Date post: | 17-Jul-2015 |
Category: |
Education |
Upload: | bhavnaraval3 |
View: | 74 times |
Download: | 6 times |
K.J.SOMAIYA COLLEGE OF ARTS AND
COMMERCE
PROJECT ON
ASEAN – AN ECONOMIC INTEGRATION
SUBMITTED BY:
MISS. BHAVNA HASMUKHBHAI RAVAL
ROLL NO. : - 46
M COM PART – 1 (SEMESTER - 1)
2013 - 2014
INTERNAL ASSESSMENT
ECONOMICS OF GLOBALE TRADE AND FINANCE
PREPARED UNDER THE GUIDANCE OF
DR.C.V. HARI NARAYANAN
AFFILIATED TO:
ACKNOWLEDGEMENT
I would like to thank all the people who helped me in
undertaking the study and completing the project, by imparting me with
valuable information and guidance that was required at every stage of
my project work.
I would like to thank our Principal Dr. Sudha Vyas and
course co-ordinate Miss. Sonali Deogirikar, for giving me an
opportunity and encouragement to prepare the project.
Last but not the least, I would like to thank my project
guide Dr. C. V. HARI NARAYANAN for guiding and helping me
throughout the preparation of my project, right from selection of the
topic till its completion.
Bhavna H. Raval
Roll No:-46
DECLARATION BY THE STUDENT
I, BHAVNA HASMUKHBHAI RAVAL, Roll
Number:-46 student of M.Com Accountancy Part- 1 hereby
declare that the project for the paper Economics of
Global Trade & Finance titled, “ASEAN – AN
ECONOMIC INTEGRATION” Submitted by me for
Semester - 1 during the academic year 2013 – 2014, Is
based on actual work carried out by me under the
guidance and supervision of
Dr. C.V. HARI NARAYANAN.
I further state that this work is original and not
submitted anywhere else for any examination.
Signature of Student
(Bhavna H. Raval)
Roll No:-46
K. J. SOMAIYA COLLEGE OF ARTS & COMMERCE
VIDYAVIHAR (EAST)
CERTIFICATE
(2013 – 2014)
This is to certify that the undersigned have assessed and
evaluated the project on “ASEAN – An Economic Integration”
submitted by BHAVNA H. RAVAL, Roll No:-46 student of M.Com
in Accountancy Part-1 for the academic year 2013-2014. This project
is original to the best of our knowledge and has been accepted
for Internal Assessment.
Date: - 26th SEPTEMBER, 2013
Place: - MUMBAI
Internal Examiner External Examiner Principal (Dr. C.V. HARI NARAYANAN) (Dr. SUDHA VYAS)
INDEX
Topics page number
1. Introduction 02
2. HISTORY 03
3. ABOUT ASEAN
Legal Personality 05
ASEAN Name 05
ASEAN Identity 06
ASEAN Motto 06
ASEAN Member States 06
Admission of New Members 12
ASEAN Flag 12
ASEAN Emblem 13
ASEAN Day 14
ASEAN Anthem 14
4. PURPOSE 15
5. PRINCIPLES 17
6. charter 19
Interpretation of Charter 20
Original Text 20
Registration Of The ASEAN Charter 20
7. Structure 21
8. Settlement of dispute
General Principles 23
Good Offices, Conciliation 23
Dispute Settlement Mechanism in Specific Instruments 23
Establishment of Dispute Settlement Mechanisms 24
Unsolved Disputes 24
Compliance 24
9. DECISION MAKING
Consultation & Consensus 24
Implementation 25
10. BUDGET & FINANCE
General Principles 25
Operational Budget & Finances of the ASEAN Secretariat 25
11. ADMISSION & PROCEDURE
Chairman of ASEAN 26
Role of the Chairman of ASEAN 26
Working Language 27
12. ORGANS
ASEAN Summit 29
ASEAN Coordinating Council 29
ASEAN Community Councils 30
ASEAN Sectoral Ministerial Bodies 31
Secretary-General of ASEAN & ASEAN Secretariat 31
Committee of Permanent representatives to ASEAN 33
ASEAN National Secretatriats 34
ASEAN Human Rights Body 34
ASEAN Foundation
13. ASEAN HEADS OF DEPARTMENT 35
14. ENTITIES ASSOCIATED WITH ASEAN
Parliamentarians 36
Business Organisation 36
Think Thank & Academic Institution 37
AEAN – Accredited Civil Society Organisations (CSOs) 37
15. EXTERNAL RELATION
Conduct of External Relation 38
Dialogue Co-ordinator 39
Status of External Parties 39
16. ASEAN – India Free Trade Area 40
Background 41
History 42
Tariffs 43
Criticism 43
17. CONCLUSION 44
18. BIBLIOGRAPHY 46
ASEAN – AN ECONOMIC INTEGRATION
The Association of Southeast Asian Nations (ASEAN) was founded on August 8 1967 by
Indonesia, Malaysia, the Philippines, Singapore and Thailand. They were subsequently
joined by Brunei, Cambodia, Laos, Myanmar and Vietnam. ASEAN activities are
coordinated by the ASEAN Secretariat, which is based in Jakarta, Indonesia.
ASEAN has emphasized regional cooperation on the three pillars of security and socio-
cultural and economic integration. It has made most progress in economic integration and
aims to create an ASEAN Economic Community (AEC) by 2015. The AEC would have a
combined population of over 566 million people and a gross domestic product of over
$1.173 trillion.
The foundation of the AEC is the ASEAN Free Trade Area (AFTA), a common external
preferential tariff scheme to promote the free flow of goods within ASEAN. Other
elements of economic integration, such as the free flow of investment and services and
the elimination of non-tariff barriers, have been added by the ASEAN leaders.
Through agreements such as the ASEAN Charter, signed in November 2007, ASEAN's
leaders are attempting to build a single market, but without either a strong central
executive (comparable to the European Commission in the European Union) or a well-
developed body of laws and dispute settlement mechanisms (like those of the North
American Free Trade Association (NAFTA)). ASEAN members' historical reluctance to
encourage either of these elements stems from a fear of impinging on ASEAN’s long-
held principles of non-interference and consensus. However, failure to integrate
ASEAN's diverse markets will mean a loss of investment and economic opportunities to
regional competitors, such as China and India. This tension between the need to integrate
and the reluctance to yield national sovereignty is the main factor affecting the
development of the AEC.
HISTORY:
Much of Southeast Asia was colonized by Western powers prior to World War II. During
the war Japan took control of the region, but was forced out following the war as
Southeast Asia countries pushed for independence. Though they were independent, the
countries found that stability was hard to come by, and they soon looked to each other for
answers.
ASEAN was preceded by an organisation called the Association of Southeast Asia,
commonly called ASA, an alliance consisting of the Philippines, Malaysia and Thailand
that was formed in 1961. The bloc itself, however, was established on 8 August 1967,
when foreign ministers of five countries – Indonesia, Malaysia, the Philippines,
Singapore, and Thailand – met at the Thai Department of Foreign Affairs building in
Bangkok and signed the ASEAN Declaration, more commonly known as the Bangkok
Declaration. The five foreign ministers – Adam Malik of Indonesia, Narciso Ramos of
the Philippines, Abdul Razak of Malaysia, S. Rajaratnam of Singapore, and Thanat
Khoman of Thailand – are considered the organisation's Founding Fathers.
It was a short, simply-worded document containing just five articles. It declared the
establishment of an Association for Regional Cooperation among the Countries of
Southeast Asia to be known as the Association of Southeast Asian Nations (ASEAN) and
spelled out the aims and purposes of that Association. These aims and purposes were
about cooperation in the economic, social, cultural, technical, educational and other
fields, and in the promotion of regional peace and stability through abiding respect for
justice and the rule of law and adherence to the principles of the United Nations Charter.
It stipulated that the Association would be open for participation by all States in the
Southeast Asian region subscribing to its aims, principles and purposes. It proclaimed
ASEAN as representing “the collective will of the nations of Southeast Asia to bind
themselves together in friendship and cooperation and, through joint efforts and
sacrifices, secure for their peoples and for posterity the blessings of peace, freedom and
prosperity.”
The motivations for the birth of ASEAN were so that its members’ governing elite could
concentrate on nation building, the common fear of communism, reduced faith in or
mistrust of external powers in the 1960s, and a desire for economic development.
The bloc grew when Brunei Darussalam became the sixth member on 8 January 1984,
barely a week after gaining independence on 1 January.
On 28 July 1995, Vietnam became the seventh member. Laos and Myanmar (Burma)
joined two years later on 23 July 1997. Cambodia was to have joined together with Laos
and Burma, but was deferred due to the country's internal political struggle. The country
later joined on 30 April 1999, following the stabilisation of its government.
During the 1990s, the bloc experienced an increase in both membership and drive for
further integration. In 1990, Malaysia proposed the creation of an East Asia Economic
Caucus comprising the then members of ASEAN as well as the People's Republic of
China, Japan, and South Korea, with the intention of counterbalancing the growing
influence of the United States in the Asia-Pacific Economic Cooperation (APEC) and in
the Asian region as a whole. This proposal failed, however, because of heavy opposition
from the United States and Japan. Despite this failure, member states continued to work
for further integration and ASEAN Plus Three was created in 1997.
In 1992, the Common Effective Preferential Tariff (CEPT) scheme was signed as a
schedule for phasing tariffs and as a goal to increase the region’s competitive advantage
as a production base geared for the world market . This law would act as the framework
for the ASEAN Free Trade Area. After the East Asian Financial Crisis of 1997, a revival
of the Malaysian proposal was established in Chiang Mai, known as the Chiang Mai
Initiative, which calls for better integration between the economies of ASEAN as well as
the ASEAN Plus Three countries (China, Japan, and South Korea).
Aside from improving each member state's economies, the bloc also focused on peace
and stability in the region. On 15 December 1995, the Southeast Asian Nuclear-Weapon-
Free Zone Treaty was signed with the intention of turning Southeast Asia into a Nuclear-
Weapon-Free Zone. The treaty took effect on 28 March 1997 after all but one of the
member states have ratified it. It became fully effective on 21 June 2001, after the
Philippines ratified it, effectively banning all nuclear weapons in the region.
ABOUT ASEAN:
ARTICLE 1 => LEGAL PERSONALITY OF ASEAN
ASEAN, as an inter-governmental organization, is hereby conferred legal personality.
ARTICLE 2 => ASEAN Name
A. Guidelines on the Use of the Name “ASEAN”
1. The Name “ASEAN” refers to the “Association of Southeast Asian Nations”.
2. The Name “ASEAN” is the reserved copyright of ASEAN.
3. The Name “ASEAN” shall be used in a manner that promotes ASEAN and its
purposes and principles. It shall not be used for political propaganda or for activities that
harm the dignity of ASEAN.
B. Enquiries and Requests for the Use of the Name “ASEAN”
4. Enquiries and requests for the use of the name “ASEAN” shall be submitted in
writing, and accompanied with the following information:
• organisational profile; and
• purpose for the proposed use of the name “ASEAN”.
5. Such request should satisfy the following conditions:
• The entity should be indigenous to ASEAN;
• The usage of the name “ASEAN” should not have any negative effect on
the aims and objectives of ASEAN;
• The name “ASEAN” should not be brought into disrepute by its usage; and
• The use of the name “ASEAN” shall be in support of ASEAN purposes and
principles.
6. The ASEAN Secretariat shall consider the requests accordingly. The approval
granted shall be exclusive to the proposed activity. Such approval shall not be extended
to third parties.
7. Enquiries and requests for the use of the name “ASEAN” should be submitted to the
following address:
Public Outreach and Civil Society Division
The ASEAN Secretariat
70 A, Jl. Sisingamangaraja, Jakarta 12110
Indonesia
E-mail: [email protected]
ARTICLE 3 => ASEAN IDENTITY
ASEAN shall promote its common ASEAN identity and a sense
of belonging among its peoples in order to achieve its shared
destiny, goals and values.
ARTICLE 4 => ASEAN MOTTO
The motto ASEAN is: "One Vision, One Identity, One
Community"
ARTICLE 5 => ASEAN MEMBER STATES
The Member States of ASEAN are Brunei Darussalam, the Kingdom of Cambodia, the
Republic of Indonesia, the Lao People’s Democratic Republic, Malaysia, the Union of
Myanmar, the Republic of the Philippines, the Republic of Singapore, the Kingdom of
Thailand and the Socialist Republic of Viet Nam.
Brunei Darussalam
For Brunei Darussalam:
HAJI HASSANAL BOLKIAH
Sultan of Brunei Darussalam
Head of State : His Majesty Sultan Haji Hassanal Bolkiah Mu’izzaddin Waddaulah
Capital : Bandar Seri Begawan
Language(s) : Malay, English
Currency : B$ (Brunei Dollar) Ministry of Foreign Affairs & Trade of Brunei Darussalam Website: www.mfa.gov.bn
Cambodia
For the Kingdom of Cambodia:
SAMDECH HUN SEN
Prime Minister
Head of State : His Majesty King Norodom Sihamoni
Head of Government : Prime Minister Hun Sen
Capital : Phnom Penh
Language : Khmer
Currency : Riel
Ministry of Foreign Affairs & International Cooperation of Cambodia
Website: www.mfaic.gov.kh
Indonesia
For the Republic of Indonesia:
DR. SUSILO BAMBANG YUDHOYONO
President
Head of State : President Susilo Bambang Yudhoyono
Capital : Jakarta
Language : Indonesian
Currency : Rupiah
Department of Foreign Affairs of Indonesia Website: www.deplu.go.id
Lao PDR
For the Lao People’s Democratic Republic:
BOUASONE BOUPHAVANH
Prime Minister
Head of State : President Choummaly Sayasone
Head of Government : Prime Minister Thongsing Thammavong
Capital : Vientiane
Language : Lao
Currency : Kip
Ministry of Foreign Affairs of Lao PDR Website: www.mofa.gov.la
Malaysia
For Malaysia:
DATO’ SERI ABDULLAH AHMAD BADAWI
Prime Minister
Head of Government : The Honourable Dato’ Sri Mohd Najib bin Tun Abdul Razak
Capital : Kuala Lumpur
Language(s) : Malay, English, Chinese, Tamil
Currency : Ringgit
Ministry of Foreign Affairs of Malaysia Website: www.kln.gov.my
ASEAN-Malaysia National Secretariat Website: www.kln.gov.my/myasean
Myanmar(Burma)
For the Union of Myanmar:
GENERAL THEIN SEIN
Prime Minister
Head of State : Senior General Than Shwe
Head of Government : Prime Minister General Thein Sein
Capital : Nay Pyi Taw
Language : Myanmar
Currency : Kyat
Ministry of Foreign Affairs of Myanmar Website: www.mofa.gov.mm
Philippines
For the Republic of the Philippines:
GLORIA MACAPAGAL-ARROYO
President
Head of State : President Benigno S. Aquino III
Capital : Manila
Language(s) : Filipino, English, Spanish
Currency : Peso
Department of Foreign Affairs of the Philippines Website: www.dfa.gov.ph
Singapore
For the Republic of Singapore:
LEE HSIEN LOONG
Prime Minister
Head of State : President S R Nathan
Head of Government : Prime Minister Lee Hsien Loong
Capital : Singapore
Language(s) : English, Malay, Mandarin, Tamil
Currency : S$ (Singapore Dollar)
Ministry of Foreign Affairs of Singapore Website: www.mfa.gov.sg
Thailand
For the Kingdom of Thailand:
GENERAL SURAYUD CHULANONT (RET.)
Prime Minister
Head of State : His Majesty King Bhumibol Adulyadej
Head of Government : Prime Minister Abhisit Vejjajiva
Capital : Bangkok
Language : Thai
Currency : Baht
Ministry of Foreign Affairs of Thailand Website: www.mfa.go.th
Viet Nam
For the Socialist Republic of Viet Nam:
NGUYEN TAN DUNG
Prime Minister
Head of State : President Nguyen Minh Triet
Head of Government : Prime Minister Nguyen Tan Dung
Capital : Ha Noi
Language : Vietnamese
Currency : Dong
Ministry of Foreign Affairs of Viet Nam Website: www.mofa.gov.vn
ARTICLE 6 => ADMISSION OF NEW MEMBERS
1. The procedure for application and admission to ASEAN
shall be prescribed by the ASEAN Coordinating Council.
2. Admission shall be based on the following criteria:
(a) location in the recognised geographical region of Southeast Asia;
(b) recognition by all ASEAN Member States;
(c) agreement to be bound and to abide by the Charter; and
(d) ability and willingness to carry out the obligations of Membership.
3. Admission shall be decided by consensus by the ASEAN Summit, upon the
recommendation of the ASEAN Coordinating Council.
4. An applicant State shall be admitted to ASEAN upon
signing an Instrument of Accession to the Charter.
ARTICLE 7 => ASEAN FLAG
The ASEAN flag shall be as shown in Annex 3.
Guidelines on the use of The ASEAN FLAG
1. The ASEAN Flag is a symbol of Member States’ unity & support for the principles
& endeavours of ASEAN & a means to promote greater ASEAN awareness & solidarity.
2. The ASEAN Flag represents a stable, peaceful, united and dynamic ASEAN. The
colours of the Flag – blue, red, white and yellow – represent the main colours of the flags
of all the ASEAN Member States.
3. The blue represents peace and stability. Red depicts courage and dynamism, white
shows purity and yellow symbolises prosperity.
4. The stalks of padi in the centre of the Emblem represent the dream of ASEAN’s
Founding Fathers for an ASEAN comprising all the countries in Southeast Asia, bound
together in friendship and solidarity.
5. The circle represents the unity of ASEAN.
6. The ASEAN Flag is the reserved copyright of ASEAN.
7. The specifications of the ASEAN Flag are annexed.
A. Dignity of the ASEAN Flag
8. The ASEAN Flag shall be treated with respect and shall not be subjected to
any indignity.
ARTICLE 8 => ASEAN EMBLEM
The ASEAN emblem shall be as shown in Annex 4.
Guidelines on the Use of the ASEAN Emblem
1. The ASEAN Emblem shall be the official emblem of ASEAN.
2. The ASEAN Emblem represents a stable, peaceful, united and dynamic ASEAN.
The colours of the Emblem — blue, red, white and yellow — represent the main colours
of the state crests of all the ASEAN Member States.
3. The blue represents peace and stability. Red depicts courage and dynamism, white
shows purity and yellow symbolises prosperity.
4. The stalks of padi in the centre of the Emblem represent the dream of ASEAN’s
Founding Fathers for an ASEAN comprising all the countries in Southeast Asia, bound
together in friendship and solidarity.
5. The circle represents the unity of ASEAN.
6. The ASEAN Emblem is the reserved copyright of ASEAN.
Note:
The Guidelines were adopted at the 6th Meeting of the ASEAN Coordinating Council
(ACC), Ha Noi, 8 April 2010.
ARTICLE 9 => ASEAN DAY
The 8th of August shall be observed as ASEAN Day.
ARTICLE 10 => ASEAN ANTHEM
Guidelines on the Use of the ASEAN Anthem
1. The ASEAN Anthem is an expression of ASEAN unity. It also strengthens the sense
of ASEAN identity and belonging among the peoples of the region.
2. The ASEAN Anthem is titled “THE ASEAN WAY”, with musical composition and
lyrics as attached.
A. Dignity of the ASEAN Anthem
4. The ASEAN Anthem shall be used in a proper and dignified manner. When the
Anthem is played, the audience shall rise.
5. The Anthem shall not be used in whole or in parts for commercial purposes or
political propaganda.
Audio, "The ASEAN Way"
The Asean Way / Original Version
By :
Mr.Kittikhun Sodprasert, Mr Sampow Triudom, Mrs.Payom Valaipatchra
Lyrics, "The ASEAN Way"
Raise our flag high, sky high
Embrace the pride in our heart
ASEAN we are bonded as one
Look-in out to the world.
For peace, our goal from the very start
And prosperity to last.
Note:
The Guidelines were adopted at the 6th Meeting of the ASEAN Coordinating Council
(ACC), Ha Noi, 8 April 2010.
PURPOSES:
The Purposes of ASEAN are:
1. To maintain and enhance peace, security, stability, ASEAN study
and further strengthen peace-oriented values in the region;
2. To enhance regional resilience by promoting greater
political, security, economic and socio-cultural cooperation;
3. To preserve Southeast Asia as a Nuclear Weapon-Free
Zone and free of all other weapons of mass destruction;
4. To ensure that the peoples and Member States of ASEAN
live in peace with the world at large in a just, democratic and harmonious environment;
5. To create a single market and production base which is stable, prosperous, highly
competitive and economically integrated with effective facilitation for trade &
investment in which there is free flow of goods, services and investment; facilitated
movement of business persons, professionals, talents and labour; & freer flow of capital;
6. To alleviate poverty and narrow the development gap
within ASEAN through mutual assistance and cooperation;
7. To strengthen democracy, enhance good governance and the rule of law, and to
promote and protect human rights and fundamental freedoms, with due regard to the
rights and responsibilities of the Member States of ASEAN;
8. To respond effectively, in accordance with the principle of comprehensive security,
to all forms of threats, transnational crimes and transboundary challenges;
9. To promote sustainable development so as to ensure the protection of the region’s
environment, the sustainability of its natural resources, the preservation of its cultural
heritage and the high quality of life of its peoples;
10. To develop human resources through closer cooperation in education and life-long
learning, and in science and technology, for the empowerment of the peoples of ASEAN
and for the strengthening of the ASEAN Community;
11. To enhance well-being & livelihood of the peoples of ASEAN by providing them
with equitable access to opportunities for human development,social welfare & justice;
12. To strengthen cooperation in building a safe, secure and
drug-free environment for the peoples of ASEAN;
13. To promote a people-oriented ASEAN in which all sectors
of society are encouraged to participate in, and benefit from,
the process of ASEAN integration and community building;
14. To promote an ASEAN identity through the fostering of greater awareness of the
diverse culture and heritage of the region; and
15. To maintain the centrality and proactive role of ASEAN as the primary driving force
in its relations and cooperation with its external partners in a regional architecture that is
open, transparent and inclusive.
PRINCIPLES:
1. In pursuit of the Purposes stated in Article 1, ASEAN and its Member States
reaffirm and adhere to the fundamental principles contained in the declarations,
agreements, conventions, concords, treaties and other instruments of ASEAN.
2. ASEAN and its Member States shall act in accordance
with the following Principles:
(a) mutual respect for the independence, sovereignty, equality,
territorial integrity and national identity of all ASEAN Member States;
(b) shared commitment and collective responsibility in
enhancing regional peace, security and prosperity;
(c) renunciation of aggression and of the threat or use
of force or other actions in any manner inconsistent with international law;
(d) reliance on peaceful settlement of disputes;
(e) non-interference in the internal affairs of ASEAN Member States;
(f) respect for the right of every Member State to lead
its national existence free from external interference, subversion & coercion;
(g) enhanced consultations on matters seriously
affecting the common interest of ASEAN;
(h) adherence to the rule of law, good governance, the
principles of democracy and constitutional government;
(i) respect for fundamental freedoms, the promotion
and protection of human rights, and the promotion of social justice;
(j) upholding the United Nations Charter and
international law, including international
humanitarian law, subscribed to by ASEAN Member States;
(k) abstention from participation in any policy or activity, including the use of its
territory, pursued by any ASEAN Member State or non-ASEAN State or any
non-State actor, which threatens the sovereignty, territorial integrity or
political and economic stability of ASEAN Member States;
(l) respect for the different cultures, languages and
religions of the peoples of ASEAN, while
emphasizing their common values in the spirit of unity in diversity;
(m) the centrality of ASEAN in external political,
economic, social and cultural relations while
remaining actively engaged, outward-looking,
inclusive and non-discriminatory; and
(n) adherence to multilateral trade rules and ASEAN’s
rules-based regimes for effective implementation of
economic commitments and progressive reduction
towards elimination of all barriers to regional
economic integration, in a market-driven economy.
(o) effective cooperation among themselves.
3. In 2003 the group agreed on the pursuit of three pillars, or, "communities":
Security Community: No armed conflict has taken place among ASEAN’s members
since its inception four decades ago. Each member has agreed to resolve all conflicts by
use of peaceful diplomacy and without use of force.
Economic Community: Perhaps the most vital part of ASEAN's quest is to create a free,
integrated market in its region, much like that of the European Union. The ASEAN Free
Trade Area (AFTA) embodies this goal, eliminating virtually all tariffs (taxes on imports
or exports) in the region to increase competitiveness and efficiency. The organization is
now looking towards China and India to open up their markets in order to create the
largest free market area in the world.
Socio-cultural Community: To combat the pitfalls of capitalism and free trade, namely,
disparity in wealth and job loss, the socio-cultural community focuses on disadvantaged
groups such as rural workers, women, and children. Various programs are used to this
end, including those for HIV/AIDS, higher education, and sustainable development,
among others. The ASEAN scholarship is offered by Singapore to the other nine
members, and the University Network is a group of 21 higher education institutes that aid
each other in the region.
CHARTER:
The Secretariat of ASEAN at Jalan Sisingamangaraja No.70A, South Jakarta, Indonesia.
The ASEAN Charter serves as a firm foundation in achieving the ASEAN Community by
providing legal status and institutional framework for ASEAN. It also codifies ASEAN norms, rules and values; sets clear targets for ASEAN; and presents accountability and compliance.
The ASEAN Charter entered into force on 15 December 2008. A gathering of the ASEAN Foreign Ministers was held at the ASEAN Secretariat in Jakarta to mark this very historic occasion for ASEAN.
With the entry into force of the ASEAN Charter, ASEAN will henceforth operate under a new legal framework and establish a number of new organs to boost its community-building process.
In effect, the ASEAN Charter has become a legally binding agreement among the 10
ASEAN Member States. It will also be registered with the Secretariat of the United Nations, pursuant to Article 102, Paragraph 1 of the Charter of the United Nations.
The importance of the ASEAN Charter can be seen in the following contexts:
New political commitment at the top level New and enhanced commitments New legal framework, legal personality New ASEAN bodies Two new openly-recruited DSGs
More ASEAN meetings More roles of ASEAN Foreign Ministers New and enhanced role of the Secretary-General of ASEAN Other new initiatives and changes
ARTICLE 11 => INTERPRETATION OF THE CHARTER
1. Upon the request of any Member State, the interpretation of the Charter shall be
undertaken by the ASEAN Secretariat in accordance with the rules of procedure
determined by the ASEAN Coordinating Council.
2. Any dispute arising from the interpretation of the Charter shall be settled in
accordance with the relevant provisions in Chapter VIII.
3. Headings and titles used throughout the Charter shall
only be for the purpose of reference.
ARTICLE 12 => ORIGINAL TEXT
The signed original text of this Charter in English shall be
deposited with the Secretary-General of ASEAN, who shall
provide a certified copy to each Member State.
ARTICLE 13 => REGISTRATION OF THE ASEAN CHARTER
This Charter shall be registered by the Secretary-General of
ASEAN with the Secretariat of the United Nations, pursuant to
Article 102, paragraph 1 of the Charter of the United Nations.
STRUCTURE:
The Chair of ASEAN is rotated among the ASEAN countries on an annual basis, and acts
as host of the Summit and key ministerial meetings. The Chair of ASEAN for 2013 is
Brunei, to be followed by Myanmar in 2014.
The ASEAN Secretariat, based in Jakarta, Indonesia, coordinates, initiates and
implements ASEAN activities. The Secretariat is headed by the Secretary-General of
ASEAN, who is appointed for a five-year term and accorded ministerial status. Le Luong
Minh, former Vice Minister of Foreign Affairs of Vietnam, assumed the post of
Secretary-General of ASEAN in January 2013.
Established by the ASEAN Charter, the Jakarta-based ASEAN Committee for Permanent
Representatives (CPR) is tasked to engage Dialogue Partners.
There are a number of decision-making bodies that comprise ASEAN, spanning from
international to the very local. The most important are listed below:
Meeting of the ASEAN Heads of State and Government: The highest body made up of
the heads of each respective government; meets annually.
Ministerial Meetings: Coordinates activities in many areas including agriculture and
forestry, trade, energy, transportation, science and technology, among others; meets
annually.
Committees for External Relations: Made up of diplomats in many of the world's major
capitals.
Secretary-General: The appointed leader of the organization empowered to implement
policies and activities; appointed to five year term. Currently Surin Pitsuwan of Thailand.
Not mentioned above are over 25 other committees and 120 technical and advisory
groups.
Source: David Irvine, Making haste less slowly: Asean from 1975, in Alison Broinski (editor), Understanding
Asean, Macmillan Press Ltd, London, 1983 p.53
SETTLEMENT OF DISPUTES:
ARTICLE 12 => GENERAL PRINCIPLES
1. Member States shall endeavour to resolve peacefully all disputes in a
timely manner through dialogue, consultation and negotiation.
2. ASEAN shall maintain and establish dispute settlement
mechanisms in all fields of ASEAN cooperation.
ARTICLE 13 => GOOD OFFICES, CONCILIATION AND MEDIATION
1. Member States which are parties to a dispute may at any time agree to
resort to good offices, conciliation or mediation in order to resolve the dispute
within an agreed time limit.
2. Parties to the dispute may request the Chairman of ASEAN or the
Secretary-General of ASEAN, acting in an exofficio capacity, to provide good
offices, conciliation or mediation.
ARTICLE 14 => DISPUTE SETTLEMENT MECHANISMS IN SPECIFIC
INSTRUMENTS
1. Disputes relating to specific ASEAN instruments shall be settled through
the mechanisms and procedures provided for in such instruments.
2. Disputes which do not concern the interpretation or application of any ASEAN
instrument shall be resolved
peacefully in accordance with the Treaty of Amity and
Cooperation in Southeast Asia and its rules of procedure.
3. Where not otherwise specifically provided, disputes which
concern the interpretation or application of ASEAN economic
agreements shall be settled in accordance with the ASEAN
Protocol on Enhanced Dispute Settlement Mechanism.
ARTICLE 15 => ESTABLISHMENT OF DISPUTE SETTLEMENT
MECHANISMS
Where not otherwise specifically provided, appropriate dispute settlement mechanisms,
including arbitration, shall be established for disputes which concern the interpretation or
application of this Charter and other ASEAN instruments.
ARTICLE 16 => UNRESOLVED DISPUTES
When a dispute remains unresolved, after the application of the preceding provisions of
this Chapter, this dispute shall be referred to the ASEAN Summit, for its decision.
ARTICLE 17 => COMPLIANCE
1. The Secretary-General of ASEAN, assisted by the ASEAN Secretariat or any other
designated ASEAN body, shall monitor the compliance with the findings,
recommendations or decisions resulting from an ASEAN dispute settlement mechanism,
and submit a report to the ASEAN Summit.
2. Any Member State affected by non-compliance with the findings, recommendations
or decisions resulting from an ASEAN dispute settlement mechanism, may refer the
matter to the ASEAN Summit for a decision.
DECISION-MAKING:
ARTICLE 18 => DECISION-MAKING CONSULTATION AND
CONSENSUS
1. As a basic principle, decision-making in ASEAN shall be
based on consultation and consensus.
2. Where consensus cannot be achieved, the ASEAN
Summit may decide how a specific decision can be made.
3. Nothing in paragraphs 1 and 2 of this Article shall affect the modes of decision-making
as contained in the relevant ASEAN legal instruments.
4. In the case of a serious breach of the Charter or noncompliance,
the matter shall be referred to the ASEAN Summit for decision.
ARTICLE 19 => IMPLEMENTATION AND PROCEDURE
1. Each ASEAN Community Council shall prescribe its own rules of procedure.
2. In the implementation of economic commitments, a
formula for flexible participation, including the ASEAN Minus X
formula, may be applied where there is a consensus to do so.
BUDGET AND FINANCE:
ARTICLE 20 => GENERAL PRINCIPLES
1. ASEAN shall establish financial rules and procedures in
accordance with international standards.
2. ASEAN shall observe sound financial management
policies and practices and budgetary discipline.
3. Financial accounts shall be subject to internal and external audits.
ARTICLE 21 => OPERATIONAL BUDGET AND FINANCES
OF THE ASEAN SECRETARIAT
1. The ASEAN Secretariat shall be provided with the
necessary financial resources to perform its functions effectively.
2. The operational budget of the ASEAN Secretariat shall be
met by ASEAN Member States through equal annual
contributions which shall be remitted in a timely manner.
3. The Secretary-General shall prepare the annual operational budget of the ASEAN
Secretariat for approval by the ASEAN Coordinating Council upon the recommendation of
the Committee of Permanent Representatives.
4. The ASEAN Secretariat shall operate in accordance with the financial rules and
procedures determined by the ASEAN Coordinating Council upon the recommendation of
the Committee of Permanent Representatives.
ADMINISTRATION AND PROCEDURE:
ARTICLE 22 => CHAIRMAN OF ASEAN
1. The Chairmanship of ASEAN shall rotate annually, based
on the alphabetical order of the English names of Member
States.
2. ASEAN shall have, in a calendar year, a single Chairmanship by which the
Member State assuming the Chairmanship shall chair:
(a) the ASEAN Summit and related summits;
(b) the ASEAN Coordinating Council; (c) the three ASEAN Community Councils; (d) where appropriate, the relevant ASEAN Sectoral
Ministerial Bodies and senior officials; and (e) the Committee of Permanent Representatives.
ARTICLE 23 => ROLE OF THE CHAIRMAN OF ASEAN
The Member State holding the Chairmanship of ASEAN shall:
(a) actively promote and enhance the interests and wellbeing of ASEAN, including efforts to build an ASEAN Community through policy initiatives, coordination, consensus and cooperation;
(b) ensure the centrality of ASEAN; (c) ensure an effective and timely response to urgent issues or crisis situations affecting
ASEAN, including providing its good offices and such other arrangements to immediately address these concerns; (d) represent ASEAN in strengthening and promoting closer relations with external partners; and
(e) carry out such other tasks and functions as may be mandated.
ARTICLE 24 => WORKING LANGUAGE OF ASEAN
The working language of ASEAN shall be English.
ORGANS:
ARTICLE 25 => ASEAN SUMMIT
1. The ASEAN Summit shall comprise the Heads of State or Government of the Member States. 2. The ASEAN Summit shall:
(a) be the supreme policy-making body of ASEAN;
(b) deliberate, provide policy guidance and take decisions on key issues
pertaining to the realization of the objectives of ASEAN, important matters of
interest to Member States and all issues referred to it by the ASEAN
Coordinating Council, the ASEAN Community Councils and ASEAN Sectoral
Ministerial Bodies;
(c) instruct the relevant Ministers in each of the Councils concerned to hold ad hoc
inter-Ministerial meetings, and address important issues concerning ASEAN that
cut across the Community Councils. Rules of procedure for such meetings shall
be adopted by the ASEAN Coordinating Council;
(d) address emergency situations affecting ASEAN by taking appropriate actions;
(e) decide on matters referred to it under Chapters VII and VIII;
(f) Authorise the establishment and the dissolution of
Sectoral Ministerial Bodies and other ASEAN institutions; and
(g) appoint the Secretary-General of ASEAN, with the
rank and status of Minister, who will serve with the
confidence and at the pleasure of the Heads of
State or Government upon the recommendation of
the ASEAN Foreign Ministers Meeting.
3. ASEAN Summit Meetings shall be:
(a) held twice annually, and be hosted by the Member State holding the ASEAN Chairmanship; and
(b) convened, whenever necessary, as special or ad
hoc meetings to be chaired by the Member State
holding the ASEAN Chairmanship, at venues to be
agreed upon by ASEAN Member States.
List of ASEAN Summits
ASEAN Summits Venue Date
First ASEAN Summit Bali, Indonesia 23-24 February 1976
Second ASEAN Summit Kuala Lumpur, Malaysia 4-5 August 1977
Third ASEAN Summit Manila, the Philippines 14-15 December 1987
Fourth ASEAN Summit Singapore 27-29 January 1992
Fifth ASEAN Summit Bangkok, Thailand 14-15 December 1995
First Informal ASEAN Summit Jakarta, Indonesia 30 November 1996
Second Informal ASEAN Summit Kuala Lumpur, Malaysia 14-16 December 1997
Sixth ASEAN Summit Ha Noi, Vietnam 15-16 December 1998
Third Informal ASEAN Summit Manila, the Philippines 27-28 November 1999
Fourth Informal ASEAN Summit Singapore 22-25 November 2000
Seventh ASEAN Summit and Related Summits
Bandar Seri Begawan, Brunei Darussalam
5-6 November 2001
Eight ASEAN Summit and Related Summits
Phnom Penh, Cambodia 4-5 November 2002
Ninth ASEAN Summit and Related Bali, Indonesia 7-8 November 2003
Summits
Tenth ASEAN Summit and Related
Summits Vientiane, Lao PDR 29-30 November 2004
Eleventh ASEAN Summit and
Related Summits Kuala Lumpur, Malaysia 12-14 December 2005
Twelfth ASEAN Summit and Related Summits
Cebu, the Philippines 9-15 January 2007
Thirteenth ASEAN Summit and Related Summits
Singapore 18-22 November 2007
Fourteenth ASEAN Summit and Related Summits
Cha-am Hua Hin, Thailand 26 February – 1
March 2009
Fifteenth ASEAN Summit and
Related Summits Cha-am Hua Hin, Thailand 23-25 October 2009
Sixteenth ASEAN Summit Ha Noi 28-30 October 2010
Seventeenth ASEAN Summit Ha Noi 28-30 October 2010
Eighteenth ASEAN Summit Jakarta 7-8 May 2011
Nineteenth ASEAN Summit Bali, Indonesia 14-19 November 2011
Twentieth ASEAN Summit Phnom Penh 03-04 April 2012
Twentyfirst ASEAN Summit Phnom Penh 18 November 2012
ARTICLE 26 => ASEAN COORDINATING COUNCIL
1. The ASEAN Coordinating Council shall comprise the ASEAN Foreign Ministers and meet at least twice a year.
2. The ASEAN Coordinating Council shall:
(a) prepare the meetings of the ASEAN Summit;
(b) coordinate the implementation of agreements & decisions of ASEAN Summit;
(c) coordinate with the ASEAN Community Councils to
enhance policy coherence, efficiency and cooperation among them;
(d) coordinate the reports of ASEAN Community Councils to ASEAN Summit;
(e) consider the annual report of the Secretary-General on the work of ASEAN;
(f) consider the report of the Secretary-General on the functions and operations
of the ASEAN Secretariat and other relevant bodies;
(g) approve the appointment and termination of the Deputy Secretaries-General
upon the recommendation of the Secretary-General; and
(h) undertake other tasks provided for in this Charter or such other functions as
may be assigned by the ASEAN Summit.
3. The ASEAN Coordinating Council shall be supported by the relevant senior officials.
ARTICLE 27 => ASEAN COMMUNITY COUNCILS
1. The ASEAN Community Councils shall comprise the ASEAN Political-Security
Community Council, ASEAN Economic Community Council, and ASEAN Socio-
Cultural Community Council.
2. Each ASEAN Community Council shall have under its
purview the relevant ASEAN Sectoral Ministerial Bodies.
3. Each Member State shall designate its national
representation for each ASEAN Community Council meeting.
4. In order to realise the objectives of each of the three
pillars of the ASEAN Community, each ASEAN Community Council shall:
(a) ensure the implementation of the relevant decisions of the ASEAN Summit;
(b) coordinate the work of the different sectors under its purview, and on issues
which cut across the other Community Councils; and
(c) submit reports and recommendations to the ASEAN
Summit on matters under its purview.
5. Each ASEAN Community Council shall meet at least twice a year and shall be
chaired by the appropriate Minister from the Member State holding the ASEAN
Chairmanship.
6. Each ASEAN Community Council shall be supported by
the relevant senior officials.
ARTICLE 28 => ASEAN SECTORAL MINISTERIAL BODIES
1. ASEAN Sectoral Ministerial Bodies shall:
(a) function in accordance with their respective established mandates;
(b) implement the agreements and decisions of the
ASEAN Summit under their respective purview;
(c) strengthen cooperation in their respective fields in support of
ASEAN integration and community building; and
(d) submit reports and recommendations to their respective Community Councils.
2. Each ASEAN Sectoral Ministerial Body may have under its purview the relevant
senior officials and subsidiary bodies to undertake its functions as contained in Annex 1.
The Annex may be updated by the Secretary-General of ASEAN upon the
recommendation of the Committee of Permanent Representatives without recourse to the
provision on Amendments under this Charter.
ARTICLE 29 => SECRETARY-GENERAL OF ASEAN AND ASEAN
SECRETARIAT
1. The Secretary-General of ASEAN shall be appointed by the ASEAN Summit for a
non-renewable term of office of five years, selected from among nationals of the ASEAN
Member States based on alphabetical rotation, with due consideration to integrity,
capability and professional experience, and gender equality.
2. The Secretary-General shall:
(a) carry out the duties & responsibilities of this high office in accordance with the
provisions of Charter & relevant ASEAN instruments,protocols & established practices;
(b) facilitate and monitor progress in the implementation of ASEAN agreements
and decisions, and submit an annual report on the work of ASEAN to ASEAN Summit;
(c) participate in meetings of the ASEAN Summit, the ASEAN Community
Councils, the ASEAN Coordinating Council, and ASEAN Sectoral Ministerial Bodies
and other relevant ASEAN meetings;
(d) present the views of ASEAN and participate in meetings with external parties
in accordance with approved policy guidelines and mandate given to the
Secretary-General; and
(e) recommend the appointment and termination of the Deputy Secretaries-General
to the ASEAN Coordinating Council for approval.
3. The Secretary-General shall also be the Chief Administrative Officer of ASEAN.
4. The Secretary-General shall be assisted by four Deputy Secretaries-General with the
rank and status of Deputy Ministers. The Deputy Secretaries-General shall be
accountable to the Secretary-General in carrying out their functions.
5. The four Deputy Secretaries-General shall be of different nationalities from the
Secretary-General and shall come from four different ASEAN Member States.
6. The four Deputy Secretaries-General shall comprise:
(a) two Deputy Secretaries-General who will serve a non-renewable term of three
years, selected from among nationals of the ASEAN Member States
based on alphabetical rotation, with due consideration to integrity, qualifications,
competence, experience and gender equality; and
(b) two Deputy Secretaries-General who will serve a term of three years, which
may be renewed for another three years. These two Deputy Secretaries-General shall be
openly recruited based on merit.
7. The ASEAN Secretariat shall comprise the Secretary-General and
such staff as may be required.
8. The Secretary-General and the staff shall:
(a) uphold the highest standards of integrity, efficiency, and
competence in the performance of their duties;
(b) not seek or receive instructions from any government or external
party outside of ASEAN; and
(c) refrain from any action which might reflect on their position as ASEAN
Secretariat officials responsible only to ASEAN.
9. Each ASEAN Member State undertakes to respect the exclusively ASEAN character
of the responsibilities of the Secretary-General and the staff, and not to seek to influence
them in the discharge of their responsibilities.
ARTICLE 30 => COMMITTEE OF PERMANENT REPRESENTATIVES
TO ASEAN
1. Each ASEAN Member State shall appoint a Permanent
Representative to ASEAN with the rank of Ambassador based in Jakarta.
2. The Permanent Representatives collectively constitute a
Committee of Permanent Representatives, which shall:
(a) support the work of the ASEAN Community
Councils and ASEAN Sectoral Ministerial Bodies;
(b) coordinate with ASEAN National Secretariats and
other ASEAN Sectoral Ministerial Bodies;
(c) liaise with the Secretary-General of ASEAN and the
ASEAN Secretariat on all subjects relevant to its work;
(d) facilitate ASEAN cooperation with external partners; and
(e) perform such other functions as may be determined
by the ASEAN Coordinating Council.
ARTICLE 31 => ASEAN NATIONAL SECRETARIATS
Each ASEAN Member State shall establish an ASEAN National Secretariat which shall:
(a) serve as the national focal point;
(b) be the repository of information on all ASEAN matters at the national level;
(c) coordinate the implementation of ASEAN decisions at the national level;
(d) coordinate and support the national preparations of ASEAN meetings;
(e) promote ASEAN identity and awareness at the national level; and
(f) contribute to ASEAN community building.
ARTICLE 32 => ASEAN HUMAN RIGHTS BODY
1. In conformity with the purposes and principles of the ASEAN Charter relating to the
promotion and protection of human rights and fundamental freedoms, ASEAN shall
establish an ASEAN human rights body.
2. This ASEAN human rights body shall operate in
accordance with the terms of reference to be determined by the
ASEAN Foreign Ministers Meeting.
ARTICLE 33 => ASEAN FOUNDATION
1. The ASEAN Foundation shall support the Secretary-General of
ASEAN and collaborate with the relevant ASEAN bodies to support ASEAN community
building by promoting greater awareness of the ASEAN identity, people-to-people
interaction, and close collaboration among the business sector, civil society,
academia and other stakeholders in ASEAN.
2. The ASEAN Foundation shall be accountable to the
Secretary-General of ASEAN, who shall submit its report to the
ASEAN Summit through the ASEAN Coordinating Council.
ASEAN HEAD OF DEPARTMENT:
Source: David Irvine (1983). Making haste less slowly: Asean from 1975. In Alison Broinski (edt. Understanding Asean. London: Macmillan Press Ltd. pg 60
ENTITIES ASSOCIATED WITH ASEAN:
1. ASEAN may engage with entities which support the ASEAN Charter, in particular
its purposes and principles. These associated entities are listed in Annex
2. Rules of procedure and criteria for engagement shall be prescribed by the
Committee of Permanent Representatives upon the recommendation of the Secretary-
General of ASEAN.
3. Annex 2 may be updated by the Secretary-General of ASEAN upon the
recommendation of the Committee of Permanent Representatives without recourse to the
provision on Amendments under this Charter.
ARTICLE 34 => Parliamentarians
ASEAN Inter-Parliamentary Assembly (AIPA)
ARTICLE 35 => Business Organisations
• ASEAN Airlines Meeting
• ASEAN Alliance of Health Supplement Association (AAHSA)
• ASEAN Automotive Federation (AAF)
• ASEAN Bankers Association (ABA)
• ASEAN Business Advisory Council (ASEAN-BAC)
• ASEAN Business Forum (ABF)
• ASEAN Chamber of Commerce and Industry (ASEAN-CCI)
• ASEAN Chemical Industries Council
• ASEAN Federation of Textiles Industries (AFTEX)
• ASEAN Furniture Industries Council (AFIC)
• ASEAN Insurance Council (AIC)
• ASEAN Intellectual Property Association (ASEAN IPA)
• ASEAN International Airports Association (AAA)
• ASEAN Iron & Steel Industry Federation
• ASEAN Pharmaceutical Club
• ASEAN Tourism Association (ASEANTA)
• Federation of ASEAN Economic Associations (FAEA)
• Federation of ASEAN Shippers’ Council
• US-ASEAN Business Council
ARTICLE 36 => Think Tanks and Academic Institution
ASEAN-ISIS Network
ARTICLE 37 => ASEAN-Accredited Civil Society Organisations (CSOs)
Activities of ASEAN Accredited CSOs
AFA Dialogue with International Federation of Accountants Compliance Advisory Panel
(IFAC CAP), Bangkok, 19 January 2009
Note: The Guidelines were adopted at the 6th Meeting of the ASEAN Coordinating Council (ACC), Ha Noi, 8 April 2010.
• ASEANAPOL
• Federation of Institutes of Food Science and Technology in ASEAN
(FIFSTA)
• Southeast Asian Fisheries Development Centre (SEAFDEC)
• Working Group for an ASEAN Human Rights Mechanism
EXTERNAL RELATIONS:
ARTICLE 38 => CONDUCT OF EXTERNAL RELATIONS
1. ASEAN shall develop friendly relations and mutually
beneficial dialogue, cooperation and partnerships with countries
and sub-regional, regional and international organisations and
institutions.
2. The external relations of ASEAN shall adhere to the
purposes and principles set forth in this Charter.
3. ASEAN shall be the primary driving force in regional arrangements that it initiates
and maintain its centrality in regional cooperation and community building.
4. In the conduct of external relations of ASEAN, Member
States shall, on the basis of unity and solidarity, coordinate and
endeavour to develop common positions and pursue joint actions.
5. The strategic policy directions of ASEAN’s external
relations shall be set by the ASEAN Summit upon the
recommendation of the ASEAN Foreign Ministers Meeting.
6. The ASEAN Foreign Ministers Meeting shall ensure
consistency and coherence in the conduct of ASEAN’s external relations.
7. ASEAN may conclude agreements with countries or subregional,
regional and international organisations and institutions. The procedures for concluding
such agreements shall be prescribed by the ASEAN Coordinating Council in
consultation with the ASEAN Community Councils.
ARTICLE 39 => DIALOGUE COORDINATOR
1. Member States, acting as Country Coordinators, shall take turns to take overall
responsibility in coordinating and promoting the interests of ASEAN in its relations with
the relevant Dialogue Partners, regional and international organisations and institutions.
2. In relations with the external partners, the Country Coordinators shall, inter alia:
(a) represent ASEAN and enhance relations on the
basis of mutual respect and equality, in conformity with ASEAN’s principles;
(b) co-chair relevant meetings between ASEAN and external partners; and
(c) be supported by the relevant ASEAN Committees in
Third Countries and International Organisations.
ARTICLE 40 => STATUS OF EXTERNAL PARTIES
1. In conducting ASEAN’s external relations, the ASEAN
Foreign Ministers Meeting may confer on an external party the
formal status of Dialogue Partner, Sectoral Dialogue Partner,
Development Partner, Special Observer, Guest, or other status
that may be established henceforth.
2. External parties may be invited to ASEAN meetings or
cooperative activities without being conferred any formal status,
in accordance with the rules of procedure.
ASEAN–India Free Trade Area :
Asean, India, Manmohan Singh, Japan, Yukio Hatayama, East Asia Summit, India-Asean Round
Table, Thailand : http://www.thehindu.com
IN WITNESS WHEREOF, WE have signed this Framework Agreement on Comprehensive
Economic Cooperation between the Republic of India and the Association of South East Asian Nations.
DONE at Bali, this 8th day of October, 2003 in duplicate copies in the English Language.
Description for the Following image:
India ready to sign FTA in Services, Investment with ASEAN: PM
Manmohan to hold talks with Wen November 18, 2012
The ASEAN–India Free Trade Area (AIFTA) is a free trade area among the ten
member states of the Association of Southeast Asian Nations (ASEAN) and India. The
initial framework agreement was signed on 8 October 2003 in Bali, Indonesia. and the
final agreement was on 13 August 2009. The free trade area came into effect on
1st January 2010. India hosted the latest ASEAN-India Commemorative Summit in New
Delhi on December 20–21, 2012.
ARTICLE 41 => Background
The ASEAN–India Free Trade Area emerged from a mutual interest of both parties to
expand their economic ties in the Asia-Pacific region. India's "Look East" policy was
reciprocated by similar interests of many ASEAN countries to expand their interactions
westward.
After India became a sectoral dialogue partner of ASEAN in 1992, India saw its trade with
ASEAN increase relative to its trade with the rest of the world. Between 1993 and 2003,
ASEAN-India bilateral trade grew at an annual rate of 11.2%, from US$ 2.9 billion in 1993
to US$ 12.1 billion in 2003. Much of India's trade with ASEAN is directed towards
Singapore, Malaysia, and Thailand, with whom India holds strong economic relations.
In 2008, the total volume of ASEAN-India trade was US$ 47.5 billion. ASEAN’s export to
India was US$ 30.1 billion – a growth of 21.1 per cent in comparison with that of 2007.
ASEAN’s imports from India were US$ 17.4 billion – a growth of 40.2 per cent in
comparison to that of 2006. As for foreign direct investment (FDI), the inflow from India to
ASEAN Member States was US$ 476.8 million in 2008, accounting for 0.8 per cent of total
FDI in the region. Total Indian FDI into ASEAN from 2000 to 2008 was US$ 1.3 billion.
The ASEAN-Dialogue Partners trade and investment statistic data can be accessed through
http://www.asean.org/22122.htm.
Acknowledging this trend and recognising the economic potential of closer linkages, both
sides recognised the opportunities for deepening trade and investment ties, and agreed to
negotiate a framework agreement to pave the way for the establishment of an ASEAN–India
Free Trade Area (FTA).
ARTICLE 42 => History
At the Second ASEAN-India Summit in 2003, the ASEAN-India Framework Agreement on
Comprehensive Economic Cooperation was signed by the Leaders of ASEAN and India. The
Framework Agreement laid a sound basis for the eventual establishment of an ASEAN-India
Regional Trade and Investment Area (RTIA), which includes FTA in goods, services, and
investment.
ASEAN and India signed the ASEAN-India Trade in Goods (TIG) Agreement in Bangkok
on 13 August 2009, after six years of negotiations. The ASEAN-India TIG Agreement
entered into force on 1 January 2010. The 7th ASEAN-India Summit in Cha-am Hua Hin,
Thailand on 24 October 2009 agreed to revise the bilateral trade target to 70 billion USD to
be achieved in the next two years, noting that the initial target of USD 50 billion set in 2007
may soon be surpassed.
ASEAN-India trade grew at over 22 percent annually during the 2005-2011 period. Trade
between India and ASEAN in 2011-2012 increased by more than 37 percent to $79 billion,
which was more than the target of $70 billion set in 2009.
At the 10th ASEAN-India Summit in New Delhi on December 20, 2012, India and ASEAN
concluded negotiations for FTAs in services and investments. The two sides expect bilateral
trade to increase to $100 billion by 2015, and $200 billion within a decade.
ASEAN and India are also working on enhancing private sector engagement. Details on the
re-activation of the ASEAN-India Business Council (AIBC), the holding of the ASEAN-
India Business Summit (AIBS) and an ASEAN-India Business Fair (AIBF), are being
worked out by officials.
The Fourteenth ASEAN Transport Ministers (ATM) Meeting on 6 November 2008 in
Makati, Metro Manila, Philippines adopted the ASEAN-India Aviation Cooperation
Framework, which will lay the foundation for closer aviation cooperation between ASEAN
and India. The ASEAN-India Air Transport Agreement (AI-ATA) is being negotiated with
the implementation timeline of 2011.
ARTICLE 43 => Tariffs
The signing of the ASEAN-India Trade in Goods Agreement paves the way for the creation
of one of the world’s largest FTAs – a market of almost 1.8 billion people with a combined
GDP of US$ 2.8 trillion. The ASEAN-India FTA will see tariff liberalization of over 90
percent of products traded between the two dynamic regions, including the so-called “special
products,” such as palm oil (crude and refined), coffee, black tea and pepper. Tariffs on over
4,000 product lines will be eliminated by 2016, at the earliest.
ARTICLE 44 => Criticism
While there are many benefits to the ASEAN-India FTA, there is concern in India that the
agreement will have several negative impacts on the economy. As previously stated, the two
regions aim to reduce their tariffs on a majority of their traded goods. This will allow them to
increase the market access of their products. It is criticized, however, that India will not
experience as great an increase in market access to ASEAN countries as ASEAN will in
India. The economies of the ASEAN countries are largely export-driven, maintaining high
export-to-GDP ratios (in 2007, Malaysia had a ratio of almost 100%). Considering this, as
well as the global financial crisis and India's expansive domestic market, the ASEAN
countries will look eagerly towards India as a home for its exports.
Since the early 2000s, India has had an increasing trade deficit with ASEAN, with imports
exceeding exports by more than US$6 billion in 2007-2008. It is feared that a gradual
liberalization of traiffs and a rise in imported goods into India will threaten several sectors of
the economy, specifically the plantation sector, some manufacturing industries, and the
marine products industry. As a dominant exporter of light manufacturing products, ASEAN
has competitive tariff rates that make it difficult for India to gain access to the industry
market in ASEAN countries.
Before the agreement was signed, the Chief Minister of Kerala, V.S. Achuthanadan, led a
delegation to the Indian Prime Minister protesting against the FTA. The state of Kerala is an
important exporter in the national export of plantation products. It fears that cheap imports of
rubber, coffee, and fish would lower domestic production, adversely affecting farmers and
ultimately its economy. Kerala has already experienced a flooding of its market with
inexpensive imports under the South Asia Free Trade Agreement of 2006. Cheap coconuts
from Sri Lanka and palm oil from Malaysia has since hindered Kerala's coconut cultivation.
To alleviate the losses that arise from the initial stages of trade, the Government of India
must be able to effectively redistribute some of the wealth to those industries who suffer
from the increased competition with ASEAN markets. This way, total welfare gains in India
would increase and India would ultimately benefit from trade with ASEAN.
CONCLUSION:
To ensure political condition of Southeast Asia, ASEAN has struggled to implement various
efforts even though the implementation was little bit slowly. This show ASEAN spirit and
sense of belongings as what been stated by former Malaysia
Prime Minister Tun Dr. Mahathir Mohammad and it is the secret of ASEAN successful by
holding on 5 Cs which are Consolidation, Consultation, Consensus, Caring and Cornerstone.
Consultation is one way of decision making among ASEAN countries’ leader with frequent
contact and negotiation to gain Consensus or collective agreement in every decision made.
Caring is a concern feeling and each ASEAN country need to has high spirit and always
think about ASEAN interest besides their individual needs. Cornerstone is the direction that
is needs every ASEAN country to establish their foreign policy as an ASEAN country based
on ASEAN spirit.
Consolidation or unity required all ASEAN countries to unite in any action taken. ASEAN
was born while the world is having tension in Cold War and unsecured security. Because of
this, it has made ASEAN busy in political problems. Even though ASEAN countries possess
different strategic and security perspective, ASEAN unity has manage to come with big
success in creating peace. It can be seen when ZOPFAN concept was declared during
ASEAN Head of State Summit in Kuala Lumpur in 1971. The treaty based on sovereignty
respect principles of other countries, non-intervention on internal affairs, to solve regional
internal issues with peace and effective cooperation. The treaty also had come out with code
of conduct of peaceful solution for every conflict based on ASEAN principles as conflict
solving mechanism. Until now, ZOPFAN concept manage to be the only applied regional
diplomatic tool in providing mechanism and process for peaceful solution in any dispute.
ASEAN was not the organization or body to establish cooperation among Southeast Asia
countries but has become an important society to East Asia countries. Moreover, ASEAN
and East Asia are also defending their interest and direction and working together to increase
regional economic integration. In order to measure the effectiveness of economic
development, ASEAN needs several solid strategies to ensure member countries to enhance
their economic level accordance to ASEAN direction to prosperous regional economy. By
making China and Japan that have rapid growth in economy, it is an advantage for ASEAN
to develop cooperation and maintaining peace among member countries. With constructive
experiences and principles accepted by regional countries, ASEAN become stronger in
establishing stability and prosperous according to their own mould.
After 40 years, many consider ASEAN to be very successful in part because of the ongoing
stability in the region. Instead of worrying about military conflict, its member countries have
been able to focus on development of their political and economic systems.
The group has also made a strong stance against terrorism with regional partner, Australia. In
the wake of the terrorist attacks in Bali and Jakarta in the past eight years, ASEAN has
refocused its efforts to prevent incidents and capture perpetrators.
In November 2007 the group signed a new charter that established ASEAN as a rule-based
entity that would promote efficiency and concrete decisions rather than simply a large
discussion group it has sometimes been labeled. The charter also commits members to
advocate democratic ideals and human rights.
ASEAN is often criticized for saying on the one hand that democratic principles guide them,
while on the other allowing human rights violations to occur in Myanmar, and socialism to
rule in Vietnam and Laos. Protesters of free market who fear the loss of local jobs and
economies have appeared all over the region, most notably at the 12th ASEAN summit in
Cebu in the Philippines.
Despite any objections, ASEAN is well on its way to full economic integration and is making
great strides to fully assert itself on the world market.
BIBLIOGRAPHY:
Reference book
Dr. G. K. KalKoti
Dr. G. Rajalakshmy
on the Web
ASEAN Official Site http://www.asean.org/22122.htm. http://www.asil.org/aseanevent/sim_intro_to_asean.pdf http://www.asean.org/archive/publications/ASEAN-Charter.pdf http://commerce.nic.in/agree_asean.htm
http://www.thehindu.com
Suggested Reading
The United Nations
Commonwealth of Nations Introduction to the ASEAN Economic Community - International Law Office
THANK YOU !!!