Without fanfare, the third Seminar of “China-Indonesia Relations: Strengthening Partnership and Deepening Regional Cooperation”, jointly organized by the Chinese People’s Institute of Foreign Affairs (CPIFA) and Indonesia’s Centre for Strategic and International Studies (CSIS) went smoothly in Beijing a few days ago.
This 1.5 track diplomacy was well attended by noted academicians, journalists and thinkers from both sides. Former vice president Jusuf Kalla also attended the seminar and underscored the strategic importance of Sino-Indonesia relations in the maintenance of regional peace, stability and prosperity.
As predicted, the discussions centered on the South China Sea, an issue which has recently attracted a lot of attention the world over. All participants agreed that this conflict cannot be resolved in the near future.
There is, therefore, an urgent need for all related parties to speedily overcome the simmering tensions, as it may push some to miscalculate.
The stakes are high. These are some statistics why it is so.
Since ASEAN accepted China as a full dialogue partner in 1996 at the 29th ASEAN Ministerial Meeting (AMM), the ASEAN+1 cooperation has expanded to cover a wide-ranging cooperation with 11 priority areas, namely: agriculture, information and communication technology, human resources development, investment, Mekong River Basin Development, transportation, energy, culture, tourism, public health and environment.
China is currently the second-largest economy in the world with a national reserve of around US$3.5 trillion. With approximately $1.92 trillion budget for the fiscal year 2012, China’s economy is only second to the US whose budget stood at $3.796 trillion. It is expected that in the near future China will overtake the US as the largest economy in the world; an economy that ASEAN cannot afford to miss out on.
Meanwhile, China’s foreign direct investment (FDI) to ASEAN countries reached $4.4 billion in 2010. In the tourism sector, China sent approximately 4.5 million travelers to ASEAN and both sides have set a target that two-way tourist arrivals should reach 15 million by 2015.
ASEAN-China trade has continued to grow. The volume of two-way trade jumped from only $7.96 billion in 1991 to $362 billion in 2011, representing an average annual growth of more than 20 percent. China has now become ASEAN biggest trading partner. Likewise, ASEAN has become China’s third-largest trading partner, thanks partly to the ASEAN-China Free Trade Area (ACFTA), which has been in operation since January 2010.
China has also taken a series of important steps to deepen and widen its relationship with ASEAN countries by inter alia, providing additional $10 billion loans to ASEAN countries, including $4 billion preferential loans; establishing ASEAN-China Committee on Connectivity Cooperation; and setting up ASEAN-China Maritime Cooperation Fund of RMB 3 billion (US$476 million).
On the other hand, ASEAN’s economies are also performing well.
With around 600 million inhabitants, approximately 10 percent of the world’s population, ASEAN is a huge market for China. It also controls the Straits of Malacca and Singapore, the busiest sea-lanes in the world, through which half of the world’s trade and one-third of oil export passes.
ASEAN countries’ combined GDP was approximately $1.8 trillion in 2010, the ninth biggest economy in the world and the third after China and Japan in Asia; a market which China can continue to tap into.
If the current standoff over the South China Sea continues unabated, both sides will definitely stand to suffer. Besides, it will run counter to the mutually acceptable principle that the ASEAN+1 mechanism is the prime mover in molding the regional architecture in which ASEAN is in the driving seat.
It is, therefore, in the best interest of both sides to ensure that ASEAN+1 remains solid and united in dealing with the multi-facetted challenges the region is currently confronted with.
It is, therefore, the duty of all ASEAN+1 countries to take necessary measures to keep bilateral ties growing steadily and healthily, shelving their differences and concentrating instead on cooperation, as the paramount leader Deng Xiaoping once wisely suggested.
A prompt negotiation of the code of conduct can certainly serve as an excellent step in that direction, thereby avoiding misunderstanding and miscalculation.
It is against this backdrop that the strategic importance of the seminar has to be seen. It definitely can help contribute to developing and nurturing mutual understanding among countries of ASEAN+1.
It is not an easy task. It is a Herculean one, requiring our common endeavor and common resolve.
Staying put is not an option.
The writer is a Fletcher School of Law and Diplomacy graduate and currently serves as Indonesian ambassador to China concurrently to Mongolia. Views expressed in this article are his and do not necessarily reflect the Indonesian government’s policy.