As the 2020 marks the year of realization of the ASEAN ICT Master-Plan and the middle point of ASEAN’s journey between the ASEAN Community to 2015 and to 2025, in which the digital competitiveness is given special significance, an interim assessment of what the “brave digital world” means for the association is a timely and relevant exercise.
Asean in the Pre-Digital Era: What Was and Was Not Achieved
Declaring that in the realization of ASEAN’s prospective plans to increase its digital competitiveness the previously developed foundation is an important prerequisite, the ups and downs of ASEAN’s digital journey will be assessed from this starting point.
Regarding ASEAN’s real achievements, the establishment of the ASEAN Community is of special significance. The importance of the ASEAN Economic Community (AEC) as part of the ASEAN Community project hardly stems from the advantages of the AEC itself as much work remains to be done even to make Southeast Asia a single market and a single production base as just one of the components of AEC to 2015, not to say about realizing the more ambitious goals of AEC to 2025. A more important factor is the weakness of other Asia-Pacific multilateral dialogue formats and initiatives, be it APEC, CPTPP or even the ASEAN-led prospective RCEP. As long as their prospects remain unclear, the AEC will remain the only de-facto existing multilateral initiative with relatively clear rules of cooperation.
No less significant ASEAN’s asset is its political-security brainchild with positive economic aftereffects. Having developed the cooperative security system in the Asia-Pacific region – exemplified by the ASEAN Regional Forum, the ASEAN Defence Ministers Meeting Plus Eight and the East Asia Summit, – the Association has strengthened its credentials as a respectful Asia-Pacific actor. This allows the association to maintain a relatively peaceful international milieu in Southeast Asia contributing to its economic and investment competitiveness.
Lastly but perhaps most importantly, the history of ASEAN amply demonstrates how an international actor can benefit from the virtues of the evolutionary regional order by fostering international cooperation premised upon inclusivity and neutrality. The most important competitive advantage of ASEAN is its ability to bring to the Asia-Pacific region the inclusive and neutral mode of cooperation. The latter is an important strategic asset that is behind the present relative insulation of the Asia-Pacific region from the unfolding “global entropy”, which to a considerable extent has been made possible by the ASEAN-led institutions.
While the afore-discussed ASEAN’s advantages are indisputable, its points of its vulnerability are no less serious.
Arguably, the most potentially dangerous threat is ASEAN’s inability to create safety mechanisms against the negative aftereffects of globalization. The flows of capital are hampered by international sanctions, the free movement of people is accompanied by illegal migration, the information flows go hand-in-hand with the spread of fake news. In its turn, ASEAN lacks both institutional mechanisms for collective action and the capacities of its member states to manage these challenges.
With ASEAN’s pronounced intention to strengthen its influence on the global development, the global processes demonstrate the same characteristics the association has been trying to eliminate in the Asia-Pacific region since the ASEAN-led cooperative security system was established. In the global realm, long-term and mutually beneficial projects are regularly sacrificed for the sake of short-term minor political profit – suffice it to mention implications of the anti-Russian sanctions for Russia’s partners. From the ASEAN perspective, examples of the damage the anti-Russian sanctions inflict on the states of Southeast Asia are numerous40. On the whole, the ASEAN leaders disapprove of the present sanction-countersanction vicious circle exemplified mostly by China-US trade contradictions
The association is beset with the simultaneous rise of traditional and non-traditional security challenges in global politics. Their Asia-Pacific aftereffects are exemplified, among other developments, by systemic escalations of North Korea’s nuclear and missile issue and the rise of ISIS threat in Southeast Asia. As long as the former is unresolved, for ASEAN the establishment of the Nuclear Weapons Free Zone in Southeast Asia remains a remote possibility. Regarding the latter, the ISIS is expanding its activity from the Middle East to other regions, among which Southeast Asia with its large Muslim population, deep-rooted separatist sentiments and indigenous groups linking separatism and terrorism, is a perfect destination. The Russian top military officials, including the Minister of Defense of the Russian Federation, assess the threat of terrorism in Southeast Asia as both real and growing41.
In this complicated context, the association aims to increase its influence upon the global development. The globalizing problems of the Southeast Asian territorial domain requires global solutions. At the same time, ASEAN’s attempts to explore the potential of intra-ASEAN cooperation, be it ASEAN Free Trade Area (AFTA), ASEAN Investment Area (AIA) and other multilateral initiatives, have reached the maturity level and demonstrated limited efficiency in developing cooperation with ASEAN’s extra-regional partners. Among the latter, China’s example is worthy of note. After the establishment of the China-ASEAN Free Trade Area (CAFTA) the association encountered a growing trade deficit (strongly magnified by China’s mega-strategy the Belt and Road Initiative). Responding to this trend, the association has to incentivize its other extra-regional partners to increase trade and investment exchanges.
Contrary to ASEAN’s expectations, however, the response of these partners has come in the form of a politicized project rather than a headlong rush to invest in Southeast Asia. The revitalization of the Indo-Pacific region with a clear anti-Chinese agenda may well marginalize the ASEAN-led venues of multilateral dialogue.
The challenges presented by the afore-discussed developments raise a logical question: to what extent has ASEAN developed the safety mechanisms of its policy which will assist the association in its journey to the “brave digital world”? Stating that the foundation is shaky at best, it is expedient to specify what this emerging reality means for the association.
Asean and the Digital Winds of Change
Outlining the influence of the presently evolving digitalization on ASEAN and its member states, the following points deserve distinguishing.
First, the global economy faces a kind of “productivity paradox”, as the exponential increase in technological development is not accompanied by the commensurate rise of productivity. Technologically advanced solutions, like gaming, interactive advertising, on-line shopping etc., focus on consumption and entertainment rather than production. For the ASEAN states, this scenario leads to a serious crisis of values as it undermines the East Asian work ethics as a pivotal prerequisite for new economic success stories.
Second, the Fourth Industrial Revolution incentivizes the association to seriously revise its formats and initiatives of economic regionalism. The present regulatory frameworks of multilateral trade, be it the General Agreement on Tariffs and Trade (GATT), the General Agreement on Trade in Services (GATS) or the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS Agreement) were developed before the present digitalization of international trade. Accordingly, these frameworks do not grasp the present essence of digital products and services. This incentivizes the association to perform a double-edged task – to digitally support its multilateral economic initiatives and to upgrade their regulatory formats, both under serious time constraints.
