ASEAN leaders agree to work together on regional economy, security

Monitoring Desk

BANGKOK: Southeast Asian leaders agreed on Sunday to work together on the region’s economy and security to strengthen their position to face growing U.S.-China tensions, as they wrapped up their summit in Bangkok.

The 10-member Association of Southeast Asian Nations (ASEAN) will need its collective economic strength for bargaining power globally, especially amid the trade tensions between the world’s top two economies, Thai Prime Minister Prayuth Chan-ocha told a news conference, as chairman of the 34th ASEAN Summit.

Prayuth urged ASEAN nations to complete negotiations this year for the China-initiated Regional Comprehensive Economic Partnership (RCEP) pact that includes 16 countries but has been held up by disputes between China and India over access to markets and protected lists of goods.

Negotiations began in 2012 on RCEP, which envisages the creation of a free trade zone encompassing 45% of the world’s population and more than a third of its GDP, but does not involve the United States.

“This will help ASEAN handle the changes and uncertainty that will happen in the region going forward, particularly the impacts of trade tension between ASEAN’s important trade partners,” Prayuth said.

First proposed by China, RCEP’s 16 signatories comprise the 10 ASEAN member states and six Asia-Pacific countries, including major economies China, India, Japan and South Korea. ASEAN has existing free-trade agreements with all six countries.

“If we can do this, we will have the bargaining power and base for negotiation. Because when combined, we are 650 million people, the largest regional bloc in the world,” the Thai prime minister said of ASEAN.

Singaporean Prime Minister Lee Hsien Loong told reporters that ASEAN “must expect some fallout” from the U.S.-China trade war, pointing to Singapore’s already slowing economy this year.

Four ASEAN countries – Thailand, Indonesia, Singapore and Vietnam – will discuss the trade war in next week’s G20 summit, which assembles 20 major economies, in Tokyo, Prayuth said. Thailand will host the next ASEAN summit in November.

ASEAN members also agreed on a common approach on a U.S.-led Indo-Pacific initiative on Sunday, at a time when U.S.-China tensions are rising and forcing ASEAN countries to take sides.

Prayuth hailed the bloc’s agreement on the ASEAN Outlook on the Indo-Pacific as a “significant step,” as it will help guide cooperation in the region in an increasingly polarized geopolitical landscape.

The outlook, seen by Reuters, is aimed at “helping to promote an enabling environment for peace, stability and prosperity in the region in addressing common challenges”.

The chairman’s statement, released later on Sunday, called for a de-escalation of tension in the South China Sea.

The South China Sea is one of the world’s busiest waterways, and a potential flashpoint in the region as several ASEAN members – the Philippines, Vietnam, Malaysia, Brunei and Indonesia – as well as China and Taiwan have conflicting territorial claims.

“We emphasized the importance of non-militarization and self-restraint in the conduct of all activities by claimants and all other states … that could further complicate the situation and escalate tensions in the South China Sea,” the statement said, without naming China but referring instead to its militarization of islands and islets.

The statement also said a first reading of a Code of Conduct negotiating draft for the disputed South China Sea would likely be finished by this year. Thailand has said the final reading could be expected by the end of 2021.

“There are some issues in the COC which are going to be very difficult to work out – in their nature they are going to be contentious,” Singapore’s Lee said. “I think the vital interests will not be easy to reconcile.” (Reuters)