ASEAN unity at stake
Rather than mirroring the geo-economic fragmentation besetting the world, member states need to come together and negotiate favorable trade terms for the region as a whole.
The Association of Southeast Asian Nations (ASEAN) risks losing its unity as member states face growing economic infighting. Instead of working together to negotiate favorable trade terms for the entire region, nations have become accustomed to living in a divided economy. The World Trade Organization, which once served as a neutral arbiter, is now seen as ineffective, leading to a surge in neo-mercantilist practices.
These include tariffs, nontariff barriers, subsidies, incentives, export bans, and unilateral sanctions. Meanwhile, global supply chains are increasingly influenced by the interests of the United States or China, often cloaked in terms like "friendshoring". This geopolitical fragmentation could potentially lead to ASEAN countries adopting investment nationalism, focusing on attracting foreign investment to their own nations at the expense of other members.
While healthy competition can foster growth, ASEAN must guard against open, divisive rhetoric that could foster resentment between neighbors. For instance, Jakarta recently urged Toyota to consider moving its regional production from Thailand to Indonesia, offering the automaker "every incentive you want". The report emphasizes the need for ASEAN to remain united in their economic pursuits, despite natural rivalries that arise between countries with similar economic structures vying for the same global supply chain spots.
Written by urgent.news from The Jakarta Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
