Published on 30th June 2020.

SPECIAL UPDATE 1: THE 36TH ASEAN SUMMIT


The 36th ASEAN Summit was held via teleconference and hosted in Hanoi on 26 June 2020 under Vietnam’s 2020 Chairmanship theme “Cohesive and Responsive ASEAN.”

Key Outcomes of the Meeting



Below are the prioritised outcomes related to the economic pillar of the ASEAN Community based on the Chairman’s Statement of the 36th ASEAN Summit.

A. KEY DELIVERABLES

The ASEAN Leaders’ Vision Statement for a Cohesive and Responsive ASEAN, which reflects ASEAN’s strong commitment to upholding ASEAN unity, solidarity and centrality was adopted. The Vision Statement:

  • Underscores the need to expedite the effective and timely realisation of the ASEAN Community Vision 2025; and
  • Stresses the importance of conducting the Mid-Term Review of the ASEAN Community Blueprints 2025 in moving forward the regional integration process
     
  1. Initiative for ASEAN Integration
    The ASEAN Integration (IAI) Work Plan III (2016-2020) Task Force has been tasked with taking into account the emerging issues and current trends to ensure the relevance of the new Work Plan and prepare the Cambodia, Laos, Myanmar and Vietnam (CLMV) countries in meeting their regional commitments.

    2.  

  2. ASEAN Connectivity
    Notable progress has been made in the implementation of the Master Plan on ASEAN Connectivity (MPAC) 2025:

    • Ongoing efforts to promote the Initial Rolling Priority Pipeline of ASEAN Infrastructure Projects to attract investments and to support cities in ASEAN to implement the ASEAN Sustainable Urbanisation Strategy (ASUS).
    • Finalisation of the “Development of an ASEAN Database on Trade Routes and Framework for Enhancing Supply Chain Efficiency” project to assist in strengthening the competitiveness of regional trade networks and improve cross-border trade and supply chain efficiency, taking into account the impact of COVID-19 and trends in trade patterns.
    • The Second Progress Review Report and Mid-Term Review of MPAC 2025 with recommendations will be conducted to enhance MPAC 2025 implementation.

    3.  

  3. ASEAN SMART CITIES NETWORK
    Continued progress was made through the strengthening of partnerships of the ASEAN Smart Cities Network (ASCN) to support the implementation of the Smart City Action Plans.

B. ASEAN ECONOMIC COMMUNITY

The ASEAN Leaders’ Vision Statement for a Cohesive and Responsive ASEAN, which reflects ASEAN’s strong commitment to upholding ASEAN unity, solidarity and centrality was adopted. The Vision Statement:

  1. Progress on the implementation of the ASEAN Economic Community (AEC) Blueprint 2025:
    • A total of 132 out of the 171 annual priorities for 2019 under the AEC Blueprint 2025 have been implemented.

    2.  

  2. The economic fallout from COVID-19:
    • Had a significant impact on hard-hit sectors such as health, agriculture, fisheries, transport, tourism and hospitality, as well as on vulnerable and at-risk businesses and individuals, including Micro-Small, and Medium Enterprises (MSMEs), informal workers, and migrant workers.
    • The region’s economic growth appears to be stabilising with an estimated GDP growth of 4.6% in 2019, but the COVID-19 pandemic will affect the prospect of further recovery in the region in 2020.

    3.  

  3. Commitment to keep markets open for trade and investment:
    • Recognition on the importance of the private sector in the post-pandemic recovery efforts, which include restarting the economy, rehiring, and restoring business and consumer confidence. ASEAN is also studying a proposal for the creation of a high-level special committee that will address the aftermath of the pandemic alongside other ASEAN mechanisms.
    • ASEAN welcomed the adoption of the Hanoi Plan of Action on Strengthening ASEAN Economic Cooperation and Supply Chain Connectivity in Response to the COVID-19 pandemic by the ASEAN Economic Ministers, and have tasked officials to ensure its implementation in a swift and efficient manner.

    4.  

  4. ASEAN welcomed the 13 Priority Economic Deliverables (PEDs) under Vietnam’s 2020 ASEAN Chairmanship. The PEDs will:
    • Help promote intra-ASEAN economic integration and connectivity;
    • Deepen ASEAN engagement with the global community for sustainable development; and
    • Enhance the responsiveness and institutional capacity of ASEAN.

    5.  

  5. Key progress made towards further economic integration:
    • The onboarding of 10 ASEAN Member States in the Live Operation for the exchange of the ASEAN Trade in Goods Agreement (ATIGA) e-form D via the ASEAN Single Window (ASW). The expansion to other trade-related documents among ready ASEAN Member states is expected to take place in 2020.
    • Discussions on the Mutual Recognition Arrangement (MRA) for Type Approval of Automotive Products was concluded and is expected to be signed in 2020.
    • The development of the following documentation to promote strong regional competition:
      • The ASEAN Peer Review Guidance Document,
      • The Trainers’ Guide for Market Studies,
      • The Toolkit for Formulating National Enforcement Strategies, and
      • Research paper on commonalities and differences in competition legislations in ASEAN.
    • The development of the following frameworks:
      • The ASEAN Framework on Cross-Border Cooperation for ASEAN consumer protection authorities,
      • The Trainers’ Guide for Market Studies,
      • The Capacity Building Roadmap for Consumer Protection 2019-2025, and
      • The ASEAN Guidelines on Cross Border B2C Dispute Resolution.
    • The publication of the following handbooks:
      • The ASEAN Online Business Code of Conduct, the Business Guide to IP Institutions, and
      • The Handbook on IP Commercialisation.

    6.  

  6. Recognition of the indispensable role of digital technologies in ASEAN’s recovery efforts and to this end, the development of the ASEAN consolidated strategy on the 4IR to prepare the region for the Fourth Industrial Revolution.

    7.  

  7. The continued enhancement in transport connectivity through:
    • The conclusion of Protocol 3 on the Expansion of Fifth Freedom Traffic Rights Between Contracting Parties to the ASEAN China Air Transport Agreement between the Governments of the Member States of the Association of Southeast Asian Nations and the Government of the People’s Republic of China (AC-ATA),
    • The adoption of the Implementation Framework of ASEAN Framework Agreement on Multimodal Transport (AFAMT) and its Action Plan,
    • The signing of the Protocol to Implement the Eleventh Package of Commitments on Air Transport Services under the ASEAN Frameworks Agreement on Services,
    • ASEAN’s reaffirmed commitment to strengthen regional food security through the implementation of the ASEAN Guidelines on Promoting Responsible Investment in Food, Agriculture and Forestry, and
    • The adoption of the ASEAN Innovation Roadmap 2019–2025, which would contribute to advancing ASEAN innovation transformation.

    8.  

  8. Recognition on the importance of public-private sector engagement, so as to regenerate employment to address the socio-economic impacts of COVID-19, particularly in the advent of 4IR.
    • ASEAN welcomed the contribution of the ASEAN Business Advisory Council (ASEAN-BAC), in close partnership with the Joint Business Councils, in strengthening ASEAN’s efforts to address the impact of the COVID-19 pandemic, particularly ASEAN-BAC’s current legacy project, DIGITAL STARS, that aims to empower business start-ups and enterprises by promoting innovation and digitalisation of MSMEs.

    9.  

  9. Initiatives related to healthcare:
    • The efforts of the Healthcare Services Sectoral Working Group (HSSWG) towards the implementation of the ASEAN’s Mutual Recognition Arrangements (MRAs) for Nursing Services, Medical Practitioners, and Dental Practitioners, thereby facilitating the movement of health professionals within the ASEAN Region,
    • Progress made in the discussions on Health Tourism and e-Healthcare Services, noting the increasing demand for healthcare services delivered through digital technologies and telecommunications especially during disasters and pandemics.

FREE TRADE AGREEMENT

  1. Progress was made:
    • In the implementation of ASEAN’s free trade area (FTA) and comprehensive economic partnership (CEP) agreements with major trading partners, i.e., China, India, Japan, Korea, Australia and New Zealand, and Hong Kong, China as well as engagement with new FTA partners.
    • In the full conclusion of the negotiations of the Regional Comprehensive Economic Partnership (RCEP) Agreement, which is expected to be signed by the end of 2020.

SPECIAL UPDATE 2: HANOI PLAN OF ACTION ON STRENGTHENING ASEAN ECONOMIC COOPERATION AND SUPPLY CHAIN CONNECTIVITY IN RESPONSE TO THE COVID-19 PANDEMIC

The Hanoi Plan of Action was agreed to by the ASEAN Economic Ministers on 4 June 2020, in order to implement the Declaration of the Special ASEAN Summit on the Coronavirus Disease 2019 (COVID-19), adopted by the ASEAN Leaders at a Special ASEAN Summit on 14 April 2020.

  1. The implementation of the Hanoi Plan of Action will be done in accordance with:
    • The rights and obligations of the ASEAN Member States under the General Agreement on Tariffs and Trade (GATT) 1994 and other WTO covered Agreements,
    • The ASEAN Economic Community Blueprint 2025 and other ASEAN internal Agreements, such as the ASEAN Trade in Goods Agreement (ATIGA), the ASEAN Trade Facilitation Framework, the Master Plan on ASEAN Connectivity (MPAC) 2025, and other relevant ASEAN Agreements.


I. AREAS OF COOPERATION UNDER THE ACTION PLAN

  1. ASEAN Member States are to ensure the smooth flow of essential goods and facilitate information exchange on the best practices of member states in handling COVID-19. Under the areas of cooperation, ASEAN Member States are to:
    • 1.1 Refrain from imposing unnecessary non-tariff measures during the COVID-19 pandemic. This would include the consideration to not apply against any ASEAN Member State export prohibition or restrictions within the meaning of Article XI of the GATT 1994 to essential goods, including food, medicines, and medical and other essential supplies, for the purpose of combating the COVID-19 pandemic, except as provided under Article XI:2 (a) GATT and other WTO provisions.
       
    • 1.2 Promptly inform all member states of any trade-related measure, through the ASEAN Secretariat, including the application of export prohibition or restriction, and/or the removal of export prohibition or restriction on essential goods, including food, medicines, and medical and other essential supplies if necessary. Also, ASEAN member states are to promptly publish and update such trade-related measures for transparency.
       
    • 1.3 Enhance cooperation amongst ASEAN Member States to ensure security of essential goods, including medical, food and other essential supplies in ASEAN by – on a best endeavour basis – informing all other ASEAN Member States as soon as practicable in the event of surplus production.
       
    • 1.4 Promote the sharing of information and best practices in handling the pandemic, through business consultation support, and public-private sector collaboration efforts.
       
    • 1.5 Facilitate the smooth flow and transit of essential goods, including food, medicines, and medical and other essential supplies bound for the other member states through their respective land entry points, sea and air ports, including transit and transhipment points while ensuring compliance with the regulations of each ASEAN Member State on safety standards and quality for those essential goods.
       
    • 1.6 Encourage dialogue between local government authorities of provinces of ASEAN Member States sharing borders to discuss solutions for customs clearance of essential goods, including food, medicines, and medical and other essential supplies while ensuring compliance of preventive measures against COVID-19 with national regulations.
       
    • 1.7 Expedite release of all essential goods, including food, medicines, and medical and other essential supplies at all land entry points, sea and air ports, including adopting or maintaining, where practicable, the procedures on facilitating customs clearance and procedures allowing for the early and digital submission of import documentation and other required information, allowing for the use of electronic means, to the extent allowed by laws and regulations of each ASEAN Member State, for purposes of commencing processing prior to the arrival of the products.
       
    • 1.8 Endeavour to abide by the:
      • i. World Health Organization’s (WHO) International Health Regulations (IHR) 2005 to allow free passage to cargo ships – i.e. the permission to enter a port, discharge or load cargo or stores; and
      • ii. International Maritime Organization’s (IMO) Statement on 19 March 2020 to ensure that commerce by sea is not unnecessarily disrupted, by taking a practical and pragmatic approach to maintain the ability for shipping services and seafarers to deliver vital goods, including medical supplies and foodstuffs.
         
    • 1.9 Support the International Civil Aviation Organization’s (ICAO) COVID-19 Declaration adopted on 9 March 2020, and endeavour to facilitate entry, transit and departure of air cargo containing the products classified as essential goods, including food, medicines, and medical and other essential supplies.
       
    • 1.10 Intensify consultations with a view to addressing the implementation of the Hanoi Plan of Action for better understanding of the measures adopted on essential goods, including food, medicines, and medical and other essential supplies for the purpose of combating COVID-19.
       
    • 1.11 Facilitate and promote cooperation for the production of and access to medicines and vaccines used for COVID-19 medical treatment, using appropriate TRIPS flexibilities, to protect public health from negative impacts of the pandemic; be willing and ready to share with other AMS the supply sources of raw materials for production of the medicines and vaccines used for COVID-19 treatment, when possible.
       
    • 1.12 Strengthen collaboration/communication among ASEAN Member States to easily address issues on cross-border movements of essential goods, including medical, food and other essential supplies.
       
    • 1.13 Foster cooperation among ASEAN Member States to ensure regional financial safety nets and financial stability as well as to mitigate the impacts of the pandemic on regional economy and finance.
       


II. STRENGTHENING SUPPLY CHAIN CONNECTIVITY

To strengthen supply chain connectivity in the long-term, ASEAN Member States are to:

    • 2.1 Collaborate with external and development partners to strengthen regional and global supply chain resilience and sustainability including the promotion of local currency settlement to enhance trade and direct investment flows in the region, and to be less vulnerable to internal and external shocks similar to the COVID-19 pandemic.
       
    • 2.2 Leverage on technologies to put in place a robust mechanism for regional information sharing and coordination in responding to economic challenges such as the COVID-19 pandemic.
       
    • 2.3 Encourage the sharing of information and best practices on new technologies, systems or mechanisms adopted to facilitate trade such as online platforms, streamlining of processes, implementation of programmes or policies in support to traders, importers and suppliers to ensure the smooth flow of essential and critical goods and services.
       
    • 2.4 Build on existing trade facilitating platforms in ASEAN to promote and support supply chain connectivity and ensure the unimpeded flow of goods and services in supply chains, as well as to increase regional resilience through various efforts, including promoting regional food security and energy security and facilitating the environment for the possibility of the shifting of production business models.
       
    • 2.5 Take proactive action in enabling an effective trade facilitation to ensure the flows of goods amongst ASEAN Member States and intensify efforts to address barriers to the smooth flow of essential and critical goods, including food, medicines, and medical and other essential supplies, and services.
       
    • 2.6 Strengthen engagement with stakeholders such as the private sector by having them as significant partners in strengthening regional supply chains, to instil investment confidence, promote business opportunities, and strengthen supply chain connectivity.
       
    • 2.7 Promote the use of science, technology and innovation, digital economy, and provide mechanisms to facilitate customs clearance and processing to allow businesses, especially the micro, small and medium enterprises (MSMEs) to continue operations amidst the economic challenges such as the COVID-19 pandemic while ensuring responsible business practices, with observance of the relevant rules and regulations of each ASEAN Member State including those on digital related platforms, and empowering their business to access the regional and global market and staying competitive in the era of digital economy in the long run.
       
    • 2.8 Strengthen regional and global supply chain to fully combat COVID-19 and its economic impacts without prejudice to ASEAN Member States’ rights and obligations under the WTO.
       
    • 2.9 Identify and implement appropriate measures/initiatives to boost confidence in Southeast Asia as a trade and investment hub, and tourism destination in the region, in close collaboration with relevant industry stakeholders.
       
    • 2.10 Continue the implementation of the ASEAN Work Program on Electronic-Commerce in support to businesses that will use technologies and digital economy to continue operation.


III. INSTITUTIONAL MECHANISM

    • 3.1 Designate national contact points for the purpose of implementing the Hanoi Plan of Action promptly following the adoption of this Plan of Action.
       
    • 3.2 Report the progress in the implementation of the Hanoi Plan of Action to the ASEAN Economic Community Council, through the Senior Economic Officials Meeting.


Summarised by Aznita Ahmad Pharmy, Research Fellow, CIMB ASEAN Research Institute