Before and After the Crisis
Chapter 11: Prospects for ASEAN economic cooperation
If one has to assess the performance of ASEAN as a political and economic grouping since its formation in 1967, two remarkable political achievements can be noted: first, ASEAN has promoted peace and stability in the region; second, it has strengthened ASEAN’s bargaining position and influence in international negotiations. But ASEAN’s efforts at trade liberalization, as indicated by the level of intra-ASEAN trade, and industrial cooperation have met only with limited success due to a number of factors, as explained in previous chapters. The 1992 agreement at the Fourth ASEAN Summit in Singapore to form a free trade area among the ASEAN countries by the year 2008 (the target date was later moved forward to the year 2002) represents a milestone as well as a greatest challenge in the entire history of ASEAN economic cooperation. At the Fifth ASEAN Summit in December 1995, ASEAN took another important step forward. The focus was to look for an enhanced model of economic integration with the aim of bringing ASEAN towards a more closely integrated, dynamic and prosperous enlarged family beyond the year 2002 after AFTA is realized. A bold regional arrangement for investment was agreed in the form of an ASEAN Investment Area (AIA) to enhance the attractiveness and competitiveness of the region. At the inaugural meeting of the AIA Council in October 1998 in Manila, the ASEAN member states signed the Framework Agreement on the ASEAN Investment Area. This chapter discusses the prospect for greater ASEAN economic cooperation and the challenges...
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