This week CIMB
Bank head Nazir Razak proposed that ASEAN adopt a region-wide master plan for
the banking industry and that ASEAN member states create ASEAN-specific
government ministries to deal with ASEAN Economic Community issues. These are positive suggestions to advance the
AEC, suggestions which result from the overlapping competencies at play in
ASEAN which often act at cross-purposes.
(NB: I have done instructional work for CIMB and written for the CIMB
ASEAN Research Institute.)
The banking sector of course
falls within the purview of the AEC and is covered as part of the financial
services industry under the ASEAN Framework Agreement on Services (AFAS).
However, AFAS deals with market access and not with the details of banking
regulation, which would be covered by the ASEAN Banking Integration
Framework, which is still under
discussion. Furthermore, banking issues
in ASEAN have been traditionally supported by the Asian Development Bank rather
than the ASEAN Secretariat, even though the Secretariat is charged with
monitoring the AEC.
The issue of overlapping
bureaucracies and competencies in ASEAN is not limited to the banking industry. Intra-ASEAN relations themselves are subject
to such overlap. As ASEAN was initially a political grouping, internal coordination
was originally handled exclusively by the foreign affairs ministries of the
member states. Later, the addition of
economic issues led to the involvement of other ministries such as trade and
commerce ministries.
The overlap has slowed down
some operational aspects of ASEAN. For example, the ASEAN Charter calls for member
states to station permanent representatives in Jakarta to deal with ASEAN
matters. These usually are senior foreign
affairs ministry officials with relatively limited experience in economic
matters. The ASEAN Charter also calls
for member states to establish national secretariats for ASEAN matters, but
again these are all part of the foreign affairs ministries.
Thus, Dato Seri Nazir’s call
for the master plan and national ASEAN ministries would better serve the
implementation of the AEC. Having
ASEAN-specific ministries would allow member states to put all aspects of ASEAN
cooperation – e.g., the political-security, economic and socio-cultural pillars
– under one roof in each country, with a singular focus on ASEAN community
construction. For example, many EU
member states have a ministry devoted to EU matters to provide such
cooperation.
Creating a Ministry of ASEAN
Affairs in each member state would be a good step to creating “more ASEAN”. The
question is whether the newly designated ministry officials would look back to
their former colleagues as their peers or view the ministry as their new
bureaucratic home. If the former were to
occur, then the creation of ASEAN ministries would simply be putting a new
label on the ASEAN national secretariats.
However, if the new Ministry of ASEAN Affairs officials take their new
responsibilities to heart, all aspects of the ASEAN Community will be better
supported and less subject to the bureaucratic wrangling that currently happens
in ASEAN. Let’s hope that Dato Seri
Nazir’s proposal is taken seriously as ASEAN leaders review the institutional structure
of the grouping.
