Philippine Defense Cooperation with Russia: A Wake-up Call for the United States?

October 25, 2018

Asia Pacific Bulletin No. 444

Philippine Defense Cooperation with Russia: A Wake-up Call for the United States?

By Anna Patricia L. Saberon

Since the election of President Rodrigo Duterte in 2016, the Philippines has pursued an independent foreign policy aimed at gaining distance from the United States. President Duterte has called upon China and Russia for assistance in the modernization of the Armed Forces of the Philippines (AFP), much to the dislike of Washington. It must not be forgotten that the Philippines and the United States have a long-standing military alliance, established in various agreements: the 1951 Mutual Defense Treaty (MDT), Military Assistance Agreement, Visiting Forces Agreement, Cooperative Threat Reduction Agreement, and the Enhanced Defense Cooperation Agreement, to name a few. Despite these US-Philippines agreements, and the perceived warm connection between President Duterte and US President Donald Trump, the Philippines is undeniably turning to its northern neighbors for defense cooperation.

In May 2017, President Duterte went to Russia for an official visit and met with Russian President Vladimir Putin. Later in October, the Philippines signed an agreement with Russia on Defense and Technical Cooperation. The document contained provisions on various areas of military and technical cooperation such as research, production support, as well as possible exchange of experts and training of personnel for joint programs. Manila and Moscow also signed a contract for the Philippines’ procurement of defense articles from Rosoboronexport, a Russian state-owned company. Additionally, Russia supplied small arms and army trucks to the Philippines.<

Presidents Duterte and Putin also met at the sidelines of the APEC Summit held in Vietnam in November 2017. The two leaders discussed possible cooperation on military and economic concerns including Russian counter-terrorism training for Filipino soldiers, construction of a ship repair facility for Russian vessels passing through the Philippines, and the Russian donation of weapons in Marawi City.It seems that things are going well between the two governments as evidenced by the increased number of visits by high-level officials. In September, Philippine Defense Secretary Delfin Lorenzana visited Russia and inspected various military equipment showcased in the International Military-Technical Forum ARMY 2018 show in Moscow.

In the words of Philippine Ambassador to Russia Carlos Sorreta, “Russia is willing to provide brand new equipment customized to the specific needs of the Philippines, at favorable financial terms, with reasonable delivery times, full after sales service, necessary training and without political conditionalities or limitations.” The Philippines is in dire need of modern military equipment and has been struggling to procure new equipment for many years now. Russia’s recognition of the Philippines’ military needs, including battle plans and tactics, allows the AFP to maximize their use.

Amidst these new developments, we hear US officials voicing statements that the Philippines’ military purchase deals with Russia will not be helpful to the US-Philippines alliance. According to US Assistant Secretary of Defense Randall Schriver, “choosing another supplier like Russia will be an opportunity cost that will affect interoperability.” He added that the United States can be a better partner than the Russians can be to the Philippines. To summarize his sentiments, the Philippines ultimately will not benefit from greater defense ties with Russia.

 

President Duterte subsequently revealed that he received a letter from three top US officials: Secretary of Commerce Wilbur Ross, Secretary of Defense James Mattis and Secretary of State Mike Pompeo. The letter insists on the significance of Philippine procurement of US military equipment, “exemplifying our continuing commitment to the breadth and the strength of our alliance.”

Perhaps without publicly admitting it, the US leadership is bothered by how the Philippines is no longer a ‘follower’ of US Foreign Policy. For decades, the Philippines sourced military equipment from the United States and now the Duterte Administration has been turning away from Washington. This is largely because previous sales from the United States were of used arms and equipment and following certain conditionalities that frustrated many Philippine authorities including military personnel.

In the new US National Security Strategy, mention was made that “in Southeast Asia, the Philippines and Thailand remain important allies and markets for Americans.” The Trump Administration is pushing for the US Indo-Pacific Strategy, with the aim of including India in regional cooperation and a larger leadership role of Japan. It is important to mention here that Diego Garcia, an island in the middle of the Indian Ocean, has been operating as a military base with American and British forces since the 1970s.

Analyzing the statements and policies of US officials over the years, one comes to the conclusion that the United States wants to be the major, if not the sole, supplier of military equipment to the Philippines. The Philippines became a receiver of used/decommissioned equipment from the United States (e.g. BRP Gregorio del Pilar, BRP Ramon Alcaraz and BRP Andres Bonifacio – all naval vessels currently under the roster of the Philippine Navy). This equipment was made available as an Excess Defense Article under the US Defense Department’s Defense Security Cooperation Agency. While the United States has its own reasons for doing so, the outcome is Philippine military dependence on the United States. Instead of actually contributing to the strength and modernization of the Philippine military, Washington had a role in the decades-long weakness of the AFP. That is not to say that the Philippines is blameless for its own neglect of defense modernization, but the Philippine-US alliance is supposed to help strengthen the AFP, not weaken it. While previous Philippine Presidents were complacent and were hesitant to display defiance against the United States, President Duterte is not. He stands firm in his belief that the United States failed to give the Philippines what it needed and consequently he has deepened defense relations with Russia.

The new defense cooperation between the Philippines and Russia represents a wake-up call for the United States. No longer the ‘little brother’ of the US, no longer dependent on US foreign policy decisions, no longer pleased with leftovers, spare/used equipment from the United States, and no longer naïve; the Philippines is out to pursue an independent foreign policy. Washington should bear in mind that neglecting the Philippines has repercussions. If indeed it is true that the United States is a strong ally of the Philippines, then it seems that a few mistakes have been made: a) refusing to give priority to the Philippines and b) failure in preparation as they did not anticipate that the Philippines would turn to its neighbors, in particular China and Russia.

For the Philippines, the future is not with the United States alone, but with multiple partner countries — most notably its neighbors. The Philippines-Russia defense cooperation will bring to the Philippines modernized military equipment, military training, and the pronounced assurance that defense partners make each other stronger.

Anna Saberon teaches Philosophy and International Relations at Ateneo de Naga University in the Philippines. She can be contacted at asaberon@gbox.adnu.edu.ph.

US-China Technology Competition is about “Self Transcendence”

September 13, 2018

Asia Pacific Bulletin, No. 439

Publisher: Washington, DC: East-West Center

Available From: September 12, 2018

Publication Date: September 12, 2018

US-China Technology Competition is about “Self Transcendence”

By Dr. Wenhong Chen

Eric Schmidt, then executive chairman of Alphabet, Google’s parent firm, commented on China’s AI ambition on November 1, 2017, in Washington DC: “By 2020 the Chinese will have caught up (to the United States). By 2025 they will be better than us. And by 2030 they will dominate the industries of AI.” Not to miss the boat, about one and a half months later, Google announced its first major China move after its search engine left the mainland in 2010 — that it was opening a Google AI China Center in Beijing, its first in Asia, led by the Chinese-American scientist Feifei Li.

Disruptive AI, Big Data, and Cloud Computing (ABC) innovations have generated opportunities and challenges for entrepreneurs and policymakers across the Asia Pacific. Given the centrality of ABC policy to national security, economic prosperity, and global influence, it is critically important to understand and assess ABC policy practices and their implications for the digital economy and the US-China bilateral relationship.

Chinese government policy has been credited as a major driver of China’s digital transformation. In the pursuit of the Chinese Dream — a narrative of the great rejuvenation of the Chinese people — China has been purposefully and skillfully developing ABC as a top national project since 2013.

First, a series of regulatory and legislative work including the passage and implementation of national, regional, and local policies, laws, plans, and programs (including Made in China 2015 which has become a contentious issue in the US-China trade talks).

Second, financial and institutional support gives rise to national big data pilot zones, ministerial industry demonstration bases, provincial and municipal industrial parks, and numerous national big data and AI research labs. Guizhou, one of poorest provinces for a long time, was selected as China’s first national big data zone and has demonstrated one of the highest annual GDP growth rates in the nation.

Third, the government has been exploring new mode of engagement with established and emerging tech giants such as Baidu, Alibaba, and Tencent (BAT) and their younger peers which have been growing primarily outside of the state-owned sector. BAT have been chosen as national AI champions, and as part of the mixed-ownership reform, they were invited to invest in state-owned telecom behemoths for a greater integration of public and private sector digital resources in 2017. During the Two Sessions (China’s parliament sessions) in spring 2018, Chinese tech firms listed in overseas stock markets were invited to return to the Chinese stock markets.

Fourth, China has been promoting cyber-sovereignty through the control of cross-border data flow and the demand of data localization. Domestic and foreign companies are required to store data from China in China. Transnational corporations have been complying – via joint ventures with local, often state-owned partners – and complaining at the same time.

When asked by Senator Dan Sullivan at the Senate hearing on April 10, 2018 on whether Facebook and Mr. Zuckerberg were too powerful, Mr. Zuckerberg redirected: “And when I brought up the Chinese Internet companies, I think that that’s a real strategic and competitive threat that, in American technology policy we should be thinking about.”

Henry Kissinger lamented that “Other countries have made AI a major national project. The United States has not yet, as a nation, systematically explored its full scope, studied its implications, or begun the process of ultimate learning.” America’s ABC policy has been less systematic than China’s top-down, whole-of-government, national-strategy approach.

The Trump Administration’s ABC approach, if any, seems to center on economic security as an integral part of national security. The Department of Defense spent $7.4 billion in 2017 on ABC, and set AI as the cornerstone of America’s military dominance. Similar to other areas, the Administration is shifting from the multilateral approach to one of bilateralism. As importantly, the Administration has been more confrontational, accusing China of forced technology transfer and intellectual property theft, and threatening tariffs and other punitive actions. In particular, the Administration has demanded that the Chinese government give up its Made in China 2025 plan which aims to develop China’s ABC industries as world leaders.

The US inter-agency Committee on Foreign Investment in the United States (CFIUS) has been tightening scrutiny on Chinese investment in US critical infrastructure and technology. A bipartisan bill further expands and strengthens CFIUS oversight.

In addition to these protectionist measures, the Administration recently released a factsheet showcasing its AI efforts and achievement in terms of military and unclassified R&D investment, government service, regulatory barrier removal, talent training, and international collaboration. The White House Office of Science and Technology Policy (OSTP) organized an AI Summit with more than 30 American corporations and various federal agencies for better public and private AI coordination in May 2018. Although observers have different assessments on the Administration’s protectionist approach, it is time for the US to step up, starting with a long-term, more comprehensive tech policy framework, as well as greater investment in R&D.

While acknowledging the importance of ABC to national security and government efficiency, the federal government has been facing challenges such as 1) an aging IT infrastructure, 2) shortage of IT talent, and 3) tight budgets. Since President Trump took office, the Office of Science and Technology Policy (OSTP), the White House hub of innovation for the last four decades, has experienced substantial decline: the director position has not been filled and staff has dropped from 135 during the Obama administration to 45, and the majority have no science background

As media and pundits fixate on a binary US-China tech competition, both Washington and Beijing need to carefully gauge the benefits and costs of US containing or engaging China as a strategic competitor. ABC related policies and practices are at the frontline. Perhaps Wang Yi, the Chinese foreign minister, says it the best that the aim of US-China relations is about “self-transcendence rather than replacing each other.”

Dr. Wenhong Chen is  a visiting fellow at the East-West Center in Washington DC and associate professor of media and sociology at the University of Texas at Austin. She is serving as the chair of the Communication, Information Technologies, and Media Sociology Section of American Sociological Association (CITAMS). She can be contacted at Wenhong.Chen@Austin.UTexas.edu.

India-Indonesia Relations and Indo-Pacific Security

August 17, 2018

Foreign Policy: India-Indonesia Relations and Indo-Pacific Security

by Vinay Kaura

Asia Pacific Bulletin, No. 437

Publisher: Washington, DC: East-West Center

Available From: August 14, 2018

Publication Date: August 14, 2018

Binding: Electronic

PDF

Vinay Kaura, Assistant Professor at Sardar Patel University in Rajastan, explains that “Modi and President Joko ‘Jokowi’ Widodo agreed to elevate the India-Indonesia relationship to a comprehensive strategic partnership.”

Though India and Indonesia do have long historical and cultural linkages, strategic partnership has been a recent development. The two share multiple common concerns, one of which pertains to China’s rapid rise and its intentions in the maritime theater. Since 2014, the government of Prime Minister Narendra Modi has been trying to boost India’s ties with many Southeast Asian countries as part of its ‘Act East Policy’ which was recently manifest in his visit to Indonesia in late May just ahead of his first-ever speech at the Shangri-La Dialogue in Singapore.

 

India, no longer content to look east, wants to be an active contributor to the regional balance of power by acting east. Although it is not India’s role to dictate the nature and scope of Indo-Pacific cooperation, through discussion and experimentation, India can find areas where increased cooperation will serve mutual security interests. In the words of Luhut Pandjaitan, Indonesia’s minister for maritime affairs, “India and Indonesia relations are important to the balance of power in Asia.” Clearly, Indonesia is equally keen to ensure that Beijing is effectively prevented from moving ahead on its current antagonistic trajectory.

The Modi government’s attempt to connect India to its traditional maritime neighborhood, particularly in the Indo-Pacific, is aimed at sustaining a rules-based liberal international order by ensuring free movement of people, goods, and services through the Strait of Malacca, one of the busiest shipping routes between the Indian Ocean and Pacific Ocean. The freedom of navigation, availability of port infrastructure, and unhindered access to markets are mandatory for this purpose. Hence, the major focus of  Modi’s visit to Indonesia was to highlight that the two countries are close maritime neighbors. Modi and President Joko ‘Jokowi’ Widodo agreed to elevate the India-Indonesia relationship to a comprehensive strategic partnership. Their joint statement emphasized the “importance of achieving a free, open, transparent, rules-based, peaceful, prosperous, and inclusive Indo-Pacific region,” which would uphold “sovereignty and territorial integrity, international law, in particular UNCLOS, freedom of navigation and overflight, sustainable development.”

Jokowi, meanwhile, seeks to transform Indonesia into a maritime power, and is passionate about maritime sovereignty for his country. Hence, repeated assertions about protecting freedom of navigation is unmistakably targeted at Beijing which is engaged in hotly contested territorial disputes in the South and East China Seas. Jakarta claims that it is not a party to any territorial disputes with Beijing in the South China Sea; however, Indonesia has not hesitated in clashing with China over fishing rights around the Natuna Islands. Jokowi’s dramatic gesture of holding a cabinet meeting aboard a warship off the Natuna just days after a Sino-Indonesian naval skirmish in 2016 was seen as a show of resolve to Beijing.

Not as bitterly opposed to the Beijing-led Belt and Road Initiative (BRI) as India, Indonesia is also not as supportive as China expects. After their meeting, Modi sought to link India’s ‘Act East Policy’ and ‘SAGAR’ (Security and Growth for All in the Region) with Jokowi’s ambitious ‘Maritime Fulcrum Policy’.

 

In the past, India-Indonesia maritime cooperation has remained largely confined to coordinated bilateral patrols, anti-piracy patrols, and search and rescue exercises. It is thus important for them to move to a more intensive engagement, as together they control the entry point from the Bay of Bengal to the Strait of Malacca. India’s interest in joining the Malacca Straits Patrol (MSP) – a four-nation arrangement between Indonesia, Malaysia, Singapore, and Thailand – should be seen in this context. But Indian participation is easier said than done. A meeting among technical experts on May 10 in Bali explored the issue but soon revealed that the Indian side did not have full comprehension of the operational nuances of MSP. Since no forward movement seemed possible, the Modi-Jokowi joint statement merely noted that the May 10 meeting was “to explore ways in enhancing strategic technical cooperation on maritime security.”

Indonesia is the de-facto leader of ASEAN. As the security environment in the region is increasingly exacerbated by US–China rivalry, Jakarta wants ASEAN to be at the center of the conceptualization and evolution of the Indo-Pacific region. Jokowi has been outlining the Indonesian conception of the Indo-Pacific as “Open, transparent and inclusive, promoting a habit of dialogue, promoting cooperation and friendship, and upholding international law”. Modi’s Indo-Pacific vision sounds strikingly similar. He has indicated that India is keen to preserve a free and open regional security architecture in Asia with “ASEAN centrality”, and even without American leadership.

Although New Delhi has thrown its weight behind the Quadrilateral – the grouping of India,  United States, Japan, and Australia that is widely perceived as a counterbalance to rising Chinese geoeconomic and geopolitical assertiveness – in its quest to reshape the Indo-Pacific balance of power, India continues to pursue a hedging approach by both engaging directly with China and seeking to contain Chinese behaviour. Positive momentum generated by the ‘Wuhan consensus’ may have further exacerbated India’s skepticism on the quad.

Strategically, Indonesia is equally important to the United States and China as it straddles vital Indo-Pacific chokepoints.  Jakarta has secured Chinese investment without showing any evidence of a tilt towards Beijing. Being one of the very few countries in the region that has the capability and credibility in making significant contributions towards countering Chinese assertiveness, Jakarta now reckons New Delhi as a credible strategic partner. However, the possibility of Indonesia joining the quad seems remote.

Modi signed a deal with Jokowi allowing India access to northern Sumatra’s Sabang port, enhancing the Indian navy’s ability to maintain a forward presence in the Straits of Malacca. China is not oblivious to its implications. A day ahead of Modi’s trip to Indonesia, China’s state-run Global Times asserted that Beijing would not “turn a blind eye” if New Delhi sought “military access to the strategic island of Sabang,” advising India not to “wrongfully entrap itself into a strategic competition with China and eventually burn its own fingers.”

Given the irreversible geopolitical shifts, the Indo-Pacific has emerged as one of the major hotbeds of global power politics. India’s emerging consensus with Indonesia, as reflected in the elevation of their relationship to the level of a comprehensive strategic partnership, can provide a basis for a closer engagement between the two countries to further develop the Indo-Pacific concept. Delhi and Jakarta have agreed to take concrete steps to accelerate economic and security cooperation in the maritime domain. But the renewed awareness that they are close neighbors, sharing broadly common challenges regarding sustainable use of the oceans must make it imperative for them to contribute more to the maintenance of the regional security order in the Indo-Pacific. The challenge for both Modi and Jokowi will be to institutionalize the maritime cooperation so that the Indo-Pacific becomes truly free, open, and inclusive.

Malaysia’s May 2018 General Election and Foreign Policy

August 8, 2018

by Thomas Daniel

Asia Pacific Bulletin, No. 433

Publisher: Washington, DC: East-West Center

Available From: August 7, 2018

Publication Date: August 7, 2018

Binding: Electronic

Pages: 2

Free Download: PDF

Thomas Daniel, Analyst at the Institute of Strategic and International Studies in Malaysia, explains that “In Malaysia’s May 2018 elections, foreign policy appears to have been a significant part of the campaign…but  the claim that foreign policy was a major deciding factor in Malaysian elections is still a bit of a stretch “

The 14th Malaysian General Elections (GE14) held in May saw the then main opposition alliance of Pakatan Harapan, together with an allied party from East Malaysia, win a surprising 121 of 222 Parliamentary seats, allowing them to form a simple majority government. Former Prime Minister Dr Mahathir Mohamad is once again leading the nation at the age of 92. The Barisan Nasional coalition, which ruled from even before independence, now sits on the opposition bench alongside the Islamist party PAS, while Barisan’s election allies from Sarawak in East Malaysia already have left the coalition to form an independent block of their own.

 

What role did foreign policy play in Malaysia’s recent elections? Foreign policy by itself has rarely been an issue in Malaysian elections. Some external observers might consider this odd for a nation whose prosperity depends significantly on regional and international trade and peace. Domestic issues – the economy, social dynamics, internal peace and security – have always been dominant concerns of the Malaysian electorate. Where foreign policy matters have popped up, they are limited to rather specific issues, often the flavour of the day. Traditionally, politicians from both sides of the divide have often – and rather flippantly – attempted to use Malaysian involvement or positions on global and regional affairs against each other as a smear tactic. For the most part however, foreign policy as a subject has largely been a domain of the few – policymakers, diplomats, academics and other practitioners.

At first glance, in Malaysia’s May 2018 elections, foreign policy — both directly and indirectly — appears to have been a significant part of the campaign – driven mainly by Pakatan Harapan. A large part of this has to do with former Prime Minister Najib Razak himself and the fallout from the 1 Malaysia Development Berhad (1MDB) scandal.

After vast sums of money initially linked to 1MDB which were deposited in Najib’s personal accounts turned out to be a ‘donation’ by a Saudi royal to Malaysia channelled directly to the former Prime Minister, there was chatter amongst Malaysians on the nature and impact of such ‘donations’ by friendly countries and what countries could be considered as ‘allies’ of Malaysia. This led to further conversations on whether non-alignment and neutrality was still a central tenet in Malaysian foreign policy and on the extent of Malaysia’s involvement in the Saudi-led Islamic Military Counter Terrorism Coalition, including even whether Malaysia was a silent participant of the Saudi offensive in Yemen.

The 1MDB saga itself was a major part of the campaign against the Najib and his ruling party. Various local investigations into the scandal had cleared him of wrongdoing. Nevertheless, the financial irregularities of 1MDB continued to be investigated by authorities in seven countries – including the United States. This further eroded the credibility and reputation of both the government and its associated institutions in the eyes of the Malaysian electorate, which came to see them as damaged goods when articulating Malaysia’s interests and reputation on the global stage.

Another major foreign policy factor was the nature of the Malaysia-China relationship, and perceived notions of the influence that the latter has over the former. It became part and parcel of the campaign against Najib and his party. A key driver here was the rapid and staggering rise of investment and acquisitions by Chinese companies – both private and state-linked – in Malaysia. Foreign direct investment from China, which stood at RM4.8 billion in 2013, surged to nearly RM21 billion by the end of 2016. It now encompasses diverse sectors like construction, real estate, manufacturing, ports and power generation facilities. Concerns remain over how much of the money coming in were investments, and how much were in fact loans for various projects, and if the previous government was honest to Malaysians about the nature of such transactions.The fact that Chinese companies or capital can be seen in almost every major ongoing or planned project in Malaysia unnerved many – especially the average man-on-the-street. The purchase of majority stakes in several key Malaysian companies which are household names in Malaysia by Chinese interests did not help the perception.

1MBD related scandals come into the picture once again as some of these deals include the purchase of investments and assets previously owned by the wealth fund, which helped the troubled company meet its debt payments. The allegation that China helped bail out the troubled Malaysian sovereign fund and by extension the Prime Minister thus making him beholden to China, possibly compromising Malaysia’s national interests, was a popular narrative amongst the anti-Najib camp.

Despite the above mentioned issues, the claim that foreign policy was a major deciding factor in Malaysian elections is still a bit of a stretch. The campaign for the GE14 might be one where certain aspects of foreign policy and external relations played a role – at least more than previous elections. However, they are issue-specific, or in this case, personality-specific, and driven primarily by a domestic undertone. The ‘foreign policy’ approach used by the opposition when speaking about these issues ultimately relate back to local narratives that the electorate holds dear – the price of living, the future of their children, and to an extent, national prestige. Additionally, the manifestos released by the contesting parties also barely touched on foreign policy. There were, at best, vague remarks on continuing or restoring (depending on who the author was) Malaysia’s reputation and record within global institutions.

Nevertheless, moving forward, policymakers and campaign managers need to take into account that foreign policy issues could become a more common fixture in Malaysian political campaigns. The signs, despite being faint, are there. Conversations about Malaysia’s relationship with China and the Saudi Arabian royal family, for example, persist in a post-GE14 Malaysia both amongst politicians and voters. The situation becomes ever more pertinent when one takes into account that Malaysia has a combination of a relatively high internet penetration rate and coupled with an active social media presence amongst its connected citizenry.

 

ASEAN’s Role in the US Indo-Pacific Strategy

June 28, 2018

Asia Pacific Bulletin, No. 425

ASEAN’s Role in the US Indo-Pacific Strategy

By Kavi Chongkittavorn

Ever since US President Donald Trump announced the Indo-Pacific strategy at the Asia-Pacific Economic Cooperation leaders’ meeting in November, 2017 at Danang, Vietnam, the leaders from of the 10 member countries of the Association of Southeast Asian Nations (ASEAN), have been anxious trying to figure out what it really means and to understand the possible long-term regional implications.

Eight months have elapsed and the US has not yet come out with detailed strategic and operational plans, except for some outlines. The US State Department views the Indo-Pacific strategy in an all-encompassing way, which includes security, economic, and social aspects. The Defense Department’s version, however, puts more emphasis on strategic matters. Both share key commonalities of an ideal Indo-Pacific region that must be free from any coercion, open for free and competitive trade, abide by rules of law and universal principles. Emphasis is also placed by both on commercial governance as well as high-quality investment in infrastructure and connectivity.

 

At the Shangri-La Dialogue in June 2018 in Singapore  Defense Secretary General James Mattis reiterated that ASEAN centrality remains vital to the success of the Indo-Pacific strategy.

In his speech at the Shangri-La Dialogue in June 2018 in Singapore, Defense Secretary General James Mattis highlighted four pivotal elements of this strategy. First, it has to do with the maritime commons, which requires capacity and capabilities building in naval and law enforcement. It is aimed at improving monitoring and projection of maritime borders and interests within the region. Second, it is about expanding interoperability and establishing a network of allies and partners working together to increase mutual trust between militaries and economies. Third, it aims at strengthening the rule of law, civil society and transparent governance, promoting sustainable economic development. Finally, it foresees an increasing role of private sector in promoting development and finance institutions to be “better, more responsive partners.” Transfer of knowledge and technology with end-to-end solutions would also be front and center to this approach without abandoning economic sovereignty of recipient nations.

The essence of US Indo-Pacific strategy has been aptly summarized by General Mattis, who called it a subset of the US broader security strategy: “Make no mistake: America is in the Indo-Pacific to stay. This is our priority theater,” he declared. Indeed, the Pacific Command, which oversees security stretching both the Indian and Pacific Oceans, has changed its name to the Indo-Pacific Command.

During the informal meeting with ASEAN Defense Ministers on the sidelines of the Shangri-la Dialogue, Gen Mattis praised the group’s consensus-making process, which aims to avoid confrontation. He reiterated that ASEAN centrality remains vital to the success of the Indo-Pacific strategy.

Over the past months, Australia, Japan, and India, which are democratic allies of the United States, have also put forward their visions of Indo-Pacific strategy. They comprise similar features to the US concept, emphasizing an international rules-based order and norms, transparency, governance, maritime security, and infrastructure. Furthermore, they also pinpointed ASEAN centrality as a driving force for forging closer cooperation in the region.

However, Japan and India also have broadened the Indo-Pacific’s geographic footprints to include not only the two oceans — Indian and Pacific — but also the two continents of Asia and Africa. Obviously, as major Asian economies, they would like to connect the Asian continent and business opportunities with Africa, which has enjoyed impressive growth over the past two decades.

As ASEAN has been accorded a higher profile by major powers, the 10 member-states are also under constant pressure to respond to their clarion calls and prove their mettle. Given the rapid shifts of the regional and international environment, ASEAN has to be more proactive and adopt forward-looking positions on key transnational issues such as the North Korean nuclear crisis, extremism, and cyber security. Most importantly, it must ensure that no one nation should be allowed to dominate the region. This appeal comes at the time when ASEAN is building up its regional security architecture, reliance on its existing security mechanism, and security partnerships.

For the time being, only three countries — Thailand, Indonesia and Vietnam — have expressed their individual opinions about the perceived role of ASEAN in the overall Indo-Pacific scheme. Obviously, as the group’s biggest economy, Indonesia has been the leading voice on the Indo-Pacific concept. In 2013, former foreign minister Marty Natalegawa proposed that ASEAN and its dialogue partners committed to peace-building and non-use of force to further prevent conflicts in the region, but received lukewarm support. However, the government under President Joko Widodo has decided to revive the idea again after Trump’s announcement of Indo-Pacific with a new emphasis that rebranded Indonesia as a maritime power.

To ensure continuity, Jakarta is working closely with Thailand, the upcoming chair of ASEAN. Bangkok will coordinate all ASEAN positions and prepare a report for the members next year. At the 32^nd ASEAN summit, the leaders discussed the Indo-Pacific concept but did not come up with any position. In the chairman’s statement, it simply said that ASEAN looked forward to further discussing the new concept.

Granted the lack of details from Washington, ASEAN senior officials quickly filled the gap. They have already discussed and exchanged notes on points of convergence that need to be included in the ASEAN Indo-Pacific version. These are some of elements: free and open, rules based, complementary, ASEAN-led mechanism, ASEAN centrality, connectivity, infrastructure, inclusiveness, and not involving a third party.

Meanwhile, the Washington-based ASEAN diplomats have been informed by the US State Department that the details of US Indo-Pacific would soon be available. President Donald Trump is scheduled to take part in the 13^th East Asian Summit in early November in Singapore. He expects to outline the contour of the Indo-Pacific strategy himself.

Despite President Trump’s decisions to revoke several of the international commitments and cooperative frameworks of his predecessor Barack Obama, including the US-led Trans Pacific Partnership (TPP), he has maintained existing programs and activities related to US-ASEAN bilateral cooperation. With continued strong bipartisan support, Trump’s Indo-Pacific strategy will be value-added to further strengthening the US interoperability and networks of security partners in the region.

All in all, it is incumbent on ASEAN to reach out to the United States, Japan, India, and Australia to ascertain that all proposed elements are synergized and most importantly, the emerging broader strategy would place ASEAN in the center.

Kavi Chongkittavorn is a Visiting Fellow at the East-West Center in Washington, DC, and Senior Fellow at the Institute of Security and International Studies, Chulalongkorn University. He can be contacted at Chongkik@eastwestcenter.org.

APB Series Founding Editor: Dr. Satu Limaye | APB Series Coordinator: Peter Valente

The views expressed in this publication are those of the author and do not necessarily reflect the policy or position of the East-West Center or any organization with which the author is affiliated.

The East-West Center promotes better relations and understanding among the people and nations of the United States, Asia, and the Pacific through cooperative study, research, and dialogue. Established by the US Congress in 1960, the Center serves as a resource for information and analysis on critical issues of common concern, bringing people together to exchange views, build expertise, and develop policy options.

Click Here to view this piece on the East-West Center Website

 

The 32nd ASEAN Summit’s Economic Priorities and Implications for US-ASEAN Economic Relations

May 3, 2018

Number 422 | May 2, 2018

ANALYSIS

By Kaewkamol Karen Pitakdumrongkit

The Summit’s Economic Priorities for ASEAN

The leaders of the ten member countries of the Association of the Southeast Asian Nations (ASEAN) gathered at the 32nd ASEAN Summit in Singapore from April 25 – 28, 2018 under the theme of “Building a Resilient and Innovative ASEAN.” Among the economic cooperation priorities agreed to were the continued advancement of the ASEAN Economic Community (AEC), pursuit of the Regional Comprehensive Economic Partnership (RCEP), and establishment of an ASEAN Smart Cities Network (ASCN).

These agreed outcomes are steps in the right direction concerning regional integration. Although AEC – aimed at transforming the region into a single market and production base – was officially established in December 2015, more work is needed in areas such as trade facilitation and services liberalization. Another outcome was continued pursuit of RCEP, a trade mega-deal among ASEAN and its six dialogue partners (i.e. Australia, China, India, Japan, New Zealand, and South Korea) proposed to consolidate the existing ASEAN+1 free trade agreements (FTAs) to tackle a “noodle bowl” problem. If successfully concluded, it will encompass 45 percent of the world’s population and one-third of the world’s GDP.

Proposed by the Singapore Chair, ASCN is an initiative to foster smart and sustainable urban development. Recognizing that digital technologies have weaved their way into the economy and people’s lives, this program is aimed at leveraging technology to improve quality of life in increasingly urbanized Southeast Asia. The ASCN will cut across several sectors (e.g. transport, environment, and healthcare) and can in the future be applied beyond the 26 pilot cities. The initiative also holds the potential to improve life even in remote areas, for example, smart sensors installed in households send consumption data to the power distribution centers, enabling the latter to better distribute electricity and avoid power shortages. ASCN can help accomplish the AEC 2025’s goal of “A Resilient, Inclusive, People-Oriented, and People-Centered ASEAN.”

Beyond living standard improvements, ASCN can enable businesses to better participate in transnational production networks, helping to achieve another AEC 2025 objective of “A Competitive, Innovative, and Dynamic ASEAN.” For example, Singapore’s Intelligent Transport System feeds in real time traffic data to alert commuters of accidents on major roads. Although the immediate beneficiaries are drivers and motorists in the city-state, the system facilitates trade. The data enable truck drivers to avoid congested routes or accidents and deliver cargo to the ports on time, increasing businesses’ participation in the global supply chains.

The Future of US-ASEAN Economic Relations

The economic priorities agreed to at the 32nd ASEAN summit can be seen as parts of the regional states’ efforts to enhance their economic cooperation in the “America First” era. The fact that the US’ Indo-Asia-Pacific Strategy has not been clearly articulated elevates the importance of regional integration as the nations turn to rely more on the combined size of regional economies as a means for further liberalization.

However, it is wrong to think that Southeast Asia’s economic integration will leave little room for the United States to participate. The development of its regional economic architectures has been based on the principle of “Open Regionalism” which embraces an open system and regards regional arrangements as building blocks for wider economic integration. According to the ASEAN Leaders’ Vision for A Resilient and Innovative ASEAN adopted at this Summit, “ASEAN shall keep our markets open and competitive, deepen economic integration . . .[and] forge high quality and mutually beneficial economic agreements with external partners. . . to strengthen resilience against rising protectionism and global volatilities.” Such commitment has been reflected by RCEP, other FTAs and Comprehensive Economic Partnerships (CEPs) among individual ASEAN members and their extra-regional partners, and the engagement of non-ASEAN countries in several programs such as the Master Plan for ASEAN Connectivity 2025.

“It is wrong to think that Southeast Asia’s economic integration will leave little room for the United States to participate.”

As the door will not be closed for Washington, American policymakers have to think how to further engage their fourth-largest trading partner to reap the benefits of the latter’s combined GDP of more than $2.4 trillion and market of 632 million people. There exist several ways to do so. First, the United States can participate in the ASEAN Smart Cities scheme as more than half of the ASEAN population do not have access to basic Internet services. With their comparative advantage in digital technology, U.S. policymakers should encourage American firms to build such infrastructure. Also, cooperation under the US-ASEAN Connect Initiative created in 2016 should be further enhanced. Moreover, Washington should rely more on American research institutions to provide inputs helpful for its decision-making process. Furthermore, regular Track 1.5/2.0 dialogues between American and ASEAN academic and think tank communities should be developed and enhanced. These platforms can be used to discuss issues too sensitive to be raised at the Track I (government-to-government) level. This would enable both Washington and Southeast Asian countries to test ideas and explore optimal solutions before forwarding them for consideration in the inter-government talks.

Southeast Asia’s transnational supply chains have been deepening and regional efforts at economic integration have been increased as reflected in the announcements of the 32nd ASEAN Summit. There is still room to expand US-ASEAN trade and investment as well as other forms of commercial interaction. Washington should speed up its effort to roll out programs enhancing such economic ties. Doing so could help the United States reap more benefits from the world’s most dynamic economic region.

About the Author

Kaewkamol Karen Pitakdumrongkit is an Asia Studies Visiting Fellow at the East-West Center in Washington DC. She is also Deputy Head & Assistant Professor at the Centre for Multilateralism Studies, at the S. Rajaratnam School of International Studies (RSIS) of Nanyang Technological University, Singapore. She can be contacted at PitakduK@EastWestCenter.org.

The East-West Center promotes better relations and understanding among the people and nations of the United States, Asia, and the Pacific through cooperative study, research, and dialogue.

Established by the US Congress in 1960, the Center serves as a resource for information and analysis on critical issues of common concern, bringing people together to exchange views, build expertise, and develop policy options.

The Asia Pacific Bulletin (APB) series is produced by the East-West Center in Washington.

APB Series Editor: Dr. Satu Limaye, Director, East-West Center in Washington
APB Series Coordinator: Peter Valente, East-West Center in Washington

The views expressed in this publication are those of the authors and do not necessarily reflect the policy or position of the East-West Center or any organization with which the author is affiliated.