EU could be ASEAN's best bet in hedging against US-China rivalry uncertainties

The world's two most active regional organisations - the Association of Southeast Asian Nations (ASEAN) and the European Union (EU) celebrated their 45th anniversary of dialogue relations on 14 December 2022 in Brussels, Belgium.

The summit was significant, as it was the first time that most leaders from ASEAN and EU member states met in person. In past summits, the EU was represented by just the president of the European Council.

Past summits were not given such prominence, partly due to the limited representation of the EU. The EU has been accused in the past of "preaching" (to ASEAN) on issues such as democracy, human rights, and fundamental freedoms, issues on which some ASEAN countries cannot see eye-to-eye with the EU.

Furthermore, the EU has not joined any of the more prestigious ASEAN-led mechanisms such as the East Asia Summit and the ASEAN Defence Ministers' Meeting Plus.

Relations between ASEAN and the EU have been overshadowed by the China-US strategic rivalry. It is therefore unsurprising that the perception of the EU within the ASEAN region has declined in recent years.

The EU lost its top position in 2021 as a global free trade champion in the State of Southeast Asia 2022 Survey Report, dropping to fourth place after the US, China and ASEAN. The same report showed that the EU, previously the region's top choice for demonstrating global leadership in maintaining a rules-based order and upholding international law since 2019, has now dropped to third place after the US and ASEAN.

Despite these challenges, the convening of this ASEAN-EU leaders' summit is itself a victory. Where ASEAN is concerned, symbolism is as important as substance. The summit covered substantive issues, including a seemingly frank discussion on the Russia-Ukraine quagmire - an issue of existential importance to the EU.

Like the G20 formulation, the ASEAN-EU joint statement contained qualified caveats such as, "[M]ost members strongly condemned the war in Ukraine" while acknowledging that there were "other views and different assessments of the situation and sanctions". Conceivably, it was a statement that all the representatives could live with.

Economic cooperation, particularly connectivity, digital transitions, trade and sustainable supply chains were high on the agenda. Sustainable development, environment, climate change, energy and food security matters took centre stage.

Could this commemorative summit revive the ASEAN region's perception of the EU? What are the strategic imperatives that can help to shore up the EU's place in the region as a significant player in the Indo-Pacific?

The two blocs possess sufficient gravitas as successful regional organisations that can strengthen the international rules-based order and promote regionalism and multilateralism. The two organisations are natural partners in integration with the main goal of promoting international law (mentioned ten times in the joint statement) and a rules-based multilateral system.

Russia's invasion of Ukraine was a key consideration in negotiating the joint statement, where language on the importance of international law (particularly respect for sovereignty and territorial integrity) prevailed. The language in the Joint Leaders' Statement mentioned Russia's aggression in paragraph 46 - a formulation otherwise not seen in any prior ASEAN statements. It is clear that, rhetorically at least, such principles will not be compromised where the EU is concerned, in its cooperation with ASEAN.

The EU finally signed Partnership and Cooperation Agreements (PCAs) with Thailand and Malaysia at the sidelines of the summit. These PCAs signal an intent towards negotiating bilateral free trade agreements (FTAs). With two free trade agreements (FTAs) with Singapore and Vietnam in place, the EU's PCAs with Indonesia, Philippines, and now Thailand and Malaysia, will serve as important milestones towards the longer-term objective of a ASEAN-EU FTA.

Although discussions on the bloc-to-bloc FTA have stalled, trade and connectivity clearly still matter; the EU is ASEAN's second largest foreign investor and third largest trading partner (behind China and the US).

Apart from trade, the EU's announcement of its contribution of 10 billion euros for the implementation of the Global Gateway (EU's sustainable connectivity and infrastructure fund) for the ASEAN region could help to boost connectivity investments and to provide an alternative to China's Belt and Road Initiative.

The EU could be ASEAN's best bet in hedging against some of the uncertainties brought about by US-China rivalry. In the State of Southeast Asia 2022 report, the EU is clearly the region's trusted and preferred choice as a middle power (when taken as a bloc) that can provide some strategic equilibrium. Leveraging its strength and expanding its role in ASEAN-related matters can help the EU better play the great game in the Indo-Pacific in line with the region's expectations.

The EU knows that the Indo-Pacific is a region of growth and opportunity and will seek greater alignment between the ASEAN Outlook on the Indo-Pacific and the EU's Strategy for Cooperation in the Indo-Pacific. The EU has thus far refrained from joining "mini-lateral" arrangements such as the Quad (Quadrilateral Security Dialogue). ASEAN may thus seek greater strategic leverage vis-à-vis the EU.

With more than a third of the joint statement devoted to meeting the challenges of sustainable development, environment, climate change and energy, accelerating ASEAN-EU cooperation in these areas will position both organisations as potential leaders. The summit affirmed the convening of an ASEAN-EU Ministerial-level dialogue on Environment and Climate Change in 2023. A regular ministerial level dialogue is an indication that both sides prioritise the issue.

As strategic partners, ASEAN and the EU have an ever greater interest in finding closer strategic alignments when the world is facing dire and multifaceted transnational challenges. The recent commemorative summit has hopefully set the tone for elevated engagement. In the next stage of ASEAN-EU engagement, more regular leaders-level summits and more inclusive EU membership in ASEAN-led mechanisms should be encouraged.

This article was first published by ISEAS - Yusof Ishak Institute as a Fulcrum commentary.

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