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Analysts: ASEAN Unlikely to Change to EU Model in Near Future


Many leaders in Asia see a European model of integration as the way forward for Southeast Asia. But while the Association of Southeast Asian Nations has taken steps toward greater regional economic integration, experts doubt whether the organization will be able to follow the European Union's example any time soon. Claudia Blume reports from VOA's Asia News Center in Hong Kong.

Forty years after the founding of the Association of Southeast Asian Nations, there is a growing acknowledgment that the organization needs to reinvent itself to remain relevant. Many believe that the way to go for ASEAN is to push for European Union-like integration.

Benito Lim is a political scientist at Ateneo de Manila University in the Philippines. He says ASEAN's goal is to become a unified market similar to the E.U.

"That is the eventual aspiration of all member nations, that once we are integrated we will be able to act as a bloc, especially for negotiating with other countries on the selling of our products, on tariffs and all other issues pertaining to economic and trade relations," said Lim.

At last month's ASEAN summit in the Philippine city of Cebu, the organization moved a step closer toward regional integration. Leaders of the 10 member countries agreed to create a free-trade zone by 2015. They approved a blueprint for the group's first charter, which would make ASEAN a more legally defined organization and allow it to impose sanctions on members who do not follow its rules. Currently, ASEAN resolutions are not binding on the members.

But there are many stumbling blocks that make it difficult for ASEAN to integrate as fully as the E.U.

Masahiro Kawai is dean of the Asian Development Bank Institute in Tokyo. He says the disparities among ASEAN member countries are enormous - unlike the European Union.

"The development gaps among countries are huge - Singapore versus Laos or Cambodia," he said. "The income disparities are huge, institutional differences are big, of course political regimes are different across countries, whereas in the case of Europe even 50 years ago there was a lot of homogeneity among core countries in Europe."

While the average per capita gross domestic product in Singapore, one of the richest countries in the world, was more than $26,000 last year, the per capita GDP in Burma, the poorest ASEAN member, was less than $200. Laos and Cambodia are not far above Burma.

Malcolm Cook, program director of the Lowy Institute, a Sydney international policy institute, says another major problem in Southeast Asia that makes integration difficult is that the region's economies compete against each other. Most have similar exports, such as textiles and natural resources, which are exported to similar markets.

"Almost all the economies of Southeast Asia minus Singapore are competing economies," said Cook. "They are not particularly complimentary, which is different than Europe, especially when Spain, Greece and Portugal joined. So the economies don't trade much amongst each other and compete against each other on world markets - that makes integration both less beneficial and more difficult to achieve."

Lack of economic freedom is another weakness of several ASEAN member countries. This year's "Index of Economic Freedom" - released by the U.S. policy research center the Heritage Foundation in January - ranked Cambodia, the Philippines, Indonesia and Vietnam as "mostly unfree" economies.

Vietnam, for example, was only placed 138 on an index of 157 countries surveyed for their level of economic freedom because of the government's tight controls of most assets and the financial sector. Laos and Burma's economies ranked as "repressed".

Development in the region is hampered by widespread corruption, which scares away investors and can restrict economic growth. According to a 2006 Index released by the corruption watchdog Transparency International, six of the 10 ASEAN countries were among the 50 most corrupt countries in the world: Laos, Vietnam, the Philippines, Cambodia, Indonesia and Burma.

Political integration in the region is made difficult by the large differences among government systems, ranging from multi-party democracies such as Indonesia to communist regimes in Vietnam and Laos. Benito Lim says because of this, the proposed introduction of majority voting, replacing ASEAN's customary decision-making by consensus, is a thorny issue.

"It is controversial because one of the principles they are committed to would be commitment to democracy, human rights - and you know most of the ASEAN states are not real democracies so that would be a big problem," added Lim.

Traditionally, ASEAN members have stuck to the principle of not intervening in their neighbors' affairs. The organization has been accused of not taking a strong enough stance against human rights abuses, particularly by Burma.

Masahiro Kawai says, however, that the grouping has started to become more vocal.

"They had [an] implicit agreement not to interfere with each others' domestic affairs. But in order to make further progress for integration of course you have to talk about countries' businesses economic issues, and to some extent political issues," said Kawai. "So things are moving in the right direction."

Kawai thinks that to strengthen integration, considerable economic, institutional and political convergence has to take place, and that will take time.

Kawai and other experts say that the introduction of a single Asian currency, similar to the euro, is even further away on the horizon.

Talk about an Asian currency unit, aimed at bolstering monetary stability, spurring economic growth and evening out disparities, has gone on for years. It particularly gained momentum during the Asian financial crisis in the late 1990's. But ASEAN has pushed the topic off the table for now. Malcolm Cook says the organization is focusing first on less ambitious goals such as Asian bond markets and on encouraging countries in the region to borrow regional currencies instead of relying on dollar loans.