27th ASEAN Summit, November 18-22, 2015: and Creating the Asean Economic Community

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27th ASEAN Summit, November 18-22, 2015: and Creating the Asean Economic Community

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boholano-thumbImmediately following the Philippines’ hosting of the Asia Pacific Economic Community (APEC) Summit, Malaysia hosted the holding of the 27th ASEAN summit of ten member countries in Kuala Lumpur, November 18-22. The Association of Southeast Asian Nations (ASEAN) was founded in 1967 as a bulwark against communism in the then ongoing Cold War.

This report draws heavily from the Associated Press and a report from Ronnel W. Domingo. Philippine Daily Inquirer, November 21, 2015.

Leading the ASEAN countries were Prime Minister Najib Razak of Malaysia, the host country, President B.S. Aquino III of the Philippines, President Joko Widodo of Indonesia, Prime Minister Hun Sen of Cambodia, Sultan Hassanal Bolkiah of Brunei, Prime Minister Choummaly Sayasone of Laos, Prime Minister Nguyen Tan Dung of Vietnam, Prime Minister Prayut Chan-o-cha of Thailand, Prime Minister Lee Hsien Loong of Singapore, and President Thein Sein of Burma/Myanmar.

President B.S. Aquino III rushed to his last ASEAN summit that U.S. President Barack Obama briefly attended. So both of them put pressure on China for her aggressive moves on the islands belonging to the Philippines, Brunei, Malaysia, and Vietnam that are claimed by China as her own in the South China Sea and the West Philippine Sea.

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Addressing his fellow ASEAN leaders, President Aquino said: “As a rules-based community, Asean should not allow any country, no matter how powerful, to claim an entire sea as its own and to use force or the threat thereof in asserting such a claim.

“Our collective prosperity requires stability in the region. This has come under threat by unilateral actions such as the massive reclamation and building of structures in the Spratly islands which have urgent and far-reaching implications to the region and the international community.”

The United Nations Arbitration Court in the Hague has agreed to take jurisdiction over the Philippine’s appeal to apply the U.N. Conference on the Law of the Seas to the Philippines’ problem with China. Although China is also a signatory to the UNCLOS, she is refusing to honor the jurisdiction and judgment of the U.N. Arbitration Court.

Southeast Asia will be the 4th largest market by 2050. This will happen with the formation of the regional economic community according to Malaysian Prime Minister Najib Razak. He said that last year the collective foreign investment in the region hit $136 billion, more than in the U.S. or China. And that Asean is expected to post an average annual growth of 5.6 percent through to 2019.  He said that AEC will benefit poor and unskilled workers. And that there are large opportunities for skilled workers as countries look to grow from higher value-added activities and knowledge-based sectors.

Comparing ASEAN countries as background. Following are comparisons of the ASEAN countries based on data from the World Bank, Transparency.org and Vision of Humanity.org.

ASEAN population total is 623 million (2014). Indonesia takes up over 40 percent. Brunei is the smallest, about 417,000. Singapore has highest population density. Philippines has second population density: 322 people per square kilometer; total land area of 300,000 square kilometers.

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ASEAN population is growing faster (1.27 percent) than the world average (1.13 percent).

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The Philippines has the highest unemployment rate in the region (7.1 percent). Indonesia (6.3 percent). Lowest are Cambodia (6.3 percent) and Thailand (0.7 percent).

Economy (total GDP). Indonesia has the biggest (35.9 percent). Thailand (15.08 percent). Malaysia (13.18 percent). Philippines (11.52 percent). Myanmar (2.59 percent). Laos (0.49 percent).

Tourism. Thailand and Malaysia had most tourists in 2013. 26.5 million visited Singapore. 25.7 million visited Indonesia. Philippines posted 4.8 million tourists.

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More than a third of Filipinos are online. But the Philippines has the slowest Internet. Singapore is most advanced; followed by Malaysia.

Singapore is the most peaceful and least corrupt. Myanmar and Cambodia are considered the most corrupt, both ranking in honesty in the world as 156th.

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Philippines is regarded the least peaceful among ASEAN countries, ranking only 132nd in peacefulness in the world.

The Asean Economic Community (AEC) is created. This historic event highlighted the final day of the 27th ASEAN Summit held in Kuala Lumpur. It has taken ten years for the ASEAN leaders to plan and create the AEC that will become a legal entity on December 31, 2015.   

The Asean Economic Community (AEC) aims to become the fourth largest market in the world, to boost economic and political ties among the Southeast Asian countries. It aims to bolster the region’s economic clout  and counterbalance a rising China  and an America that is increasingly assertive in Asia. It goes beyond liberalizing trade in goods. Services, investment, skilled labor and capital will also be allowed to move across borders more freely, a landmark step in economic cooperation for the region.

Easing restrictions on work visas will make it easier for people from one country to seek employment in another, but so far it applies only to eight professions, including medical, accounting, engineering, and tourism.

Unlike the European Union, the ten members of the Asean Economic Community will maintain their economic and financial independence. There will be no central agencies such as a common central bank, parliament or court as in the European Union, and no common currency. The AEC is based more on consensus than creating overarching institutions that take on some of the powers of member governments.

Southeast Asian officials stress that the formation of the AEC is not a destination but a journey to deeper integration, because more work is required on domestic reforms, infrastructure and strengthening skills. Efforts must also be made to address trade and investment impediments, non-tariff barriers and other regulatory hindrances that are increasingly replacing tariffs as protective measures for some industries. At the same time, government corruption and unreliable courts in the region also create roadblocks to trade because they make contracts hard to enforce.

All the highest leaders of Southeast Asia signed the Kuala Lumpur Declaration on the Asean 2025: Forging Ahead Together. This was witnessed by leaders of the East Asian countries Japan Prime Minister Shinzo Abe, Korean President Park Geun Hye, New Zealand Prime Minister John Key, and Australian Prime Minister Malcolm Turnbull.

The vision of the ASEAN Economic Community is to build a “highly integrated and cohesive regional economy that supports sustained high economic growth by increasing trade, investment, and job creation; improving regional capacity to respond to global challenges and mega trends; advancing a single market agenda through enhanced commitments in trade in goods, and through an effective resolution of non-tariff barriers; deeper integration in trade in services; and a more seamless movement of investment, skilled labor, business persons, and capital.”

The Asean community will abide by the principle that the region should “resolve differences and disputes by peaceful means, including refraining from the threat or use of force and adopting peaceful dispute settlement mechanisms while strengthening confidence-building measures, promoting preventive diplomacy activities and conflict resolution initiatives.”

The economic community also vowed that the region will “remain free of nuclear weapons and other weapons of mass destruction, as well as contribute to global efforts on disarmament, non-proliferation and peaceful uses of nuclear energy.” (By Jose “Pepe” Abueva)

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