ASEAN and the economic dimension of Asian security

By EAF editorial team 
The role of ASEAN in underpinning Asian security is vastly underestimated. To the security hard-heads this may seem a peculiar claim, especially in Washington where ASEAN is often seen as some kind of wishy-washy construct which needs stiffening in its resolve against the rising economic and political power of China.
While there is a politically important military presence in many of the key ASEAN states, their capacity — both individually and collectively — to project external military power is relatively limited. Singapore serves as an anchor for the US navy in Southeast Asia but so too it did for Great Britain, it might be recalled, in the interwar period.
It is not military power that gives ASEAN its key role in underpinning Asian security. Rather, ASEAN has played a vital role in enmeshing Asia’s great powers — the United States, China and Japan — into the region’s institutions, and in furthering the region’s economic integration and growth.
The strength and success of ASEAN as it approaches its 50-year anniversary is measured in its ability to continue to promote economic growth through deeper regional integration into the global economy — the current troubles in the South China Sea notwithstanding — not by its military power. The South China Sea issue is not, as some claim, the test of economic and political security on which ASEAN integrity and coherence will finally stand 
or fall.
As Sourabh Gupta observes in our lead essay this week on the fallout from the Philippines arbitration case, the ‘sovereignty-linked issues of jurisdiction in the South China Sea have always been tied to a larger political calculus of stability and good neighbourliness’. ‘China’s leaders’, Gupta writes, ‘have not been shy in calibrating their stance between a hardline and 
a flexible one to suit the strategic circumstances’.
The quiet in the wake of the award will not last, but it is, as US Secretary of State John Kerry says, an opportunity to ‘turn the page’. It is in the context of the broader interests in the ASEAN–China relationship that there is incentive for both sides to nudge their relationships forward positively beyond the judgment of the UNCLOS Tribunal at the Permanent Court of Arbitration.

Even more important role
In the coming years, ASEAN is likely to assume an even more important role as the locus of efforts that buttress globalisation and an important bulwark against the tide of inward-looking anti-globalisation movements in North America and Europe that threaten global political and economic stability.
This contention may sit oddly against the history of ASEAN’s emergence as an arrangement that was originally designed to deal with the legacy of insecurity in Southeast Asia after Sukarno’s Indonesia and the communist insurgency in Indochina. Many commentators have measured ASEAN’s success exclusively against the metric of how useful it was in managing these and other security affairs. Indeed, in 1967 as the foreign ministers of the ASEAN 5 — Indonesia, Malaysia, Thailand, Singapore and the Philippines — gathered in Bangkok, it was defence and international relations that were at the forefront of their minds. And certainly, as a forum promoting non-violent conflict resolution, ASEAN has been a considerable political success.
But there is another narrative often overlooked that provides a more persuasive account of why ASEAN has served regional security so well.
In the 1960s, the famous Swedish economist Gunnar Myrdal identified Southeast Asia among other parts of the developing world as a region stuck in a vicious cycle of poverty, a likely sea of instability and woes for many years to come. Looking back today, Myrdal’s prognostication for the region seems to have been spectacularly wrong. What changed all this, of course, was how the Southeast Asian economy was turned around, not all at once or at the same pace, but in a common direction at around the same time. Without this re-direction of economic policies across the region, the innovation and success of ASEAN would hardly have become the lynchpin of East Asian political arrangements 
that it has become and still remains today.

Regional political fragility
The diversity in stages of development, economic endowments, institutions, culture, religion and ethnicity may appear to have been an enduring source of regional political fragility. But economically, this diversity was a fountain of strength, offering opportunity for specialisation that multiplied the gains from trade for growth. It was growing economic security that attenuated the politics of ASEAN diversity and ensured its reach and influence, however tenuous it may have at times appeared. And it will be economic security and success that underpins ASEAN’s political sway and effectiveness in the face of political uncertainties 
going forward.
Somehow, against the odds, ASEAN settled on the right economic formula: one that guaranteed success despite the vicissitudes, notably during the Asian financial crisis, and one that delivered a credible 
measure of economic success across the region.
ASEAN is now a formidable group of economies that has delivered economic security to the majority of its population of over 600 million people and promises the same for more.
It is a remarkable story, not only in the annals of regional experience but also in the history of modern international affairs. It is one that is too often underestimated by its being told through the prism of a postcolonial commentary that has its own axe to grind and dignity to maintain.

Shift in policy paradigm
What is the economic character of the ASEAN enterprise and its development? And what are the driving conceptions and philosophies on which the economic success of ASEAN has been built?
The shift in the policy paradigm that came to guide ASEAN’s original member states and then enlisted others led them away from inward-looking protectionism and towards outward-looking economic policy strategies that sought to capitalise on Southeast Asia’s external opportunities wherever they were, not only in the region itself. This was a huge achievement and the source of considerable economic benefit. It was not and still is not, of course, a sweeping victory on every battlefront or in every state; the going has been sometimes tough and lost direction.
This is exemplified in the case of Indonesia, where the political economy of vested protectionist interests and atavistic policy thinking sometimes triumphed over the measurable gains from international integration. These ghosts still hover over contemporary policy choices.
Yet it was ASEAN and Indonesian leadership that articulated the strategies of open regionalism and consensus-building which shaped the success of Asian regionalism and ASEAN growth. The ASEAN Economic Community embodies that spirit.
Ponciano Intal points out in this week’s other lead essay that ‘an important lesson that ASEAN takes from Brexit is the need to socialise the economic benefits of regional integration. To be effective, ASEAN’s regional integration must be inclusive and the economic benefits widely shared and appreciated. Integration needs to be promoted within the context of enhancing domestic competitiveness and economic dynamism in an open and globally connected region’.
The challenge for ASEAN today is to direct its unique but resilient strategies of regional association to tackling the issues of the middle income trap and not be diverted in its open economic strategies by uncertainties in the international economic environment.
(Courtesy: East Asia Forum)
(The EAF Editorial Group is comprised of Peter Drysdale, Shiro Armstrong, Ben Ascione, Ryan Manuel, Amy King and Jillian Mowbray-Tsutsumi and is located in the Crawford School of Public Policy in the ANU College of Asia and the Pacific)