US-ASEAN Connect Holds Promise of Deepening ASEAN-US Relations

Abstract

Economic cooperation between the US and ASEAN has been advancing steadily since the former became a Dialog Partner in 1977. A Trade and Investment Agreement (TIFA) was inked in 2006 to strengthen economic links between the two, and in 2012, the US-ASEAN Expanded Economic Engagement (E3) initiative was launched under the TIFA to strengthen trade and investment ties, and to create business opportunities and jobs.1 The latest initiative – the US-ASEAN Connect – announced in February 2016 by President Obama at the US-ASEAN Summit in Sunnylands, CA, is poised to take US-ASEAN relations to new heights. The US-ASEAN Connect has four strategic thrusts, or pillars.2 The first is the Business Connect that aims to support commercial links between the US and ASEAN in key sectors, and to assist ASEAN in its ASEAN Economic Community (AEC) implementation measures. The Energy Connect focusses on the development of power sectors in ASEAN and the connectivity, clean energy as well as energy security goals of ASEAN. The Innovation Connect uses policy support and direct engagement with entrepreneurs to develop Southeast Asia’s entrepreneurial ecosystem while the last pillar, the Policy Connect supports the development of a policy environment conducive to the promoting of trade, investment, innovation and sustainable and equitable economic growth. This article reviews ASEAN-US economic ties before analysing the impact of the US-ASEAN Connect on ASEAN and the US in terms of economic rebalancing. It further examines the implications of this new initiative on the Trans-Pacific Partnership Agreement (TPPA), and on economic integration within ASEAN.