Brexit A Wake-up Call for ASEAN

The Khmer Times, 27 June 2016

Last week’s referendum saw Britain voting to leave the European Union (EU), resulting in global shockwaves of uncertainty, high volatility in the currency and stock markets and a weakened EU, both regionally and globally.
Brexit adversely affects the EU’s relationship with other countries and regions in the world. The economic slowdown in Europe will affect the world economy, including Asean, in terms of investment and trade flows. The EU is the world’s largest economy with a nominal GDP of $20.2 trillion for all 28 economies combined.
The EU is the top investor in Asean with average annual investment capital of about $18 billion from 2006 to 2014. The EU is Asean’s third largest trading partner after China and Japan, accounting for about 13 percent of Asean trade.
The EU’s main exports to Asean are chemical products, machinery and transport equipment. The main imports from Asean to the EU are machinery and transport equipment, agricultural products as well as textiles and clothing.
After the Second World War, European countries came together to promote regional peace and cooperation. Economic cooperation was the key driving force of uniting Europe. In 1950, the European Coal and Steel Community was established to integrate Europe economically and politically. In 1957, the European Economic Community (EEC) was created.  In 1993, the European Union was created and now, there are 28 members, including the United Kingdom.
Asean was created in 1967 with the initial aim to maintain regional peace and stability and counter the spread of communism in the region before gradually expanding to promote economic and cultural cooperation.
At the end of the Cold War, Asean enlarged its membership from six to the current 10. Now, these 10 members are working together to realize the three pillars of the Asean community, which include political security, economic cooperation and socio-cultural community.
While The EU moved towards the creation of a supra-national institution, Asean maintains its way of regional integration, which allows the members to maintain their national sovereignty and independence.
The Asean Way of regional integration is the combination of consensus-based decision making, non-interference, quiet diplomacy and voluntary compliance.
The Brexit vote proved that the force of nationalism is stronger than that of regionalism.
“There is a new brew in politics around the world. The growing appeal of nationalist politics, demagogues, and in some cases outright racism… A growing disaffection with the establishment. A weakening of trust and consensus in society, and of the center in politics,” wrote the Deputy Prime Minister of Singapore, Tharman Shanmugaratnam, on his Facebook page.
For the low-income working class, they don’t feel they benefited from the regional integration process. Some are disappointed with the EU. Some believes that British sovereignty is being threatened and immigrants are posing security and employment challenges to local people.
If nationalism and xenophobia are either allowed or poised to dominate domestic politics and international affairs, the world will become less stable. The world will become more fragmented.
The global and regional governance institutions need to reform more urgently to ensure fair and just development. The widening gaps between the haves the have-nots, between the rich and the poor, give a lot of room for certain political leaders to maneuver to gain popular support and votes.
Although the Asean Way is quite obsolete within the context of deepening regional integration and community building, it remains critical to politically uniting Asean members, regardless of their size, wealth and power.
Asean should not aim to establish a supra-national institution. A gradual integration process with certainty is vital to the future of Asean.
“We go very incrementally and step by step. We did not go for full integration – making the entire Asean one economic or political unit. In that sense, we have room for adjustment,” said former Asean Secretary General Surin Pitsuwan in an interview with Nikkei Asian Review.
Asean should not force its members to agree on certain regional issues that harm their national economic interests, particularly in regards to the South China Sea disputes.
Economic interests will continue to be the main focus of making foreign policy in Southeast Asia. Asean needs to deliver economic results that are more inclusive than they currently are.
Asean needs to deliver and show concrete results to the people, otherwise its relevance will be questioned.
What Asean needs to do is to speed up its efforts in narrowing the development gaps within and between the member states. Asean needs to take concrete steps and action to ensure that the people are the main drivers and beneficiaries of regional integration.
The promotion of a caring, sharing and people-centered Asean community can help reduce nationalism in the region and promote a sense of belonging to Asean.

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