Tuesday, October 3, 2023

US or China? ASEAN Says Both

Jayanty Nada Shofa
June 8, 2023 | 3:34 pm
President Joko "Jokowi" Widodo walks together with fellow Southeast Asian leaders at the 42nd ASEAN Summit in Labuan Bajo on May 10, 2023. (POOL/Antara Photo/Akbar Nugroho Gumay)
President Joko "Jokowi" Widodo walks together with fellow Southeast Asian leaders at the 42nd ASEAN Summit in Labuan Bajo on May 10, 2023. (POOL/Antara Photo/Akbar Nugroho Gumay)

Jakarta. ASEAN has chosen to stay neutral amidst the escalating US-China tension as the regional grouping views the two rivaling major powers as important partners.

“At ASEAN, we work with all of our partners. The US and China are all important dialogue partners. Both are very important markets, sources of investment for ASEAN,” ASEAN secretary-general Kao Kim Hourn told B-Universe in Jakarta on Wednesday.

“It is of our interest to continue to work closely with both countries,” Kao said.

According to Kao, ASEAN’s relations with US-China put emphasis on confidence-building and strategic trust strengthening. The secretary-general added: “They are attending all of the ASEAN-led mechanisms. We do not want to see any growing tension. We wish to see reduced tension, and open communication between the great powers.”


In a separate interview, an analyst with the Economic Research Institute for ASEAN and East Asia (ERIA) said the regional grouping should keep its neutral stance, as decoupling from Beijing could mean losing a pivotal trading partner. 

“Economically, it is very wrong to ask ASEAN to decouple from China, which is one of the bloc’s main trading and investment partners. Investment and trade with China have been growing so fast for the past two decades,” Lili Yan Ing, the lead advisor for Southeast Asia Region at ERIA, said.

From a political standpoint, ASEAN should remain a “peacemaker” by promoting peace not only within the 10-member group but also at a multilateral level.

“The way that the US and European countries put ASEAN into a corner to choose between the US or China. I don’t think it is going to work very well,” Lili said.

China is ASEAN’s largest trading partner and its second top foreign investor. The ASEAN Secretariat data showed that ASEAN-China merchandise trade totaled $669 billion in 2021, up by 29 percent year-on-year. China invested a total of $13.6 billion, almost a twofold increase from the $7 billion posted in 2020. This also represented 7.8 percent of the foreign direct investment (FDI) flows to ASEAN in 2021.

According to the US Department of State, US-ASEAN trade in goods and services amounted to $441.7 billion in 2021. ASEAN is home to more than 6,200 American companies. In 2020, 630,000 American tourists spent over $1.3 billion when traveling to Southeast Asia. 

Preliminary ASEAN statistics reported that the US invested $24.5 billion in the region in 2019, making the latter as the Southeast Asian bloc’s largest source of foreign direct investment.

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