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Asean

Australian-American partnership in 21st century Asia Pacific

Author: Robert Sutter, Georgetown University Prime Minister Julia Gillard’s visit with President Barack Obama in Washington highlights Australia’s extraordinary role in American strategy toward the Asia Pacific. Australia is the US partner with the most extensive breadth of vision, interests and resolve to provide advice, criticism and support as the United States works to foster an Asia Pacific order of peace, stability and development. The Australian visitors bring to the table an impressive record of commitment with the United States that is appreciated by all sides in politically fractious Washington: Australia’s elite troops and other support in Iraq and Afghanistan; its initiative in taking the lead in working with the United States in dealing with issues in Indonesia, other Southeast Asian countries and the Pacific Island nations; and its ability to provide perspective and experience for the United States in sometimes complicated interactions with Asia’s rising powers, especially China . Australia’s strong ties with Japan and South Korea are also the foundation for counsel and actions on North Korea’s proliferation and provocations. Despite claims of US ‘decline’ and ‘neglect,’ a comprehensive and effective US re-engagement with the Asia Pacific has emerged over the past year. America relies on and coordinates closely with Australia on these initiatives; the two powers are working together to advance American engagement beneficial to both countries and the region as a whole. The Obama administration’s diplomatic, security and economic initiatives represent the most important shift in regional dynamics in several years. They signal top priority American policy attention to the Asia Pacific region. President Obama reportedly has become convinced that the Asia Pacific is both of major importance to the United States and a world region where greater US engagement would be widely welcomed and beneficial for the United States and for the president’s standing at home and abroad. The significance of the US initiatives has been overshadowed to some degree by China’s often ham-handed treatment of security issues, territorial disputes, maritime navigation rights and other sensitive issues with its Asian Pacific neighbors. Ironically, the Chinese actions have had the effect of reinforcing the importance of the American initiatives. Concerns over China’s actions and intentions have prompted Australia and other Asian Pacific countries to support and engage with the renewed US activism; the regional governments on the one hand position their countries to work positively with rising China in areas of common interests, while on the other hand they prepare for possible contingencies involving domineering Chinese assertiveness. The stronger US engagement ranges across the entire Asia Pacific region. Firm US support for the security alliance with Japan helped Tokyo get its footing in the face of what was widely seen as Chinese ‘bullying’ over fishing disputes involving the Senkaku/Diaoyu Islands. The United States has steadily backed its South Korean ally as it sought support in the United Nations and in military exercises against North Korea’s aggression. The US intervention at the ASEAN Regional Forum (ARF) meeting in July led a collective effort by involving Australia and other participants to defend free navigation and restore stability in the disputed South China Sea . The United States joined Australia in the East Asian Summit, raising the profile of that regional body over Asian-only regional groups. Prominent advances in US military and other relations with Vietnam came in August; President Obama held a summit meeting with ASEAN leaders in September, visited Indonesia, along with India, Japan and South Korea, in November and pledged to be at the 2011 East Asian Summit meeting in Jakarta. Meanwhile, US interaction with small Pacific Island states has been upgraded with annual meetings with the Secretary of State, and New Zealand has seen the most significant breakthrough in its relations with the United States since the rupture of the alliance over 20 years ago. The Australian visitors will want an update on US engagement with Asia, especially the summit with China amid renewed Chinese reassurances and less truculent behavior coincident with President Hu Jintao’s successful visit. They will seek stronger American economic commitment in the region, assessing US follow-through on free trade initiatives with South Korea and the regional Trans Pacific Partnership that involves Australia and is forecast to reach a milestone agreement at the APEC meeting in Hawaii this year. Overall, while there are sure to be some differences in the talks, the strongly converging Australian-American interests and actions forecast a remarkably close partnership in the years ahead. Robert Sutter is Visiting Professor of Asian Studies at the School of Foreign Service at Georgetown University and Adjunct Professor of Asian Studies in the Elliott School of International Affairs at George Washington University.

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Author: Robert Sutter, Georgetown University

Prime Minister Julia Gillard’s visit with President Barack Obama in Washington highlights Australia’s extraordinary role in American strategy toward the Asia Pacific. Australia is the US partner with the most extensive breadth of vision, interests and resolve to provide advice, criticism and support as the United States works to foster an Asia Pacific order of peace, stability and development.

The Australian visitors bring to the table an impressive record of commitment with the United States that is appreciated by all sides in politically fractious Washington: Australia’s elite troops and other support in Iraq and Afghanistan; its initiative in taking the lead in working with the United States in dealing with issues in Indonesia, other Southeast Asian countries and the Pacific Island nations; and its ability to provide perspective and experience for the United States in sometimes complicated interactions with Asia’s rising powers, especially China. Australia’s strong ties with Japan and South Korea are also the foundation for counsel and actions on North Korea’s proliferation and provocations.

Despite claims of US ‘decline’ and ‘neglect,’ a comprehensive and effective US re-engagement with the Asia Pacific has emerged over the past year. America relies on and coordinates closely with Australia on these initiatives; the two powers are working together to advance American engagement beneficial to both countries and the region as a whole.

The Obama administration’s diplomatic, security and economic initiatives represent the most important shift in regional dynamics in several years. They signal top priority American policy attention to the Asia Pacific region. President Obama reportedly has become convinced that the Asia Pacific is both of major importance to the United States and a world region where greater US engagement would be widely welcomed and beneficial for the United States and for the president’s standing at home and abroad.

The significance of the US initiatives has been overshadowed to some degree by China’s often ham-handed treatment of security issues, territorial disputes, maritime navigation rights and other sensitive issues with its Asian Pacific neighbors. Ironically, the Chinese actions have had the effect of reinforcing the importance of the American initiatives. Concerns over China’s actions and intentions have prompted Australia and other Asian Pacific countries to support and engage with the renewed US activism; the regional governments on the one hand position their countries to work positively with rising China in areas of common interests, while on the other hand they prepare for possible contingencies involving domineering Chinese assertiveness.

The stronger US engagement ranges across the entire Asia Pacific region. Firm US support for the security alliance with Japan helped Tokyo get its footing in the face of what was widely seen as Chinese ‘bullying’ over fishing disputes involving the Senkaku/Diaoyu Islands. The United States has steadily backed its South Korean ally as it sought support in the United Nations and in military exercises against North Korea’s aggression.

The US intervention at the ASEAN Regional Forum (ARF) meeting in July led a collective effort by involving Australia and other participants to defend free navigation and restore stability in the disputed South China Sea. The United States joined Australia in the East Asian Summit, raising the profile of that regional body over Asian-only regional groups. Prominent advances in US military and other relations with Vietnam came in August; President Obama held a summit meeting with ASEAN leaders in September, visited Indonesia, along with India, Japan and South Korea, in November and pledged to be at the 2011 East Asian Summit meeting in Jakarta. Meanwhile, US interaction with small Pacific Island states has been upgraded with annual meetings with the Secretary of State, and New Zealand has seen the most significant breakthrough in its relations with the United States since the rupture of the alliance over 20 years ago.

The Australian visitors will want an update on US engagement with Asia, especially the summit with China amid renewed Chinese reassurances and less truculent behavior coincident with President Hu Jintao’s successful visit. They will seek stronger American economic commitment in the region, assessing US follow-through on free trade initiatives with South Korea and the regional Trans Pacific Partnership that involves Australia and is forecast to reach a milestone agreement at the APEC meeting in Hawaii this year.

Overall, while there are sure to be some differences in the talks, the strongly converging Australian-American interests and actions forecast a remarkably close partnership in the years ahead.

Robert Sutter is Visiting Professor of Asian Studies at the School of Foreign Service at Georgetown University and Adjunct Professor of Asian Studies in the Elliott School of International Affairs at George Washington University.

Asean

ASEAN weathering the COVID-19 typhoon

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Vietnam's Prime Minister Nguyen Xuan Phuc addresses a special video conference with leaders of the Association of Southeast Asian Nations (ASEAN), on the coronavirus disease (COVID-19), in Hanoi 14 April, 2020 (Photo:Reuters/Manan Vatsyayana).

Author: Sandra Seno-Alday, Sydney University

The roughly 20 typhoons that hit Southeast Asia each year pale in comparison to the impact on the region of COVID-19 — a storm of a very different sort striking not just Southeast Asia but the world.

 

Just how badly is the COVID-19 typhoon thrashing the region? And what might the post-crisis recovery and reconstruction look like? To answer these questions, it is necessary to investigate the strengths and vulnerabilities of Southeast Asia’s pre-COVID-19 economic infrastructure.

Understanding the structure of the region’s economic house requires going back to 1967, when Southeast Asian countries decided to pledge friendship to one another under the ASEAN framework. While other integrated regions such as NAFTA and the European Union have aggressively broken down trade barriers and significantly boosted intra-regional trade, ASEAN regional economic integration has chugged along slower.

Southeast Asian countries have not viewed trade between each other as a top priority. The trade agreements in the region have been forged around suggestions for ASEAN countries to lower tariffs on intra-regional trade to within a certain range and across limited industries. This has lowered but not eliminated barriers to intra-regional trade. Consequently, a relatively significant share of Southeast Asian trade is with countries outside the region. This active extra-regional engagement has resulted in ASEAN countries’ successful integration into global value chain networks.

A historically outward-facing region, in 2010 around 75 per cent of Southeast Asian commodity imports and exports came from countries outside of ASEAN. This share of extra-regional trade nudged closer to 80 per cent in 2018. This indicates that ASEAN’s global value chain network embeddedness has deepened over time.

Around 40 per cent of ASEAN’s extra-regional trade is with the rest of Asia. From 2010 to 2018 Southeast Asian countries forged major trade relationships with four Asian countries: China, Japan, South Korea and India. Outside Asia, the United States is the region’s major trading partner. ASEAN’s trade focus on Asia’s largest markets is not surprising. Countries tend to establish trade relationships with large, geographically close, and culturally similar markets.

Fostering deep relationships with a few large markets, however, is a double-edged sword. While it has allowed ASEAN to benefit from integration in global value chains, it has also resulted in increased vulnerability to the shocks affecting its network connections.

ASEAN’s participation in global value chains has allowed it to transition from a net regional importer in 1990 to a net regional exporter in 2018. But the region’s deep embeddedness in a small and tightly-coupled network cluster of extra-regional global value chain partners has exposed it to disruption to any and all of its external partners. By contrast, ASEAN’s intra-regional trade network structure is much more loosely-coupled: a consequence of persistent intra-regional trade barriers and thus lower intra-regional trade intensity.

In the pre-COVID-19 period, ASEAN built for itself an economic house held up by just five extra-regional markets, while doing less to expand and diversify its intra-regional trade network. The data shows that ASEAN trade became increasingly concentrated in these few external markets between 2010 and 2018.

This dependence on a handful of markets does not bode well for risk and crisis management. All of the region’s major trading partners have been significantly affected by COVID-19 and this in turn is blowing the ASEAN economic house down.

What are the ways forward? The immediate task at hand is to get a better picture of the region’s position in global value chain networks and to get on top of managing its network risk exposure. Already there are red flags around the region’s food security arising from its position in food value chains. It is critical to look for ways to introduce flexibility into existing supply chains for greater agility in responding to crises.

It is also an opportune time for ASEAN to harness the technology transfer gains of global value chain participation and invest in innovation-driven diversification of products and markets. The region’s embeddedness in global value chain networks certainly places it in a strong position to readily access large export markets not just in Asia but also Europe and the Americas.

Over the longer term, ASEAN is faced with the question of whether it should seriously look…

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Asean

Can Asia maintain growth with an ever ageing population ?

To boost productivity in the future, Asian governments will have to implement well-targeted structural reforms today.

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