ASEAN tries to be united in facing rising China

Abdul Khalik, The Jakarta Post, Jakarta | Sun, 07/17/2011

ASEAN members are trying to stay united as China goes on a charm offensive to offer infrastructure development assistance in return for economic and political gains.

Japan, which was overtaken this year by China as the world’s second-largest economy, is struggling to maintain its influence and relations with ASEAN and also extend aid and investment.

Under the ASEAN connectivity programs, aimed at connecting countries in the region, China and Japan are competing to take part in developing projects.

China was quick to help finance the building of a railway from Kumming in China to Singapore, which would pass through Laos and Cambodia, but critics warned China’s help was not free, raising concerns China would obtain economic benefits and political influence in those two countries and in Indochina in general.

Japan has been eager to help Indonesia’s small and medium enterprises cope with regional competition.

Some ASEAN member states, including current chair Indonesia and Singapore, however, said all the offers must be suited to ASEAN’s plan to build a community rather individual countries’ interests.

Former Singaporean foreign minister George Yeo expressed concerns about ASEAN’s unity as certain member states were more inclined to work with an outside power than with the grouping itself.

“China and Japan have offered us financial help to build projects that help connect areas within our region. But we must pick those
offers based on ASEAN’s interests and goals of achieving a community by 2015,” Indonesian Foreign Ministry director for ASEAN economic cooperation Rahmat Pramono said Saturday.

However, it looks like the grouping may face difficulties in stopping members from falling under China’s influence, with many observers warning that if ASEAN neglected its poorest members, then other countries would attempt to take advantage, pointing to Myanmar’s dependence on China, which has invested aggressively in that country.

ASEAN has agreed on 15 priorities projects to connect and close the gap between rich and poor member states.

Rahmat said two projects related to Indonesia’s interests were the development of power plants and establishing links between small islands inside and outside the country.

“With the help of the Asian Development Bank, Indonesia and Malaysia began building two power plants, one in the border area between Sarawak and West Kalimantan and another in Malacca that will be connected to Riau,” he said.

Rahmat said the power plants in Borneo and Malacca were US$150 million and $400 million projects, respectively.

Connectivity is also expected to boost trade among ASEAN member states. The ASEAN Secretariat estimates the value of trade among member states at $400 billion, while ASEAN trade with the world market is worth $1.7 trillion.