DEVELOPMENTS IN EXTERNAL RELATIONS

The changing content and complexion of ASEAN’s external relations is well illustrated by the participation of ASEAN Senior Officials (SOM) in a number of the Dialogue sessions indicating that political and security issues are also being given added emphasis in ASEANs Dialogue relations. The establishment of the ASEAN Regional Forum at ASEANs initiative is another indication of the importance that ASEAN itself attaches to the discussion of political and security issues pertaining to the region in a wider context involving not just ASEAN’s Dialogue Partners but also the major players in the region and other countries in Southeast Asia. At the same time, discussions on International economic issues and linkages have acquired new significance following the conclusion of the Uruguay Round and, in the broader context, resulting from the increasing interdependence of the world economy. The establishment and the impact of regional trading arrangements, notably AFTA, the North American Free Trade Agreement (NAFTA) and the Australia-New Zealand Closer Economic Relations Trading Arrangement (ANZCERTA) have become an added feature in the agenda of the respective Dialogue meetings. Through the Dialogue process ASEAN continues to articulate its concerns on issues such as market access, the generalized system of preferences and the linking of the so-called social issues to trade.

Meanwhile, development cooperation activities have moved to more thematic programming approaches to ensure broader impact on intra-ASEAN cooperation. ASEAN has become increasingly involved in the programming and review of development cooperation projects consistent with the principles of partnership and mutuality of interest. Most programmes have involved the private sector as development cooperation has become more inextricably linked with commercial and industrial cooperation. Science and technology as well as the environment have become increasingly important areas of cooperation, not only with the Dialogue Partners but also in ASEANs new relationships with India and China.

The ASEAN-India Sectoral Dialogue relations, which were established in July 1993, moved into the operational phase during the year. ASEAN- China Consultative relations will be formalized through an Exchange of Letters establishing two joint committees on economic and trade cooperation and science and technology cooperation. Efforts are on-going to formulate an appropriate modality for operationalizing ASEAN-Pakistan Sectoral Dialogue. Meanwhile, the process of consultations with Russia to establish an appropriate modality and the areas of cooperation is continuing.

ASEAN Member Countries supported and have continued to participate actively in various APEC programmes and activities and have supported the initiatives taken at the APEC Informal Leaders Meeting in Seattle in November 1993.

Consultations were also initiated during the year towards the launching of the East Asia Economic Caucus (EAEC) as a caucus within APEC following the consensus reached by ASEANs Foreign and Economic Ministers. These consultations are continuing with those concerned.


ASEAN-Australia

The 16th ASEAN-Australia Forum was held at Canberra in May 1994. ASEAN and Australia had extensive discussions on a number of regional and global economic and political issues. They also reviewed the progress of development cooperation, including cooperative projects under the ASEAN-Australia Economic Cooperation Programme (AAECP).

The 16th Forum discussed regional security, trade and investment relations, sub-regional growth areas, AFTA, and international economic issues. The subject of political and regional security covered developments in the Korean Peninsula, preparations for the ASEAN Regional Forum, the Treaty of amity and Cooperation in South

East Asia, South East Asia Nuclear Weapons Free Zone (SEANWFZ) and Non-Proliferation, Myanmar and Cambodia. Both sides agreed that countries in Asia-Pacific now face a much more fluid situation than they had for the past four decades, and that there were new opportunities for cooperation to maintain peace and stability in Asia-Pacific.

The ASEAN Australia Economic Cooperation Programme (AAECP) remains the main mechanism for development cooperation under ASEAN-Australia Dialogue. Phase 11 of the AAECP would expire on 9 July 1994 and extensive preparations have already been undertaken to launch AAECP Phase III by July 1994. Phase III consists of two components: a projects stream and a linkages stream. As agreed at the 15th ASEAN-Australia Forum held at Bangkok in January 1993, the projects stream will focus on science and technology, environment, telecommunications and agro-based industries.

Meanwhile, six related priority sectors are covered under the linkages stream: environmental management (e.g., marine science, energy efficiency, conservation and demand management and industrial waste management), transportation, biotechnology, telecommunications and information technologies and agriculture/agro-based industries. The linkages stream is aimed at facilitating networking between the private sectors in ASEAN and Australia and at identifying opportunities for commercial collaboration. Activities in the linkages stream will replace the former Trade and Investment Promotion Programme (TIPP).

Australia has approved an allocation of A$ 32 million for the next four years under AAECP Phase III, of which A$18 million (60 per cent) will be made available to the projects stream, and an indicative A$14 million (40 per cent) to the linkages stream.


ASEAN-Canada

The 9th ASEAN-Canada Joint Cooperation Committee Meeting (JCC) was held at Ottawa in June 1994. It was the first JCC to be held after the signing of the new Economic Cooperation Agreement which was signed during the Post Ministerial Conferences in July 1993. The Meeting discussed the modalities for intensifying economic and commercial cooperation and, in this respect, benefited from the active participation of the private sector. ASEAN and Canada discussed developments in the implementation of AFTA and NAFTA and the importance of continuing trade liberalization efforts within the work programme of the WTO.

ASEAN and Canada discussed measures for expanding trade including market access issues and the general preferential tariff scheme. Specific investment opportunities were also discussed, as well as the means of promoting interaction and contacts among ASEAN and Canadian private sectors.

During the 9th JCC, ASEAN and Canada agreed to establish a Joint Planning and Monitoring Committee (JPMC) to undertake joint programming and review of development cooperation projects.

ASEAN and Canada also had an exchange of views on the environment and science and technology based on the plans of action which have already been adopted by ASEAN. In as much as Canada’s regional policy framework for development cooperation, as the basis for new programming allocations under CIDA will be completed much later in the future, Canada’s support to current ASEAN proposals will be primarily undertaken through existing programmes of other Canadian institutions.


ASEAN-European Community

The 11 th Meeting of the ASEAN-EC Joint Cooperation Committee (JCC) was held at Davao City in January 1994. The JCC took further steps to consolidate, deepen and diversify areas of cooperation. Progress was made on the four points raised by ASEAN at. the 9th ASEAN-EC Ministerial Meeting in November 1993, namely, trade consultations, industrial cooperation, financing from the European Investment Bank, and participation in certain science and technology R & D programmes.

The three JCC Sub-Committees on trade, economic and industrial cooperation, and science and technology met prior to the 11 th JCC to advance cooperation on a number of activities. The Sub-Committee on Trade examined the trade flows between ASEAN and the EC, and discussed market access issues, the GSP Scheme and Intellectual Property Rights (IPRs), among others. At the Sub-Committee on Economic and Industrial Cooperation, the EC briefed ASEAN on the Single Market and the current economic situation in Europe.

The Financing Agreement for the ASEAN-EC Management Center was signed on 21 January 1994 on the occasion of the 11 th JCC. The Center was established to develop public administration and business management capabilities for both the public and private sectors in the region. The Management Center is expected to be fully operational within the year.

During the 11 th JCC, ASEAN and EC agreed to take measures to strengthen the linkages between their private sectors and to promote their participation in defining areas for cooperation. Towards these objectives, ASEAN and the EC agreed to the establishment of European Information Centers in ASEAN capitals. The EC has also supported the strengthening of the European Chambers of Commerce in the ASEAN region to provide information on the European Single Market and to undertake regular business promotion activities.


ASEAN-Japan

During the year under review, Japan continued to strengthen cooperation with ASEAN through its various development cooperation programmes. In particular, Japan has agreed to extend the ASEAN-Japan Friendship programme, which expires this year, for another 5 years. In the first quarter of 1994, Japan released another US $ 2 million as its fourth annual contribution to Phase 11 of the ASEAN-Japan Youth Scholarship Fund. ASEAN has acknowledged the usefulness of the ASEAN-Japan Development Fund (AJDF) in promoting industrial development in ASEAN. In this regard, ASEAN has requested Japan to extend the AJDF scheme, which expired in July 1993, for another three years.

Economic dialogue between ASEAN and Japan entered into a more strategic phase during the year. At the Second AEM-MITI Meeting held in Singapore in October 1993, the ASEAN Economic Ministers and Japan exchanged views on a number of key issues, namely, economic and trade development, market access, investment and industrial cooperation, cooperation in Indochina, and environment and energy cooperation. Japan extended the GSP Scheme for ASEAN until the year 2001 and further liberalized the programme for 1993. In the area of investment and industrial cooperation, ASEAN and Japan agreed to cooperate on four specific programmes involving the development of supporting industries, intellectual property, industrial standards and quality, and industrial technology research. The specific activities under these programmes are being implemented on a bilateral basis.


ASEAN - Republic of Korea (ROK)

Cooperation between ASEAN and ROK has expanded to cover not only the areas of trade, tourism, investment, but also science and technology, and human resource development. Within the latter part of 1993, five projects under these expanded areas had been successfully implemented. These included the Human Resource Development Programme, Technical Transfer Programme in Agricultural Development. Sellers-Buyers Exchange Programme, Workshop on Formulation of Biotechnology Atlas, and Survey on Investment Demands of ASEAN Industry, Phase I.

Several project proposals were also approved for implementation in 1994. The 6th Meeting of the ASEAN-ROK Joint Management Committee held at Jakarta in December 1993 considered the budget for eight approved projects. Of these approved projects, the Study Mission on Investment Climate of ASEAN Countries has been completed. A two-year research project that will analyze the patterns and implications of ASEAN-ROK relations is currently on going.


ASEAN-New Zealand

A new mechanism was established by ASEAN and New Zealand to further enhance the benefits of their development cooperation activities. During the Post Ministerial Conferences held in Singapore in July 1993, ASEAN and New Zealand signed Ministerial Exchange of Letters establishing the ASEAN-New Zealand Joint Management Committee (ANZJMC). The objective of setting up the JMC will ensure the effective implementation of the projects under the ASEAN-New Zealand Economic Cooperation (ANZEC) Programme with a view to achieving fully the planned objectives.

The ANZJMC held its inaugural meeting at Wellington in November 1993. The Meeting reviewed the progress of the three main ongoing components of the ANZEC Programme, namely the Inter-Institutional Linkages Programme (IILP), the Trade and Investment Promotion Programme (TIPP), and the Natural Gas Utilization in Transport Programme (NGUT). The review concluded that the projects were making good progress. Recommendations made by the ANZJMC included the timetable for the completion of projects and measures to ensure the sustainability of project benefits. More importantly, science and technology was recommended as another area for funding ASEAN-New Zealand cooperation.

The 12th Meeting of the ASEAN-New Zealand Dialogue was held at Wellington in March 1994. ASEAN and New Zealand exchanged information on the latest developments pertaining to the ASEAN and New Zealand economies, GATT, APEC, ANZCERTA, AFRA, and the EAEC. It was agreed at the Meeting that science and technology would be a new area for cooperation. A workshop will be held following the 30th ASEAN-COST Meeting at Chiang Mai in September 1994 to identify more specific activities for cooperation in this field. Tourism was also identified as an area with potential mutual benefits for cooperation between ASEAN and New Zealand.

Following an official invitation, the Secretary- General of ASEAN paid an official visit to New Zealand on 24-31 March 1994. During his visit, he held discussions with the Right Honourable James Bolger, Prime Minister of New Zealand, the Honourable Philip Burdon, Minister for Trade Negotiations and Minister for State Owned Enterprises, the Right Honourable W.F. Birch, Minister of Finance. the Right Honourable Jonathan Hunt, MP and the Honourable Simon Upton, Minister of Research, Science and Technology and Minister for the Environment. The Secretary-General also had opportunities to meet the New Zealand private sector in Auckland and Christchurch.

The ASEAN Secretary-General and New Zealand leaders exchanged views on areas of mutual interest. The leaders emphasised the importance they attached to developing closer ties with Asia, particularly with ASEAN, and the role that the Asia 2000 policy would play in this regard.


ASEAN-US

The 12th meeting of the ASEAN-US Dialogue was held at Washington D.C. in May 1994. ASEAN and the US exchanged views on trade relations covering policies on anti-dumping and countervailing duties, and anti-circumvention practices and the GSP. ASEAN pointed out that there have been greater opportunities for investment in ASEAN as a result of the liberalization of investment policies and the implementation of AFTA. The US stressed that it would be actively involved in ensuring an environment of stability and predictability to promote increased investments into the region.

The private sector which has continued to play an important role in ASEAN-US relations, participated actively in the economic discussions of the 12th ASEAN-US Dialogue. During the Meeting, the ASEAN private sector voiced its concern over the slackening of US investments in ASEAN and asked the US government to continue to remove trade barriers. On the other hand, the US private sector stressed the importance of the Uruguay Round, the need to get more US firms interested on ASEAN and the need for ASEAN Governments to continue to lower tariffs and to remove non-tariff barriers. Both ASEAN and US private sectors supported the renewal of the non-conditional GSP on a longer-lasting basis and opposed the linkage of social clauses.

The US reiterated that the Environment Improvement Programme (EIP) and the Private Investment and Trade Opportunities (PITO) Project would remain the main vehicles for development cooperation with ASEAN. A number of activities had already commenced under the work programme of EIP. By way of expanding cooperation in the areas of technology exchange, energy training and management, and harmonization of environmental standards, the US indicated that the EIP would eventually be incorporated into the Asian Environmental Partnership (AEP).

Significant progress has been achieved in the implementation of the PITO project. It has provided benefits to ASEAN and US firms through increased trade and investment activities in the region. As the project is due to end in June 1995, ASEAN has expressed its interest to extend the project. The US and ASEAN private sectors suggested that the infrastructure already set up for the PITO project could be used for the proposed Alliance for Mutual Growth (AMG).

The AMG is an initiative of the US designed to harness human and financial, government and private sector resources to create business opportunities between the two regions and to create the foundations for long-term expansion of trade and commercial ties. The six areas under the AMG that have been mutually agreed upon are human resource, infrastructure, small and medium enterprises, standards, technology, and trade promotion. ASEAN and the US would take steps to come to a final understanding on the form and modalities for the AMG.


ASEAN - United Nations Development
Programme (UNDP)

As the only multilateral organization which is a Dialogue Partner of ASEAN, the UNDP has provided most of the technical assistance to ASEAN in the area of capacity-building and institutional development. Under the ASEAN - UNDP Sub-Regional Programme Cycle Five (ASP-5) covering the period 1992-1996, the amount of US$ 5.8 million has been allocated to assist ASEAN in five areas, namely :
  1. liberalization and promotion of trade and investment including the implementation of AFTA,

  2. technology,

  3. trade and the environment,

  4. human resource development and

  5. capacity building in the ASEAN Secretariat.

For each of these areas, a sub-programme has been formulated to provide focus and direction. The Sub-programmes were based on plans of action and other framework documents endorsed by the various ASEAN Ministerial Meetings and the relevant ASEAN bodies, such as the ASEAN Plan of Action on Science and Technology, ASEAN Work Programme for the Implementation of AFTA, ASEAN Strategic Plan of Action on the Environment and the Resolution on the ASEAN Plan of Action for Children. All the Sub-programmes hive been endorsed by the relevant ASEAN bodies and have been submitted to UNDP for approval. The UNDP agreed to provide a grant of US$ 5.8 million to the ASEAN- UNDP sub-regional programme (ASP-5).

The documents for the Sub-Regional Programme were signed by the UNDP Resident Representative and the ASEAN Secretary-General on 1 July 1994. The implementation of the Sub-Regional Programme activities is expected to commence in July 1994.




ASEAN-India

Following the establishment of the ASEAN- India Sectoral Dialogue Relations in New Delhi in March 1993, the First Meeting of the ASEAN- India Joint Sectoral Cooperation Committee (AIJSCC) was held at Bali in January 1994. At this Meeting, the Rules of Procedure and Terms of Reference of the AIJSCC were adopted, marking the formal establishment of this inter-governmental consultative body.

The First AIJSCC Meeting also adopted the Terms of Reference and Rules of Procedure of the Joint Management Committee for the ASEAN- India Fund. India has provided an initial allocation of US$158,478 for setting up the Fund which will support programmes and projects approved by the AIJSCC. In addition, India has offered training modules in designated areas of interest to ASEAN and specific projects within the frame- work of the India Technical and Economic Cooperation Programme.

ASEAN and India have made substantial progress in identifying areas of cooperation under the Sectoral Dialogue. Under trade and investment, it was decided that the focus would be on programmes and projects on trade liberalization, facilitation and promotion, and infrastructure development. In this connection, it was agreed that a Group of Experts from ASEAN and India would be established to identify mechanisms, modalities and areas of trade and investment cooperation between the two sides. In the field of tourism, ASEAN and India have agreed to cooperate in the promotion Of tourist destinations and coordination among the various sectors of the travel industry. In the area of science and technology, joint workshops have been proposed to bring together ASEAN and Indian scientists and technologists to discuss possible collaboration in advanced materials science, biotechnology, and information technology.




ASEAN-China

Consultative Relations between ASEAN and China will be enhanced this year through the signing of the Exchange of Letters between the Secretary-General of ASEAN and the Foreign Minister of the Peoples Republic of China. The Exchange of Letters will establish two joint committees, one on economic and trade cooperation, and the other on scientific and technological cooperation.

Meanwhile, ASEAN and China have begun pursuing their mutual interests in promoting cooperation in science and technology. Senior COST officials met with their Chinese counter- parts during the meeting of the Committee on Science and Technology (COST) in Manila in January 1994. They agreed on the draft procedural guidelines and terms of reference of the Joint Committee on Scientific and Technical Cooperation which will meet annually. The meeting also discussed Chinas proposal to set up the China-ASEAN Science and Technology Training Center in Beijing and the China-ASEAN Technology Development Center in one of the ASEAN Member Countries.




Laos and Vietnam

Laos and Vietnam acceded to the Treaty of Amenity and Cooperation in Southeast Asia and were granted Observer Country status at the 25th AMM in Manila in 1992. Subsequently, their Foreign Ministers attended the 26th AMM in Singapore in July 1993 as Observers. At that meeting in Singapore, the Foreign Minister of Laos sought ASEANs cooperation in the area of human resource development, while the Foreign Minister of Vietnam called for cooperation with ASEAN in the areas of science and technology, environment, culture and information, public health, and tourism.

ASEAN has also agreed to the participation of Laos and Vietnam as Observers in meetings of ASEAN’s committees, sub-committees and their subsidiary bodies on functional cooperation. The Committees were Committee on Science and Technology (COST), ASEAN Senior Officials on Environment (ASOEN), Committee on Culture and Information (COCI), Committee on Social and Development (COSD), ASEAN Senior Officials on Drugs (ASOD), and ASEAN Conference on Civil Service Matters (ACCSM). This was aimed at familiarizing Laos and Vietnam with ASEAN and its various mechanisms. The possibility of including Laos and Vietnam in the Human resource development programmes and projects of these Committees is also being looked into. A set of guidelines designed to enable Laos and Vietnam to participate actively in ASEAN meetings is already iii place. The ASEAN Senior Economic Officials have also agreed to hold consultations with Laos and Vietnam as and when necessary.

Laos and Vietnam have already begun to take part in some of the ASEAN meetings and projects in the functional cooperation areas. They are active participants in ASEANs Three-Year Plan of Action on Preventive Drug Education (1993- 1995). Vietnam has also sent observers to the meetings of COST, ASOD and the ASEAN Sub- Committee on Youth.

In February 1994, the Secretary-General visited Laos and Vietnam as an official guest of the two Observer Countries. Laotian leaders emphasized their desire to see closer cooperation between Laos and ASEAN, especially in human resource development, environment, drugs and the building of their economic infrastructure. The Vietnamese leaders expressed a strong interest in expanding Vietnams cooperation with ASEAN ranging from the areas of functional cooperation to trade and economic cooperation.

The ASEAN Secretariat has put forth a series of recommendations to accelerate ASEANs cooperation with Laos and Vietnam. The Senior Officials Meeting (SOM) held in Pattaya in April 1994 agreed to accelerate this cooperation and requested the ASEAN Directors-General to explore in detail the various proposals on ways and means to accelerate ASEANs cooperation with Laos and Vietnam.


Cambodia and Myanmar

ASEAN continued to support His Majesty, King Norodom Sihanouk, and the National Government of Cambodia in their efforts to establish political stability, and rehabilitate and reconstruct their country. For the first time, at the 26th AMM, ASEAN invited the Cambodian Foreign Minister, Prince Norodom Sirivudh, for informal discussions on ASEANs assistance to Cambodia. ASEAN has also participated actively at the International Conference on the Reconstruction of Cambodia.

As regards Myanmar, ASEAN continues to ad- here to its policy of constructive engagement. ASEAN believes that it would be better to keep

the avenues of cooperation and communications open with Myanmar rather than isolate her. The past year has seen a number of high-level visits exchanged between various Member Countries of ASEAN and Myanmar. At the 27th AMM in Bangkok in July 1994, Myanmar will be invited as a guest of the host Thailand.



ASEAN has made progress in its efforts to launch the East Asia Economic Caucus (EAEC) within the framework of the decision of the 26th AMM that the EAEC would be a Caucus within APEC. In accordance with the request of the AEM, the Secretary-General of ASEAN visited Beijing, Seoul and Tokyo and held fruitful con- sultations with ministers and senior officials of the Peoples Republic of China, Japan and South Korea regarding the objectives, principles, features, and modalities of the EAEC. At these meetings, ASEAN reaffirmed the view that the EAEC would be an open and outward-looking consultative forum, that it would not be an institutionalized entity or trading bloc, and that it posed no threat to other regional organizations. ASEAN also emphasized these points in the briefing given to the US during the ASEAN-US Dialogue meeting in Washington D.C in May 1994.




There has been considerable progress in APEC towards promoting increased trade and investment cooperation among its member economies. ASEAN Member Countries have participated actively in the implementation of APEC’s projects and activities and in the discussions on economic trends and issues and on trade and investment policies.

The Fifth APEC Ministerial Meeting, which was held in Seattle, USA on 17-19 November 1993, endorsed the mission statement of APEC’s Ad-hoc Group on Economic Trends and Issues (ETI) and adopted the Declaration on an APEC Trade and Investment Framework; while the informal meeting of APEC Leaders, held on 20 November 1993 on Blake Island, Seattle, took eight initiatives as the priority areas of cooperation among member economies.

APEC leaders have agreed to meet informally again on 15 November 1994 in Bogor, Indonesia, subsequent to the Sixth APEC Ministerial Meeting which has been scheduled for 11-12 November in Jakarta. Preparations for the two meetings are being made.