ASEM Summit: Lessons To Learn From The European Single Market
This week, European and Asian leaders will gather on the banks of the Mekong in Laos for the 9th Asia-Europe Meeting (ASEM) Summit. Nations accounting for half the world’s GDP will focus their attention on economic development – not just in Asia, but in Europe, too. Amidst continuing economic instability, the future of the European project is once more a subject of fevered discussion.
After choosing monetary union, further political union and workable governance in Europe was always going to be necessary. But as Europe’s leaders struggle to resolve the debt crisis, the arguments for deeper integration have changed.
The problems in the Eurozone are serious. But they should not obscure a greater truth. Far from being toxic, economic co-operation can be one of the most powerful drivers of competitiveness and growth. The European Single Market – the agreement to trade freely in goods, services and labour – remains a unique accomplishment, and one which the ten countries in the Association of South East Asian Nations have watched with particular interest.
In 2015, our own single market – the ASEAN Economic Community (AEC) – will come into effect. It is a chance for us to restate the case for economic co-operation across borders.
Of course, Asia is not Europe. Our implementation of a single market will necessarily differ. But the fundamental principles behind free trade are the same wherever you are in the world.
Like all single markets, the AEC aims to boost trade between member countries; reducing barriers such as tariffs, harmonising rules, and facilitating the flow of goods and services. It also aims to enhance our regional competitiveness, providing a fertile ground for South East Asian firms to expand and flourish into global corporations. In bringing our nations closer together, ASEAN leaders hope to stimulate growth, create millions of jobs, and increase the standard of living for more than half a billion people.
Economic considerations are at the heart of the AEC project. But collaboration between nations in trade and investment can also lead to stronger institutions. Common markets require common rules and an independent mechanism for arbitration, improving governance.
Just as the European project helped some if it’s smaller nations develop into mature democracies, so the AEC can strengthen institutions and promote good governance in our region. And just as democracies rarely go to war with each other, single markets also bring a peace dividend. The stabilising power of economic union was one of the reasons the EU was awarded the Nobel Peace Prize.
ASEAN already knows well the value of co-operation on the international stage. In global trade negotiations, we worked collectively to ensure poorer nations could negotiate on equal terms. In Cambodia, we sponsored UN resolutions and supported the dialogue which lead to the peace settlement that brought decades of violence to an end.
This geopolitical strength presents another compelling argument for closer economic co-operation. The world is shifting from a hegemonic era, where the United States dominated alone, to a multipolar system. As new power centres such as China, India, and Brazil vie for influence, ASEAN nations will need to work harder to make their voices heard. We have already seen that a supranational whole can be greater than the sum of its national parts; a single market will further strengthen our hand in international negotiations, giving ASEAN an opportunity to advance collective positions.
We can also increase the opportunities for our people. The EU’s 500 million citizens enjoy the right to live and work in any of the Union’s 27 member states. Similarly, the AEC envisages the free movement of skilled labour, opening up new prospects for ASEAN’s 600 million people. This flexibility will make our economies stronger and our businesses more competitive. It will also help more of our citizens realise their ambitions, as a new frontier of opportunity stretches out before them.
Although the debate about the future extent of wider European integration smoulders on, history shows us that the single market itself and economic co-operation is an idea worth fighting for. As South East Asian nations take audacious first steps towards a single market, our ambition – and our resolve – should be strengthened by the knowledge that a single market can bring growth, influence and opportunity.
These may be familiar waters, but ASEAN will chart its own course. Properly designed, the AEC can build on the successes of the European project, whilst learning from its failings. My hope is that over the coming decades the people of South East Asia enjoy the democracy, prosperity and peace that greater economic co-operation can bring.