The ASEAN Economic Community: A Work in Progress

Abstract

"Although the self-imposed deadline for the realization of the ASEAN Economic Community (AEC) is 2015, it should not be viewed as a hard target. One should not expect 2015 to see ASEAN suddenly transformed, its nature and processes abruptly changed, its members’ interests substantially altered. Rather, 2015 should be viewed more as a milestone year — a measure of a work in progress — rather than as a hard target year. The experts commissioned by the Asian Development Bank (ADB) and the Institute of Southeast Asian Studies (ISEAS) to write chapters on this matter express considerable doubt as to whether the specific measures Rodolfo C. Severino and Jayant Menon committed to in the AEC Blueprint will have been carried out by 2015. One chapter notes ASEAN’s failure to do away with NTBs. Another chapter cites the lack of progress in liberalizing intra-regional trade in services, which is becoming increasingly important in Southeast Asia. Still another attributes ASEAN’s failure to recover its attractiveness to FDI to the region’s inability, whether real or perceived, to integrate its economy. The chapter on competition law and Intellectual- Property Rights (IPR) protection in ASEAN concludes that, although “harmonizing” rules and enforcement measures relative to competition and intellectual property is important for bringing down trade barriers, such harmonization would both be difficult and time consuming. The chapter on subregional zones similarly observes that, although mutual confidence and functioning institutions are essential to transnational endeavors, they take time to build; however, subregional zones can help reduce development gaps and improve connectivity across national boundaries. The chapter on free trade agreements states that ASEAN “has no prospect of coming close to … (a) single market by the AEC’s 2015 deadline — or even by 2020 or 2025”. The chapter on dispute settlement underlines the importance of the subject for regional economic integration, declaring that it is essential for an effective mechanism to be in place by 2015 or earlier if the AEC is to be achieved by that year. The study on institutions finds that ASEAN member countries wish to retain as much political autonomy as they can in carrying out their commitments to regional economic integration and that ASEAN lacks the institutions and processes that help governments and societies to recognize the benefits that the AEC presents."