Asean Charter

INTERNATIONAL BUSINESS MANAGEMENT

Topic: Importance of International Trade for India

Submitted to:
Dr. Philip Nicholls Submitted by:
Tony Antony 553 - 9043
Introduction
By the end of the twentieth century, the Association of South East Asian Nations (ASEAN) was experiencing growing pains. The organization had changed vastly since its inception in 1967, when it served as a political bulwark against the Cold War superpowers in order to protect the independence of its founding member states—Indonesia, the Philippines, Singapore, Malaysia, and Thailand.
By the 1990s, ASEAN’s primary mission was to be an engine for regional economic growth. And by the 2000s, ASEAN had embraced Brunei, Cambodia, Laos, Myanmar, and Vietnam as members, and sought to resolve security issues in Southeast Asia. These successive changes produced a chaotic and weak structure, and proponents of the 2007 ASEAN Charter desired a document that would enable ASEAN to better facilitate economic integration and enhance security cooperation among the members. But they failed because of deeply seated norms, encapsulated by the “ASEAN Way.”
The “ASEAN Way” refers to several principles which collectively prevent organizational change, and can be reduced to two essential components. First, it emphasizes decision making through informal consultation among diplomats, which facilitates group consensus at official meetings. Second, it is a series of six behavioral principles set forth in the 1976 Treaty of Amity and Cooperation: (1) respect for state sovereignty; (2) freedom from external interference; (3) noninterference in internal affairs; (4) peaceful dispute settlement; (5) renunciation of the use of force; and (6) cooperation. Of these, member states particularly emphasize noninterference in each other’s internal affairs.
ASEAN’s membership has become a heterogeneous patchwork. For example, the member states’ economies vary dramatically: At one end is Singapore’s entrepôt economy, with a gross domestic product (GDP) of $52,200. At the other is Myanmar, a poverty-stricken exporter of natural resources, with a GDP of $1,100. The members’ governments are wildly different as well: For example, Indonesia is a democracy, while Vietnam14 and Laos are communist states. Moreover, according to Worldwide Governance Indicators of rule of law, Singapore ranks in the 90th percentile, Thailand, Malaysia, and Brunei rank in the 50th to 60th percentile, and Myanmar ranks in the 4th percentile.
ASEAN’s diverse political makeup points to a deeper issue that the critics miss: the members may not have a common conception of the ASEAN Way. Myanmar, Cambodia, and Laos emphasize non-interference. However, older members focus on cooperation and coordination.
These differences not only impede the members’ efforts to find common solutions to particular difficulties, but also make it difficult to determine when collective action is appropriate in a given situation.
Despite these vast differences, observers maintained high hopes for the Charter. The former secretary-general of ASEAN hoped that the instrument would explicitly reject genocide, the use of child soldiers, and discrimination on the basis of gender, race, religion, or ethnicity. Others wanted the Charter to bolster economic integration by improving ASEAN’s dispute settlement mechanism and by developing protocol by which to sanction states that violate trade agreements. The Charter was also anticipated to protect human rights as a common value, and that it might create a mechanism to resolve non-economic disputes. After a two-year process, at the 13th ASEAN Summit in November 2007, the ASEAN CHARTER was adopted and is now a part of the constitution.

Discussion
Blueprint for a New ASEAN
ASEAN pronounced its own goals for the Charter and more specifically, the goals of the most progressive member states in the Report of the Eminent Persons Group (EPG Report). It was the EPG’s mandate to propose a Charter that would enable ASEAN to fulfill its integrative goals.
1. Mandate to Build a Charter
ASEAN had formally announced its commitment to establish a Charter in the Kuala Lumpur Declaration, 1971. According to the Declaration, the Charter would fulfill the vision of ASEAN set out in the Bali Concord II and subsequent Action Plans. It also emphasized that the Charter would be a legal and institutional framework that would help ASEAN strengthen internal economic linkages, ensure the implementation of agreements, promote human rights and democracy, and promote regional cooperation, among other activities. Last, it delegated to an Eminent Persons Group (EPG) the task of offering practical recommendations for the Charter, specifying that the EPG would be a group of “highly distinguished and well respected citizens from ASEAN member countries.” They were to construct a document that would balance the practical with the visionary.
Thus, the EPG was ordered to create a Charter that could fulfill the vision laid out by the previous integrative mechanisms, while still attempting to ground its recommendations in political reality.
2. Economic Integration
Despite emphasizing that economic integration is “the cornerstone of ASEAN’s integration efforts” and that ASEAN’s ultimate goal is to achieve a single market, the EPG’s proposals for economic integration remained modest. Indeed, although it identified that ASEAN was plagued by fragmented markets, high transaction costs, and an unpredictable policy environment, the EPG simply urged for ASEAN to “step up its integration efforts” and proposed few structural reforms specifically targeted towards this goal. To be sure, the EPG did recommend institutionalizing a number of existing practices. It sought to apply the 2004 ASEAN Protocol on Enhanced Dispute Settlement Mechanism to all disputes pertaining to economic agreements, and it recommended that economic agreements employ an opt-out mechanism to engender greater flexibility in implementation. But if implemented in the Charter, these were not the kind of structural reforms that would push the ASEAN Economic Community into the twenty first century. The member states continued to avoid the DSM (Dispute Settlement Mechanism), and expanding its potential use to all economic disputes would not substantially remedy that deficiency. Similarly, the opt-out mechanism was of mixed utility while it did help members to construct economic agreements with which not all states could comply, it limited ASEAN’s ability to pursue integration uniformly. But the EPG also proposed two groundbreaking reforms for economic integration. First, it suggested that member states should utilize a majority-vote process when consensus could not be achieved.
This would have directly contravened consensus, a core component of the ASEAN Way. The instrument would have streamlined decision-making and might have been a vehicle through which the member states would develop a deeper regional identity, as a voting mechanism would almost necessarily require that members subordinate national interests to regional interests.
Second, the EPG recommended that ASEAN develop a Special Fund to help support development efforts. This Fund would have drawn resources from member states through voluntary contributions, and from the business sector through special taxes or fees. An ASEAN Special Fund would have been an indispensible mechanism, as much of the CLMV (Cambodia, Laos, Myanmar and Vietnam) states’ inability to pursue integration as quickly as the older member states was due to their lack of resources and infrastructure.
3. Security Cooperation
Compared to its proposals for economic integration, the EPG’s suggestions for security cooperation were far more creative. Reflecting the rhetoric of previous instruments, the EPG foresaw an ASEAN that would protect and promote human rights, reject unconstitutional changes in government, and commit to the development of democracy and the rule of law in Southeast Asia.
To support these functions, the EPG suggested that ASEAN explore the establishment of a human rights mechanism. The EPG also proposed a solution for member state discipline, recommending that ASEAN discipline states upon a unanimous vote, discounting the state subject to the proceeding. With this provision, the member states would have a mechanism by which they could decide that a peer state’s actions violated certain basic regional norms. Although it is unlikely that the CLMV states would ever vote to discipline one another, establishing the mechanism would have been an important first step. The EPG’s recommendations for security cooperation nevertheless also remained bound to political realities. More “visionary” proposals would necessarily entail a more centralized and powerful regional organization. But the organization’s membership remains divided on whether—much less how—to move forward. Ultimately, the Charter ultimately eschewed all EPG innovation, effectively admitting that Southeast Asian politics would not sustain the visionary communitarian goals sought by the progressive members throughout the previous decade.

Conclusion
The ASEAN Charter failed to meet the expectations and ambitions of the progressive members both with respect to economic integration and security cooperation, disappointing those who hoped ASEAN could be a stronger force for human rights and an engine for regional economic growth. It made no structural improvements to address concerns about the inability to implement agreements, the construction of agreements with lengthy timelines and broad exceptions, and the omnipresent threat of the development gap. The Charter’s changes either restated existing practices, or further entrenched the organization’s problems. Similarly, it failed to develop mechanisms better equipped to resolve interstate conflict than those mechanisms which existed before the Charter. Moreover, the Charter’s mechanisms of decision-making, dispute resolution, and human rights all defer authority to make decisions that the Charter’s drafters themselves were unable to make.

References * https://www.law.nyu.edu/ecm_dlv3/groups/public/@nyu_law_website__journals__journal_of_international_law_and_politics/documents/documents/ecm_pro_068232.pdf * http://en.wikipedia.org/wiki/ASEAN_Charter * http://jcsesecuneta.com/snoworld/the-asean-charter-bulleted-summary * http://maruah.org/asean-charter/ * http://www.asean.org/asean/asean-charter/asean-charter

References: * https://www.law.nyu.edu/ecm_dlv3/groups/public/@nyu_law_website__journals__journal_of_international_law_and_politics/documents/documents/ecm_pro_068232.pdf * http://en.wikipedia.org/wiki/ASEAN_Charter * http://jcsesecuneta.com/snoworld/the-asean-charter-bulleted-summary * http://maruah.org/asean-charter/ * http://www.asean.org/asean/asean-charter/asean-charter