ASEAN plans $15t trade bloc

Novan Iman Santosa, The Jakarta Post, Phnom Penh | Headlines | Wed, November 21 2012, 9:42 AM

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The leaders of ASEAN have succeeded in persuading their top trading partners to start negotiations on the Regional Comprehensive Economic Partnership (RCEP) to create the world’s largest trading bloc.

Cambodian Prime Minister Hun Sen formally launched the negotiations on the RCEP during the ASEAN Summit and Related Summits on Tuesday at a meeting at the Peace Palace in the western part of Phnom Penh.

The leaders of the 10-member regional grouping and their six major trading partners agreed to create a trading bloc that will comprise more than three billion people and with a combined GDP of US$15 trillion, roughly equal to that of the US.

ASEAN also launched the US-ASEAN Expanded Economic Engagement initiative, aimed at expanding trade and investment ties with the US and smoothing a path for the Trans-Pacific Partnership.

Trade Minister Gita Wirjawan said that plans for the RCEP would be welcomed by world leaders from Australia, India and the US as an amazing tool of economic integration that might become the benchmark for other regions.

“The spirit is not that of a zero-sum game. The economic integration of other regions is complementary to the economic integration among [ASEAN] member countries,” Gita told The Jakarta Post on the sidelines of the event.

“Many ASEAN member nations are conducting bilateral talks that are just fine, because they are complementary [to the RCEP],” Gita said.

The minister has previously said that the RCEP would “rewrap” five current free trade agreements (FTAs) with ASEAN’s six major trading partners, China, Japan, India, South Korea, Australia and New Zealand.

ASEAN’s FTA with Australia and New Zealand covers both nations.

Gita said that the prospects for the RCEP were currently brighter than of the Trans-Pacific Partnership (TPP) free trade agreement touted by the US, as ASEAN already had FTAs in place, albeit mostly on goods and tariffs, with most of the nations involved.

The RCEP will expand upon existing FTAs to include agreements covering services and investment.

ASEAN is currently in discussions to expand its FTA with India, which it expects to complete in time for the ASEAN-India Commemorative Summit next month in India. Similar negotiations will follow with Japan.

Earlier in the day, there was a global dialogue between ASEAN leaders with the heads of world financial institutions, including Asia Development Bank President Haruhiko Kuroda, IMF Managing Director Christine Lagarde, World
Bank Managing Director Caroline Anstey, UN Conference on Trade andDevelopment Secretary-General Supachai Panitchpakdi and World Trade Organization Director-General Pascal Lamy.

Gita said that the leaders agreed that ASEAN had shown itself to be resilient amid the global financial crisis, becoming a model for other economic zones.

“Also discussed were efforts to face financial crises, such as the Chiang Mai Initiative pool of funds, which has been increased from US$120 million to $240 million,” Gita said.

Another important decision that was made during meetings and summits in Cambodia between Nov. 15 and 20 was to start additional talks on implementing the ASEAN Economic Community on Dec. 31, 2015, to aid member nations in their preparations.

ASEAN’s leaders also adopted the ASEAN Human Rights Declaration, despite critics who said that the document was not up to universal standards of human rights protection, promotion, monitoring and enjoyment.

At the end of the closing ceremony, Hun Sen presented the gavel to Brunei Darussalam Sultan Hassanal Bolkiah to mark the handover of ASEAN’s rotating chair from Cambodia to Brunei starting on Jan. 1.

Bolkiah said it would be the fourth time that Brunei would hold ASEAN’s chair, and that the nation had chosen a motto of “Our People, Our Future Together” for ASEAN for 2013.

ASEAN Secretary-General Surin Pitsuwan of Thailand also brought to an end to his term. He will be replaced by Vietnamese deputy foreign minister Le Luong Minh, who has been endorsed by ASEAN’s member nations.

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ASEAN leaders meet major dialog partners

Novan Iman Santosa, The Jakarta Post, Phnom Penh | World | Mon, November 19 2012, 2:41 PM

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Leaders of the ASEAN states are meeting with their major dialog partners on the second day of the 21st ASEAN Summit and Related Summits at the Peace Palace on Monday.

The series of summits start with an ASEAN-Japan Summit when the 10 leaders will discuss various issues with Japanese Prime Minister Yoshihiko Noda followed by a similar summit with South Korea. The morning session ends with the ASEAN+3 Commemorative Summit on the 15th anniversary of ASEAN+3 Cooperation. In addition to Japan and South Korea, China completes the ASEAN+3 configuration.

After lunch, there will be the ASEAN-India Summit, followed by yet another meeting with China which will be led by outgoing Premier Wen Jiabao. At the China affair ASEAN leaders intend to present the code of conduct on the South China Sea. Four members, Brunei Darussalam, Malaysia, the Philippines and Vietnam are claimants to pars of the sea which China considers its sovereign territory.

Later in afternoon, leaders will sign three documents: an agreement on movement of citizens; an amendment on economic cooperation between ASEAN and China and a protocol on trade, sanitary and phytosanitary issues, again part of Chinese cooperation.

After the signing ceremony, there will be a meeting with US President Barack Obama before a gala dinner hosted by Cambodian Prime Minister Hun Sen.

Southeast Asia to adopt human rights declaration

The Associated Press, Phnom Penh, Cambodia | World | Sun, November 18 2012, 1:18 PM

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Diplomats say Southeast Asian leaders have decided to launch a human rights declaration despite last-minute calls for a postponement by critics, including Washington, who say the pact contains loopholes that can allow atrocities to continue.

According to diplomats, the 10 leaders of the Association of Southeast Asian Nations, an unwieldy bloc of liberal democracies and authoritarian states, will sign a document adopting the ASEAN Human Rights Declaration on Sunday in the Cambodian capital of Phnom Penh, where the heads of state are holding an annual summit.

The nonbinding declaration calls for an end to torture, arbitrary arrests and other rights violations that have been longtime concerns in the region.

Myanmar's top diplomat, Wunna Maung Lwin, told The Associated Press that his country welcomes the declaration and will abide by it.

ASEAN leaders adopt lame-duck rights declaration

Novan Iman Santosa and Yohanna Ririhena, The Jakarta Post, Phnom Penh | Headlines | Mon, November 19 2012, 9:39 AM

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Pledging to promote and protect human rights along with democracy, rule of law and good governance, 10 ASEAN leaders adopted the first human rights declaration in the region amid criticism that it falls short of international principles.

“The adoption of the ASEAN Human Rights Declaration [AHRD] at the 21st ASEAN Summit will further
promote peace, security, reconciliation and the protection of human rights in the region,” Cambodian Prime Minister Hun Sen said at the Peace Palace in Phnom Penh, Cambodia on Sunday.

Preparing the declaration was one of the key mandates of the ASEAN Intergovernmental Commission on Human Rights (AICHR), which was established in 2009.

ASEAN Secretary–General Surin Pitsuwan declared that the association would pursue the highest standards expressed in various instruments and declarations by the international community.

Critics are especially concerned about the lack of transparency during the drafting process and various clauses that detract from fundamental human rights principles.

“I am concerned that those will detract from the credibility of the document and the ownership of the document by the people concerned,” said United Nations High Commissioner on Human Rights Navanethem Pillay as she voiced her concern over the lack of public consultancy during the process.

Over 60 human rights groups issued a joint statement urging ASEAN members to postpone the adoption.

NGOs have threatened to reject and condemn the declaration if ASEAN insists on proceeding with the adoption. Among the NGOs are very prominent organizations such as Human Rights Watch, Amnesty International and several from Indonesia, including the Commission for Missing Persons and Victims of Violence (Kontras).

“The AHRD is not worthy of its name. The declaration as it stands now unquestionably fails to meet existing international human rights standards, let alone add value to them,” the statement reads.

In Geneva, the largest body of independent experts in the UN human rights system, called on ASEAN to ensure that international human rights standards were maintained.

“It is imperative that, as a minimum, ASEAN’s landmark human rights instrument maintains international standards to complement the work of the UN human rights system,” said Michel Forst, who currently chairs the Coordination Committee set up by independent experts designated by the UN Human Rights Council to address specific country situations and thematic issues in all parts of the world.

In an open letter to ASEAN member states, the group stressed the need to reaffirm the duty of states to promote and protect all human rights and fundamental freedoms regardless of their particular political, economic and cultural systems — one of the key principles of the Vienna Declaration and Program of Action, adopted by 171 states in 1993 to forge a new vision for global action for human rights into the next century.

To improve the human rights situation, the independent experts also urged ASEAN to consult further with the people of the region, including civil society organizations, and to take on board their concerns and aspirations.

Aware of criticism from civil society groups, ASEAN diplomats acknowledged that the declaration was not perfect, but given the differences in the political systems of ASEAN member nations, a substantial step forward.

“It is not easy to unify 10 nations and reach a similar level of protection,” director general for ASEAN cooperation at the Indonesian Foreign Ministry, I Gusti Agung Wesaka Puja, said.

Indonesia’s Representative to the AICHR, Rafendi Djamin, argued that the declaration was more of a political declaration to move forward on the protection of human rights for the 600 million people in ASEAN.

Minister Marty, Ambalat should never be forgotten

Eddy Purwanto, Jakarta | Opinion | Mon, November 19 2012, 8:08 AM

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Indonesia has received a host of compliments from the US on its dominant role in the ASEAN region, especially after the shuttle diplomacy conducted by Foreign Minister Marty Natalegawa was successful in persuading the 10 members of ASEAN to approve the six principles on the South China Sea, including the implementation of the Code of Conduct (CoC) declaration to overcome conflict in the South China Sea zone without force.

Indonesia’s success at the regional level should not make the nation forget that bilaterally, Indonesia still has chronic territorial problems with neighboring countries, particularly Malaysia.

Indonesia badly needs speedy settlement of territorial issues to cover its scarcity of resources, notably depleting oil and gas reserves, followed by increasing oil/gas trade deficits.

One of the territories being disputed with Malaysia and which bears high potential for oil/gas exploitation is Ambalat in East Kalimantan.

Indonesia’s superiority in ASEAN should be coupled with the diplomatic courage to face neighboring countries in settling bilateral issues. While Indonesia enjoyed praise from the US, the government of the Philippines openly offered three oil/gas exploration contracts in the disputed South China Sea territory in Palawan Island’s offshore area.

Although two of the three exploration blocks were in dispute, Philippine Deputy Energy Minister Jose Layug claimed all of them were within the full sovereign territory of the Philippines.

Jose Layug was seemingly brushing aside the dispute with China as a potential stumbling block to the oil/gas contracts being proposed. The Philippines is known to have active disputes with China in some South China Sea locations like Reed Bank, Spratly and Beting Scarborough.

The Philippines’ “superior” stance is different from Indonesia’s “inferior” attitude. With the International Tribunal’s decision favoring Malaysia in the dispute over Sipadan and Ligitan Islands in 2002, Malaysia promptly strengthened its claim to part of the Ambalat Block by promising oil/gas reserves as its property.

In the face of Malaysia’s claim, often accompanied by military provocation, Indonesia has in fact carried out more “propagandist” strategies. One of the strategies is to present a more “symbols of state sovereignty” that are more permanent and active in disputed zones.

Many circles believe the defeat of Indonesia in the Sipadan-Ligitan case was due to a very “naïve” attitude toward the status quo, whereas Malaysia was quietly very active in mobilizing forces and resources so that the world and the International Tribunal saw Malaysia’s claim as more legitimate than Indonesia’s. As a result, Indonesia was seen as weak in the use of propagandistic sovereignty symbols in the disputed territories as concrete displays for the outside world.

One of Indonesia’s sovereignty symbols in disputed areas is the appearance of oil/gas block management through production sharing contracts (PSC).

This strategy was once implemented in Ambalat, but regrettably, Indonesia’s experience in Ambalat found it hard to expect foreign multinational companies to serve as “envoys of the national flag” by undertaking contracts in disputed zones.

The presence of foreign firms proved to be less effective in representing symbols of state sovereignty in border regions and disputed territories.

A major US oil company was trusted to be present in Ambalat through a PSC, but from the signing of its contract in 2004 to its “forced” termination, the company was reluctant to undertake oil prospecting operations in the East Ambalat Block based on the contract.

The contract committed the company to carry out seismic surveys and drill exploration wells until December 2010, but for over six years, it did not execute its contract obligations because it was thwarted by the bilateral dispute already underway before signing the contract.

The opportunistic approach of multinational companies is obviously unsupportive of Indonesia’s policy to raise symbols of state sovereignty in disputed zones, and creates the potential to make room for neighboring countries to assume a more favorable diplomatic position.

The presence of foreign firms in border regions has more often produced ironic results. One such case happened in Ambalat.

In 1999, a large multinational company from Holland was trusted to sign a PSC in Ambalat in hopes of being able to guard the Indonesian flag in the zone.

After selling the concession to an Italian company in 2001, ironically the Dutch giant company in 2005 again returned to the same block in Ambalat displaying the Malaysian flag, as if degrading Indonesia’s sovereignty in Ambalat.

Indonesia was indeed enraged at the time, with the Energy and Mineral Resources Ministry stating that the Dutch company had utilized Ambalat Block oil/gas data without the permission of the Indonesian government (March 2005).

The director general of international laws and agreements at the Foreign Ministry, also said Indonesia would take “tough” actions against whatever activities were executed in Indonesian waters. Fortunately, though, the Dutch multinational was helped by the “forgetful” nature of Indonesians and it later reentered, enjoying a warm welcome in the name of investment.

Multinational companies thus easily act as “jumping fleas” in disputed border areas. With data obtained from Indonesia, they come back to the same block by carrying a neighbor’s flag.

So is the original character of multinationals, which unsurprisingly makes the Malaysian government inclined to give prominence to its “state-owned company” in a conflict zone as a shield and symbol of Malaysian sovereignty.

Later, Ambalat became a disputed territory because it was believed to bear large oil/gas resources. Andang Bachtiar, director of Exploration Think Tank Indonesia (ETTI), once indicated Ambalat was estimated to have potential oil reserves of up to 1 billion barrels plus potential natural gas of around 12.5 trillion cubic feet.

Based on previous experience, it is very naïve for the government to leave oil/gas management in disputed territories fully to multinational companies, and it is wiser for the state to leave natural resources management to “national capacity”, in the form of assignments or normal business entities, serving simultaneously as envoys of the nation and symbols of Indonesian sovereignty in border regions, particularly in Ambalat.

Who can guarantee that multinationals firmly abide by contract commitments and acting also as envoys to fly the red-and-white in disputed zones? Who can guarantee that foreign companies will not become “jumping fleas” carrying national oil/gas secrets to rivals or neighboring countries?

Who can guarantee that multinationals have no conflict of interests as they generally own business chains with neighboring countries in other projects?

In border zones, Indonesia should field such “national capacity”, in the form of private companies and primarily state-owned enterprises (BUMN) really oriented to state interests, free from the influence of intervention by a group of economic rent and political rent seekers.

Partiality and intervention by the state has been proven to lead national capacity to grow, such as in Malaysia with Petronas, Brazil with Petrobras, China with Petrochina, Venezuela with PDVSA, and so forth.

Without the state taking sides and intervening, it is difficult to fly the colors of national corporations all over the world, which is also the case in Indonesia. Especially in border areas and disputed zones, it is proper for the government to offer various facilities and incentives to national companies, private firms as well as BUMN, from fiscal and tax incentives to adequate armed Marine escorts to guard them against Malaysian patrols.

As for the defense of its sovereignty and oil/gas resources in the South China Sea, the Philippines was able to adopt a superior stance in the face of a giant nation. Why should Indonesia in Ambalat be inferior and lack self-confidence in facing Malaysia?

A superior approach at the level of ASEAN by no means implies that Indonesia should become inferior at the bilateral level.

The writer is an expert staff member at BPMigas.

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Some thoughts on China-ASEAN relations

Yang Xiuping, Jakarta | Opinion | Mon, November 19 2012, 10:17 AM

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I feel very honored to be designated as China’s first permanent ambassador to ASEAN. Since I took office in August — and since the Chinese mission opened officially in September — I have called on the leaders of the ASEAN Secretariat and the permanent representatives to ASEAN, exchanged ideas and views with experts at think tanks and attended many meetings and symposiums on mutual cooperation in various areas.

My understanding of China and ASEAN’s relationship was deepened by these exchanges and involvements. While being quite encouraged by what we have achieved so far, I face a tougher task to bring our relationship to a higher level.

China and ASEAN opened a new chapter in their relations in 1991 with the establishment of a dialogue relationship. Over the past 21 years, China-ASEAN relations have taken a historic leap from the dialogue to forging a strategic partnership that shares extensive common interests.

The leaders of China and ASEAN’s member nations have visited each other like family members. On major international and regional issues, the two sides have maintained close communications and coordination and worked together to safeguard the interests of developing countries.

Committed to common development, China and ASEAN have made tremendous effort to strengthen economic cooperation. Two-way trade between China and ASEAN has surged from US$7 billion in 1991 to $362.8 billion last year, making for an average annual growth rate of over 20 percent. China has been ASEAN’s largest trading partner for three consecutive years and ASEAN became China’s third-largest trading partner last year. We are also major investment partners, with two-way investment growing steadily.

Cooperation between China and ASEAN is comprehensive, multi-tiered and wide-ranging, covering over 20 areas, including science and technology, culture, agriculture, education, poverty reduction, disaster prevention and relief, and combating transnational crimes.

The two sides have set up 12 ministerial meeting mechanisms and have established the China-ASEAN Expo, the China-ASEAN Business and Investment Summit, the ASEAN-China Center, the China-ASEAN Environmental Cooperation Center, the China-ASEAN Education Cooperation Week and other cooperative platforms.

All these figures and facts prove that China and ASEAN are good neighbors enjoying solidarity, friendship and mutual trust.

The friendship and mutually beneficial cooperation between China and ASEAN have not only brought about economic and social development in our own countries and delivered enormous benefits to our peoples, but also contributed significantly to steady economic development and stability in East Asia and Asia as a whole.

With economic globalization and regional integration developing in greater depth, the destinies of China and ASEAN have never been so closely linked as they are today. Now, as the international financial crisis is about to enter its fifth year, the current global economic and financial scene still gives us no reason for optimism.

East Asia, which has been the most dynamic region in the world because of its sustained and rapid economic growth and social stability for the last several years, is at a crucial stage of development.

As strategic partners, China and ASEAN need to size up the situation and work together to expand business and financial cooperation, promote connectivity, and deepen social, cultural and people-to-people exchanges so as to enhance self-generating dynamism for the sustained development of the region.

Against this backdrop, the importance of the upcoming 15th China-ASEAN Summit in Phnom Penh, Cambodia, cannot be overstated. It offers a good opportunity for both China and ASEAN to initiate new ideas in a trying time. The Chinese side is willing to explore with ASEAN member nations specific measures to deepen cooperation in the aforementioned fields. We hope that the summit can continue to raise the flag of solidarity, promote development and cooperation, and create more consensus on strengthening political trust and promoting economic and social cooperation in a full-fledged manner.

There has been a lot of focus on the South China Sea in recent months. Frankly, I think that this issue has been exaggerated at the expense of the positive side of China-ASEAN relations.

China’s position on the South China Sea issue has been clear-cut and consistent. The issue is not between China and ASEAN, but one between China and the claimants. China has all along stood for the resolution of disputes in a peaceful manner through friendly consultation between claimants based on respect for historical fact and universally recognized international law.

Since the establishment of dialogue relations, China and ASEAN member nations have overcome many difficulties and challenges hand in hand, from tackling the Asian financial crisis to addressing the impact of the international financial crisis to the Indian Ocean tsunami to responding to the SARS epidemic.

I am fully confident that our peoples and our leaders have the wisdom to properly address this issue. The relationship between China and ASEAN won’t be derailed because of the disputes in the South China Sea.

China welcomes a stronger ASEAN and supports ASEAN’s centrality in East Asian cooperation. I’m sure that so long as we keep our destiny firmly in our own hands, and move ahead in the direction that we have set for ourselves, China-ASEAN cooperation will enjoy a bright future of increasingly solid and extensive development.

The writer is China’s ambassador to ASEAN.

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China and the US: What this election could not decide

Tom Plate, Los Angeles | Opinion | Wed, November 07 2012, 11:23 AM

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America still has much to decide. Among major issues, the US presidential campaign did not — and without comprehensive national review could not — clear up the daunting question of China. The policy differences between the two parties and their candidates, exaggerated for effect, were miniscule in comparison to the questions China raises. The ultimate stakes for America are huge.

At some point a decision should be made on an overriding question that might roughly be put this way: If this planet is in fact big enough for not just one but two superpowers, can’t the US accept that a new Cold War is not inevitable? If so, what should be the optimal Sino-US relationship? What is in the national interest of each side and how large an area is the overlap of the two national interests?

But such calculations are hard to make when Beijing deviates from its “peaceful rising” policy and adopts what might be termed an it’s-our-way-or-the-highway’ attitude that tends to chill the living life out of people. Here’s what I mean:

Look back a bit in time: China awoke from its long sleep (or perhaps tossing-and-turning insomnia) during the reign of (1978-1992) Deng Xiaoping. Very few historians or economists quarrel with the claim that — totalitarian communist as it may still be — this government and its successors raised more millions out of poverty in a relatively short period of time than any other in modern recorded history. No sensible definition of overall human rights can exclude a measure of economic security and opportunity. This deserves respect and recognition: We are talking 1.4 billion mouths to feed, not a mere 315 million!

But let us look forward a bit: instead of applauding China, more and more neighbors are tending to rearm precisely because of China and are looking at Washington to take out a homeowner’s insurance policy for protection.

Many nations in Asia have had territorial disputes with Beijing, but in all cases Beijing says it is in the right and all their neighbors are wrong. But how can this be? How can everyone in Asia be wrong except China?

Consider the absolutely senseless quarrel with Tokyo over a pool of islands known as Diaoyu Dao, if you’re China or Taiwan, or as Senkaku, if you’re not.  Previous Chinese leaders wisely looked the other way and played down the disagreement, on the sensible ground that nothing should stand in the way of China’s economic development.

Japan was becoming both a huge market for China’s low-cost goods and an exporter of many of the quality products it required to develop.

That’s still the basic deal, but sometimes you get the sense of a kind of unwarranted hubris among China’s elite, now meeting to decide its country’s new leadership.

Take the recent newspaper op-ed in which a prominent and respected Chinese diplomat berated the Japanese for their claims on the islands in the scolding manner of a schoolmaster.

Worse yet, Liu Xiaoming, China’s Ambassador to the United Kingdom, actually likened Tokyo’s presumption to challenge Beijing’s Diaoyu claim to a brand of Nazi attitude. Harkening back to the aggression that lead to World War II in the Asia, he painted Japan as Asia’s potential Nazi Germany and cited a recent BBC broadcast Nazis: A Warning from History as a warning to us all to “be on guard to prevent the rise of military fascism”.

Liu was referring to Japan, of course, but Americans might be forgiven for wondering whether China’s own human rights history and current record is so impeccable as to qualify Beijing as moral judge of Japan. Any survey of human rights organizations will show them far less critical of Tokyo than they are of Beijing.

It is bizarre. The Chinese ambassador who indicts Japan for allegedly failing to face up to its wartime history of atrocities makes no mention of either China’s Cultural Revolution or the Tiananmen Square horror. Also flatly unmentioned by Liu was the recent United Nations criticism of China’s treatment of Tibetans.

Frustrated by Beijing’s stonewalling, Navi Pillay, the UN’s top human rights official, pointed to the rising cases of self-immolations by Tibetans protesting China’s rule as an indictor of mainland heavy-handedness.  Nothing the UN has said about Japan recently remotely compares to this blast.

Fair-minded Americans can only shake their head and wonder what has gotten into the Chinese.  Maybe their leadership-change process requires top officials to be as finger wagging about Japan as ours requires our own hypocritical politicians to lecture China. Or maybe Beijing is losing sight of what has made its governance credible: economic development.

For the good of China, that needs to continue, and lecturing others on human rights issues (of all things) should stop. And the territorial quarrels need to be hand led by skilled diplomats, not by threats and gunboats.

And, for the good of the United States, a grand reexamination of our relationship with China needs to begin soon.  It’s the most crucial issue of this past presidential campaign not seriously dealt with.


The writer, the distinguished scholar of Asian and Pacific Studies, is the author of Conversations with Ban Ki-moon, the latest in the Giants of Asia book series.

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