Terror response overshadows AEC at Asean summit

Terror response overshadows AEC at Asean summit

KUALA LUMPUR — The global response to terror and extremism has taken centre stage at the Asean summit, where the formal declaration of the Asean Economic Community (AEC) was expected to be the centrepiece event.

Malaysian Prime Minister Najib Razak said he had intended to open the summit to talk about the bright future for the 10-country economic community of 620 million people with a combined economic output of US$2.5 trillion. The AEC officially comes into effect on Dec 31.

"But the events of recent days and weeks have cast a shadow over us all," he said on Saturday at a business conference preceding the summit.

The summit is taking place against the backdrop of the bombing of a Russian airliner over Egypt, a suicide bombing in Beirut, a series of attacks in Paris, the slaying of a Malaysian hostage by militants in the southern Philippines, and a jihadist attack on a hotel in Mali.

"The perpetrators ... do not represent any race, religion or creed. They are terrorists and should be confronted as such, with the full force of the law,'' Najib said in a stirring speech that repeatedly emphasised the tolerance of Islam.

He also cautioned that a military solution alone would not be enough to defeat terrorism. "It is the ideology propagated by these extremists that is the cause of this sadistic violence. ... We must not lose sight of the fact that the ideology itself must be exposed as the lie that it is — and vanquished. For it is not Islamic. It cannot be.''

US President Barack Obama, meanwhile, vowed to fight the "evil'' and "hateful'' ideology unleashed by the Islamic State.

"We will not allow these killers to have a safe haven,'' he said.

Referring to the attack on a luxury hotel in the capital of Mali on Friday, he said the world was determined "to push back on the hateful ideologies that fuel this terrorism".

While there have been pockets of extremist activity in Southeast Asia, notably in the Philippines, Indonesia and southern Thailand, by and large the region has not suffered from the kind of violence seen in the Middle East, where the Islamic State is most potent.

Mr Najib suggested that economic growth has been the bedrock of Southeast Asia's relative peace and progress. Now the region is aiming for greater economic, political and cultural integration through the AEC.

Envisaged in 2002, work on the community began in 2007, and it is already delivering benefits to the region, said Mr Najib. Tariffs on trade have been reduced to zero, or near zero, helping bring down prices of goods, unemployment is down to 3.3%, citizens enjoy visa-free travel through nine out of 10 countries, and are allowed to work in other countries in the region in eight major sectors, including tourism.

Despite the good news that Mr Najib delivered, the AEC still falls short in more politically sensitive areas such as opening up agriculture, steel, auto production and other protected sectors. Intra-regional trade has remained at around 24% of Asean's total global trade for the last decade, far lower than the 60% rate seen in the European Union.

There are also other hurdles, such as corruption, uneven infrastructure and unequal costs of transport and shipping. As well, a wide economic gulf divides Southeast Asia's rich and middle income economies — Malaysia, Indonesia, Singapore, Brunei, Thailand and the Philippines — and its four less developed members, Vietnam, Laos, Myanmar and Cambodia.

Tan See Seng, a professor of international relations at the S Rajaratnam School of International Studies in Singapore, said it was true that there were no tariffs at the borders of Asean countries. "But once you enter ... you may have to grease the palms of some people in certain Asean countries to proceed. These 'behind the border' barriers ... are a key impediment slowing down the process of integration,'' he said.

The focus on security and economic issues at this weekend's summit might leave less time for discussion of one of the thorniest issues facing the 10-country Asean bloc: China's growing regional ambitions.

Asean's relationship with China is highly complex and ambivalent. Despite being a competitor, China has also played the role of a principal financier in helping Asean reach its goals to temper its image as an economic threat. It is also one of the largest markets for heavily export-dependent Asean economies including Thailand.

At the same time, it has not hesitated to bully Asean countries in staking its claim to most of the South China Sea, where the Philippines, Malaysia, Vietnam, Indonesia and Brunei have competing claims. China has also irked Asean countries by creating artificial islands from reefs to bolster its claim.

As a result, Japan has seen an opportunity to assert its soft power in the region in hopes of keeping China at bay.

Japanese Prime Minister Shinzo Abe has been conducting a major diplomatic offensive in Kuala Lumpur, saying his country was the "best partner'' for Asean and the rest of Asia as they gear up for a new development phase toward lasting sustainable growth.

He said Japan was committed to bolstering its overseas development assistance of about US$1.4 billion to the region.

In a veiled reference to China he added: "We do not impose our culture on others. ... We think together and move together with the local people.''

Mr Obama, meanwhile, stressed the virtues of the US-led Trans-Pacific Partnership (TPP) trade agreement, which some other Asean countries including Thailand, are considering joining.

He said the recently concluded 12-country trade pact was a win for the original signatories, which include Malaysia, Vietnam, Singapore and Brunei.

"TPP is a win for the United States. I'm not going to be shy about this," he added, noting that the deal would open up markets for US manufacturers and agricultural producers.

At the same time, he said, Malaysia would be able to sell more mobile phones to Mexico, Singapore could sell more medicines to Peru, and Vietnam would sell more leather goods to Japan.

He said the benefits went beyond trade to "include important strategic and geopolitical benefits".

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