Executive Summary

• After ASEAN expanded to ten Member States in 1999, there have been unequal levels of development between the six older Member States (ASEAN-6) and the new four Members (CLMV/ASEAN-4) in terms of average per capita income, human resource and institutional capacity, and level of economic competitiveness.
• ASEAN has made various concrete efforts to narrow development gap to reduce poverty and socio-economic disparity among ASEAN Member States (AMS) and between ASEAN and the rest of the world. Such efforts include the Initiative for ASEAN Integration (IAI) through the implementation of IAI Work Plan I (2002-2008), IAI WP II (2009-2015) and IAI WP III (2016-2020).
• The effort to narrow the development gap for a “two-tier ASEAN” started from 2000. The implementations of IAI WPs have made good progress and improved the development levels. Undeniably, almost all ASEAN dialogue partners, except Russia, have contributed to this endeavour through providing various supports to the implementation of IAI WPs.
• However, external resources and supports have remained a priority for the successful implementation of the IAI WP, especially in areas where ASEAN Member States are still lacking. To do so, the IAI WP should be placed high on all agenda of ASEAN-led mechanisms to encourage more engagements from relevant stakeholders, especially from ASEAN dialogue partners and external parties.

Introduction

The Association of Southeast Asian Nations (more commonly known as ASEAN) was officially established on 8 August 1967 by the ASEAN Declaration or Bangkok Declaration signed by five Member States, namely Indonesia, Malaysia, the Philippines, Singapore and Thailand. i The establishment aims primarily at accelerating economic growth, social progress and cultural development in the region as well as promoting collaborations and mutual assistance on matters of common interests. ii Over time, this regional bloc expanded to include ten Member States. Brunei Darussalam joint ASEAN in 1984. Subsequently, Cambodia, Laos, Myanmar and Vietnam (known as CLMV countries or ASEAN-4) sought to be part of ASEAN. Vietnam joined in 1995, Laos and Myanmar in 1997, and Cambodia in 1999.

Observers and analysts raised concerns over the existence of unequal levels of development among ASEAN members in terms of average per capita income, human resource, institutional capacity, and the level of competitiveness between ASEAN-6 and ASEAN-4. iii This inequality has created two-tiered structures in the regional organisation, which has been an obstacle to achieving an inclusive and prosperous ASEAN.

Therefore, ASEAN Member States have made various efforts to address the issues. Starting from 1998, ASEAN leaders expressed political will and commitments to narrow the gap in the development level to reduce poverty and socio-economic disparities among the members of the association. iv Then, the Initiative for ASEAN Integration (IAI), one of other significant initiatives, was launched in 2000. More importantly, the Ha Noi Declaration on Narrowing Development Gap for Closer ASEAN Integration was adopted in 2001. The Declaration aimed at narrowing the development gap among AMS and between ASEAN and the rest of the world for the sake of dynamic and sustained growth and prosperity of all peoples in ASEAN region. v A series of the IAI Work Plans were subsequently endorsed by the leaders of ASEAN, including the IAI Work Plan I (2002-2008) in 2002, the IAI Work Plan II (2009-2015) in 2009 and the IAI Work Plan III (2016-2020) in 2016.

Resource allocation is one of the key successes for the implementation of the IAI Work Plans. A study also found that one of the major challenges in implementing the IAI Work Plan III was a lack of funding sourcevi .

The ASEAN Charter serves as a solid foundation in achieving the ASEAN Community. Moreover, the ASEAN Charter set out the framework for ASEAN to widen and deepen its relations with external parties. ASEAN has so far granted status of dialogue partnership to ten external parties, namely Australia, Canada, China, the European Union (EU), India, Japan, New Zealand, the Republic of Korea (ROK), Russia, and the United States of America (USA).

This article aims to examine the various contributions by the ten dialogue partners to ASEAN in key/strategic areas under the IAI Work Plans frameworks and to identify the challenges and gaps for the dialogue partners to further contribute to the IAI WP III (2016-2020).

Definitions on Development and Development Gap

Todaro (1982) refers ‘development’ to the process of making better off the quality of all human lives. There are three basic values to support the definition above, namely providing basic needs, raising people’s living standard and expanding people’s freedom of choice.vii Development means standing against inequality, injustice and removal of restrictions that leave people with little choice and little opportunity of exercising their reasoned agency. viii Development can be defined as the level of achievement in health, education and income.

Development gap occurs when there is an unequal level of development between districts within a country, and between countries and regions. ix However, there is still a debate related to the definition of development gap especially on what would be the best and most appropriate indicators to explain the development gap. Many scholars use various indicators to assess development gap, namely the Gross Domestic Products (GDP) per capita, Human Development Index (HDI), information technology data, etc.

While there have been growing concerns over the emergence of a “two-tier ASEAN” after the entry of the CLMV countries into the regional organisation, development gap demonstrated not only in the differences between the average per capita income of the ASEAN-6 and the ASEAN-4 but also in terms of human resource, institutional capacity, public infrastructure, and the level of competitiveness. 

Initiative for ASEAN Integration (IAI): Development and Progress

At the 6th ASEAN Summit in Hanoi in 1998, ASEAN leaders expressed their political will and commitments to narrow the development gap among their Member States. xi Following their commitments, the leaders launched IAI at the 4th Informal ASEAN Summit in Singapore in 2000, which focused on collective efforts to address the development divide of ASEAN’s new Member States, namely Cambodia, Laos, Myanmar and Vietnam (ASEAN-4). Subsequently, the ASEAN Foreign Ministers adopted the Ha Noi Declaration on Narrowing the Development Gap for Closer ASEAN Integration. The Declaration stipulates as the following.

We resolve to promote, through concerted efforts, effective cooperation and mutual assistance to narrow the development gap among ASEAN Member Countries and between ASEAN and the rest of the world for the sake of dynamic and sustained growth of our region and prosperity of all our peoples.

Based on the guidance from ASEAN Member States, the IAI/Narrowing Development Gap (NDG) Office was established in the ASEAN Secretariat to serve as a secretariat to the IAI Task Force which comprises of the Committee of Permanent Representatives to ASEAN (CPR) in Jakarta. The office also monitors and coordinates the IAI Work Plans’ implementations. Notably, the IAI Task Force has played crucial roles in providing policy guidance, coordination, monitoring and reports on the progress of implementation of the IAI Work Plans to the ASEAN Coordinating Council (ACC). The Chair of the IAI Task Force serves a term of one year and rotates according to alphabetical order among only the CLMV countries.

The IAI is mainly implemented through the IAI Work Plans. The IAI WP I (2002-2008), IAI WP II (2009-2015) and IAI WP III (2016-2020) were endorsed in 2002, 2009 and 2016 respectively. Based on the spirit of the 2003 Declaration of the ASEAN Concord (Bali Concord II), the Vientiane Action Programme 2004-2010, a medium-term development plan to realise ASEAN Vision 2020, highlighted the strategic importance of narrowing the development gap to realise the ASEAN Community. xiv In addition, to support the efforts of the IAI, the ASEAN Framework on Equitable Economic Development (AFEED) was adopted by ASEAN leaders in 2011. Their endorsement demonstrated ASEAN’s commitment to further enhance equitable economic development as the third pillar of the ASEAN Economic Community (AEC) Blueprint.

Relevant Stakeholders’ Contributions to the Implementation of the IAI Work Plans

Since its inception in 1967, ASEAN has adopted outward-looking approach as a principle towards external relations. The ASEAN Charter sets out the framework for ASEAN to widen and deepen its relations with external parties. Article 41 of the Charter on Conduct of External Relations stipulates, “ASEAN shall develop friendly relations and mutually beneficial dialogue, cooperation and partnerships with countries and sub-regional, regional and international organizations and institutions”. xvi Furthermore, based on the Guidelines for ASEAN’s External Relations adopted in 2014, the categories of formal engagements with ASEAN by external parties include Dialogue Partnership, Sectoral Dialogue Partner, Development Partner, Special Observer and Guest.

The effective and efficient implementation of the IAI Work Plans depends on proactive stakeholder engagements including through the six older ASEAN Member States, dialogue partners and external parties, development agencies, and other partners. To date, ASEAN has granted status of ASEAN dialogue partnership to ten external parties, namely Australia (1974), Canada (1977), China (1991), EU (1977), India (1992), Japan (1977), New Zealand (1975), ROK (1991), Russia (1991), and the USA (1977). The dialogue partners had contributed about US$ 20 million, US$ 27.9 million and US$ 9.8 million as of January 2019 for the implementations of the IAI Work Plan I, IAI Work Plan II and IAI Work Plan III respectively.

ASEAN’s Dialogue Partners: Challenges and Gaps in Contributing Further to IAI Work Plan III

In response to the needs of ASEAN Member States, especially to assist CLMV countries to realise ASEAN-wide targets and commitments towards realizing the goals of ASEAN Community Vision 2025, resource allocation from ASEAN dialogue partners and external parties remains crucial for the effective and efficient implementation of the IAI WP III.

This means that proactive external engagement is one of the key mechanisms to provide opportunity for dialogue partners and external parties to further contribute to the IAI Work Plan III. The engagement should start during the work plan development phase and should continue through various forums with stakeholders to share progress and generate commitments to support the projects. xvii The existing institutional mechanism for consultation between the IAI Task Force and dialogue partners and external parties is convened once a year in Jakarta. In addition, close consultation and coordination of activities at different levels of assistance (bilateral, sub-regional and regional) play another important role and help avoid “unnecessary duplication” of supporting initiatives. xviii To expand opportunities for dialogue partners and relevant external stakeholders to contribute to the IAI Work Plan, it is important to work directly with a country or group of countries in specific programmes. This means that dialogue partners and other external parties can engage openly with ASEAN about their development assistance priorities and spending on regional initiatives.

Conclusion and Policy Recommendations

After realising the existence of unequal levels of development between the ASEAN-6 and the ASEAN-4, the leaders of ASEAN have expressed strong commitments to narrow the development gap to achieve the ASEAN Community Vision 2025 by launching the IAI among other ASEAN initiatives. Therefore, a series of the IAI Work Plans have been implemented, namely IAI Work Plan I, IAI Work Plan II, and the current IAI Work Plan III.

Based on the assessment of progress in narrowing the development gap in ASEAN, the development gap between ASEAN-6 and the CLMV countries started to improve between 2000 and 2017. xx The good progress of the implementation of IAI WPs have improved the development levels. It is undeniable that almost all ASEAN dialogue partners, except Russia, have contributed both financial and technical assistance to the endeavour through providing supports to the implementation of IAI WPs. Notably, they have contributed US$ 20 million for the implementation of IAI WP I, US$ 27.9 million for IAI WP II, and US$ 9.8 million for IAI WP III.

Even though the ASEAN dialogue partners have expressed strong political will and commitments to assist the CLMV countries, there are still some challenges and gaps. Therefore, ASEAN needs to further encourage ASEAN dialogue partners to continue to contribute to the IAI WPs through proactive external engagements, close consultation and coordination of activities at different levels of assistance (bilateral, sub-regional and regional), and open engagements with dialogue partners and other external parties about their development assistance priorities and spending on regional initiatives.

External resources and supports remain a priority to the successful implementation of the IAI WPs especially in areas where ASEAN are still lacking. Therefore, as policy recommendations, IAI WPs with dialogue partners’ engagements should be placed high on the agenda of all ASEAN-led mechanisms. There should also be proactive engagements with dialogue partners, which should start during the work plan development phase and should continue through various forums with stakeholders including the existing institutional mechanism for consultation between the IAI Task Force and dialogue partners and external parties convened once a year in Jakarta.

The opinions expressed are the author’s own and do not reflect the views of the Asian Vision Institute.