(Third of 3 parts)
This is a slightly revised version of the author’s presentation in Jakarta, Indonesia on July 29 and August 26 during the training of journalists from member-countries of the Association of Southeast Asian Nations (ASEAN) organized by the International Institute for Journalism (IIJ) of InWEnt-Germany.
BY DANILO ARAÑA ARAO
Vol. VIII, No. 32, September 14-20, 2008
The Association of Southeast Asian Nations (ASEAN) can be newsworthy.
The reportage, however, must not only be limited to the ministerial meetings held annually. A simple comparison of its fundamental principles and the resulting policies and strategies show glaring contradictions.
The 10 member-countries have global importance because of their sheer size: As of 2007, they have a combined population of 575 million, a land area of 4.5 million square kilometers and total trade of $1.4 billion (i.e., 2006 data, computed as the sum of exports and imports).
The official website of the ASEAN also stressed:
The ASEAN region is a leading recipient of FDI [foreign direct investment] flows in the developing world, with five ASEAN countries in the top 20 developing-countries recipients of such long-term global capital flows from 1997 to 1998. Between 1993 and 1998, ASEAN received about 17.4% of the US$760 billion in cumulative global net FDI flows to developing countries. Over the same period, ASEAN received an annual average of US$22 billion in net FDI flows, compared with an annual average of US$7.8 billion in the period between 1986 and 1991. FDI flow in ASEAN increased on average by about 14% annually from 1996 to 1998, while FDI stock in ASEAN grew tenfold from US$23.8 billion in 1980 to US$233.8 billion in 1998. (“Asean Investment Area”, n.d.)
The ASEAN, established on August 8, 1967, is said to be a “child of the Cold War” and was born “amidst turmoil and conflict in the region.” It was reportedly founded on the countries’ “desire to promote economic growth and welfare of the people in the region. The original five countries [Indonesia, Malaysia, Philippines, Singapore and Thailand] were then facing a common threat from communist insurgencies.” (Tan & Stehling, 1998, p. x)
Its six fundamental principles include the following: “[M]utual respect for the independence, sovereignty, equality, territorial integrity, and national identity for all nations; xxx [and] non-interference in the internal affairs of one another.” (“Overview”, n.d., italics mine)
These two principles, just like the four others, may sound harmless and even noble, but these are subverted by some agreements recently forged by the ASEAN member-countries.
For example, the ASEAN Vision 2020, adopted during the ASEAN’s 30th anniversary, has a “shared vision of ASEAN as a concert of Southeast Asian nations, outward looking, living in peace, stability and prosperity, bonded together in partnership in dynamic development and in a community of caring societies.” (“Overview”, n.d., italics mine)
The principles of “mutual respect” and “non-interference” are clearly compromised by imposing, albeit indirectly, an economic direction that seeks globalist ends. Being “outward-looking” means that a country should constantly assess what is in demand in the global market and should consequently make the necessary adjustments in terms of its policies and programs. Even if the ASEAN does not explicitly state its bias for globalization instead of protecting domestic industries, an outward-looking economic orientation naturally results in a country’s being export-oriented and foreign investment-led.
ASEAN journalists could very well study the positive and negative implications of this implied bias for globalization, especially in the context of the social cost it brings to the poor people.
The ASEAN Investment Area (AIA), the framework agreement of which was signed on October 7, 1998 in Manila, seeks the “immediate opening up of all industries for investment, with some exceptions…to ASEAN investors by 2010 and to all investors by 2020.” The AIA also wants to promote “freer flows of capital, skilled labor, professional expertise and technology amongst the member-countries.” (“Asean Investment Area”, n.d., italics mine)
These objectives further quality what is meant by an outward-looking orientation among ASEAN member-countries. To encourage investors, the ASEAN enumerates the benefits they stand to get:
1. “greater investment access to industries and economic sectors as a result of the opening up of industries under the AIA arrangements, if investors quality as ASEAN investors;
2. “national treatment, if investors qualify as ASEAN investors;
3. “greater transparency, information and awareness of investment opportunities in the region;
4. “more liberal and competitive investment regimes; and
5. “lower transaction costs for business operations across the region.” (“Asean Investment Area”, n.d., italics mine)
For those who want to write about the AIA, they should note that an ASEAN investor is “defined as being equal to a national investor in terms of the equity requirements of the member-country in which the investment is made. Thus, a foreign firm with a majority interest can avail itself of national treatment and investment market access privileges…” (“Asean Investment Area”, n.d.) This simply means that the rights and privileges of a local investor will also be given to a foreign counterpart, making competition more “even.”
The ASEAN reported that “ASEAN investors can now invest in manufacturing sector in any member-country subject to certain exclusions.” The same is now true for non-ASEAN investors if they came in between 1999 and the end of the year 2000. They also stand to enjoy special privileges like “income tax exemption, full foreign equity ownership, duty-free imports of capital goods, domestic market access, and at least 30-year long-term lease for industrial land.” (“Recent Developments”, 1999) As regards the latter, the Philippines enacted an Investors Lease Act in 1993 that provides for a 50-year lease of land for foreign investors, renewable for another 25 years.