1. First of all, let me express my pleasure to be in this beautiful and scenic city of lakes once again.  I would like to take this opportunity to congratulate the ASEAN Department of the Ministry of Foreign Affairs of Viet Nam and Committee on Culture and Information (COCI)-Viet Nam for holding such a Seminar at a time when ASEAN is undergoing a paradigm shift in its cooperation and in its relations with its dialogue partners, especially with the watershed decisions taken by ASEAN Heads of State/Government at the recently concluded Bali Summit last month.

2. ASEAN’s external relations took a strong footing in 1976, more than a decade after the formation of ASEAN in August 1967.  In the first ten years of its existence, ASEAN was preoccupied with building the new association, fostering mutual confidence and keeping the region from being an arena of Cold War conflict.  The aim was to create national and regional resilience so that economic and national development could be pursued by the newly independent ASEAN countries to improve the livelihood of their people.

3. ASEAN’s initially cautious outlook on external relationships is understandable, given the circumstances of its birth. The founding members had a history of disputes with one another, and their principal concern was learning to overcome their differences and to trust the workings of group dialogue and cooperation. Beyond their countries they saw a region and a world community fatefully divided by ideology and the Cold War.

4. The key goals of ASEAN’s external relations then were three-folds –secure technical assistant for regional cooperation projects; promote trade and economic relations; and strengthen political relations with third countries and regional groupings.  Given these parameters, ASEAN’s first wave of Dialogue Partners included the European Union, Japan and the United States which were ASEAN’s major trading partners. 

Changing Strategic Landscape in ASEAN

5. As ASEAN progressed and became more confident as a regional organisation, it expanded its membership to include Brunei Darussalam, Viet Nam, Laos, Myanmar and Cambodia by the turn of the last century fulfilling the desire of its founding fathers to have an ASEAN embracing all the countries of Southeast Asia.  At the same time, ASEAN admitted India, China and Russia as dialogue partners in a strategic move to secure the peace and security of the region in the Post Cold War era whether multi-polarity became the new reality of politics. 

6. Given its efforts to foster peace and prosperity in the region through intra-regional cooperation and external relations, ASEAN earned international recognition as a force of peace, stability and moderation.  The international community looked upon ASEAN as an anchor for the stability of the Asia Pacific region given its innovative style in engaging the major players of the world in active dialogue and cooperation through the ASEAN Regional Forum (ARF) as well as the other regional mechanisms that ASEAN helped to create and drive such as the ASEAN Plus Three process, Asia Pacific Economic Cooperation (APEC), Asia-Europe Meeting (ASEM), and ASEAN Cooperation Dialogue (ACD).

Changing External Relations Strategy

7. Over the last twenty five years, the external relations strategy has undergone a shift reflecting the new interests of ASEAN and the dynamic regional and international environment.

8. First, the relationship between ASEAN and its dialogue partners was put on an equal footing instead of a donor-client relationship where the dialogue partner had the upper-hand on cooperation activities.  Cooperation is now based on joint decisions and joint planning and implementation of cooperation activities.  Increasingly, ASEAN and its dialogue partners are using cost-sharing approaches in implementing projects with due consideration being given to the new ASEAN member countries.  Development cooperation is more focused on larger programmes of mutual benefit and which would have greater impact on the development of the region and on the dialogue relations.

9. Second, while economic imperatives continue to dictate external relations, the focus has shifted to gaining greater market access for ASEAN exports; securing more investments; cooperation in facilitating trade in services; promoting tourism; and assisting ASEAN in narrowing the development gaps to expedite regional integration. 

10. The strengthening of economic linkages is reflected by the number of comprehensive economic partnerships (CEPs) that ASEAN has entered into with its dialogue partners.  China, India, and Japan have concluded CEPS with ASEAN and are working towards free trade areas (FTAs) in a decade or more, which will cover not only trade in goods but also trade in services, investments and eradicating non-tariff barriers.  The US, EU, Australia and New Zealand are also working with ASEAN on closer economic linkages.   

11. With the adoption of the concept of an ASEAN Community comprising the three pillars of ASEAN Security Community (ASC), ASEAN Economic Community (AEC) and the ASEAN Socio-Cultural Community (ASCC), ASEAN will now have to focus on expediting its integration.  The AEC is expected to drive the community process since the building blocks had been put in place through the ASEAN Free Trade Area (AFTA), ASEAN Investment Area (AIA) and the ASEAN Framework Agreement on Services (AFAS).  The ASEAN dialogue partners will play a contributory role in assisting ASEAN evolve into an economic community through the CEPs and other cooperation initiatives.

12. As ASEAN worked on the FTAs with its dialogue partners, it will have to come together as a group to gain better leverage in the negotiation process over its dialogue partners.  This is expected to be a catalyst to the AEC.  At the same time, the opening up of ASEAN markets to its dialogue partners and vice-versa will mean that ASEAN countries will have to improve its competitive edge to gain a greater share for its exports in the ASEAN and dialogue partners’ markets.  In fact, some ASEAN leaders have called for the realisation of the AEC even before the realisation of the FTAs to gain better mileage for ASEAN countries through the free trade arrangements. 

13. Third, cooperation in the political and security area has been elevated to a higher plane.  ASEAN has been successful in harnessing the ARF in engaging the major players of the world and keeping their interest in the region.  Its other spin-offs such as the ASEAN Plus Three process, APEC, ASEM and ACD has helped to build concentric rings further bolstering the peace, security and prosperity of the region.  This concentric approach is consistent with ASEAN’s orientation of being an outward looking and progressive regional organisation.

14. Another concentric ring that ASEAN has drawn recently to safeguard the peace and security of Southeast Asia is the opening up of ASEAN’s Treaty of Amity and Cooperation (TAC) in Southeast Asia to the dialogue partners.  China became the first dialogue partner to sign the TAC followed by India at the recent Bali Summit.  Russia is expected to sign the TAC next year.  ASEAN is encouraging its two ASEAN Plus Three partners, Japan and the Republic of Korea, to sign the TAC as soon as possible to serve as a code of conduct for relations in East Asia.  At the same time, ASEAN will continue to pursue the signing of the Treaty of Southeast Asia Nuclear Weapon Free Zone (SEANWFZ) with the five nuclear powers.   

15. With the September 11 attacks on the US and the rise of international terrorism, ASEAN has been working actively with its dialogue partners at the bilateral, regional and multilateral level in addressing the issue.  ASEAN has concluded a number of pacts with dialogue partners to jointly address terrorism and transnational crimes.  They include the US, EU, China, Russia, and India.  Cooperation will centre on areas such as information sharing, capacity building, working together closely in international fora, and signing and ratifying UN conventions on terrorism and related transnational crime.  Such cooperation is vital for ASEAN to quell the perception that it is a hotbed for terrorists.

16. Fourth, development cooperation has become an integral part of external relations in today’s context.  It acts as a glue to bond the strengthening partnership between ASEAN and its dialogue partners and creates the comfort level for both sides to further expand and deepen cooperation.  Development cooperation with dialogue partners is increasingly focused on four aspects –strengthening economic cooperation; supporting ASEAN’s integration, including the narrowing of development gaps through physical interconnections and capacity building; addressing transnational concerns; and promoting people-to-people contacts.  ASEAN and its dialogue partners are increasingly using the dialogue process to put in place mechanisms for enhancing economic linkages to tap each others’ markets, facilitate investment flows, and promote tourism and other economic activities.

17. Dialogue partners are aware that economic cooperation with ASEAN will depend very much on how fast the new ASEAN countries are able to catch up with the rest of ASEAN.  A more integrated ASEAN will be able to move the CEPs and FTAs with the dialogue partners and achieve the timelines set for such arrangements.  Acknowledging this, ASEAN and its dialogue partners are increasingly focusing on assisting the new member countries through sub-regional development programmes, especially in the Mekong Basin area.  China, India, Japan, and ROK are assisting ASEAN to implement the Initiative for ASEAN Integration (IAI) as well as actively participating in sub-regional cooperation in the Mekong Basin region.  Another region that would increasingly gain the assistance of the dialogue partners will be the Brunei Darussalam, Indonesia, Malaysia and the Philippines- East ASEAN Growth Area (BIMP-EAGA).

18.  ASEAN-6 countries themselves are committed to helping the CLMV countries so that ASEAN as a whole could expedite the process of economic integration.  More needs to be done in this area by the ASEAN-6 countries.  Only with greater commitment within ASEAN that dialogue partners will see the value in further assisting in the integration of CLMV countries into ASEAN.  This will also ensure that the CLMV countries stay committed to the ASEAN process and vision.

19. Finally, ASEAN external relations strategy is tuned to East Asia more than ever due to the changing dynamics of the region and the world.  The financial crisis of 1997-1998 reinforced the reality among ASEAN and its East Asian Partners of China, Japan and the ROK that the region will have to work more closely to ensure the macro-economic and financial stability of the region to prevent a recurrence of another crisis.  This has made the ASEAN Plus Three process, which was initiated by ASEAN in 1997 and formalised in 1999, an important mechanism to secure the future peace and prosperity of the East Asia region.
20. Within the last five years, East Asia cooperation has grown to cover economic, monetary and financial, science and technical, health, labour, environment, agriculture, culture and development, and people-to-people contact.  Counter-terrorism is another area that will increasingly feature in the ASEAN Plus Three cooperation since the rise of terrorism and other transnational crimes has increased the need for political and security engagement in East Asia

Future Challenges

21. While ASEAN external relations has deepened and widened, new issues and challenges have emerged that would required ASEAN and its dialogue partners to work together in resolving them.

 22. In the political arena, ASEAN will have to look into the managing of its relations with its strategic partners such as China and India who are parties to the TAC and soon Russia since these countries are in the inner circle of ASEAN’s external relations.  Being strategic partners, political and security cooperation and consultations between ASEAN and them will have to be strengthened.   While having them in the TAC will increase the political confidence and mutual trust, especially since they have nuclear capabilities, managing the relations with them will require ASEAN to work closely as a region.  ASEAN should encourage them to continue to subscribe to the ASEAN way to seeking solutions to issues.  This includes respect for the principle on non-interference in each other’s domestic affairs, respect for national sovereignty and respect for one another as enshrined in the TAC.

23.  At the same time, ASEAN should be astute in ensuring that a rivalry is not started among the three countries to woo ASEAN.  This could be counter-productive since relationship with each dialogue partner is unique in itself and the synergies to be tapped by both sides vary from partner to partner.  ASEAN’s relations with its partners should not boil down to a zero sum game but rather one that that is based on a “win-win” strategy.  As such, ASEAN should adopt a more balanced strategy of engaging the rest of its dialogue partners, in particular the US, which is still an important strategic partner of the region.

24. ASEAN will have to review its mechanisms to engage the dialogue partners such as the ARF and Post Ministerial Conferences (PMCs) to keep the dialogue partners focused on the region.  The ARF should continue to evolve from the confidence- building stage to the preventive diplomacy stage and more in time as ASEAN works towards achieving the ASC.  Otherwise, the Forum will lose its lustre.  The PMCs should be made more interactive and should focus on other non-security but important issues.  At the same time, ASEAN will have to look at new ways to engage its strategic partners such as China, India, Russia and the US. 

25. ASEAN will have to do more with its dialogue partners in addressing terrorism and other transnational concerns.  ASEAN will have to look into signing and ratifying the UN conventions on terrorism and related transnational crimes to foster greater cooperation at the multilateral level.  At the regional level, the declarations signed with the dialogue partners on addressing terrorism and related transnational crimes will have to be expeditiously implemented through appropriate work programmes and activities.    ASEAN could work with China, Japan and the ROK on the issue of sea piracy in the Straits of Malacca to ensure that the maritime security in one of the busiest shipping lanes of the world and where most of the East Asian partners’ exports and imports pass through.  ASEAN could work with Australia and EU on trafficking in persons, with India on drug trafficking and with the US on counter-terrorism, tapping on the strengths of the dialogue partners in addressing these crimes.

26. In the economic arena, ASEAN will have to work on its commitments under the CEP so that the milestones set for the CEPs and FTAs could be attained as planned.  This will help to speed up the creation of the AEC by 2020 or even advance it.  Negotiations should commence as agreed on the various CEPs and should go beyond just the early harvest packages which are more of confidence building measures.   More efforts will be required to facilitate investments into ASEAN and promote tourism as well as to dismantle non-tariff barriers.   

27.   In the development cooperation arena, ASEAN will have to maintain its principle of equal partnership and non-discrimination of any of its members in development cooperation activities.  Development cooperation should be used as an effective tool to narrow the development gaps and to strengthen the economic and political relationship with the dialogue partners.
28. At the same time, such cooperation should also touch the lives of the people not only through substantive cooperation activities but also through people- to-people exchanges, including greater engagement of the business community, think tanks and non-governmental organisations.  This would in time have a greater impact on external relations as more and more of the people from ASEAN will be able to relate and associate themselves with their counterparts in the dialogue countries.  Exchanges among the youths will be important since the future of ASEAN’s external relations will be in their hands and a better understanding of the dialogue partners who are their neighbours or trading and strategic partners will certainly help to build the relationships.

29. ASEAN will have to look at innovative approaches to fund its development cooperation activities with the declining development assistance from dialogue partners over the years.  This is not just a trend in ASEAN but also the world where development assistant has drastically fallen and increasingly being tied to values such as democracy, human rights, and transparency.  ASEAN will have to look into new resource mobilisation strategies to augment the dialogue partners’ assistance.  One approach that has gained currency is joint-implementation of activities between the dialogue partners and the ASEAN-6 countries which is witnessed under the IAI.  The other option would be cost-sharing of projects and activities as seen in the ASEAN plus Three process.  ASEAN will have to review its moratorium on new dialogue partnerships and look into creative ways of engaging other interested countries and entities which are keen to undertake development programmes with ASEAN.

30. As for the ASEAN plus Three process, the immediate task will be to implement the seventeen short-term measures recommended by the East Asia Study Group (EASG) and adopted by the ASEAN leaders to deepen the cooperation.   ASEAN could set 2006 as the timeframe for implementing all the short-term measures when a decade of ASEAN Plus Three cooperation will be achieved.  The successful completion of the measures will set the stage for the implementation of the nine EASG medium and long-term measures that will help ASEAN plus Three cooperation to move to the next stage of East Asia cooperation. 

31. At the same time, the Plus Three Countries will have to increase their support for ASEAN’s integration as this will be the key and catalyst for the progress of East Asia cooperation.  The faster ASEAN integrates, the greater will be the comfort level for ASEAN to shift into a higher gear to move East Asia cooperation.   This is necessary or otherwise in an East Asia setting where ASEAN is not integrated, ASEAN will not be able to act as the buffer between the traditional rivals of China and Japan.  Besides, China and Japan may be at the wheels and could be controlling the accelerator of East Asia cooperation with ASEAN being a passenger.  If this happens, East Asia cooperation is destined to fail. 

Concluding Remarks

32. ASEAN external relations will continue to be a pillar in ASEAN cooperation.  It will continue to deliver benefits to ASEAN as the regional organization pursues its objective to be a force of peace, prosperity and moderation in Southeast Asia and beyond.  However, the future directions will be very much dependent on several multi-dimensional factors that include the changing strategic landscape, integration and transition towards an ASEAN Community, and how effective ASEAN addresses the challenges facing it both at the intra-regional cooperation and external relations levels.

Thank you.