WAT Topic for MBA: Is ASEAN a defunct Group

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WAT Topic for MBA: Is ASEAN a defunct Group

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The Association of Southeast Asian Nations, or ASEAN, was established on 8th August 1967 in Bangkok, Thailand, with the signing of the ASEAN Declaration (Bangkok Declaration). Signatories to ASEAN were Indonesia, Malaysia, Philippines, Singapore and Thailand. Brunei Darussalam then joined on 7 January 1984, Viet Nam on 28 July 1995, Lao PDR and Myanmar on 23 July 1997, and Cambodia on 30 April 1999, making up what is today the ten Member States of ASEAN.


Key points to remember


Noble goals

The fanfare with which ASEAN began its journey, it appears the group is unable to sustain. The noble objectives were adopted for achievement by the ASEAN. Acceleration of the economic growth, social progress and cultural development in the region through joint endeavours in the spirit of equality and partnership in order to strengthen the foundation for a prosperous and peaceful community of Southeast Asian Nations were the targets.


ASEAN also aimed to promote regional peace and stability through abiding respect for justice and the rule of law in the relationship among countries of the region and adherence to the principles of the United Nations Charter. Besides promoting active collaboration and mutual assistance on matters of common interest in the economic, social, cultural, technical, scientific and administrative fields was also an important objective.


Obstacles and achievements
The aim to provide assistance to each other in the form of training and research facilities in the educational, professional, technical and administrative spheres has not been able to penetrate much. The wish to promote Southeast Asian studies; maintain close and beneficial cooperation with existing international and regional organisations and explore all avenues for even closer cooperation among themselves has not been properly implemented due to one or other reason.  


In order to achieve the goals the group required more effective collaboration for the greater utilisation of their agriculture and industries, the expansion of their trade, including the study of the problems of international commodity trade, the improvement of their transportation and communications facilities and the raising of the living standards of their peoples. However, nothing fruitful could be delivered by the group.


Non-ASEAN countries have criticised ASEAN for being too soft in its approach to promoting human rights and democracy in the junta-led Burma Despite global outrage at the military crack-down on peaceful protesters in Yangon, ASEAN has refused to suspend Burma as a member and also rejects proposals for economic sanctions. This has caused concern as the European Union, a potential trade partner, has refused to conduct free trade negotiations at a regional level for these political reasons. International observers view it as a "talk shop", which implies that the organisation is "big on words but small on action".


In 2009, realized Foreign Direct Investment (FDI) of ASEAN was $37.9 billion and increased by two-fold in 2010 to $75.8 billion. 22 percent of FDI came from the European Union, followed by ASEAN countries themselves by 16 percent and then followed by Japan and US. European Union and USA has debt problems, while Japan has been making tsunami recovery. China who helped Asia lead the global post-2008 recovery still grapples with 3-years high inflation. So, in the long term all of the problems will give negative impact to ASEAN indirectly. There is little possibility to push even few programs by ASEAN Economic Community.


Any group formed to extend all round cooperation among its members cannot function well in absence of sufficient funds availability. ASEAN does not have the financial resources to extend substantial grants or loans to the new members.


Therefore, it usually leaves the financing of these infrastructure projects to international financial institutions and to developed countries Intra-ASEAN trade is still low as the members have been mainly exporting to countries outside the region, except Laos and Myanmar with 80 percent and 50 percent respectively of their exports went to other ASEAN countries. 


ASEAN way serves as the major stumbling-block to it becoming a true diplomacy mechanism. Due to the consensus-based approach every member has a veto, so contentious issues remain unresolved until agreements can be reached. Moreover, it is claimed that member nations are directly and indirectly advocating that ASEAN be more flexible and allow discourse on internal affairs of member countries. The preference for informal discussions to adversarial negotiations limits the leverage of diplomatic solutions within ASEAN.



Although ASEAN has not been able to carve the niche on the wall so far, it might do better if the member countries make the concerted efforts otherwise it will be nothing more than a defunct group.