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Mohammad Hazyar Arumbinang, Intern staff ASEAN Studies Center UGM

During the past decade, natural and man-made disasters at various scales continue to increase by the year in Southeast Asia Region. Experience has shown that local government and holders with their capacity have proved their ability to handle small and medium scale emergency response, but under the circumstance of mega scale disaster which can cause a massive destruction to society and economical loss. Therefore, the host State sometimes cannot deal with this issue and need the support and assistance from international community.

Taking an example, the large scale and mega scale disaster mitigation beyond the capacity of the local stakeholders as demonstrated in the Southeast Asia earthquake and tsunami, which struck on 26 December 2004, affected 11 countries, killing more than 225 000 and displacing an estimated 1.2 million. The crisis required governments, civil society, humanitarian actors (including non-governmental organizations and donors) and the international organization to respond on a scale that had never been seen before.

The ASEAN Commitment

Learning form the history, ASEAN as the regional organization in Southeast Asia playing an importance role to building a well-prepared disaster management through join collaboration among ASEAN member, since Southeast Asia has a lot of potential natural disaster.

On 24 December 2009, The ASEAN Agreement on Disaster Management and Emergency Response (AADMER) has been ratified by all ten Member States and entered into force. The AADMER is a regional framework for cooperation, coordination, technical assistance, and resource mobilization in all aspects of disaster management. It also affirms ASEAN’s commitment to the Hyogo Framework of Action (HFA) and is the first legally-binding HFA-related instrument in the world. Therefore, it would allow all ASEAN countries will work together and giving humanitarian assistance as disaster response to host state.

Disaster Relief as Soft Diplomacy?

Recently, China and ASEAN signed a Memorandum of Understanding (MoU) on Disaster Management Cooperation on Monday October 2014. Under the agreement, China will provide 50 million RMB ($8.1 million) to build ASEAN’s capabilities to respond to regional disasters. The funds will support the ASEAN Agreement on Disaster Management and Emergency Response Work Program, the ASEAN Coordinating Center for Humanitarian Assistance, and the ASEAN Secretariat’s programs to build capacity for disaster management. This is one of the example of collaboration on disaster management in international level. At this stage all ASEAN countries must have a collaboration on this matter since it will strengthen the relation among Southeast States.

There is no state may refuse the assistance from other countries if the result of natural or man-made disaster involves the loss of many lives and is beyond the capacity of the affected country. It also as part of commitment towards partnership and local as well as global cooperation. By that means, disaster response nowadays is not considering as humanitarian assistance but also as the soft diplomacy between the states. Cooperation on humanitarian assistance and disaster relief is one of the easiest ways to build trust and goodwill between two States.  It will provide ample ground for diplomatic and even military cooperation. As such, many analysts have argued that cooperation between ASEAN members and other both international and regional organization can help build mutual trust. By providing greater assistance in disaster relief.

Habibah Hermanadi, Intern staff at ASEAN Studies Center UGM

The road to a complete economic integration promoting higher productivity and trade activity for ASEAN is filled with challenges and opportunities. Gradually, within the Economic Blueprint ASEAN aims for a deeper economic and political integration. Theoretically, this transition equals to ASEAN’s movement towards Custom Union and deeper will be better, as simplified and more harmonized border procedures facilitate trade, common product standards enable longer production runs, and a common competition policy serves to unify the market (Basu Das, Sen, and Srivastava, 2015). However, a very important question must be answered by each ASEAN states in regards of who will be benefited from ASEAN economic community? If the changes focused only for capital holders then this integration would definitely neglected the community, the people, hence the labors.

One of the pillars which were introduced by AEC’s pillars is endorsing the free flows of services; the point emphasized on the free flow the free flow of goods, services, investments, capital, and skilled labor. Alongside to other technical difficulties among ASEAN states in terms of infrastructure, state stability, and other political aspects, deepening the scope of competition without any preparation only leads to a detrimental point for labors, if not the community is not free from exploitation possibilities (Chia, 2013).

Naturally, through all of the changes ASEAN must not allow opportunistic actors to perform a race to the bottom where due to open opportunities states will try attracting corporations and will seize the action by reducing social welfare of labors (Suranovic, 2010). This particular transition should not lead us to a condition where labors became the victim of big corporations and international laws. The danger of race of the bottom is real, not only it will undermine the ASEAN’s aim for the community it will be a prescription towards widened income gap between the rich and the poor, inexistence of job security among ASEAN people, and in AEC will be utilized for massive multinational corporations to milk the benefits of the free flow and hurts the small to medium enterprises which represents almost 90% of ASEAN’s source of employments (Palatino, 2014), not to mention killing opportunities for low skilled workers, traditional and agricultural industries.

This is the part where ASETUC (ASEAN Services Employees Trade Union Council) must play its role and should be strengthened. ASETUC as a representative legal platform of regional labor union must be able to perform its duty in protecting the welfare of labors within the region.  It is only necessary for the union to enforce the fundamental principles and rights of work ratified by the International Labor Organization (ILO, 2002) for both local and migrant workers.

Through this representation, unions showed its participation in defining the fates of ASEAN labors, more importantly in negotiating their terms with the government and employers. A balance within the economic integration shall bridge the needs of capital and labor movements in order to pursue the desired collective development without violating the differences each state have (Felipe and Hasan, 2006). Regardless of the differences, what must be seen in this context is that labor welfare stand on the same ground, and only if they were involved within the union ASEAN labors would recognize their bargaining position. Lastly, the reinforcement of ASETUC will be obsolete without the commitments of ASEAN members. Each state also have their own homework in order to assure the increasing quality of labors within the region, expand the social security programs, and in accordance to the ASEAN Socio-Cultural that governments should invest in workers’ education, lifelong learning, and skills development programs.

Bibliography

Basu Das, S., Sen, R., & Srivastava, S. (2015). The Feasibility of an ASEAN Customs Union Post- 2015. Institute of South East Asian Studies, (13), 5-7.

Chia, S. (2013). The ASEAN Economic Community: Progress, Challenges, and Prospects. Asian Development Bank Institute, (440), 4-8.

Felipe, J., & Hasan, R. (2006). Labor markets in Asia: Issues and perspectives (1st ed.). Basingstoke, Hampshire: Palgrave Macmillan.

Suranovic, S. M. (2010). A Moderate Compromise: Economic policy choice in an era of globalization (1st ed.). New York: Palgrave Macmillan.

The International Labour Organization’s fundamental conventions. (2002). Geneva: International Labour Office.

Electronic Media

Palatino, M. (2015, May 05). Who Will Benefit from the ASEAN Economic Community? Retrieved February 10, 2016, from<http://thediplomat.com/2015/05/who-will-benefit-from-the-asean-economic-community/>

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Dio H. Tobing, Intern Staff at ASEAN Studies Center UGM

ASEAN is always at risk when there is a call to faithfully implement human rights values within Southeast Asian Region, yet at the same time the organization has entered a new phase of complexity when large-scale integration between all of the member states has taken into force under the greater umbrella of what-so-called, ASEAN Community. The willingness to direct back ASEAN into precolonial period, to make everything old, new again (Noor, 2014) are hindered by the negligence of one of three important pillars that construct the establishment of the Charter, the Political-Security. And this cannot be achieved if ASEAN is still seen as a legacy of colonialism, where the organization is emphasizing on sovereignty as the fundamental aspect of a country. Similarly goes to the uphold of human rights value by ASEAN through the creation of ASEAN Human Rights Declaration and the establishment of ASEAN Intergovernmental Commission on Human Rights (AICHR). Although the term of human rights and the approach of human security is relatively new in the organization, however, this shall not be neglected. The reason is simply because the obligation to ensure human-security falls under ASEAN Political Security Community, and this is what ASEAN has missed.

The former Secretary-General of ASEAN, argued that in accordance to the implementation of ASEAN Charter, ASEAN will be a rules-based, people-oriented and more integrated entity (Pitsuwan, 2008). Therefore ASEAN should be careful to take concern on human rights issues that present within the region by playing a significant role. If not the ASEAN Intergovernmental Commission on Human Rights (AICHR) and even ASEAN itself will be lacking on legitimacy. What ASEAN currently has within the framework at this is time is only focusing on promotion and protection, but lacking on the enforcement. Not to mention that it is not feasible seeing that there is a difficulty to reconcile the principle of human rights with non-interference principle, but whatever it takes should be extending the mandate of AICHR in promotion and primarily ‘protection’ of human rights in ASEAN by granting power to the organization to conduct investigation within its member states. A type of approach, namely ‘Carrot and Stick’ approach should be taken into account by the organization in order to fully take concern on human rights issues within the region. In this regard, after empowering or extending the mandate of the AICHR, ASEAN may take a look on the European Court of Human Rights (ECHR) on how this mechanism in the European Continent is working properly in upholding core human rights values.

Andika Putra, Intern Staff at ASEAN Studies Center UGM

The establishment of ASEAN Community aims to improve the welfare of all ASEAN member states to be able to compete in regional and global scope. Furthermore, higher levels of investment between ASEAN member states will increase the number of disputes arising between private investors and governments in South East Asia. To settle this issues, ASEAN Comprehensive Investment Agreement (ACIA) was signed by ASEAN Member on 2009, which regulated about the investment protection and investor-state dispute settlement mechanism. On the one hand, the parties may settle their dispute through Alternative Dispute Resolution. On the other hand, ACIA allow the investor to submit a claim to the courts of disputing Member State, or even submit their claim to the arbitration institution, such as International Centre for Settlement of Investment Dispute (ICSID), UNCITRAL Arbitration Rules, Regional Centre for Arbitration at Kuala Lumpur or any other regional center for arbitration in ASEAN that agreed by the disputing parties. This article will discuss about the role of ICSID in ASEAN Economic Community.

What is ICSID and why choose ICSID?

Arbitration under the International Centre for Settlement of Investment Disputes (ICSID), or the ICSID Additional Facility Rules (Additional Facility Rules) is a profitable choice for investors, since founded in 1965, ICSID has significant experience handling a dispute over investment. As of October 1, 2015, ICSID had registered 539 cases under the ICSID Convention and Additional Facility Rules. Forty-two (42) of these cases (8%) involved a State Party from the South & East Asia & the Pacific (SEAP) Region (Chart 1).

There are some advantages offer by the ICSID, the first is neutral and self-contained system, as detailed in Chapter 5 of ICSID Convention provides that the arbitration law of the places of arbitration, wherever it may be, has no impact whatsoever on the proceedings. Second, as in other international arbitration, ICSID hearing generally is private, however as a result of the 2006 ICSID amendment, it is possible for non-parties and NGO to observe the hearing process and publish the decision. Third, ICSID provides a transparent cost structure and keeps its administrative fees relatively low, and the last, it remains true that most of ICSID awards have been either successfully settled or voluntarily executed by the parties, this success may be due to ICSID being an organ of the world bank, and the perception that failure to respect and ICSID award would have indirect political consequences in terms of credibility with the world bank.

Chart 1: Geographic Distribution of All Cases Registered under the ICSID Convention and Additional Facility Rules (click on picture to enlarge)

The Role of ICSID in Investor-State Dispute Settlement in ASEAN

To resolve the dispute through ICSID, both of the host country and the investor’s country of origin are parties to the Washington Convention. However, Laos, Myanmar, Thailand and Vietnam did not ratify this convention. For the cases involving these countries, ICSID Additional Facility Rules is possible to be used by the parties. ACIA allows arbitration based on Additional Facility Rules when one of the host country or the country of origin of the investor is a member of the Washington Convention. However, if both of the disputing parties are not the parties in Washington Convention, they cannot submit their claim to the ICISD. For example, the dispute between the Governments of Myanmar and Thailand investors, will not be handled by the ICSID, because both of parties did not ratify the Washington Convention.

In conclusion, ASEAN as a regional organization in South East Asia was enacted ASEAN Comprehensive Investment Agreement, it is good momentum for the investor and ASEAN Member States to develop the South East Asia region, because ASEAN has provided the investment protection and dispute settlement mechanism. However, we have to optimize the role of ICSID as one of the remarkable institution, who have good reputation and good experience in investment dispute settlement. However, ICSID Arbitration is not the best option in every situation.  In fact, there are some ASEAN Member who has not ratify the Washington Convention yet, it will be the challenges in the future, because the role ICSID is very important in investment dispute settlement. Even, there are some other arbitration institution, in this case ICSID will be the alternative solution to settle the investment dispute in ASEAN. Therefore, the ratification of Washington Convention for the rest member of ASEAN will be good idea for the investment protection in ASEAN.