Open
Regionalism and Deeper Integration: The Implementation of ASEAN Investment
Area (AIA) and ASEAN Free Trade Area (AFTA)
Dr.
Lawan Thanadsillapakul
Part
2
The
AHIA also noted that "it is even more important now, in the light
of the present financial crisis besetting the region, to strengthen regional
co-operation in promoting greater direct investments into and within the
region"(5) . All these circumstances emphasise the urgent need for policy changes
in ASEAN countries.
There
have been calls for strengthening regional co-operation. The Secretary-General
of ASEAN on 30th April 1999, calling for regional integration in response
to the Asian crisis and global economy, emphasized that:
"One
painful but invaluable lesson from the current economic difficulties
is that in this age of globalisation, nations can thrive and flourish
only if they band together for common purposes. Through internal reforms,
active cooperation and purposeful integration, ASEAN will certainly
overcome the difficulties, as it has already begun to do so. ASEAN will
be stronger and ready for sustainable growth and development in the
new millennium. With half a billion people in ASEAN and a combined GDP
of nearly US$ 700 billion, ASEAN remains an important market and platform
for production". (Statement by the Secretary-General of ASEAN welcoming
the Kingdom of Cambodia as the Tenth Member State of ASEAN30 April 1999,
ASEAN Secretariat)
ASEAN
started strengthen its closer regional co-operation in the AFTA scheme
that clearly signals ASEAN countries to move up to the level of regionalisation
by launching Free Trade Area: free movement of intra-ASEAN trade by realising
that:
"tariff
and non-tariff barriers are impediments to intra-ASEAN trade and investment
flows, and that existing commitments to remove these trade barriers
could be extremely improved upon". (Preamble of the Framework Agreement
on Enhancing Economic Co-operation, Singapore, 28 January 1992)
Some
plans(6) of ASEAN
imply moves towards deepening regional integration(7) . Nevertheless, the links between individual ASEAN and non-ASEAN countries
are still stronger than those regionally, and ASEAN is committed to the
policy of "Open Regionalism".
ASEAN's
direction and development are very much based on social, economic, and
political factors and circumstances. This section will discuss legal aspects
of ASEAN integration, i.e. deeper integration and "Open Regionalism"(8) , by analysing the feasibility of closer ASEAN integration following
the recent initiatives when ASEAN has launched important new framework
agreements for this purpose. The discussion of these new framework agreements
of ASEAN and their implications for regional integration emphasises how
far these agreements entail intra-ASEAN preferential treatment or more
generalised liberalisation, and the balance between these.
Part
3
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(5)
See Statement on Bold Measures in Annex 11.
(6)
The new framework agreements of ASEAN imply the moves towards deeper regionalisation
of ASEAN such as to enhance free movement of service suppliers intra-ASEAN
under the Framework Agreement on Services. Also the ASEAN investment area,
when fully implemented, it facilitates the codification of ASEAN investment
laws and regulations or at least the mutual recognition of laws or regulatory
coordination in order to implement the AIA and facilitate intra-ASEAN
investment. This process involves various aspects of laws such as taxation,
investment laws, company law, and other related laws and regulations.
(7)
This is especially emphasised in The Hanoi Action Plan, which accelerated
all new framework agreements of ASEAN to realise the objectives set forth
in the agreements and clearly considered to enhance regional economic
integration, which provided the action plan in section "II. ENHANCE
GREATER ECONOMIC INTEGRATION: To create a stable, prosperous and highly
competitive ASEAN Economic Region in which there is a free flow of goods,
services and investments, a freer flow of capital, equitable economic
development and reduced poverty and socio-economic disparities".
(8)
The concept of "open regionalism" as developed and applied in
these new ASEAN arrangements has not yet been discussed or analysed by
scholars, so this analysis is based largely on primary sources. |