Asean Could Learn From EU: Analysts

By webadmin on 07:18 pm May 31, 2012
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Bhimanto Suwastoyo

The 10-member Association of Southeast Asian Nations could learn from the European Union in its drive toward a single market, an academic and an official said on Tuesday.

Speaking in a panel discussion at the GlobaAsia Business Summit, Wijayanto, a vice rector of the Paramadina University, said Asean could learn much from the experience of the European Union in forging an integrated economy for the region.

However, Julian Wilson, the EU Ambassador to Indonesia, said that for him, Asean would be better off learning “more from the mistakes rather that the beneficial ones.”

He said Asean was much less homogenous than Europe, and that it was also imperative that all countries realized there would need to be a political commitment to actually move forward. And that, he said, meant there would be a need for sacrifices by each participating country for the greater good.

Wilson also said experience has shown that some integration, in terms of product standardization and acceptance, had already taken place in some sectors, citing cosmetic products.

The same model, he said, should be used in promoting integration in other sectors. “Start small, take time,” he said.

Wilson added that successes in specific sectors could be more easily used as a example of the benefit of the an integrated market.

Shubham Chaudhuri, a World Bank economist, said that Asean’s entry into an integrated market had to be incremental.

“The lesson from the European Union that I would draw for Asean is the tremendous push from the domestic sector, including private business, for market integration,” he said.

As Asean comes nearer to its 2015 deadline for economic integration, there is still much that can be done to increase transnational trade within the group, the economist said on Tuesday.

Chaudhuri, said growth projections were slowing down for most regions in the world, even in China.

Export growth is also declining, particularly to the economies that make up the Organization for Economic Cooperation and Development, a main destination for Asean exports. “Exports have been a critical driver of growth for Asean, compared to what you see in other regions,” he said.

Chaudhuri added that intra-regional trade and investment could provide an alternative route to growth, but that had not been the case so far. “As Asean economies grow, they are actually exporting less within the region,” he said.

Still, while some progress has been made, there is more to be done in terms of unifying the region’s economies, he said.

Chaudhuri said the case for economic integration had to be rooted in the aims of creating better jobs and enhancing competitiveness. And that, he said, was a domestic issue the government should address.

Chaudhuri also said the member nations of Asean should address the problems within their borders that hindered economic integration.

He cited disparity in education, welfare, legal systems, infrastructure and connectivity as the main areas, the latter especially important for Indonesia, which is composed of thousands of islands spread over thousands of kilometers.