Forms of ASEAN Cooperation in the Economic Sector – Human nature as a social being is evidently not only manifested in relations between humans, but also between countries. ASEAN is one of the interstate cooperation that is taken into account because it increasingly shows its strategic position.
One form of cooperation is in the economic field. So, what are the forms of ASEAN cooperation in the economic field? Come on, see the explanation below!
A. The Establishment Process of ASEAN
Before we explain further about this economic cooperation, we need to know in more detail what ASEAN is and how its history was founded.
ASEAN is the abbreviation for Association of Southeast Asian Nations. Association of Southeast Asian Nations, according to the translation. ASEAN is an organization at the regional level which is a forum for cooperation for ten countries in the Southeast Asian region.
This organization was formed by five countries, namely, Thailand, the Philippines, Singapore, Malaysia, and Indonesia. ASEAN was officially established with the signing of the Bangkok Declaration on August 8, 1967.
As the name implies, the declaration was held in Bangkok, Thailand. At that time each country was represented by its Foreign Ministers. Indonesia was represented by Adam Malik, Thailand by Thanat Khoman, Narsisco Ramos represented the Philippines, S. Rajaratnam represented Singapore, and Malaysia was represented by Tun Abdul Razak.
As a representative from Indonesia, Adam Malik played an active role in designing, compiling, the establishment of the ASEAN organization on August 8, 1967 in Bangkok, Thailand. You can read the whole story in the book Series of Leaders of the Nations-Adam Malik Actors of the ASEAN Declaration.
The Bangkok Declaration is proof of the strong commitment of the five ASEAN founding countries to create a safe, peaceful, prosperous and stable region.
The discourse to form a forum for countries in Southeast Asia surfaced because during the 1960s the region was characterized by a situation prone to conflict.
The existence of territorial struggles to spread ideological influence carried out by major powers is one of them. Not to mention that the countries in the Southeast Asian region also have to face conflicts among themselves.
Conflicts like this, if allowed to continue, could threaten regional stability and hinder the course of development.
As the ASEAN organization grew, five other Southeast Asian countries gradually joined.
Brunei Darussalam joined on January 8, 1984, then Vietnam joined eleven years later, namely in 1995 on July 28 to be precise. Laos and Myanmar entered simultaneously two years later, namely on July 23, 1997. The joining of Cambodia on April 30, 1999 completed the ten ASEAN member countries.
B. ASEAN Cooperation Objectives
- Accelerate the pace of economic growth , cultural development and social progress through joint efforts in a spirit of friendship and equality to strengthen the foundations of a peaceful Southeast Asian society
- Strengthening relations of mutual assistance and active cooperation in overcoming problems in the corridor of common interest in various fields, such as science, engineering, administration, and especially economic and social
- Strengthening regional stability and peace by mutually respecting law and order and justice in relations between countries in the Southeast Asian region, as well as adhering to the principles in the UN Charter
- Mutual assistance between countries in providing a wide range of research advice and training in the professional, technical, educational and administrative sectors
- Increase the effectiveness of cooperation to strengthen the use of industry and agriculture between countries, expand trade and carry out studies on international commodities, improve communication and transportation facilities, and elevate people’s living standards
- Succeeding the process of studying the Southeast Asian region
- Build and maintain strong and fruitful cooperation with various organizations—both at the regional and international levels—that share the same vision and goals, and maintain all possibilities for building close relations between ASEAN countries.
C. Encouragement of Cooperation Between ASEAN Countries
Establishing cooperation between countries is not easy, there are many things that need attention. Likewise with countries in Southeast Asia.
The cooperation they build in ASEAN must have a solid foundation. There are at least two main factors driving cooperation between ASEAN countries. These two factors are:
1. There are several similarities and differences in natural resources
Even though they are in the same region, in reality ASEAN countries do not have uniformity in natural resources.
For example, Singapore and Indonesia. The short distance between the two countries does not mean that Singapore has as much mining wealth as Indonesia. However, on the other hand, Indonesia is still behind in port management arrangements compared to Singapore.
Thus both ultimately benefit equally. The process of exporting Indonesian mining products must pass through the port of Singapore. This is because the Lion City is located in a strategic position on world trade routes, which connect the Southeast Asian region with countries on the European continent.
In addition to the natural resources contained in the bowels of the earth, food resources can also be a reason for encouraging cooperation between countries in one region. In the case of ASEAN, the existence of different food resources in its member countries makes them work together.
For example, Indonesia sells its agricultural products to Singapore. However, at the same time, our country also buys rice from Thailand as well as Myanmar to meet domestic consumption needs.
2. There are similarities and differences in geographical conditions
As the name suggests, the Southeast Asian region is a number of countries located in the southeastern Asian continent. Geographically, these countries are surrounded by two continents, namely the continent of Asia and the continent of Australia, and two oceans, namely the Indian Ocean and the Pacific Ocean.
It is because of the similarity in geographical location that a number of countries in one region usually develop cooperative relations. This aims to maintain the security and stability of the region in general and the country itself in particular. ASEAN is one example of cooperation because of its geographical similarities.
D. Results of ASEAN Cooperation
1. The results of ASEAN cooperation in the form of infrastructure:
ASEAN succeeded in establishing several factories for the common good. These factories and their locations are:
- ASEAN fertilizer factory established in Indonesia
- The urea-ammonia fertilizer plant is located in Malaysia
- ASEAN copper factory built in the Philippines
- Soda ash factory established in Thailand
- Hepatitis B vaccine factory in Singapore
Apart from being in the form of factories, ASEAN countries are also working together to build infrastructure in the education sector, namely in the form of campuses. Currently, ASEAN University has stood firmly in North Sumatra Province, in Pematangsiantar City to be precise.
2. Results of ASEAN cooperation with developed countries outside ASEAN:
To add benefits to its member countries, ASEAN is also exploring cooperation with other developed countries. Japan is the target of this cooperation. In Tokyo City, the capital city of Sakura Country, ASEAN has succeeded in establishing a promotion site for tourism, investment and trade of its member countries.
3. Results of ASEAN cooperation in the security sector:
Settlement of territorial disputes in the South China Sea is one form of cooperation between ASEAN countries in the security sector. Apart from that, ASEAN has also succeeded in forming a Zone of Peace, Freedom and Neutrality, abbreviated as ZOPFAN, which means Free and Neutral Zone. ZOPFAN was formed to protect the sovereignty of ASEAN member countries.
E. ASEAN Economic Community
The ASEAN Economic Community or commonly abbreviated as MEA, is referred to in international languages as the ASEAN Economic Community (AEC). MEA was formed with the aim of realizing economic integration in the ASEAN region.
This economic integration includes a safe Southeast Asian region with a higher level of integrated development dynamics, reduces the poverty rate of the ASEAN people, and strives for economic growth to obtain sustainable and equitable prosperity.
The book entitled Towards the 2015 ASEAN Economic Community is here to provide information about the 2015 AEC and the various opportunities and challenges behind it.
To realize this, the AEC has four main characteristics, namely a production base and a single market, an economic region that has high competitiveness, an area with equitable economic development, and a regional area that is fully integrated with the world economy.
1 Pillars of the ASEAN Community
In MEA there are several pillars of the economic community that support it. These pillars are a form of cooperative relations to deepen and expand economic integration, both within the ASEAN region and with countries outside the ASEAN region.
The Four Pillars of the ASEAN Community consist of:
a. Pillar 1 is the Single Market and Production Platform
This pillar contains the free flow of goods and services, the free flow of skilled labour, the free flow of capital, as well as the priority integration sectors, agriculture, food and forestry
b. Pillar 2 is a Competitive Economic Area
The second pillar of AEC contains consumer protection, intellectual property rights, taxation and electronic commerce ( e-commerce ), competition policy, and infrastructure development.
c. Pillar 3 is Equitable Economic Development
This third pillar contains emerging initiatives for ASEAN integration and SME development
d. Pillar 4 is Integration with the Global Economy
The last pillar of the AEC contains an integrated approach towards external economic relations and broader participation in supply chains at the global level.
The four pillars are contained in the blueprint document approved at the 38th ASEAN Economic Minister Meeting (AEM). The meeting was held in Kuala Lumpur, Malaysia in August 2006.
F. Benefits of ASEAN Cooperation for Indonesia
Every ASEAN member will always benefit from the results of cooperation between members as well as Indonesia. Then, what benefits will Indonesia experience after carrying out ASEAN cooperation?
1. Can Increase Togetherness Among ASEAN Communities
The first benefit felt by Indonesia, especially its people, after carrying out ASEAN cooperation is that it can increase or foster togetherness among ASEAN peoples. With this togetherness, every ASEAN community will try to maintain peace with each other.
2. Increasing the sense of security and peace
ASEAN cooperation is beneficial for Indonesia, especially in increasing the sense of security and peace within the country and fellow ASEAN members. This sense of security and peace can make ASEAN cooperation even closer, so that economic growth and trade between members can run optimally.
3. Can Realize Helping Fellow ASEAN Members
By cooperating with ASEAN, Indonesia can participate in helping ASEAN members who are experiencing difficulties. By doing so, Indonesia can also get help from other ASEAN members in times of trouble.
4. Can Fight for National Interests
Every country must have national interests as well as Indonesia. This national interest must be realized immediately so that a country can continue to develop and the people can live more prosperously. In ASEAN cooperation, Indonesia can fight for national interests, so that they can be realized more quickly and precisely.
G. ASEAN Cooperation Principles
Every ASEAN member in carrying out cooperation has principles that must be upheld. The following are the principles of ASEAN cooperation.
- Each ASEAN member is not allowed to interfere in the internal affairs of other ASEAN members.
- Every ASEAN cooperation must be realized in a useful, effective, efficient and rational manner.
- Mutual respect for the sovereignty, equality, independence and integrity of each member country.
- If there are problems between members, they must be resolved without using weapons that can cause conflict and war.
H. Examples and Forms of ASEAN Cooperation in the Economic Sector
1. ASEAN Cooperation in the Industrial Sector Through the ASEAN Industrial Cooperation (AICO)
The collaboration carried out through AICO is realized by building a number of industrial centers in several countries—as mentioned above—, namely:
- The ASEAN Vaccine Project , a factory that produces this vaccine, stands in Singapore
- ASEAN Urea Project , this urea fertilizer factory has been built in Malaysia
- The ASEAN Aceh Fertilizer Project , as the name suggests, is a fertilizer industry center in Aceh, Indonesia
- ASEAN Copper Fabrication Project , namely a copper industrial factory that stands in the Philippines
- Rock Salt Soda Ash Project , is a factory that produces soda ash, based in Thailand.
2. ASEAN Cooperation in the Food Reserves Sector
ASEAN has two main rice storages, namely Vietnam and Thailand. The two countries also continue to be committed to becoming providers of food reserves for their neighboring countries, other ASEAN members.
Apart from the two rice granaries, other countries, such as Singapore, Malaysia, the Philippines and Indonesia also have commitments to provide food reserves in emergency situations.
3. ASEAN Cooperation Through the Free Trade Area, ASEAN Free Trade Area (AFTA)
The ASEAN Free Trade Area or ASEAN Free Trade Area (AFTA) is a form of cooperation that functions to assist producers from the production sector at the local level to obtain special facilities.
For example, they are entitled to a Common Effective Preferential Tariff of only 5%-10% per product. This provision applies to both imported and exported products.
AFTA plays an important role in the trade process between ASEAN member countries. With this cooperation, a number of trade obstacles can be overcome.
In turn, indirectly this cooperation can also help improve the competitiveness of locally made products from member countries in the ASEAN market.
ASEAN cooperation in the field of trade does not only apply to products in the form of commodities or goods. Service products are also applied, with quite varied variants. For example, service products in the form of telecommunications and transportation, finance, and tourism, all of which can be accommodated by AFTA.
4. ASEAN Cooperation in the Tourism Economy
It is very likely that this sector will become a top priority for our country. It cannot be denied that this tourism sector is the biggest economic supporter, not only for Indonesia but also for the average ASEAN member country. In addition, this sector is also a strategic area to open employment because it is able to absorb a large number of workers.
ASEAN cooperation carried out in the tourism economic sector can be a bridge to promote and preserve the local culture of each ASEAN member country.
This is important, considering that both domestic and foreign tourists are very interested in this local culture. That’s why culture is one that continues to be developed and becomes an attraction in this tourism sector.
The strategic plan to prioritize culture in the tourism sector for ASEAN countries has actually started to be implemented in 2016 and will be evaluated in 2025.
Not only limited to introducing, but this program also makes efforts to deepen the mindset and connect intercultural dialogue from each ASEAN member.
Apart from tourism, sports competitions between countries are also able to attract tourists. Therefore cooperation in this sector is not only attention-grabbing, but also strategic.
One of the most popular sporting events is the SEA Games or Southeast Asian Games, which are biennial sports competitions among ASEAN member countries.
5. Establishment of the ASEAN Promotion Center
Even though it is quite well-known on the international stage, the existence of ASEAN must still be promoted. Some strategic sectors to be used as promotional materials are tourism, trade and investment.
The ASEAN Promotion Center has now opened in Japan. The hope is that this rapidly developing country can increase exports of ASEAN member countries to its own country. In addition, the promotion in Japan is also intended to attract investors from Japan to ASEAN countries.
This is a review of ASEAN and ASEAN cooperation in the economic field that we need to know. For Indonesia itself, there are many benefits to be gained by joining and being active in ASEAN. Not only the economy, the benefits of cooperation for Indonesia also cover the social, cultural, political and security sectors. We can enjoy all of this together as citizens and the people of ASEAN.
In order to better understand this form of cooperation within the ASEAN organization, the book Business Contracts in ASEAN by Sophar Maru Hutagalung can help Sinaumed’s in business & economics.
I. Forms of ASEAN Cooperation in the Political Sector
Not only in the economic field, ASEAN cooperation is also carried out in the political field, namely:
1. Sending Ambassadors from Consulates Representing a Country
The first ASEAN cooperation in the political field is sending ambassadors from consulates representing ASEAN countries. The sending of these ambassadors can facilitate ASEAN members in conducting international relations. In addition, the function of sending this consular ambassador is to maintain communication between ASEAN members and play a role in maintaining ASEAN political stability.
2. Establish a Nuclear Free Treaty
The existence of this free from nuclear agreement indicates that the use of nuclear weapons is strictly prohibited. Not only that, this agreement also prohibits ASEAN members from making or designing nuclear weapons.
3. There is a Peace, Neutral and Free Agreement
Every ASEAN member is definitely eager for peace, neutrality and freedom, so that a form of ASEAN cooperation emerges in the political field, namely peace, neutral and free agreements. So, each ASEAN member must mutually protect the area that has been agreed upon and may not violate it. In fact, it is not permissible to intervene in other ASEAN members.
4. There is an Extradition Agreement between ASEAN Members
Each ASEAN member also cooperates in hunting down crime suspects who have fled to other ASEAN countries. With this agreement, fugitive criminals will be more easily arrested and economic stability will be well maintained.
J. ASEAN Cooperation in the Field of Education
Below will be explained further about ASEAN cooperation in the field of education.
1. Student Exchange
The first ASEAN collaboration is a student exchange which makes students enthusiastic in carrying out learning activities. This student exchange is usually carried out within the ASEAN University Network. The duration of the student exchange varies depending on the agreement of the educational institutions of the ASEAN members. For example, student exchanges can be done in 1 semester and some are done in just 3 months.
2. There are educational scholarships
Almost everyone would be happy to get a scholarship. ASEAN cooperation in the next field of education is the existence of educational scholarships. ASEAN students will be able to study abroad, so their knowledge will increase.
Not only within ASEAN, but from outside ASEAN countries also provide scholarships for students from developing countries.
3. Meeting of the Ministers of Education of Each ASEAN Member
The organization has a goal of improving the quality of education in Southeast Asia. In addition, it also functions as educational equality for every Southeast Asian community.
4. Education Olympiad
In this case, ASEAN students can participate in the educational Olympiad, so that the level of education in Southeast Asia can continue to increase. With ASEAN cooperation in the form of educational Olympiads, ASEAN students do not rule out the possibility of participating in Olympiads at a higher level.
K. Asean Cooperation in the Social Sector
Each ASEAN member also cooperates in the social field with the aim of increasing the welfare of the people of Southeast Asia. The form of ASEAN cooperation in the social field is as follows
1. ASEAN Ministerial Meeting on Rural Development and Poverty Eradication (AMMRDPE)
In the form of ASEAN cooperation, AMMRDPE is a ministerial level meeting between ASEAN members discussing rural development and poverty alleviation.
2. ASEAN Ministers Meeting on Social Welfare and Development (AMMSDW)
ASEAN cooperation in the social field prioritizes social welfare, one form of cooperation is the ASEAN Ministers Meeting on Social Welfare and Development (AMMSDW). This meeting is a ministerial level meeting.
3. ASEAN Conference on Civil Service Matters (ACCSM)
The economic field will always be related to employees, so that for the welfare of existing employees within ASEAN, the ACCSM conference was formed.
4. ASEAN Agreement on Disaster Management and Emergency Response (AADMER)
Natural disasters are difficult to predict, so prevention is needed. In addition, after a natural disaster occurs, assistance is also needed so that people can return to their normal activities. ASEAN cooperation in the social sector is called the ASEAN Agreement on Disaster Management and Emergency Response (AADMER). With this cooperation, each ASEAN member can help each other, especially when natural disasters occur.
5. ASEAN GO-NGO Forum for Social Welfare and Development
With this form of cooperation, the welfare of ASEAN members can continue to be improved. Not only that, this form of ASEAN cooperation also discusses development.
L. ASEAN Cooperation in the Field of Culture
ASEAN members also cooperate in the field of culture. The following is an example of ASEAN cooperation in the field of culture.
1. The existence of the ASEAN Cultural Week (ASEAN Cultural Week)
With the ASEAN cultural week, there will be a lot of ASEAN people who know the culture of each ASEAN country. This activity is usually carried out alternately by ASEAN members and is usually carried out in a few days or weeks.
2. ASEAN Performing Arts (ASEAN Best Performing Arts)
In this ASEAN art show, we will see various kinds of arts owned by each ASEAN member. Thanks to this activity, it can be said that art from ASEAN members is being promoted to the world community.
3. ASEAN Cultural Show (ASEAN Cultural Show and Exhibition)
As the name suggests, in this event there will be a lot of ASEAN culture that will be exhibited to be introduced to the world community.
4. ASEAN International Film and Festival Awards (ASEAN International Film Festival and Award)
ASEAN also has awards for films, so that films from ASEAN members can be recognized by other ASEAN people. Thanks to this festival, filmmaking in ASEAN countries can continue to progress.
Recommendations for Economic Books and Articles
For those of you who are studying economics, here are some recommendations for studying economics that you can have:
1. Globalization, Constitutional Economics, and the Economics Nobel
2. Monetary Economy: Case Study of Indonesia
3. Indonesian Economic Politics