Asean must strengthen centrality and integration efforts to be an attractive partner: Chan Chun Sing

Trade and Industry Minister Chan Chun Sing is confident that a united Asean could manage challenges.
Trade and Industry Minister Chan Chun Sing is confident that a united Asean could manage challenges.ST PHOTO: KHALID BABA

SINGAPORE - Asean must maintain and strengthen its centrality, and redouble integration efforts to be a viable and attractive economic partner, Trade and Industry Minister Chan Chun Sing said on Thursday (Aug 29).

In his opening remarks at the Singapore Institute of International Affairs' (SIIA) 12th Asean and Asia Forum at the Mandarin Oriental hotel, he addressed the forum's theme - The Sino-American Conflict and Asean: Surviving, Transforming, Succeeding - and said that individual Asean countries must do the following to achieve Asean centrality: resist populist polices and pressures, adhere to a rules-based system, build strategic trust among member states and not waver in the face of challenges, even if governments change.

He cited non-tariff barriers as one example of a complex issue requiring political will to tackle. These barriers had tripled in the region over the last 15 years and could potentially erode gains from tariff elimination.

"To unlock the region's potential and allow the smallest enterprises to overcome geographical constraints, countries will need to deepen the non-tangible aspects of connectivity - data, finance, technology, talent and regulations," he said. "These are becoming as, or if not more, important than the physical aspects of connectivity."

He also spoke of the need to align standards and regulations in areas such as food, medicine and intellectual property, to enhance Asean members' value proposition and competitiveness in a knowledge-based world.

Reiterating the value of an open and rules-based multilateral trading system, Mr Chan said that Asean was leading the Regional Comprehensive Economic Partnership (RCEP) negotiations.


"When concluded, the RCEP will bring together 16 economies into a single cooperative framework for shared prosperity... It is a strategic signal to the rest of the world that this part of Asia continues to believe in upholding a multilateral trading order."

When signed, the RCEP comprising the 10 member states of Asean and six of its free trade agreement partners - China, Japan, South Korea, Australia, New Zealand and India - will be the world's biggest regional trade agreement.

It covers nearly half of the world's population, a third of the global economy and more than a quarter of cross-country trade.

In a dialogue session moderated by SIIA chairman Simon Tay, Mr Chan told the 200 experts, business leaders and officials gathered that all Asean member countries were keenly aware of and committed to Asean centrality, which is why they had set up an "aggressive timetable" to conclude the remaining issues on RCEP.

On the trade and technology war between the United States and China, he said that the consequences of further regression would be serious. "The world has enjoyed tremendous growth, uplifting many from poverty. It will become a much poorer place if we fragment supply chains and distribution systems, with different regional blocs having different technical standards. We will be sub-optimising at the local or regional level."

He added that the consequences went beyond the two major powers. "Others may also have ideas about what the world order should be. Already there are many hot spots - the World Trade Organisation (WTO) system faces challenges by the end of this year, if the Appellate Body issue is not resolved. It can result in a domino effect and cause other systems to fray."

Mr Chan was referring to the current crisis involving the Appellate Body, the highest court of appeal for the WTO. The US is blocking appointments of new judges to fill vacancies,which would prevent the tribunal from hearing new appeals and thus undermine the continued functioning of the WTO dispute settlement system.

Mr Chan said: "The question is whether the world will become more interdependent or independent of one another. The greater the interdependencies, the smaller the chance of conflict.

"There is no doubt that we have to update the rules for global integration, but we also need to uphold those rules."

He was confident that a united Asean could manage challenges. "There are opportunities for the region to distinguish ourselves amidst the uncertainties, if we continue to band together, tackle the tough integration issues and leverage new growth areas," Mr Chan said.