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Asean isn't quite a miracle yet

While its achievements are notable, the grouping has a long way to go
Saturday, July 1, 2017 - 05:50

In many cases, non-Asean economies from Asia have outperformed those of Asean, suggesting that the real “X factor” behind economic performance is domestic economic policies and governance, not membership of Asean.

“The Asean Miracle: A catalyst for peace” by Kishore Mahbubani and Jeffery Sng is published by Ridge Books, NUS Press, 264 pages. Available at Kinokuniya and airport bookshops, S$24

WITH the 50th anniversary of the Association of South-east Asian Nations (Asean) coming up on Aug 8, now is an opportune time to take stock of the grouping's achievements and shortcomings.

This is what authors Kishore Mahbubani and Jeffery Sng attempt in their new book The Asean Miracle. Most books on Asean tend to be academic studies or consultants' reports. This is refreshingly different. For one, it is readable and in parts, opinionated and entertaining. The authors are distinguished former diplomats who have spent much of their careers navigating the delicate intricacies of Asian diplomacy. Their book is peppered with anecdotes about their personal experiences and those of their fellow diplomats. It is also informed by extensive research (in which the authors were assisted by a team of researchers) and boasts an 18-page bibliography.

Sweeping in scope, it delves deep into the history of South-east Asia. A fascinating chapter reflects on the four waves of cultural influence - Chinese, Indian, Muslim and Western - that have shaped the region's societies and cultural diversity over the centuries. The book also traces the evolution of Asean, which has not been linear but has moved crab-like, as former Singapore foreign minister George Yeo aptly described - two steps forward, one step back and one step sideways. Another chapter examines Asean's engagement with the major powers over the decades.

However, as its title suggests, the 232-page book is more a celebration of Asean, a work of advocacy, than an objective assessment of the grouping. The authors' intent is evident from the first page where they suggest: "Asean is . . . more deserving of the next Nobel Peace Prize than any other person or institution today."

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The authors make a valiant attempt to substantiate this tall claim. In a chapter which summarises their case, they credit Asean with three major achievements. First, it has delivered 50 years of peace to its member states. Second, it has improved the livelihoods of Asean's 600 million citizens. Third, it has helped lubricate and smoothen relations with and between the major powers - the United States, China, Europe, Japan, Russia and India - which have all been involved, in one way or another, with South-east Asia. But these conclusions need to be qualified.

The notion that Asean has been the greatest harbinger of peace to South-east Asia is debatable. While it is a plausible hypothesis, equally plausible is the idea that the region, which has prospered over the last 50 years, would have been peaceful even without Asean - unless a convincing case is made that there were specific potential conflicts that Asean prevented. The authors do not make this case.

They draw a contrast between the west's troubled relationship with the Islamic world and the relatively peaceful coexistence of Muslims and non-Muslims in Asean.

They suggest that the European and American intelligentsia "need to make an intellectual pilgrimage to South-east Asia", to learn lessons on how different civilisations can live in peace.

There are no doubt many lessons to be learnt. But the idea that Asean is responsible for South-east Asia's more peaceful relationship vis-a-vis Islam compared to other regions is not one of them. One of the facts the visiting intellectuals would find is that South-east Asia's Islam is very different from that prevailing in the Middle East.

The authors themselves point this out, noting that Indonesian Islam is "matched by the tenacious persistence of strong local animist and Hindu-Buddhist cultural traditions."

This helps explain why South-east Asian Islam is not as infused by the radical strains that currently run through the Middle East and why it is more tolerant of other religions and cultures. But this is mainly the result of a happy accident of history, going back centuries, and has nothing to do with Asean.

In places, the authors take their Asean totemism to simplistic extremes. For instance, contrasting Egypt and Indonesia, they note that both countries have experienced corruption and military rule. Yet, Egypt remains troubled while Indonesia has emerged as a beacon of democracy. "What explains the difference? The one word answer is Asean," they suggest.

Never mind Egypt's long involvement in the Arab-Israeli conflict and its three wars with Israel since 1948, never mind the ascendancy of the Wahabbists, Salafists and the Muslim Brotherhood in Egypt that led to repeated, repressive crackdowns since the time of President Gamal Abdel Nasser in the 1950s and 1960s, never mind the terrorism and the poor governance that Egypt has endured, never mind the inclusive and secular foundational philosophy of the Indonesian state called "pancasila" which goes back to 1945.

All the complex historical forces that have made Egypt and Indonesia so different are reduced to just Asean.

While Asean countries are not embroiled in wars like the Middle East, they are not immune from Islam-related conflict. Nor is Asean's experience of dealing with its Muslim minorities unblemished.

The brutally repressed Rohingyas of Myanmar are not even considered citizens of the country, even though they have lived there for generations - something that would be unthinkable in the US or EU of today. Asean has not been able to do much about the still-festering Rohingya problem, other than individual countries making humanitarian donations - a far from adequate response. Thailand is battling a Muslim insurgency in the South, and the Philippines has a ferocious armed conflict on its hands against jihadists in Mindanao - a sobering reminder that radical Islam is not absent from South-east Asia.

When it comes to the region's economic success - another achievement highlighted by the authors - Asean's role has certainly been positive. It has provided a framework for economic cooperation. The Asean Free Trade Area, for instance, has reduced tariffs on manufactured goods, which has boosted intra-Asean trade and helped plug parts of the region into global supply chains. Asean countries cooperate on initiatives in several sectors, including agriculture, infrastructure, tourism and energy and indeed, even in such niche areas as paediatric care. Since 1997, Asean has extended its economic cooperation with the "plus three countries" of China, Japan and South Korea. The Asean Economic Community (AEC) - launched at the end of 2015 - has the ambitious vision of a free flow of goods, services and investments throughout Asean, as well as capital and skills.

But the grouping's economic achievements should not be overstated. As the IMF's director for Asia and the Pacific, Changyong Rhee, pointed out in an interview recently (BT, June 17), Asean has thus far picked the "low-hanging fruit" of manufacturing sector tariff reduction. Service sectors are still largely protected and un-integrated. Labour mobility is severely limited. The harmonisation of regulations and standards has a long way to go.

While there is some sector-wise cooperation, broader policy coordination - say, on macro-economic policies - barely exists. While potentially a game-changer, the AEC at this stage remains largely aspirational. A top-down process, its pace of evolution will depend on domestic ministries - as well as vested interests. The political will to implement commitments towards the AEC varies widely within Asean.

Nor has Asean done much, if anything, to help its members at times of crisis. During the Asian crisis of 1997 for example, Asean was all but invisible; it was the IMF that led the rescue effort. Certainly, it made mistakes in the process, as the book points out. The IMF (as well as the US) comes in for some well-deserved criticism for the way it dealt with the crisis - particularly in Indonesia. But the authors make no acknowledgement of the fact that Asean was missing in action when its members were in dire need.

Post-crisis, Asean did come up with schemes such as the Chiangmai Initiative (not mentioned in the book) under which central banks from Asean, China, Japan and Korea provide mutual liquidity support - but drawing on this facility also requires IMF approval.

To buttress their case for Asean's economic achievements, the authors compare the performance of some Asean economies with others elsewhere. For example, comparing the economic progress of Singapore with Ghana, they note that whereas in 1965, the two countries had roughly the same per capita income, today, Singapore's per capita income is US$38,088 while Ghana's is US$763. They also compare Indonesia with Nigeria and Brazil, pointing out that during the 50 years to 2014, Nigeria's per capita income rose 220 per cent, Brazil's by 300 per cent and Indonesia's by 670 per cent. They suggest that it was the "hidden X-factor" of Asean that at least partially accounts for the difference.

Such a conclusion, based on selective comparisons, is misplaced. Singapore's move to liberal, market-friendly policies predates Asean. But never mind that. Consider the fact that the so-called Asean X factor would seem to disappear when you compare the performance of Asean economies with those of non-Asean economies in Asia such as Taiwan, Korea and India, not to mention China and Japan.

For example, the same data set used by the authors ( shows that between 1980 and 2014, while Singapore's per capita income in purchasing power parity (PPP) terms jumped an impressive 9.4 times, Taiwan's increased by 11.3 times and Korea's by 16.4 times. Indonesia's rose 7.6 times over the period, but India's rose 10.3 times. China's jumped an amazing 42 times.

The fact that in many cases, non-Asean economies from Asia have outperformed those of Asean suggests that the real "X factor" behind economic performance is domestic economic policies and governance, not membership of Asean.

In terms of integration and cooperation, Asean has made progress, but it would probably have achieved more were it better funded. As the authors point out, the Asean Secretariat's annual budget is a mere US$19 million, compared to US$154 billion for the EU. They rightly suggest that starving Asean of funding is "penny-wise pound foolish" and offer some constructive ideas to increase it, by basing member contributions on capacity to pay rather than equal payments. But meanwhile, unfortunately, Asean's members get what they pay for, even though it must be said that over the years, the Asean Secretariat has done an admirable job on its tight budget.

Regional networks

In the geopolitical arena, Asean has indeed, as the authors note, spawned an impressive array of regional networks. It has dialogue partners as well as several "Asean-plus" arrangements with countries from outside the grouping. While this architecture has enabled regional dialogue and cooperation, the authors go much further, leaping to the conclusion that these extra-regional processes "helped to prevent a major war between any two states in the region". This is plausible but again, less than convincing in the absence of any explanation as to which potential wars were prevented, and how.

The book has an insightful chapter on Asean and the great powers, which traces how the grouping's relationships with the US, China, EU and India have waxed and waned over the decades. The authors are forthright in pointing out "a clear lack of wisdom" on the part of US and China. The US has been "an inconsistent ally", which lacks a clear long-term policy on Asean, while China was "unwise in being unnecessarily assertive in the South China sea",

Curiously, while they themselves criticise China's actions in the South China Sea, they castigate the US for doing so, suggesting that this amounts to "using Asean as a weapon against China".

Would they rather the US be silent on the issue (which is unlikely to happen)? They do not explain how that would help Asean.

However, they make a persuasive case for China to strengthen rather than weaken Asean, pointing out that Beijing would be better served if the grouping were united rather than divided.

But China's revealed preference is clearly to deal with Asean countries individually and bilaterally, in a targeted manner, as is evident from its dealings with Laos, Cambodia, the Philippines, Malaysia and even Singapore. For Asean member countries too, bilateral interests vis-a-vis China come first. The authors rightly point out that this is a mistake, suggesting - somewhat wistfully - that the relationship should be based on "an enlightened calculation of Asean's long term interests as a group vis-à-vis China".

They propose that Asean "walk a middle path between being supplicant and hostile to China". This may indeed be the most pragmatic option, unsatisfactory and precarious as it is. But even this is elusive: the fact remains that thus far, Asean has failed to transcend the narrow interests of its members in its dealings with China.

The book's penultimate chapter has a section on Asean's weaknesses, which the authors acknowledge are serious, including the absence of custodial leadership - Asean has no equivalent of the EU's France or Germany; it lacks strong institutions and most of its 600 million people know, or care, little about it.

One could add to this list. While Asean's achievements are notable, the grouping has a long way to go. South-east Asia still has pressing problems that it needs to address - patchy economic integration, race and religion-based politics, the repression of minorities, the rise of Islamic radicalism and a relationship with great powers that is based more on the self-interest of its individual members than the grouping as a whole.

If Asean can address such issues - even if it does not fully resolve them - maybe then it will touch the lives of its citizens sufficiently to win their appreciation without anyone having to advocate on its behalf. Maybe then, too, it can aspire to such accolades as the Nobel Peace Prize. But not yet.

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