By H.E. Ong Keng Yong, Secretary-General of ASEAN
at the Opening Ceremony of the Regional Workshop on
“Bridging Development Gaps in ASEAN: Key Challenges Towards the Realisation of ASEAN Community”
Luang Prabang, Lao PDR, 26-28 February 2007
His Excellency Phongsavath Boupha, Vice Minister of Foreign Affairs of Lao PDR,
Excellencies, Distinguished Participants, Ladies and Gentlemen,
I would like to thank the Konrad Adenauer Stiftung for its interest and support for ASEAN, especially in the narrowing development gaps among ASEAN Member Countries, and the Institute of Foreign Affairs, Lao PDR for hosting this event.
It is an honour for me to be here amongst the distinguished guests and participants of this important Regional Workshop.
ASEAN Community
The ASEAN Community, which is envisaged to be realised by 2015, would rest essentially on three pillars: ASEAN Economic Community (AEC), the ASEAN Security Community (ASC) and the ASEAN Socio-Cultural Community (ASCC) respectively.
The AEC is envisaged as a single market and production base with a free flow of goods, services, investment, skilled labour and a freer flow of capital.
To increase the pace of economic integration and better equip ASEAN to face the challenge of global competition, the ASEAN Leaders, at the 12th ASEAN Summit in the Philippines on 13 January 2007, agreed that the target date for creating the ASEAN Community be brought forward by five years to 2015.
ASEAN will study the implications for the CLMV on accelerating ASEAN integration to 2015.
For ASEAN to achieve the AEC, a conducive political and security environment is essential. The ASC is envisaged to bring ASEAN’s political and security cooperation to a higher plane where countries in the region live in harmony with one another and with the world at large.
The ASCC pillar is interlocked with the economic and security pillars of the ASEAN Community to ensure that ASEAN people are prepared for, and benefit from, economic integration.
Challenges to Regional Integration
Development Gap in ASEAN and the IAI
ASEAN has recognised the issue of development gaps within ASEAN. As a competitive ASEAN generates higher economic growth, development gaps within the region should be addressed in concerted and comprehensive manner to ensure that prosperity is shared among the over 550 million inhabitants of ASEAN.
The most significant strategy to address the gaps is through the Initiative for ASEAN Integration or IAI, which was adopted by the ASEAN Leaders at the 8th ASEAN Summit in 2002 in Cambodia. The IAI is a policy framework which aims to contribute, on a continuous basis, to narrowing the development gap within ASEAN. The main objective of the IAI is to enhance the capacity of institutions and human resources to develop the economic competitiveness of Cambodia, Lao PDR, Myanmar and Viet Nam or CLMV countries in short.
There are currently 134 projects under the IAI Work Plan which focused on 7 areas: infrastructure, human resource development, information and communications technology (ICT), regional economic integration (including investment climate), tourism, poverty and quality of life and projects of general coverage. It involves the development of legal, institutional, regulatory frameworks and technical capabilities of CLMV countries.
ASEAN-6 countries (Brunei Darussalam, Indonesia, Malaysia, the Philippines, Singapore and Thailand) have funded 87 projects amounting to USD28,2 million (as of 1 February 2007) which is more than half of the funding required to implement all of the projects.
ASEAN Dialogue Partners and international organisations have provided funding assistance for 61 projects totalling USD18.3 million. Some of the donors are Japan, Republic of Korea, India, the European Union, Australia, Denmark, New Zealand, China, UNDP, ILO and the World Bank Institute.
These contributions show the commitment of ASEAN to assist CLMV achieve their economic potential, so that these countries can more equally reap the benefits of economic integration process in ASEAN.
CLMV ownership of projects is crucial to the IAI. The objectives of narrowing the development gap could be converted to policy instruments in their respective national plans, including the establishment of support mechanisms/institutions to facilitate speedy implementation of the IAI projects.
While the IAI is intended primarily to help primarily the CLMV, similar efforts are being pursued in other designated areas in the ASEAN region. These include the Brunei-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA) and Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT) frameworks.
Strategies to Close the Development Gap
More substantive programmes complementary to the IAI are needed. A mid-term review of the IAI Work Plan done in 2005 indicated that gaps remain wide in both hard and soft infrastructure, HRD and ICT sectors in the CLMV, hindering their ability to participate more fruitfully in the ASEAN-wide economic integration initiatives.
Capacity building needs to be developed further. Concurrently, improvement of legal, institutional, regulatory frameworks to deal with the fast pace of economic integration process is essential.
As global economy, international trade and technological advancement are moving faster, policy management, good governance and technical capabilities in some countries need to be addressed urgently.
Strategies to narrow the development the gap:
ASEAN Charter
At the 12th ASEAN Summit, the Leaders signed the Cebu Declaration on the Blueprint of the ASEAN Charter to endorse the Report of the Eminent Persons Group (EPG) on the ASEAN Charter and directed the High Level Task Force to complete the drafting of the ASEAN Charter in time for the 13th ASEAN Summit in Singapore in 2007.
The Charter will set the framework and lay the legal foundation for ASEAN to restructure its existing mechanisms and improve its decision making process to enhance efficiency and ensure prompt implementation of all ASEAN agreements and decisions. The Charter will also provide ASEAN with a legal personality.
The EPG’s Report highlighted that the development gap within ASEAN has to be addressed as it could otherwise adversely affect ASEAN’s ability to achieve its goals. In this regard, the EPG proposed that a Special Fund be established to help narrow the development gap, with voluntary contributions from Member Countries. This Special Fund may additionally be contributed by private business sector and other eternal sources, from the ASEAN Standing Committee. For the purpose of this Special Fund, as well as to support other ASEAN regional development efforts, a new funding model with innovative mechanism should be explored and further studied by financial and fiscal experts. In this connection, the Second IDCF in June 2007 in Ha Noi is important. It will deliberate many issues and future strategies. A key issue is ASEAN-led initiatives and programmes as distinguished from bilateral cooperation activities provided by individual ASEAN Member Countries.
I am confident that the outcome of our deliberation over the next two days would provide significant inputs to enhance the realisation of the ASEAN Community and bridging the development gaps. It is in this light that I particularly welcome the initiative of the Konrad Adenauer Stiftung and the Institute of Foreign Affairs of Lao PDR in organising this event to further explore ways that various stakeholders can work more effectively to accelerate the ASEAN economic integration and Community building.
Thank you very much for your attention.