Behind EU-ASEAN Free Trade Agreements: Do Norms Matter?


Shane Preuss, Research Intern at ASEAN Studies Center, Universitas Gadjah Mada

The EU is currently attempting to pursue both normative political interests and economic interests in the ASEAN. I argue that the EU’s capacity to pursue its normative political interests through trade negotiations is dependent on its economic leverage and that ASEAN states, aware of the attractiveness of their markets, are willing to use their leverage to resist the EU’s attempts to export its political norms through binding legal mechanisms.

The EU has long promoted itself as the ‘model’ of regional integration and an ‘inspiration’ for ASEANs development. It has also provided significant assistance and financial support to the bourgeoning ASEAN secretariat. The EU’s normative political interests regard the attempt to export its norms of political cooperation, domestic and regional law, political institutions and values to other countries and regional bodies. The EU has, often, attempted to achieve this through conditionalities tied to FTA’s.

The resistance of ASEAN members to EU norms in trade negotiations does not, however, amount to a rejection of these norms, but a rejection of the process through which the EU attempts to pursue its normative political interests. ASEAN states have shown a willingness to adopt certain norms promoted by the EU, but only within the existing normative context of political cooperation common in the ASEAN region.

The Norms/Economic nexus in EU trade policy

The EU’s normative political interests are laid out in the Lisbon Treaty (2007), which articulates that EU foreign policy should be guided by its core principles of democracy, human rights and the rule of law. The EU has often used markets access and financial aid as leverage to incentivize policy reform in accordance with ‘European’ values. The EU’s FTA’s are commonly accompanied by Political Cooperation Agreements (PCA’s) and ‘essential clause ’has been used to link preferential trade status to conditions of upholding‘ European values outlined in the PCA. Failure to meet conditionalities can trigger a suspension of trade preferences. The ‘essential’ clause has been a central feature of the EU’s agreements since the early 1990’s.

There are, however, tensions between the EU’s economic interests and its normative political interests. The EU is not a unified actor and there is a distinction between the economic interests of member states and the EU’s normative position, which gives identity to the EU as a whole. This places limits on the EU’s ability to pursue it normative political interests alongside economic interests. The EU has faced criticism for not activating conditionality enough, or for doing so selectively on ‘harmless’ partners, while being reluctant to do so against powerful countries.

As a fragmented power, the EU tends to compromise its normative ambitions and consistency in the face of commercial interests as member states are more likely to converge on economic rather than ideational interests.

Behind EU-ASEAN’s Free Trade Agreements: Examining the relationship between Norms and Economic Leverage

The tension between the EU’s commercial interests and normative ambitions is evident in the EU’s FTA negotiations with ASEAN states. The attractiveness of South East Asia markets has given ASEAN members greater leverage in negotiations, contributing to a relatively symmetrical relationship between the EU and ASEAN states. This blunts the EU’s capacity to insist on legally binding, coercive clauses and conditionalities with prospective partners, who also object to the inclusion of explicit language on social issues in FTA agreements.  

To date, the EU has signed FTA agreements with Singapore and Vietnam and has initiated negotiations with Malaysia and the Philippines.

In FTA negotiations with ASEAN members thus far, the ‘essential clause’ has been replaced with sustainability chapters, which cover labor and environmental practices. The chapters include a dispute resolution mechanism, which is less coercive and more collaborative than the ‘essential clause’ and prevents the unilateral suspension of trade preferences. A complaint can be brought to a panel of experts appointed by a Joint Council of the Agreement who, on the basis of evidence, may propose a non-binding plan of action.

“Normative Adaptation”: Explaining EU-ASEAN Relations

The EU’s inability to insist on strong clauses and conditionality does not, however, equate to a rejection of these norms in ASEAN. It represents that ASEAN states are not passive receivers of EU norms and rejection the process through which the EU attempts to pursue its normative interests. ASEAN has it own norms of political co-operation and the reception of EU norms must be adapted to this pre-existing normative context. While the EU favors institutionalization and the incorporation international principles into domestic law, ASEAN states exhibit a strong focus on protecting sovereignty and a preference for cooperation and discussion on such issues, thus rejecting their attachment to trade negotiations.

Furthermore, while ASEAN has continued to institutionalize, as evidenced by the signing and the ASEAN charter, these developments stop short of emulation of the EU and instead demonstrate the adoption of certain norms and institutions within the EU, where appropriate and where adaptable to ASEAN norms. The inclusion of statements on human rights in the charter, as well as the creation of the ASEAN Intergovernmental Commission on Human rights are significant examples, which must be understood within the political context of ASEAN’s regional norms.

ASEAN, at this stage, is concerned with promoting, rather than protecting human rights, meaning ASEAN has adopted these norms in a way which does not replace nor undermine the norm of non-interference. The EU’s turn to ‘soft’ mechanisms, such as sustainability chapters, therefore represents a compromise of normative interests and processes of adoption, brought on by the EU’s lack of economic leverage and the embeddedness of ASEAN’s own norms.