25 July, 2015
As appeared in TheStar.com.my

EUROPE has been glued to the Grexit television screen for the longest time. Going on and on for at least five years, each episode of whether Greece will remain in the eurozone or not has run longer than the longest Tamil movie of yore (although we have our own MIC version, with 1MDB trying to play catch-up).

What are the lessons for Asean of the EU’s Greek tragedy?

No doubt the first thing that will trip out is: Thank God we do not have a common currency. However, this is only the tip of the iceberg. Beneath the surface there are deep issues involved, so many currents, cross-currents and counter-currents in the management of regional integration.

I will highlight three of the more profound: fiscal discipline; national sovereignty; and community negotiation process.

Fiscal discipline is actually easy to define, but so difficult to uphold when the freewheeling genie has been out of the bottle for so long with no inclination of coming back in. Under the EU’s Stability Growth Pact government deficit has to be not more than 3% of GDP and debt 60%, something characterised more in the violation than the adherence. Nothing has been done about this for years.

In the case of Greece over the last five years they were supposed to be brought down, but the numbers for the fiscal deficit went up again and the country is up to its ears in debt, coming to 200% of GDP after averaging an already unsustainable 177%.

The other side of the austerity equation is unemployment which has hit 25.6%. (Unemployment in Indonesia as a result of the 1997-98 Asian Financial Crisis was 30%; lowest European unemployment is in Germany at 4.7%).

Youth unemployment in Greece stands at 60%. The Greek economy has shrunk by 25% since the first IMF aid package in 2010. The government and people are saying they cannot take any more, but the creditors – on whom the Greeks are dependent for more bailout and interest servicing packages like an opiate – are saying not enough has been done in a sustained fashion to bring debt and the deficit down.

The Greeks have been used to many things which the creditors now insist on taking away from them. You cannot live beyond your means forever. The chicken is coming home to roost.

From the seven main points of the agreement reached on the night of July 13 for a new bailout package of 86 billion euros, it is clear Greece is now being pushed right against the wall – including what many in the country declare to be violation of its sovereignty.

Cutting pensions

While certain requirements such as cutting pension spending and increasing revenue, through seamless imposition of the top VAT rate of 23% for instance, might be considered par for the course in these bailout situations, the insistence on the transfer of up to 50 billion euros of “valuable Greek assets” to a new independently managed fund, as a form of collateral, was felt by Greeks to be rubbing their noses in the dirt.

Sovereignty, what sovereignty? If Greece wants to remain in the euro and needs all the bailout money, including money to service existing bailout funds, has the country got any alternative?

The Greek prime minister may quote Paul Krugman on the pain and damage all the austerity requirements are causing the economy, or even appeal to a European sense of history by comparing them to the punitive terms of the Peace of Versailles in 1919 (which historians assert were the root cause of the Second World War as Germany struck back to wipe off the shame), but has he got any other option?

If you need the money, what can you do? South-East Asians may remember that picture in 1998 of the then IMF managing director Michel Camdessus standing over the cowed former Indonesian President Suharto, as he signed away Indonesian macroeconomic sovereignty. From profligacy, it might be said, to loss of an important part of national sovereignty.

In the negotiation of the new Greek bailout deal this month – which still may undergo many twists and turns – a feature has been the predominance of Germany in the EU and in the eurozone (comprising 19 of the 28 members of the EU). It is after all the largest creditor nation and economy. If pretence was set aside, it is also the most powerful country in Europe (which arrangements at the end of the Second World War were intended to avoid – but that is a different story).

Every member country has a veto of course, but in negotiating the outline and details of the rescue package for Greece, Germany has led the way all this while and its commitment is indispensable, however much the French try to give the impression of having an eminent role as well.

So, how do we look at it all from an Asean perspective? The first instinct – thank God we do not have a single currency – is of course to be expected. But the thinking on what has been happening in Europe and on how relevant it is to Asean should not end there.

We do have big states and small states. We may say our negotiating and decision-making processes are different – and national sovereignty is untouchable. But this is too pat and shallow. The process of community-building is moving ahead. The voice of bigger countries does carry greater weight. However if it is in the service of what is good for the larger whole, there is not much to be afraid of.

The changeable predispositions of member states, however, have to be managed. Indeed, what a significant member state DOES NOT DO also affects Asean – as is the case now with the growing uncomfortable feeling that Indonesia under President Jokowi is not so enamoured of the regional grouping.

Indonesia therefore is critical to Asean. What and how it thinks, what happens in that country, have Asean impact. Thus engagement, with Indonesia particularly but also among all member countries, is most important. Asean needs, at this stage of its development, to have a Minister for Asean Affairs in each member country. The prospects and challenges need to be a focus in every national administration.

Economic management

With respect to economic management, while there is no single currency, there are threats to ALL Asean economies of mismanagement in ONE, especially a significant economy. Contagion is always a risk. With increased intra-regional trade (although now only a quarter of the total trade), there will be knock-on effects across the region.

Importantly – let us not forget – we are talking of Asean as a region, one single economy, with the prospect of the most promising growth in consumer demand and economic size (coming up to 4th in the world by 2050). Asean as an asset class. With the herd instincts of markets, reverse flows caused by fear of contagion can quickly develop into a regional crisis.

While global arrangements such as with the IMF remain, let us also not forget we have an untested multilateral currency swap system that includes three East Asian partner countries to address potential and actual balance of payments and short-term liquidity difficulties – the Chiang Mai Initiative Multilateralisation (CMIM). The US$240bil fund is 20% Asean and 80% China, Japan and South Korea. The commitments from each country are really promissory notes, and a country in difficulty can draw up to 2.5 times its committed amount.

Will the support always be forthcoming? Will political differences not get in the way?

Not to mention an assessment of whether the country facing difficulty has exercised fiscal discipline in the management of its economy. The CMIM has an institution, AMRO (Asean+3 Macroeconomic Research Office), to monitor and analyse regional economies in support of its decision-making process.

The central bank governors deciding on requests for support will also rely on AMRO reports and input, and there could be conditions attached to such support, whether the 6-month Breaking Line or the One-year Stability Facility. There could be expectation, frustration, anger and discord.

There are therefore nascent possibilities and challenges which should concentrate Asean minds as they consider the Greek drama in the EU’s eurozone beyond “Thank God, we do not have a single currency, and never should have.” We cannot be immunised from the unintended and unanticipated consequences of community-building. We have to have the institutions and imagination to manage them.

Tan Sri Dr Munir Majid, chairman of Bank Muamalat and visiting senior fellow at LSE Ideas (Centre for International Affairs, Diplomacy and Strategy), is also chairman of CIMB Asean Research Institute.

4 July, 2015
As appeared in TheStar.com.my

CHINA’S setting up of the AIIB (Asian Infrastructure Investment Bank) is a most significant event in contemporary history.

It represents another shift eastwards in the global balance of power, particularly from the US to China. However, other Asian – particularly Asean – countries have also to reflect on what it means to them.

The US AIIB dilemma is a useful point over which to ponder. It has very little to do with transparency, governance and environment. It has to do with the power equation with China. Predominance and control.

Clearly the US is struggling to come to terms with China’s rise. This is not to say America opposes it, but it is a hard thing for the US to swallow, to play second fiddle. And the AIIB is the first big test of that adjustment.

With the launch of the AIIB, China has also shown how it can make good things happen with support not just from Asia, but also beyond. It is becoming a global power with considerable reach and influence.

Controlling about 30% of the capital of the AIIB China, as the promoter, has shown itself as a leader that can control the future of other countries. How Beijing exercises that leadership remains to be seen, but insofar as member state expectations are concerned, they see Asian countries for the first time in living memory controlling an international institution of considerable weight – and with it their economic prospects.

To sustain Asian economic growth trajectory, US$8 trillion of national infrastructure development is needed up to 2020, not counting US$290bil in regional connectivity infrastructure. Indonesia alone needs US$230bil, Myanmar US$80bil. With the potential of the US$100bil AIIB, plus the US$40bil Silk Road Fund for “One Belt One Road”, there is for the first time some good hope of meeting this need.

The US, in its difficult adjustment, points to potential future problems rather than the promise of the AIIB. How “lean, clean and green” will the AIIB be? As if the US dominated Bretton Woods institutions have been pristine, but that does not mean it is a question that should not be asked about AIIB.

So, as the Asian countries get in line, eyes glued on the lolly, they should not hold back from asking questions and seeking answers on how the AIIB is going to operate.

Another issue raised primarily by the Americans is over procurement and personnel appointments. Again, as if the IMF, World Bank and ADB did not come with strings attached by largely senior Caucasian officials from the institutions. But, having suffered from such suppression in the past, Asian countries should want to know what the future holds with the AIIB on procurement and personnel.

With the AIIB headquartered in Beijing and China putting up most of the money, it is only to be expected there will be a Chinese bias on both scores. The president-designate Jin Liqun, however, is suave and affable, better than some of the boorish heads past and present of the Bretton Woods institutions. Nevertheless, it is not undignified to ask about other appointments and their distribution. This horse-trading occurs at international level.

On procurement, Chinese companies are already assuming they will have first-mover advantage contractual right – but this does not necessarily reflect what the Chinese government thinks or mean that the AIIB will be biased for them.

Indeed, Chinese Prime Minister Li Keqiang during his visit to France this week admitted China lacked advanced technologies and looked forward to “form joint ventures or cooperatives” with the developed world. This was stated on the occasion of a historic deal with France to carry out joint projects in Asian and African countries.

And it follows a considerable period during which China was intent on muscling out developed countries in its economic expansion to African and some Asian countries.

Thus, China’s tendency of blowing hot and cold has been a problem in gauging Beijing objectives and mode of operation.

A former US ambassador to the ADB recently related how the poorest Pacific countries failed to receive Chinese support at board level for projects as they had recognised Taiwan. Again, not that the US was ever reticent about such political power play.

Still, it would not be remiss to ask how far China would penalise countries on the wrong political wave-length, even if it would be too much to expect Beijing to support a state opposed to and in conflict with it.

How would the Philippines and Vietnam score in the AIIB on the Chinese political barometer given their adversarial position in the South China Sea dispute? Indeed, the other claimant states, such as Malaysia and Brunei. Of course, if they are willing to become vassals of the Chinese state in return for largesse, it is entirely up to them. But it is not to be expected the proud sovereign states of South-East Asia would stoop to this, but who knows.

In the AIIB, Asean states will each have a very small stake, even if Indonesia might be among the top ten shareholders. Together they might represent something a little more significant. Would they then not want to develop a common position in areas of infrastructure and connectivity development that would be of shared benefit?

Asean leaders do not seem to discuss strategic issues such as, now, the meaning and significance of the AIIB to future regional order. Generalised, but not inaccurate, assertions are made about its good in terms of infrastructure and economic development. But there is more to it than that.

When they meet, Asean leaders follow a well-scripted agenda that does not include a free flow of discussion. Foreign ministries often are hell-bent on avoiding this, because they think strategy and state secrets must at all cost be protected. They should give the leaders greater credit than assumed stupidity. These discussions must take place beyond other broad issues, such as the Middle East etc, or immediate issues, such as refugees and migrants.

Strategic issues are so critical to Asean’s future place in the regional order. Deficient discussion, or avoidance of it altogether, erodes Asean role in the evolving system. More time must be set aside at Asean summits for discussion on these issues.

The economic ministries too must not just look at issues and targets one by one and in a rush without presenting the bigger picture. There is great strategic content in the minutiae which is hardly highlighted or discoursed.

If Asean meetings and summits go on like this, community or no community, the region will miss the wood for the trees.

Tan Sri Dr Munir Majid, chairman of Bank Muamalat and visiting senior fellow at LSE Ideas (Centre for International Affairs, Diplomacy and Strategy), is also chairman of CIMB Asean Research Institute.

20 June, 2015
As appeared in TheStar.com.my

It is best not to host the SEA Games if we embarass ourselves by making a fuss over the outfits athletes wear.

IN 2017 Malaysia hosts the SEA Games. But will we disgrace ourselves?

No, not because we may not top the table of gold medals as Singapore almost did in the excellent games organised by the city-state that ended recently.

Rather it is by the potential controversy – perhaps even disturbance – over the attire athletes wear to compete in the sport they contest.

If this is going to happen, it is best that we do not host the Games. The authorities had better not blandly say this will not happen as they have not come out to say categorically that any contention against what gymnasts wear in their sport is unacceptable. On the contrary, a Minister of the Government has conceded to the recalcitrants by stating that a dress code will be issued on what should be worn.

Rest assured it is not likely that Malaysia will win any gold medals if its team played hockey wearing the flowing jubah, or competed in the swimming pool fully clothed – if they are allowed on the pitch and in the pool.

Malaysia’s most successful body-builder Sazali Samad has won the Mr Universe title 10 times in nothing more than a tanga, revealing his six-pack and muscles without – rightly – a squeak about the barely hidden parts of his anatomy.

Clearly he could not have become Mr Universe dressed in a loose Baju Melayu. But, of course, he is male.

When the athlete is female, it would seem, the only focus is on parts of her anatomy that arouse impure thoughts in the male mind which then has the audacity to pin the blame on the innocent woman. Men cannot control themselves, but get on a hypocritical higher plane to obscure their base instincts.

When the XVI Commonwealth Games were organised in Kuala Lumpur in 1998 – the first in Asia and the last in the last century – we did not have the kind of nonsense and stupidity that followed Farah Ann Abdul Hadi’s superb gold medal performance in gymnastics in Singapore.

We have slipped further backwards since the last century. It is, however, complacent to describe the judgmental and holier-than-thou attitude on Farah Ann’s leotard as just nonsensical and stupid.

That attitude, along with the machinery that has been dangerously allowed to ride roughshod over Malaysian lives, has become pervasive and highly invasive.

How I wish my fellow Muslims will stop playing God. They must understand they should never judge the faith of others, especially of other Muslims, which is Allah’s remit.

These invasive Muslims also advise – indeed ordain – that their co-religionists not mix, even laugh, with others, that they do not venture out or open up to protect the sanctity of their faith.

Not venturing out is a sign of meekness, of not having self-belief. In the outcome you are diminished. The Chinese, for example, will go anywhere, meet anyone, be in any social or cultural circumstance. Yet, when they go home they remain Chinese. I wish that all Malays and Muslims would have the same strength.

Faith is strong when it is deep and internalised, not when it is loudly and aggressively proclaimed, like whistling in the dark, by someone afraid and uncertain.

I do wish our leaders would engage our people in sensible ways, to tell them about the depth yet simplicity of Islam. I fear they have also become afraid.

The current political situation is not likely to give them any courage to check the dangerous extremist and violating phenomenon in the Malaysian body politic, and to lead without short-term calculation for survival.

The zero-sum open political warfare now taking place in our country is causing extensive damage to Malaysia, and so does neglecting to address extremist religious threats which will overturn all the progress this country has made.

More than the personal animosity in this conflict, there is a distrust of normal processes of the political and administrative system. This is a damning indictment of whoever may have caused that system to be so distrusted.

More than that, there is a cry for change outside of that system.

This can take many forms – at worst, violent revolution – but the upshot is that, if there was a replacement of the incumbent Prime Minister, his successor would be equally subject to the same kind of political insurrection. This prospect does not provide for political stability.

Others will follow. He who lives by the sword dies by the sword.

This is not about one-man, one-shot, one-time. It is about political change and political change management.

The spectacle we are witnessing must shame the Malays. It does me. How we run and now threaten to ruin the country. How we pay little attention to detail because we are king of the castle. How we are now about to bring the house down.

If the threats of exposing past and present misdeeds are true, the ske­letons falling out of the cupboard will bury Umno – and the Malays.

While not all will mourn this, let us not forget it is this Malay foundation that gave Malaysia its stability.

What is different from the days of Tun Razak and Tun Dr Ismail is that the honour and justice that characterised the Malay leadership of this country seem to have been lost.

I cannot look into the eyes of a prospective investor at a roadshow and say: You can be assured of Malaysia’s political stability. Not long ago, that was our country’s strongest point above everything else.

When that everything else is also under considerable strain, in a challenging global economy, in the currency and volatile capital flows, there is all the more reason to work together and negotiate our way out of these dangerous straits.

Otherwise we will arrive in 2017 in a worse state than we are in now.

Tan Sri Dr Munir Majid, chairman of Bank Muamalat and visiting senior fellow at LSE Ideas (Centre for International Affairs, Diplomacy and Strategy), is also chairman of CIMB Asean Research Institute.

23 May, 2015
As appeared in TheStar.com.my

IT is surreal, is it not, that here we are talking about an Asean community, and yet are unable to address in concert the wave of Rohingya refugees arriving in Indonesia, Malaysia and Thailand from the Arakan coast of Myanmar, or are being turned back into the Andaman Sea to suffer an uncertain fate.

That changed a little when Prime Minister Datuk Seri Najib Tun Razak gave the humane instruction to the navy and maritime agency to not push them back and to in fact pick up those bobbing about in the sea.

(The last time Malaysia faced this kind of boat people crisis – involving the Vietnamese in the 1980s – then Prime Minister Tun Dr Mahathir Mohamad – threatened to shoot them; Foreign Minister King Ghaz attempted to explain this away by saying his prime minister said “shoo them” – but nobody was fooled).

Anyway, back to the present crisis. While there is some progress from the meeting in Putrajaya last Wednesday among the foreign ministers of Indonesia, Malaysia and Thailand, it is as nothing against the enormity of the humanitarian calamity and depth of the problem. Even then, Thailand was not able to agree NOT to push back to sea the refugees arriving in rickety boats, despite a cap on the numbers based on an estimation of those out at sea, and the caveat that those accepted onshore will be housed until resettlement in third countries within one year.

The elephant NOT in the room, of course, is Myanmar, from where most if not all of these refugees originate. The Malaysian foreign minister flew there on Thursday to engage Naypyidaw. Interestingly Myanmar which has been adamant about not attending any meeting to discuss the crisis originating from its shores, has relented a bit, largely because of international pressure to do so.

Hopefully some basic mechanism to stem the problem can be found. The deeper issue of the treatment of the Rohingya in Myanmar’s Rakhine state – in which everyone has been complicit, businessmen looking for opportunity since Myanmar’s opening up in 2011, right up to Nobel Peace Prize winner Aung San Suu Kyi – is however a long way from being addressed.

There are also the cruel and callous human traffickers taking advantage of people trying to escape persecution and poverty. They need to be tracked down in the countries from which they operate. There is finger pointing between Malaysia and Thailand on this, but let us not forget Bangladesh is also in the equation.

The problem is thus not an easy one to resolve. Even in high standard-setting Europe, there is an inability to handle the refugees arriving in Italy from North Africa. Navies are turning them back. There is no agreement on quotas among European Union (EU) member states for resettlement. There is therefore no cause for a European holier-than-thou attitude when inveighing against what is happening in South-East Asia.

However, there are some significant differences which make South-East Asia look bad in comparison. At least the EU members are talking to one another. Here in Asean, not only does Myanmar deny any responsibility for the Rohingya refugee problem, the rest of the member states are reluctant to tell it squarely and openly: look here mate that is absolute nonsense and let us get rid of this fiction.

What is it about Myanmar that Asean falls over itself to shield that recalcitrant state? Asean molly-coddled it when most of the rest of the world isolated the country. Indeed the regional grouping welcomed the country as a member state in 1997, saying contact not isolation will make the country’s leaders change. When change came in 2011, Asean celebrated with “I told you so”.

Last year Myanmar was awarded grand recognition when it became the chair of Asean. What has Myanmar given Asean in return? Isn’t it about time it did so?

That question should be the sub-theme of a regional conference that must be held soon to discuss the Rohingya sea people problem. It is not about reprimanding Myanmar, but about its taking responsibility to resolve the regional problem it has mainly caused – without even going into the R2P (responsibility to protect) obligation in respect of the Rohingya in Myanmar’s Rakhine state, which must ultimately be resolved.

Less than a month ago, on 27th April, Asean issued the Kuala Lumpur declaration on a people-centric Asean at the end of its summit. How good is the declaration – and Asean – when even before the ink has dried there is this violation of people for all the world to see?

Asean is diminished. At precisely the time it is about to pronounce establishment of a community at the end of the year, its credibility is undermined. Can Asean peoples have a sense of belief in what their leaders grandly commemorate when lives so wretched are so openly lost without effective regional attention?

In this crisis, Thailand calls for a meeting, Myanmar refuses to attend, Malaysia calls for a meeting but only among states at the receiving end – no Myanmar – and Thailand is missing from the podium and flag at the press conference at the end of it. The Thai foreign minister goes off after telling his counterparts his country cannot commit to accepting the sea people even temporarily because of “domestic laws” but does not meet the press to say so. Then his Prime Minister says Thailand will not accept the refugees.

Next the Malaysian foreign minister flies to Myanmar (the mountain coming to Mohamad). Then Myanmar relents a bit, largely because of international pressure. There is effort, but at sixes and sevens.

In this crisis so far, only the decisions of Malaysian Prime Minister Najib and Indonesian President Jokowi can be recognised as positive (not to forget also that of the Turks, from almost the other side of the world, who have quietly sent a ship to our regional – Asean – waters, to do the humanitarian task of picking up those who are dying at sea).

If Asean wants to be called a community – and an allegedly people-oriented one at that – it should at least have a clear structure of meeting and decision-making when there is a crisis and lives are at stake. It has many somnambulistic bodies and contradiction-in-terms task forces which never swing into action in a timely manner because clear decisions are never made.

It is not clear where the decision-making lies. It is the Asean way to leave it vague. That does not work in a crisis. As Asean chair, Malaysia should have the leaders address this issue of acting in a crisis, instead of just acting in well-choreographed events and summits.

Tan Sri Dr Munir Majid, chairman of Bank Muamalat and visiting senior fellow at LSE Ideas (Centre for International Affairs, Diplomacy and Strategy), is also chairman of CIMB Asean Research Institute.

09 May, 2015
As appeared in TheStar.com.my

THE 26th Asean Summit from April 26 to 27 April trended in the right directions, even if it would be extravagant to describe it as an unqualified success.

What grabbed most attention was the expression, in the chairman’s statement at the end of the summit, of “serious concern” over the situation rucked up by China’s extensive reclamation work in the South China Sea, now suggested in some quarters to be called the South-East Asia Sea rather late in the day.

China’s consternation at the four of 69 paragraphs in the statement which described how China’s reclamation activities have “…..eroded trust and confidence and may undermine peace, security and stability…..” is unsurprising. China has operated on the basis of Asean disinclination to cross it at all. On its disunity over the maritime disputes.

But Asean has showed it can take a stand. With studious words which do not throw the baby out with the bath water. It is important that China recognises this concern is not adversarial and, together with Asean, work out a modus vivendi in the South China Sea based on a binding code of conduct, as promised by all the parties a good 13 years ago. China must not evidence that its increased power over that time has changed its peaceable ways.

This firm and steady stand of Asean’s, when none was expected, is a plus of the 26th Summit. Asean must persist with this unity and pursue a negotiated basis for peaceful development of the South China Sea, with China. It may seem self-evident, but non-regional powers cannot get involved if countries in the region are able to resolve their differences themselves.

Little-noticed against the red flags of the South China Sea situation was the Kuala Lumpur Declaration on a People-Oriented and People-Centred Asean, produced by the 26th Summit. Cynics often dismiss these declarations, but they are not meaningless, as they are a marker, even if aspiration is often a long distance from reality.

However, why make them at all if there is no commitment whatsoever? Why be held to account when there is no need to? Whatever the slow progress to reach that rules-based Asean, with political, economic and social justice, a start must always be made.

However, there must be some demonstrable progress to gain credibility and momentum. Here is where many things can be done in the economic field.

The declaration mentions the need to enhance the position of the SMEs and narrowing the income gaps among member states. So, I would say, do something big and real about it. Support, at the next Summit in November, the establishment of the Asean MSME Growth Bank, as has been proposed by the Asean Business Advisory Council – without even having to put up the money for it but by giving it regulatory space.

Asean leaders will get the credit. Small companies and the “small” people who run them will benefit. Employment – for people – will grow. The MSMEs will become strong.

The declaration also referred to the UN Post-2015 Development Agenda which places people and the planet at the centre of a new era of sustainable development. Therefore, Asean leaders should instruct that some of the new green industries in energy and the environment be identified in the Post-2015 AEC Plan.

Further, reference is made to more engagement with the private sector. It is best that such engagement is better structured going forward, so that there is real partnership between the Asean public and private sector. Proposals such as the embedding of expert private sector industry groups within the Asean secretariat should be approved to realise this good intention.

It is less difficult to achieve the more people-oriented Asean by working through the economy which offers real benefits than the more complex political and social issues mentioned in the declaration – although decent work principles are something that cannot wait too long. It is incumbent therefore that there should be a charter of workers rights, particularly for migrant labour which, as can be seen from recent news reports, are matters of life and death.

Having made the declaration, Asean leaders can be held to account. Where progress can be made, particularly in the economy, they should not prevaricate. Where there are good proposals to implement, it should be done without hesitation.

Simple steps

Many simple steps should be fully implemented this year, such as having Asean lanes at points of entry, Asean cafes and food stalls, the Asean young entrepreneurs association, the women entrepreneurs association, internship programmes and many other “low-hanging fruits”.

The Kuala Lumpur Declaration on a People-Oriented and People-Centred Asean is significant. But it must not fall on its sword by not moving ahead, in the equally significant 2015, with action that can be taken to give it immediate real meaning, particularly in the economic field.

Actually, the AEC offers the peoples of Asean the best start and opportunity to participate in the shaping of their future, more so than under the political-security and socio-cultural pillars which are complicated by diverse systems of government.

Back to the chairman’s statement of 27th April, it is as usual gentle, general and generous. Despite its comprehensiveness, this is where the danger lies – especially with respect to promulgation of an AEC at the end of the year.

It is too complacent when it records a 90.5% achievement, 458 out of 506 of the blueprint programmes having been achieved. This counting of matchsticks, as we know, is a gross overstatement as there are so many non-tariff barriers and measures (NTBs and NTMs) which nullify the count.

The statement does talk about the NTMs and NTBs, and welcomed the resuscitation of the Asean Trade Facilitation Joint Consultative Committee (ATF-JCC) to address them – and the officials have swung into action on this one (more meetings!) – but it would have been more of a reality check if the leaders had linked programme achievement with the need to actualise them i.e. a programme to remove the barriers.

Actually, it is one of Malaysia’s deliverables as chair to achieve a trade facilitation agreement before the year is out. It now looks unlikely to happen.

Too reliant

The leaders are too reliant on the officials. They should hand out more specific instructions if they are serious about making the AEC more robust than it will be at the end of 2015. It cannot be “business as usual”. At least they should ensure that private sector involvement in the process from now until the end of the year and on the post-2015 AEC is structured and real.

Tan Sri Dr Munir Majid, chairman of Bank Muamalat and visiting senior fellow at LSE Ideas (Centre for International Affairs, Diplomacy and Strategy), is also chairman of CIMB Asean Research Institute.