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ASEAN, East Asian economic integration
As the US President is ceding his global leadership role to others, ASEAN and East Asia need to make sure that global governance works for them and the rest of the world.
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US President Donald Trump (left) waves as US Secretary of State Rex Tillerson looks on after attending the 31st Association of Southeast Asian Nations (ASEAN) Summit in Manila on November 14, 2017. (AFP/JIM WATSON)
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nited States President Donald Trump ended his five-nation, eightday tour of Southeast and East Asia at the East Asia Summit (EAS) in Manila last month. In addition to participating in the ASEAN, APEC and EAS meetings, Trump also held one-on-one meetings with several leaders from the region. The president, who has repeatedly challenged America’s traditional alliances in Asia, showed a conciliatory approach during his first maiden voyage to Asia.
In the bilateral meetings, he sounded more like a 20th century trade negotiator than a 21st century statesman. He urged East Asian economies to invest more in the US, buy military equipment and import more gas, generally pressing for economic measures he thinks will reduce US trade deficits. The absence of a US leadership that encourages Asian progress toward economic integration is a disappointment.
President Trump’s protectionist policies are no doubt a result of unresolved economic challenges created by globalization. The bilateral trade deficits are certainly real. China, Japan and Korea export much more than they import from the US. But the US, through its inaction and lack of innovation, has also contributed to this; and now it is up to the US to fix it.
On the other hand, Asia also must take responsibility for its own recalcitrance and take the steps to move forward. Asian leaders know what must be done. But they remain plagued by inertia, preoccupied by domestic needs and immobilized by conservatism, with many leaders seemingly taken by populist opinions. As a result, the region as a whole has failed to take the steps needed to ensure long-term economic stability, economic growth and prosperity.
This is not to say that no positive steps are being taken. In a welcome contrast to Trump’s ignorant protectionism, ASEAN and East Asia have continued to advance free trade, opening negotiations on the Regional Comprehensive Economic Partnership (RCEP) and expanding trade deals with non-regional partners, offering almost all of their preferential tariff rates.
But the achievements in tariff liberalization have been offset by the rise in non-tariff measures. There are also challenges in tackling barriers to trade in services. ASEAN member states generally have more restrictive services policies than any other region in the world. Seeking uniformity in regulatory rules remains challenging, given the widely different levels of development and often clashing national interests.
The result has been delays in the implementation of specific initiatives such as the ASEAN Plan of Action of Energy Cooperation (APAEC), as well as in the ratification of signed agreements and their alignment with national laws. In Trump’s policy speeches in Tokyo, Seoul and Beijing, the world saw how economic and social woes can result in protectionist consequences. ASEAN and EAS would be wise to take note.
