions that have undermined the cooperative ethos already building up among East Asian neighbors.

Incidentally, the effort towards creating greater connectivity and collaboration between ASEAN and China has been sustained across the years. Below is an update news from ASEAN about the sustained warming up with China.

[Philippines, 05 September 2011]

Source: http://www.asean.org/26470.htm

China Keen to Further Strengthen Bilateral Relations with ASEAN in the New Century

Bali, Indonesia, 22 July 2011

The agreement on the Guidelines on the Implementation of the Declaration on the Conduct of Parties in the South China Sea is a "momentous and historic" landmark, and a reflection that the ASEAN Regional Forum works, said the Secretary-General of ASEAN, Dr Surin Pitsuwan.

This sentiment was shared by Chinese Foreign Minister Mr Yang Jiechi, who described the agreement as a "very important" landmark.

The two leaders met at the ASEAN-China Ministerial Meeting in Bali, co-chaired by Viet Nam and China.

"China will actively cooperate with ASEAN in the drafting of the Code of Conduct," said Mr Yang. Quoting from the Chinese saying that "a thousand mile journey begins with the first step", he stressed that it was an important first step by China and ASEAN "towards practical cooperation, and building mutual trust".

The announcement of the agreement on the Guidelines on Wednesday, made headlines across the Asia-Pacific, with many media analysing its importance and impact to peace and stability in the South China Sea.

Dr Surin and Mr Yang agreed that 2011 is an important year for ASEAN and China, as it marks the 20th anniversary of bilateral ties. A series of celebratory activities have been planned in Beijing and ASEAN. Dr Surin pointed out that the focus to bring the celebrations to the people, dovetails with Indonesia's emphasis on a people-centred ASEAN.

Indonesia is the Chair of ASEAN this year, and Jakarta has virtually pulled out all stops to make sure its Chairmanship is a meaningful one.

On the future of bilateral relations, Dr Surin and Mr Yang agreed that an important cornerstone in its relations is the exchange among our youth - especially the exchange of students between ASEAN and China.

Both leaders are also looking forward to a successful summit this year to wrap up the celebrations.

Mr Yang noted that for the first decade of this millennium, China and ASEAN have jointly achieved the biggest free-trade area of the developing world, and the two sides should build on this and aim for another landmark achievement in the second decade.

The upbeat sentiments were also expressed by Viet Nam's Deputy Prime Minister and Foreign Minister, Mr Pham Gia Khiem.

The Ministers expressed their commitment to work together in implementing the ASEAN-China Plan of Action, and in developing collaborative activities to strengthen ASEAN-China connectivity.

On the South China Sea issue, the Ministers noted China's exhortation to make the area "a sea of peace, friendship and cooperation". They also noted the importance attached by China to freedom of navigation and safety.

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Sunday, September 04, 2011

RUSSIAN-ASEAN RELATIONS PROPPED UP

Erle Frayne D. Argonza

I am a strong believer in ASEAN unity, even as I’m strongly convinced that socio-economic and institutional development of its member nations will be accelerated by many folds should they forge an economic union at the least and a political union at the max.

In the international relations terrain, ASEAN can leverage its unified strengths vis a vis former world powers. It is gladdening to note that even prior to the 2015 economic union, such relations are already being forged with couples of nations and regions, inclusive of Russia.

I would prefer the mutual benefits that relating parties can have in terms of the sharing of expertise. Experts constitute the greatest innovators that can build prosperous nations, as 77% of development is constituted by human & social capital. Only 5% of development is contributed by natural resources, so the forging of stronger ties with emerging markets such as Russia should go beyond the conventional “we-bond-to-exchange-natural-resources” Jurassic cliché.

Below is an update ASEAN report about the status of the dialogue between the Russian Federation and the ASEAN.

[Philippines, 04 September 2011]

Source: http://www.asean.org/26480.htm

JOINT STATEMENT OF
THE MINISTERS OF FOREIGN AFFAIRS OF THE
ASSOCIATION OF SOUTHEAST ASIAN NATIONS
AND THE RUSSIAN FEDERATION ON THE OCCASION OF THE
15TH ANNIVERSARY OF THE ASEAN-RUSSIA DIALOGUE PARTNERSHIP

Bali, 22 July 2011

1. We, the Ministers of Foreign Affairs and Heads of Delegation of the Association of Southeast Asian Nations (ASEAN) comprising Brunei Darussalam, the Kingdom of Cambodia, the Republic of Indonesia, the Lao People's Democratic Republic, Malaysia, the Republic of the Union of Myanmar, the Republic of the Philippines, the Republic of Singapore, the Kingdom of Thailand, and the Socialist Republic of Viet Nam, and the Russian Federation, held the ASEAN Post-Ministerial Conference with the Russian Federation on 22 July 2011 in Bali, Indonesia, on the occasion of the 15th Anniversary of the ASEAN-Russia Dialogue Partnership.

2. We acknowledged with satisfaction that since the establishment of the full ASEAN-Russia Dialogue Partnership in 1996, our cooperative partnership has developed and become comprehensive, turning into an important factor for peace, stability and prosperity in the Asia-Pacific region. Considerable progress has been made in all spheres of ASEAN-Russia relations with the establishment of an effective dialogue partnership and cooperation mechanisms.

3. We recalled that the Dialogue Partnership has been elevated to the highest level. The First ASEAN-Russia Summit held in Kuala Lumpur, Malaysia on 13 December 2005 laid a strong foundation for the dialogue partnership and defined priority areas of cooperation. The Second ASEAN-Russia Summit in Ha Noi, Viet Nam on 30 October 2010, reaffirmed our commitment to consolidate and further promote ASEAN-Russia progressive and comprehensive partnership. In this regard, we look forward to holding further ASEAN-Russia Summits on a regular basis and an intensified exchange of bilateral visits of Heads of State and Governments of the ASEAN Member States and the Russian Federation.

4. Russia reiterated its continued support for maintaining ASEAN centrality in the evolving regional architecture. ASEAN welcomed Russia’s active contribution to promoting peace, stability and socio-economic development in the region. We reaffirmed our commitment to the development of an ASEAN-led regional architecture that is open, transparent and inclusive, and based on principles of consensus, multilateralism and equality, and generally-accepted norms of international law. This architecture would include the East Asia Summit (EAS), ASEAN Regional Forum (ARF) and ASEAN Defence Ministers’ Meeting Plus (ADMM-Plus). ASEAN and Russia are prepared to make efforts with a view to developing working relations between ASEAN-led arrangements and other key multilateral fora, such as the Asia-Pacific Economic Cooperation (APEC) and the Shanghai Cooperation Organisation (SCO). Russia appreciated ASEAN’s support for its participation in the East Asia Summit and reaffirmed its readiness to contribute to the EAS process in order to make the expanded forum a common ground for dialogue on broad strategic, political and economic issues of common interest and concern with the aim of promoting peace, stability and economic prosperity in the Asia-Pacific.

5. ASEAN commended Russia’s accession to the 1976 Treaty of Amity and Cooperation in Southeast Asia (TAC) and its ratification of the Third Protocol to the TAC.

6. We are convinced that the establishment of a South-East Asia Nuclear Weapon-Free Zone (SEANWFZ) can contribute towards global nuclear complete disarmament and nuclear non-proliferation which are crucial for regional peace, security and stability. We confirmed that ASEAN and Russia will work constructively with a view to ensuring early accession of the Nuclear Weapon States to the Protocol to the SEANWFZ Treaty. To that end, the Russian Federation is willing to continue together with other Nuclear Weapon States, consultations with ASEAN on early resolution of outstanding issues pertaining thereof on the basis of the groundwork already done.

7. ASEAN highly appreciated Russia’s continued support for the regular participation of the ASEAN Chair in the G20 Summits.

8. We pledged to continue joint efforts to maintain peace and stability at the regional and global levels. We are convinced that all disputes between states should be resolved through dialogue and by peaceful means without the threat or use of force. We reaffirmed our mutual respect for the independence, sovereignty and territorial integrity of all states in accordance with international law.

9. We attached importance to promoting innovative projects in the framework of ASEAN-Russia cooperation, inter alia, in the areas of peaceful use of outer space, non-conventional and renewable energy, tourism, agriculture and food security. We are confident that their realization will contribute to the economic modernization of ASEAN Member States and Russia, the bridging of the development gap between ASEAN countries, socio-economic progress of Siberia and the Russian Far East. Russia reiterated its strong commitment and support for ASEAN’s integration and community building process, including through the Master Plan of ASEAN Connectivity. We agreed to explore enhanced connectivity between ASEAN and other regions, including Russian Far East. ASEAN looked forward to Russia’s support for the implementation of the IAI Work Plan II and other sub-regional initiatives aimed at bridging the development gaps within ASEAN, as well as the practical steps on the Russian side towards developing partnerships in support of the Mekong River basin development and enhancing regional capacity programmes.

10. We are committed, in accordance with the Joint Statement of the Second ASEAN-Russia Summit and the Comprehensive Programme of Action to Promote Cooperation between the Association of Southeast Asian Nations and the Russian Federation 2005-2015, to enhance cooperation in the key areas such as trade, investment, energy security, including renewable and alternative energy, combating terrorism and transnational crime, disaster preparedness and response, science and technology, health care, education, SME, culture and tourism. We noted with satisfaction that the Second ASEAN-Russia Summit gave considerable impetus to the broadening of contacts between the relevant ASEAN bodies and Russian agencies.

11. We noted the fruitful activities of the ASEAN-Russia Working Group on Counter-Terrorism and Transnational Crime and the ASEAN-Russia Senior Officials Meetings on Transnational Crime Consultations, as a framework for cooperation in tackling terrorism and transnational crime. Russia welcomed the entry into force of the ASEAN Convention on Counter-Terrorism in May 2011. We reiterated strong commitment to work effectively and efficiently to fight against terrorism.

12. We attached importance to the early finalization of the ASEAN-Russia Trade, Economic and Investment Cooperation Roadmap and ASEAN-Russia Disaster Management Cooperation Work Plan, and the implementation of the ASEAN-Russia Energy Cooperation Work Programme.

13. We underscored the need for greater cooperation between ASEAN and Russia in natural disaster early warning and mitigation. To this end, we would further explore practical cooperation, including establishing permanent channels of information exchange, and a system of mutual expert support, including the working-level contacts between National Emergency Management Centre of the EMERCOM of Russia and the ASEAN Coordinating Centre for Humanitarian Assistance on Disaster Management (AHA Centre).

14. We considered the implementation of projects supported by the ASEAN-Russia Dialogue Partnership Financial Fund to be especially helpful in enhancing the outcome of our cooperation. In this regard, ASEAN appreciated the Russian Government’s decision to increase annual contributions to the Fund, beginning in 2011.

15. We recognized the importance of promoting inter-civilizational and intercultural dialogue and moderation, which we considered to be a crucial element in preventing global and regional conflicts and ensuring international peace and security and promoting tolerance, culture of peace and respect for diversity. We further supported cultural cooperation, closer people-to-people contacts, in particular among representatives of parliaments, academia, youth and business communities, and increased cultural exchanges in addition to promoting tourism. In this connection, we considered the Agreement on Cultural Cooperation between the Governments of the Member States of the Association of Southeast Asian Nations and the Government of the Russian Federation of 30 October 2010 to be a basis for such cooperation and therefore called for its early entry into force.

16. We look forward to further enhanced ASEAN-Russia Dialogue Partnership on the basis of mutual benefit and shared interests and see this partnership as an important element of the evolving regional architecture. ASEAN welcomed Russia’s support for an ASEAN community playing proactive role in the global community of nations.

17. We welcomed the steps to carry out the Programme of Activities to commemorate the 15th Anniversary of the ASEAN-Russia Dialogue Partnership and believed that this occasion presents a good opportunity to review our existing cooperation with a view to elevating our partnership to a higher level.

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Friday, August 26, 2011

PACIFIC COUNTRIES LAG BEHIND ASIA, CATCH UP!

PACIFIC COUNTRIES LAG BEHIND ASIA, CATCH UP!

Erle Frayne D. Argonza

A tall order it is for Pacific island countries to catch up with Asian economies. It is a challenge call actually, meant to prop up the resource-rich yet phlegmatic island republics to resonate with the Asian economies most especially the emerging markets.

Take the case of Papua New Guinea (PNG) and Timor Leste, both of which are petroleum-exporting. Resource-rich they may be, yet the gap between them and the emerging markets of Asia is so wide. The challenge is to fast-track the pump-priming strategies such as infrastructure development, while at the same time instituting safety nets.

Development should be a win/win engagement, thru a synergy of stakeholders and welfare interventions for the weaker sectors. The Pacific islands are new to the development game, so they can avoid the pitfalls of their Asian neighbors that prospered in a very lop-sided way.

Below is an analytical note from the Asian Development Bank about the Pacific island countries.

[Philippines, 15 August 2011]

resource-rich-pacific-economies-thrive-while-others-lag-adb-report

Resource-Rich Pacific Economies Thrive While Others Lag - ADB Report

18 Jul 2011

MANILA, PHILIPPINES – The Pacific’s resource-rich economies of Papua New Guinea (PNG) and Timor-Leste will continue to expand strongly this year as commodity prices remain firm but growth in the rest of the region is set to remain subdued, says the new issue of the Asian Development Bank’s (ADB’s) Pacific Economic Monitor.

The report, released today, projects growth in the Pacific region will reach 6.4% in 2011 before moderating to 5.5% in 2012. The petroleum exporting economies of PNG and Timor-Leste are expected to grow by 8.5% and 10.0% respectively, boosted by the high international price of petroleum, and increased investment and employment associated with the construction phase of resource extraction. ADB predicts growth of 7.5% in 2011 in Solomon Islands, driven by increased logging and the resumption of gold mining in the country.

The 11 other Pacific economies (Cook Islands, Fiji Islands, Federated States of Micronesia, Kiribati, Nauru, Marshall Islands, Palau, Samoa, Tonga, Tuvalu, and Vanuatu) are expected to experience much lower GDP growth, at 1.5% in 2011 and 1.9% in 2012.

“The long term growth outlook for the Pacific region as a whole is very modest. If this trend continues, the region risks falling further behind the dynamic economies of developing Asia, resulting in a widening gap in incomes in the two regions,” said Robert Wihtol, Director General of ADB’s Pacific Department. “To avoid this scenario, Pacific governments need to focus on the core functions of good government—investing in infrastructure, improving education and providing an enabling business environment that will encourage investment.”

The July issue of the report raises inflation projections for 2011, due to the sharp rise in commodity prices. It warns that high inflation rates in Fiji, PNG, and Timor-Leste are of particular concern. For the region as a whole, inflation is expected at 8.4% in 2011, but will ease to 5.9% in 2012 as commodity prices stabilize.

The report notes that the smaller, more remote and heavily import dependent Pacific economies, such as those in the northern Pacific, are particularly sensitive to rising international food and fuel prices and are expected to be hit hard by inflation. The depreciation of most regional currencies against the US dollar adds to inflationary pressure across the region.

The ADB report assesses long-term growth prospects in the Pacific region. This assessment shows that Pacific economies can achieve modest growth in incomes in the long term assuming reasonable improvements in the efficiency of their resource use. Two groups of Pacific economies are emerging—those benefiting from their natural resources and those who are not.

To manage price volatility, the ADB report recommends developing safety nets to ensure that the poor in Pacific countries have access to food when prices become unaffordable, diversifying the agricultural base, and exploring alternative energy sources.

The report also presents an analysis of fiscal adjustment in Samoa and Tonga during the recent economic crisis. ADB helped these countries weather the crisis by providing budget support grants that ensured the continuation of essential public services amidst sharp declines in government revenues.

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Wednesday, June 15, 2011

ASEAN BETTER LAUNCH THE ASIAN MONETARY FUND NOW!

An ASEAN Monetary Fund was envisioned by the late PH strongman Ferdinand Marcos. That bank could have been financed by his gold. Today the said vision is becoming closer to reality, as Asian countries have legitimately accepted the concept. This article is hereby republished to drumbeat the need for the Fund.

ASEAN BETTER LAUNCH THE ASIAN MONETARY FUND NOW!

Erle Frayne D. Argonza

Buoyed up by the positive economic performances and regional integration efforts of ASEAN member-states, let me ensue with the ASEAN agenda, and articulate this time the matter of the Asian Monetary Fund or AMF. What makes the urgency of constituting the AMF even more exigent is the recent pronouncement made by the Asian Development Bank or ADB about the same theme: launch the AMF now!

The idea of an Asian Monetary Fund actually began with the late strong man Ferdinand Marcos of the Philippines. Awash with colossal hoards of gold, Marcos vouched for the creation of an Asian Monetary Fund that shall function as monetary stabilizer, steward of an Asian currency, and financer of bold development projects.

As per note from some of his own former close supporters (they were my fellow economists in the Independent Review, c. 1998 to 2000), Marcos was very eager to back up (securitize) the Asian currency with his very own gold hoards (they amount to hundreds of trillions of US. $ today).

It was too bad that Marcos had downside images among the global financiers, who conspired behind the scenes to overthrow him. They never liked the idea of an AMF that will compete with their stooge thug bank International Monetary Fund, and they were salivating to control his gold hoards. The Trilateral Commision in fact undertook steps toward aiding the process of social turbulence to unfold in the Philippines, turbulence that eventually overthrew the dictator.

It took some time before the AMF idea would resurface. The opportunity for resurfacing came with the Asian financial meltdown of 1997. That crisis saw the region’s currencies attacked by an insidious cabal of Western oligarchic financiers fronted by George Soros, who all rested happy from their criminal currency attacks that fattened their coffers by the trillions of dollars.

Thus came the technocratic and public policy responses to the crisis of that time, with the Asian Monetary Fund idea floating to the surface as a viable option. Necessarily, the stabilization of currencies will come with the institution of an Asian currency, which came alongside the AMF idea.

It then took many years of haggling and bargaining before a continental resolution was finally signed into a sort of a memorandum of undertaking. To recall, the former Speaker of the House of Representatives (Philippines), Hon. De Venecia, took much pains to legwork Asian leaders into finally signing the concordat and presenting the same to the Philippine state leaders for immediate action after accomplishing his mission.

This time around, it is the Asian Development Bank that has taken the cudgels for pushing for the urgent institution of the AMF. As articulated in a previous article, the ADB is among the continental institutions that can aid in launching an ASEAN central bank (circa 2015) as well as an Asian Monetary Fund.

Since the ASEAN is the most actively engaged regional formation among Asians, it is the most logical body that can facilitate the launching of the AMF. Its country members could easily role play the core membership of the AMF, with the quid pro quo that the latter will aid ASEAN in forming its regional central bank comes 2015.

As early as the late 90s yet, this analyst was very highly supportive of the institution of an AMF and Asian currency. The launching of the currency alone will catalyze the stabilization of monetary-fiscal environments, and can even out the very uneven cost of living situations across countries.

AMF would surely be of great help to insulating Asia’s emerging markets versus the destructive undercurrents of the economic crises of North America, Europe, and Japan. It can likewise aid enormously in regional trading efforts, precisely by securitizing and/of directly financing the pioneering and expansion efforts of exporters.

I would, however, add a caveat to the AMF’s formation: securitize the operations via a gold reserve standard or equivalent. The eradication of the gold standard in 1971 is among the factors behind monetary-financial instabilities and emergence of criminal financial predators over the last four (4) decades, predators that were responsible for de-industrialization, agricultural decay, and economic decline altogether.

The launching of the AMF shouldn’t be delayed a day longer. The global economic roof is collapsing due to the structural defects of the northern economies, and so as a measure of mitigation the region’s own economies be insulated from that crash through launching of the AMF, buffering financial collapse via collective money reserves for contingency uses, and instituting the Asian currency very soon.

To re-echo the theme: there is no better time to constitute the AMF than now. Act now, before it is too late!

[Philippines, 17 November 2010]

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Thursday, June 09, 2011

ASEAN LAND BRIDGES & RAILWAY SYSTEM

Interconnecting ASEAN member countries via landbridge cum railway project has become an urgent need. It is viable. This article is hereby republished to stress that point.

ASEAN LAND BRIDGES & RAILWAY SYSTEM

Erle Frayne Argonza y Delago

Magandang umaga sa lahat! Good morning to everyone!

This analyst will continue on the ASEAN theme and will focus on road networks & railways for this piece. The region is now preparing the foundations for its conversion into an economic union by 2015, so it would be a productive engagement for citizens of the region to put forward their ideas about how to let the region grow and prosper, such as the idea about land bridges articulated here.

Each member country of ASEAN is now developing infrastructures at different paces, thus rendering each country with gaps in terms of road networks and railways. Such I gap, I believe, can be narrowed if the entire region will conceptualize, design, and begin laying down today the foundations of a region-wide road network.

The grand project can be dubbed as ‘land bridges program’ for the goal it can aspire to attain: that of linking all of the member countries into interfacing and interloping highways. There will be defining expressways in each of the countries that will then be integrated, expanded, and closed gap where certain spaces lack them, thus creating a seamless expressway serving as ‘land bridges’ across the entire region.

Running parallel or inter-linked with the road network would be a gargantuan railway system—of maglev technology—that will be part of the land bridging efforts. Transport hubs can be constructed in certain areas where the road facilities and railway can interface. Each member country can choose to link up its railways (running on electricity and diesel) with the regional maglev to comprise a yet another complex network with awesome potency for stimulating growth.

Such a grand project, which when interlinked further with the Mekong integrated project, will serve as multiplier effect in stimulating growth and development for all of the member countries without exception. The flow of peoples, goods and services, and investments across borders will thus increase by many folds, propelling further the generation of wealth for the union.

With the ASEAN central bank and ASEAN development bank running by 2015 and onwards, it becomes facile to fund the gargantuan land bridges project. The implementers will include private construction & development companies in the region as well as banks that can fund the project’s phases from the side of the private builder-constructors.

The project will enhance the synergy of trucking, train, and shipping down the ground and waters. Such effectively done, there will then be a reduction of moving people and goods by airplanes that can then have greater space for mobility.

The land bridges project can spur more ambitious civil engineering, so that civil works can move on to build tunnels beyond 2 kilometers below the ground. The same engineering efforts can then build tunnels across islands and help to ease out the burdens on ships as the link between island components of the road network.

The same project can also facilitate the inter-connection of the ASEAN to a new ‘silk route’ now rising across the Asian continent. The entry points will be India and China, which the union can cooperate with in building linking infrastructures. With such a possibility turned into reality, one can travel by road and trains from Luzon in the Philippines onwards to the Europe, permitting enjoyment of wonderful landscapes across many lands.

Movements of peoples, goods and services to and from the giant neighbors will also move up by many folds with the land bridge project linked up with the ‘silk route’. Ships and planes can be unburdened a bit by such a twist of development, and can then accommodate more goods & services for other continents and regions.

Regional institutions can be erected to design, manage, and regulate the conduct of construction as well as future traffic along the expressways and the railways flows. There should be transparency and efficiency in the bidding of contracts, so that early enough the governance components of the future political union can already be erected.

It is very likely that the project will be highly welcomed by the peoples of the region. The business sector, notably the constructors & developers, could hardly wait to dip their hands into it as soon as the call for participation by the ASEAN will be in place. It will surely leapfrog the region’s catching up with the developed world and with China, rendering it a potential global economic power in the foreseeable future.

[Philippines, 11 November 2010]

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Saturday, June 04, 2011

ASEAN TRADE LIBERALIZATION, PREPS FOR 2015 UNION

Republished article, to drumbeat the need for more intratrade within the region. This is instrumental in creating the economic union by 2015.

ASEAN TRADE LIBERALIZATION, PREPS FOR 2015 UNION

Erle Frayne Argonza y Delago

Will the ASEAN ever achieve economic integration that its member states have long dreamed of? Being an advocate of ASEAN unification, let me once more share thoughts about my humble region.

Binding rules of tariff reforms are now in the offing for implementation this year across the region, a proof that the unification efforts are going on despite internal barriers. The original ASEAN 5 –Philippines, Indonesia, Malaysia, Singapore, Thailand—are the most prepared for execution of the rules, while Brunei can test-case them as it has the resources to cushion off negative repercussions if ever.

Agreed, the continental countries that are catching up in their development—Vietnam, Cambodia, Myanmar, Laos—need some breather space of five (5) more years to be considered as executors of the same rules. They can catch up, rest assured, so collective trust should permit their self-confidence to propel themselves to high growth.

Economic integration can induce enormous growth and fast-track development in the region altogether. Pushing through with the integration would yield a result that no more member country would be poor by as early as 2020. In other worlds, every country would move on to middle income country status, fast-tracked in its growth momentum by the economic union.

Integration would go beyond tariff reforms, for a reminder. An economic union would need central institutions to note: (a) central bank, (b) regional currency, and (c) related regulatory institutions. Governance institutions, such as a regional parliament and executive council, can undergo deeper study and preparatory formation right after 2015 (political union will take a longer time to traverse).

As to a regional currency, do note that Asian countries have already agreed on a resolution to create an Asian Monetary Fund and an Asian currency. The former speaker of the Philippines’ House of Representatives, Speaker De Venecia, was a prime mover in getting the Asian states to agree on the matter. With him out of power now in the legislature, some other key personalities in Asia should take on the cudgels for implementing the resolutions.

There are surely kinks to be resolved in matters pertaining to economic sector priorities. ASEAN countries tend to compete with one another in certain manufactures and services, so the resolutions could yield an elimination of competition and/or concurring cooperation among the competitors concerned.

ASEAN integration is coming at a time of an evolving paradigm of mixed land use. This paradigm, on a macro-level, could justify well the existence of all key manufacturing and services in a member country, thus undercutting complaints about competition across borders.

Population-wise, the ASEAN will be 700 million head-strong before 2015, which renders the region as a gigantic one. Imagine if just half of the population will be middle income in status, the class that can sustain consumer spending across time. That would be a 350-million head count serving as the economic powerhouse at the household level!

In terms of aggregated Gross National Product or GNP, the figure is nearing $3 Trillions for the region. The prospect of the ASEAN overtaking Japan is no longer remote, a possibility that can happen before 2020. Such a possibility, however, can best happen should economic integration take place as scheduled, an eventuality that will render more focused managing of economic policies and governance reforms that will fast-track growth & development.

Meantime, we can only wish for now that the trade reforms will push through, thus resulting to a semi-integrated economy. The semi-integration will produce pronto a context of ‘import-substitution’ on a regional scale, which I think is a long-overdue goal in the region.

From hereon, ASEAN has only over four (4) years to resolve the last kinks, study the integration directions inclusive of institutional designs. It will be 2011 in just two months’ time, with we hope will be another auspicious year for the humble region and its noblesse diplomats, experts, and leaders.

[Philippines, 03 November 2010]

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