Academic journal article Law and Policy in International Business

ASEAN and the Multilateral Trading System

Academic journal article Law and Policy in International Business

ASEAN and the Multilateral Trading System

Article excerpt

The Association of Southeast Asian Nations (ASEAN) - which incorporates the six countries of Thailand, the Philippines, Malaysia, Singapore, Brunei, and Indonesia - was created in 1967, making it one of the few regional arrangements originating in the 1960s that has lasted as a viable entity to the present.

ASEAN is often criticized for having achieved little in terms of regional trade liberalization over its quarter-century of existence. What is forgotten in this criticism is that the economic aims of ASEAN were modest at its beginning and remained so until 1992.

The individual members of ASEAN have been remarkably successful traders, but not as a result of ASEAN. ASEAN's two greatest achievements have been to provide a framework for regional stability, and to create a unified voice for the conduct of external relations with the rest of the world. An evaluation of ASEAN according to the standard economic criteria of intraregional trade expansion simply misses the point.

I. ASEAN's Early Priorities

The ASEAN Declaration of 1967 was quite different from the Treaty of Rome. It did not commit member countries to regional economic integration; the new organization was simply asked to facilitate cooperation on social, cultural and economic matters, and, importantly, to promote peace.

A. Political Negotiation and Collective Bargaining

ASEAN was created at a time when the communist threat to existing governments was severe. The desire to combat communism furnished the cement that initially held these disparate nations together. Peace among ASEAN members also was high on the initial priority list, and with ample reason. ASEAN's creation followed closely upon the "Konfrontasi" conflict in the early 1960s between Malaysia, Singapore and Indonesia, which nearly led to armed conflict; ASEAN created a neutral forum where leaders could discuss their differences. ASEAN also helped to broker the conflict between Malaysia and the Philippines over the Sabah region in Borneo; diplomatic relations were restored between the two countries in 1969. In 1971, all ASEAN members were able to sign a "declaration of peace and neutrality."

In the context of distrust and nationalism that characterized the 1960s and most of the 1970s, the first years of ASEAN's existence saw little progress towards intraregional liberalization. Instead, the ASEAN members addressed political conflicts among themselves and worked out common approaches to two deadly and prolonged wars in the Southeast Asian region, the Vietnam and Cambodian conflicts. In 1973, ASEAN created a rehabilitation assistance program for Indo-China following the end of the Vietnam War. In 1979, ASEAN foreign ministers jointly called for the withdrawal of foreign troops from Cambodia. In 1987, ASEAN heads of state established a nuclear-free zone in the region. And in 1993, for the first time, ASEAN officials held talks on security issues, debating the wisdom of a military alliance for the region.

ASEAN has also evolved into what may be termed a "collective bargaining force" vis-a-vis OECD nations. ASEAN has held frequent talks with its "dialogue partners," especially the United States, the European Community, Japan and Australia. These sessions have often been used to iron out bilateral trade disputes. ASEAN has discussed rules of origin for GSP exports, the imposition of U.S. countervailing duties on textile products, the quota system on primary products imports into Japan, and civil aviation with Australia, to cite the most notable examples.

In 1972, ASEAN formed an ASEAN-Brussels Committee to coordinate negotiations with the European Community; in 1980, ASEAN signed a cooperation agreement with the EC. In 1990, ASEAN and the United States agreed to establish a Trade and Investment Cooperation Committee to monitor trade and investments links. In 1973, an ASEAN Geneva Committee (AGC) was formed to coordinate the position of members in the GATT. …

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