Asean Economic Cooperation and Integration: Progress, Challenges and Future Directions

By Phar Kim Beng
Founder/Chair
Strategic Pan Indo-Pacific Arena
Strategicpipa.com
Twitter: @indo_pan
Facebook: https://www.facebook.com/Strategicpipa

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The editors in this book are old hands of ASEAN. Together Chia Siow Yee and Michael Plummers have had more than fifty years of looking at ASEAN. Thus, they are bound to write a thoughtful, sensible, and well-documented work on ASEAN. But ASEAN is also an entity that is based on sheer discourse; occasionally exaggerated rhetoric of what it is.

The moniker that it is the sixth-largest GDP in the world, coined by McKinsey Consulting, is of course encouraging. But the authors just as easily pointed out in the first chapter that ASEAN actually suffers from an acute income gap, different structural political economy, and a Gini coefficient that is high and uneven across the whole region. How then does ASEAN cohere as a cohesive economic framework and entity? Who are the brand champions? Are there any beyond the academics and thinkers themselves?

“ASEAN Economic Cooperation and Integration: Progress, Challenges and Future Directions” provides a sober assessment of the hits and misses of ASEAN. Among the misses are probably something the member states of ASEAN itself are not aware: ASEAN is but a sub-region of the macro-economic region of East Asia. There is far more trade involving China, Korea and Japan, then there is among all ten economies of ASEAN. The growth of ASEAN hinges on the north.

To the degree ASEAN tries to engineer its own “economic triangle”, such as by linking Batam, Johor and Singapore into a unique whole, the combined land bank has merely been used to build secondary factories for the purpose of out-sourcing. Not much is put into creating pulsating economic drivers and zones. This book cannot endeavor to cover all the problems and promises of ASEAN. It is indeed a region that can keep growing at twice the rate of the developed world. But without a currency policy to off-set the inflationary pressures, both from within the region and without, the growth and gains in ASEAN will be relatively flat, except for those who take the greatest amount of risks. The Iskandar Waterfront Project, for example, constitutes a risky project. It seeks to encourage Singapore and China to invest in Malaysia. But the whole project is only growing slowly, with many in Singapore considering them their weekend-homes. On any normal week, the township is still slow and docile. Chinese house-owners and investors can of course change all that. Meanwhile, the gestation period of the project has just begun.

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