Entries by aseansc

Korea-Indonesia Cooperation Forum in Commemoration of the 50th Anniversary of Diplomatic Relations

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In order to celebrate 50 years of relations between South Korea and Indonesia. On November 30, 2023, the ASEAN Studies Center at Gadjah Mada University was invited to join the Korea-Indonesia Cooperation Forum in Commemoration of the 50th Anniversary of Diplomatic Relations at Hotel Mulia Senayan Jakarta, Grand Ballroom, Indonesia. In this meeting, was raising the theme “K-Wave & I-Wave, Together for the Future”

The Center was part of an academic seminar session commemorating 50 years of Korean-Indonesian diplomatic relations. The session began with remarks from Lee Sang-deok, Ambassador of the Republic of Korea to the Republic of Indonesia, then continued with Congratulations from Lee Kyung-soo, Former Deputy Minister of Foreign Affairs of the Republic of Korea, Vice President of the Korean Council on Foreign Relations (KCFR), and Dino Patti Djalal, Former Deputy Minister of Foreign Affairs of the Republic of Indonesia, Chairman & Founder of FPCI (Foreign Policy Community of Indonesia).

In this session, there were four representatives from the ASEAN Studies Center, namely Dr. Dafri Agussalim (Executive Director), Falikul Isbah (Adjunct Researcher), and Desintha Dwi (Fellow Researcher) as panelists, and Tunggul Wicaksono (Research Manager) as moderator.

In this session, representatives of the ASEAN Studies Center discussed “Steps to Expand Korea-Indonesia Cooperation in Order to Strengthen ASEAN Centrality” together with other panelists, namely GU Bo-kyeung, Research Professor at the Korea Institute for ASEAN Studies, Busan University of Foreign Studies (BUFS ), and KO Young-kyung, Research Professor at the ASEAN Center, Korea University.

 

The discussion session then ended with a summary of the morning session by KO Young-kyung and Tunggul Wicaksono, and then continued with lunch together.

NACT Country Coordinators Meeting and Annual Conference 2023

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The Belt and Road Initiative (BRI) and the ASEAN Outlook on the Indo-Pacific (AOIP) are interconnected regions with significant potential for trade, infrastructure development, and economic growth. China introduced the BRI in 2013 to link Asia with Europe and Africa through infrastructure projects, trade routes, and cultural exchanges. Its implementation sparked discussion, prompting the need for a nuanced assessment of BRI’s impact on the global stage.

To generate a broader measure on this issue. On October 2023, 10-11, NACT China which is represented by the China Foreign Affairs University and NACT Indonesia which ASEAN Studies Center Universitas Gadjah Mada represents,  held a Network of ASEAN-China Think Tanks (NACT) Country Coordinators Meeting and Annual Conference 2023 in Yogyakarta, Indonesia. This year’s NACT has the theme “High-Quality BRI Cooperation and the AOIP”.

On the first day, the meeting began with the NACT Country Coordinators Meeting, which was divided into two sessions. The first session was Retrospective Remarks on 2023, delivered by Prof. Yang Yue (NACT China) and Dr. Dafri Agussalim (NACT Indonesia). Meanwhile, the second session, namely Introductory Remarks on 2024, was delivered by Mrs. Vithaya Xayavong, NACT Laos (NACT Co-chair 2024), and also Prof. Yang Yue. The NACT Country Coordinators Meeting then continued with a discussion about the 2024 NACT Working Group meetings and the collaboration between Tracks I and II, which then ended with a group photo of the CCM.

The meeting then continued with the NACT Annual Conference, which was opened by Dr. Fina Itriyati, Vice Dean of Collaboration, Alumni, and Research Affairs, FISIPOL UGM. Then continued with opening remarks from Prof. Gao Fei, Vice President, China Foreign Affairs University, and continued with keynote speakers from H.E. Hou Yanqi, Ambassador of China to ASEAN; H.E. Derry Aman, Permanent Representative of Indonesia to ASEAN; and H.E. Ekkaphab Phanthavong (pre-recorded), Deputy Secretary-General of ASEAN for ASEAN Socio-Cultural Community for 2021-2024.

H.E. Hou Yanqi said that the ASEAN Indo-Pacific Outlook is an independent initiative of ASEAN, which includes important principles such as maintaining ASEAN’s central status, upholding openness and inclusiveness, and focusing on development and cooperation. Meanwhile, H.E. Derry Aman said that the ASEAN-China Joint Statement on Mutually Beneficial Cooperation on the AOIP, adopted during the 26th ASEAN-China Summit in Jakarta, signifies China’s support in ASEAN’s effort to mainstream and implement the AOIP.

Before the panel discussion session began, a group photo of the Annual Conference was also taken. NACT Annual Conference 2023 had three panel discussion sessions and raised the topic of “Promoting Mutually Beneficial Cooperation between the BRI and the AOIP”. The first session was moderated by Mr. Tunggul Wicaksono, Research Manager of the ASEAN Studies Center Universitas Gadjah Mada. The first-panel session started with a presentation from Ms. Ousa Cheng (NACT Cambodia), who delivered a presentation entitled “Driving Sustainability Together Exploring ASEAN-China Partnership in the Belt and Road Initiative and the ASEAN Outlook on the Indo-Pacific”. Continued by Prof. Han Zhaoying (NACT China) on “The Great Power Rivalry between the U.S. and China and its implications for Southeast Asia’s stability”, and Dr. Nur Rachmat Yuliantoro (NACT Indonesia) on “Converging the BRI and the AOIP: A View from Indonesia”.

The second session was moderated by Prof. Yang Yue from Dalian University of Technology (NACT China), with the first panelists namely Mr. Bounphieng Pheuaphetlangsy (NACT Lao PDR), Continued by Mr. Calvin Cheng (NACT Malaysia), who presented his thoughts on “Avenues for cooperation between the BRI and the AOIP”, and Dr. Khin Ma Ma Myo (NACT Myanmar) as the next panelist explained her research on Myanmar, “BRI Infrastructure Development in Myanmar: The Case of China-Myanmar Economic Corridor on Regional Connectivity”.

Last but not least, Ms. Yulida Nuraini Santoso, MSc., Managing Director of the ASEAN Studies Center Universitas Gadjah Mada, moderated the final panel discussion. The first panelist in this session, Mr. Jovito Jose P. Katigbak (NACT Philippines), presented his thoughts on “Harmonizing BRI and AIOP: A Philippine Perspective”. Continued by Dr. Kong Tuan Yuen (NACT Singapore) on “From RCEP to DEPA: Singapore Perspective on ASEAN-China Digital Cooperation“, Assoc. Prof. Dr. Dulyapak Preecharush (NACT Thailand) on “Thailand between the BRI and the AOIP: A Geopolitical Analysis & Solution”, and Mr. Tu Anh Tuan (NACT Vietnam) as the last panelist explained her research on “Promoting the Synergy of AOIP and BRI in a Changing World”.

The NACT Annual Conference discussion panel session was also attended by several lecturers, students, and representatives from the International Relations department and the ASEAN Studies Center in Yogyakarta. During the three discussion panels, the discussion sessions at the NACT Annual Conference were active, and many insights were gained in these sessions.

The first day of NACT 2023 then ended with a Welcoming Dinner and a performance from Unit Kesenian Jawa Gaya Surakarta (UKJGS). Meanwhile, on the second day of NACT 2023, the participants went on a day-long field trip in Yogyakarta. Starting with visiting the Yogyakarta Royal Palace, then continuing with lunch at Bale Raos. After that, do a Batik Workshop at Omah Budoyo, and then end with a Closing Dinner at Candhari Heaven Restaurant.

ASC UGM x Kemenko Polhukam Focus Group Discussion

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Yogyakarta, 27 September 2023 – ASEAN Studies Center Gadjah Mada University (ASC UGM) x Coordinating Ministry for Political, Legal, and Security Affairs (Kemenko Polhukam) held a Focus Group Discussion (FGD). This FGD raised the theme “Indonesian Maritime Diplomacy Strategy in Promoting South China Sea Solidarity” and was attended by the BRIN Research Center, ASEAN Studies Center at UNS, the Indonesian Maritime Security Agency, and the Human Rights and Maritime Law Coordinator, Directorate General of ASEAN Politics and Security.

Diplomatic Briefing and ASC Monograph 2023 Launch

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Yogyakarta, 22 August 2023 – ASEAN Studies Center Universitas Gadjah Mada (ASC UGM) held a Diplomatic Briefing event and the launch of the ASC Monograph 2023. The event had the theme Diplomatic Briefing on Strengthening Indonesia’s Leadership for the Promotion and Protection of Women and Children in ASEAN – ” Charting a Safer Future: Advancing the Rights and Well-Being of Women and Children in ASEAN” and took place online through the Zoom Meeting platform. It was attended by participants from diplomats, researchers, academics, and students.

The Diplomatic Briefing event took place at 13.00 (GMT +7) and was opened with opening remarks by H.E. Amb. Lambert G., Ambassador of the Netherlands, and Dr. Dafri Agussalim, Executive Director of ASC UGM. Meanwhile, the Diplomatic Briefing and ASC Monograph Launch event were moderated by Yulida Santoso, Managing Director of ASC UGM. This event allows presenters to share in-depth insights on women’s and children’s issues. Yanti Kusumawardhani, a representative from the ASEAN Commission on the Promotion and Protection of the Rights of Women and Children (ACWC), explained child issues. Meanwhile, Dr. Fitriani, Senior Researcher from the Center for Strategic and International Studies (CSIS), presented an in-depth review of women’s issues.

Meanwhile, the launch of the ASC Monograph 2023 was also one of the sessions that all participants had been waiting for. This monograph is a collaborative work between authors and an editor from ASC UGM. ASC Monograph 2023 raises the title “From Vulnerability to Resilience: Enhancing Women and Children’s Well-Being”. ASC Monograph 2023, this time with six chapters, was written by seven authors. Two of the seven authors include Tunggul Wicaksono (Chapter 1: Empowering Futures and Bridging the Gap in the Protection of Women and Children) and Dio Tobing (Chapter 5: Safeguarding Children’s Rights Online in ASEAN: A Shared Responsibility). At the launch event, Tunggul Wicaksono, Research Manager of ASC UGM, introduced the contents of the monograph with an emphasis on the main findings and their strategic implications. Dio Tobing, a representative from the World Benchmarking Alliance, was also present to discuss the relevance of the conclusions of the monograph to broader global developments.

This event also provided a space for participants to ask questions directly to the presenters and discuss various issues raised in the Diplomatic Briefing and the contents of the ASC Monograph 2023.

Open House ASC UGM: ASEAN Day!

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On August 8, 2023, the ASEAN Studies Center Universitas Gadjah Mada held an Open House in celebration of the 56th anniversary of ASEAN Day, in the BC building room no. 208–209, FISIPOL UGM. This activity opened at 13.00 WIB and was attended by students from various universities and different departments, such as UGM, UII, UMY, UPN, and UNY.

 

In the Open House activity, the session in room BC 208 was facilitated by Diaz Kurniawan, Program Manager of ASC UGM. In the session, Diaz Kurniawan explained the ASC UGM program division and the programs within it. One of the programs he presented was the ASEAN Youth Initiative Empowerment Program (AYIEP), which this year ASC UGM will again be holding a program for the fourth time with the theme “Human Rights in ASEAN”. Apart from explaining the AYIEP program, Diaz Kurniawan also explained the program that students always look forward to every year, namely the internship program.

Meanwhile, in room BC 209, there was a sharing session regarding research at ASC UGM, which was facilitated by Yulida Santoso, Managing Director of ASC UGM, and Tunggul Wicaksono, Research Manager of ASC UGM. In the sharing session, the students were quite active in asking questions, while one of the students wanted a 1-on-1 session. Therefore, Tunggul Wicaksono and the students shared ASC UGM research 1-on-1 in room BC 208. Meanwhile, Yulida Santoso continued the research-sharing session with students in room BC 209. The sharing session was then followed by a discussion on the South China Sea dispute, which has recently become a trending topic in the media.

The Open House activity then ended with a door prize draw. Where there were 8 students who were lucky to get flash disks, block notes, and mousepad prizes from ASC UGM. At this Open House, ASC UGM also distributed free books to the participants who attended.

The ASC UGM Open House activity in celebration of the 56th anniversary of ASEAN Day was a success. Therefore, it is hoped that this event will become an annual ASC UGM event in the future. Especially with this Open House event, ASC UGM can bring ASEAN closer to students. This is in line with the tagline owned by ASC UGM, namely “Bringing ASEAN Closer To You”.

 

ASEAN Chairmanship 2023: Indonesia’s Tendency to Solve the South China Sea Territorial Disputes

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On 13 November 2022, the handover of ASEAN chairmanship from Cambodia to Indonesia was held at the ASEAN summit. Adopted the “ASEAN Matters: Epicentrum of Growth” theme, Indonesia is responsible for one year of ASEAN’s chairmanship. At the ASEAN summit, Joko Widodo, the President of Indonesia, said that ASEAN should be a peaceful and stable area and a presenter for global stability (Southgate, 2023). Some agendas should be a concern in Indonesia’s chairmanship. One of those is the issue that ASEAN has always faced: the South China Sea disputes. The conflicting claims of ASEAN’s countries’ sovereignty have worsened the relationship between China and ASEAN. So, how will Indonesia react while connecting the interest of Indonesia’s foreign policy?

Current Status of the Territorial Disputes in The South China Sea 

The status of the South China Sea remains uncertain. The claim of ASEAN countries’ seas has been seen as an insult to countries’ sovereignty. Criticization until objection to the nine-dash line as a legal argument by China has been an agenda by ASEAN countries for years. Other countries, such as the United States, have stated their position to object to China’s claim by rejecting the claim of Vietnam, Indonesia, and Malaysia seas (U.S. Department of State, 2020). Other than that, the USA has expressed its concern about how unlawful the claims are and how China has violated international law (U.S. Department of State, 2020).

The tension between ASEAN and China has gradually increased due to this issue. China has increasingly put its efforts into reclaiming the land by expanding the size of the lands, military installations, and ports, especially in the Paracel and Spratly Islands (Center for Preventive Action, 2022). China also has militarized Woody Island with its jet, radar system, and cruise missiles (Center for Preventive Action, 2022). The Philippines, as one of the ASEAN members, has had a long-time dispute and negotiation with China. In reaction to China’s continued incursions into areas of Phillippine-claimed waters in the South China Sea, the Philippines has increased its military presence and gathered U.S. military assistance in the region (Gomez, 2023).

How about Indonesia’s response? The new demarcation exclusive economic zone (EEZ) between Indonesia and Vietnam will resolve the illegal, unreported, and unregulated (IUU) fishing (Strangio, 2022). This demarcation is also seen as an important step in settling maritime disputes in the South China Sea. In its ASEAN chairmanship 2023, Indonesia has also started a code of conduct (COC) for the South China Sea dispute (Reuters, 2023). This negotiation which has been ongoing for over 20 years, tried to be restarted by Indonesia. Even though the claim to proprietorship of territorial waters covers with Indonesian EEZ through the Natuna islands, Indonesia has frequently said that Indonesia is not a part of the South China Sea disputes (Pratama, 2023). Fact that China has sent a letter to stop Indonesia from drilling for oil and gas in Natuna and even sent Coast Guard to monitor it (Reuters, 2020), Indonesia reacted as if it is not an urgent thing. Indonesia responded and rejected the claim under the UNCLOS agreement saying that China’s claim had no legal basis (Reuters, 2020). While this scene happened in 2019, there are no further policies to China’s ego. This Indonesia’s silent treatment has indicated that Indonesia, with its interest in China’s policy, will not likely take serious steps to encounter China’s domination of the South China Sea.

Indonesia’s Current Foreign Policy: Tend to Align with China

A close relationship between China and Indonesia cannot be debated anymore. Under Joko Widodo’s chairmanship, a large investment cooperation called Belt and Road Initiative (BRI) has started. One of the most controversial projects, the Jakarta-Bandung high-speed railway, is under the BRI investment (Fitriani, 2022). Electric vehicles, a lithium battery factory in Morowali, Jatigede dam, and other developments are also under the BRI investment (Fitriani, 2022). Other than that, the mining and energy industries receive the majority of Chinese investment in Indonesia. Indonesia had the most coal-fired power stations developed overseas by Chinese companies as of 2021. Besides, Indonesia and China are also good partners for their food security. The decision of Indonesia to ratify the China Regional Comprehensive Economic Partnership (RCEP) shows satisfaction for China (Rahmat, 2022). The renewing agreement, Bilateral Economic and Trade Cooperation (BETC), that has been expired in April 2021, has also been an agenda of G20 between Indonesia and China (Rahmat, 2022). Based on these facts, it can be concluded that Indonesia’s interest has tended to favor China’s interest.

Even though its principle of foreign policy, “bebas aktif” (independent and active), it is understandable for Indonesia to align with the Asian superpower, China. It is logical and pragmatic because China offers more chances than other major powers and has become the main driver of global economic growth. Since the signing agreement of the Indonesia-China Strategic Partnership in 2005, China has become Indonesia’s largest trading partner. Moreover, China and Indonesia also have the highest import and export growth rates among ASEAN nations. According to the National Bureau of Statistics and China Customs, China and Indonesia’s combined import and export volume climbed from $66.234 billion in 2012 to

$124.57 billion in 2021, with a detail of USD 31.951 billion to USD 63.923 billion, Indonesia exported more goods to China. Other than that, through the China-ASEAN Free Trade Area, this bilateral trade has positively affected the expansion of some export commodities, such as palm oil and coal (Maria, 2022). The fact that both economies are complementary, with  China having advantages in manufacturing and technology while Indonesia is rich in agricultural and raw materials, has been seen as a bilateral mutual relationship. In the future years, China’s investment in Indonesia will keep increasing as it becomes a more significant trading partner for Indonesia. Therefore, it makes more sense to accept China’s emergence and work together to counter the challenges it poses than condemning it or excluding it, which will only feed great power rivalries that could jeopardize Indonesian interests in the long run.

During Indonesia’s presidency, ASEAN’s economic recovery from the COVID-19 pandemic and promoting ASEAN’s economic growth will be the main agenda for the 2023 chairmanship (Southgate, 2023). These objectives can be seen in its eight flagship events, of which the Trade Ministry of Indonesia is responsible for four. These four flagship events, The ASEAN Online Sale Day, the ceremony of the RCEP, the launch of the new ASEAN tariff finder, and also the Digital Economy Framework Agreement (DEFA) agreement (ANTARA, 2023), have been seen as a focus on promoting ASEAN’s economic interest and strengthening the regional organization’s relevance in the global arena. These agendas align with Indonesia’s concern about its economic policy and also strengthen its relationship with China.

What is next?

Indonesia’s ignorance of the South China Sea dispute and Indonesia’s foreign policy tendency to China’s cooperation leads the writer to one conclusion: Indonesia will not likely finish the disputes between ASEAN members and China on the chairmanship of ASEAN. The dependency on China will guide Indonesia to enhance its foreign policy on the economy,

rather than solving the South China Sea issue. Despite numerous concerns about the stability of the area, Sulaiman (2019) argues that Indonesia is not developing a coalition to counter China’s expanding dominance in the South China Sea or improving its ability to project power. Indonesia’s interest has fallen into China’s hands. The strategic culture that affects Indonesia’s military and foreign policy thinking on threat perceptions and economic considerations results in under-balancing conduct, which restricts Indonesia’s alternatives in relation to China. China as a state is therefore not regarded as posing a significant, direct, or immediate threat that would require a prompt response and could damage Indonesia’s more significant interests. Moreover, the writer believes that Indonesia maintains its stance in position: Indonesia does not think that the issue is urgent to solve. Indonesia’s government is ignorant enough about the issue and currently does not have any intention to make policies to counter the unilateral recognition. Indonesia also has not been damaged enough to shift its foreign policy for the security of sovereignty. Therefore, Indonesia’s interest in the mutual economic relationship with China has made stagnancy on the issue, even in Indonesia’s year of ASEAN chairmanship.

Through the article, the writer believes that the settlement of South China Sea disputes will remain stagnated, not much different from the chairmanship of Cambodia. The interest between Indonesia and China has gradually strengthened and will obstruct the settlement of the issue, including foreign policy tendencies and economic reasons. Thus, Indonesia should not get swayed by the mutual relationship but view the issue with an objective perspective. The ASEAN region has got threatened enough to create a project power to encounter China’s power. Therefore, Indonesia needs to balance the security danger that China poses in the South China Sea by taking necessary steps, especially in its ASEAN chairmanship in 2023.

 

About Writer

Jefferson Davids Soasa is an undergraduate in the department of International Relations at Universitas Gadjah Mada.

 

Bibliography

ANTARA. (2023). Trade Ministry prepares 4 flagship events for ASEAN Chairmanship 2023. Antara News. https://en.antaranews.com/news/270234/trade-ministry-prepares-4-flagship-events-for-asean-chairmanship-2023

Center for Preventive Action. (2022). Territorial Disputes in the South China Sea. Global Conflict Tracker; Global Conflict Tracker. https://www.cfr.org/global-conflict-tracker/conflict/territorial-disputes-south-china-sea

Gomez, J. (2023). Philippines confronts Chinese diplomats over sea disputes. AP NEWS. https://apnews.com/article/china-philippines-south-china-sea-disputes-70ea7983dbf67 b1f9ae5264c6ce9271a

Maria, C. (2022). The Impact of Trade Agreement and War on Specific Indonesia-China Bilateral Trade. Journal of Research on Business and Tourism.

Pratama, A. (2023). Indonesia’s Ambiguity in the South China Sea is Hampering its Interest. Modern Diplomacy. https://moderndiplomacy.eu/2023/01/13/indonesias-ambiguity-in-the-south-china-sea- is-hampering-its-interest/

Rahmat, M. Z. (2022). China-Indonesia Relations in 2022: A Year in Review. Stratsea. https://stratsea.com/china-indonesia-relations-in-2022-year-in-review/

Reuters. (2020). Indonesia rejects China’s claims over South China Sea. Reuters. https://www.reuters.com/article/us-indonesia-china-southchinasea/indonesia-rejects-c hinas-claims-over-south-china-sea-idUSKBN1Z01RE

Reuters. (2023). ASEAN chair Indonesia to intensify talks on code for South China Sea. Reuters. https://www.reuters.com/world/asia-pacific/asean-chair-indonesia-intensify-talks-code-south-china-sea-2023-02-04/

Southgate, L. (2023). Indonesia’s ASEAN Chairmanship: Promoting ASEAN Relevance in 2023? Thediplomat.com. https://thediplomat.com/2023/01/indonesias-asean-chairmanship-promoting-asean-relevance-in-2023/

Sulaiman, Y. (2019), What Threat? Leadership, Strategic Culture, and Indonesian Foreign Policy in the South China Sea. Asian Politics & Policy, 11: 606-622. https://doi.org/10.1111/aspp.12496

Strangio, S. (2022). After 12 Years, Indonesia and Vietnam Agree on EEZ Boundaries. Thediplomat.com. https://thediplomat.com/2022/12/after-12-years-indonesia-and-vietnam-agree-on-eez- boundaries/

U.S. Department of State. (2020). U.S. Position on Maritime Claims in the South China Sea. United States Department of State. https://2017-2021.state.gov/u-s-position-on-maritime-claims-in-the-south-china-sea/in dex.html

Williams, R. D. (2020). What did the U.S. accomplish with its South China Sea legal statement? Brookings. https://www.brookings.edu/blog/order-from-chaos/2020/07/22/what-did-the-us-accom plish-with-its-south-china-sea-legal-statement/

Embracing ASEAN Economic Community 2025: Unlocking Prospects and Overcoming Obstacles in Indonesia

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Imagine businesses of all sizes, effortlessly trading goods and services across ASEAN borders, tapping into diverse markets, and seizing growth opportunities. Picture investors eagerly exploring investment prospects in ASEAN, fueling economic growth and creating job opportunities. Envision entrepreneurs, armed with innovative ideas and regional market access, expanding their businesses and contributing to prosperity. The ASEAN Economic Community (AEC) Blueprint seeks to create such an environment, where businesses of all sizes can thrive and contribute to inclusive development in the region. The AEC Blueprint serves as a roadmap to transform this vision into reality, propelling ASEAN towards a new era of economic integration for inclusive development in the region.

The AEC Blueprint 2025 outlines five reinforcing characteristics for ASEAN’s economic integration, namely: (i) A Highly Integrated and Cohesive Economy; (ii) A Competitive, Innovative, and Dynamic ASEAN; (iii) Enhanced Connectivity and Sectoral Cooperation; (iv) A Resilient, Inclusive, People-Oriented, and People-Centered ASEAN; and (v) A Global ASEAN. These characteristics provide a roadmap for ASEAN’s economic integration efforts, emphasizing the need for integration, competitiveness, innovation, connectivity, inclusivity, resilience, and global engagement (ASEAN, 2015). We are currently two years away from achieving the dream, and as ASEAN continues to evolve as a regional bloc, the AEC Blueprint still presents both opportunities and challenges for member countries, including Indonesia, in its pursuit of greater economic cooperation towards 2025 and beyond. 

Unleashing Underestimated Economic Sector

The AEC Blueprint 2025 presents a plethora of opportunities for Indonesia. In essence, the blueprint creates greater market opportunities for ASEAN members. The integration of ASEAN markets under the AEC framework will hopefully drive Indonesia to improve competitiveness and efficiency for intra-ASEAN trade. This collective effort among ASEAN member countries has the potential to unlock underestimated economic sectors.

The services sector, despite its contribution of over 64.4% to the global GDP (World Bank, 2021b), has often been colloquially referred to as the “Cinderella sector”. This stems from the belief held by economists, industrial relations researchers, and innovation scholars who regard the sector as relatively unproductive compared to other sectors, despite its potential to bring significant value to the economy (Miles & Boden, 2015). In fact, William Baumol went so far as to suggest that the expansion of this low-productivity services sector could potentially hinder economic growth due to limited productivity improvement, potential labor cost savings, and price-inelastic demand (Baumol, 1967). This concept is now known as “Baumol disease”. Interestingly, the services sector’s share in Indonesia’s GDP is relatively high compared to other sectors, contributing 42.8% to its total GDP, highlighting the significant opportunities that can be tapped into for the economies (World Bank, 2021a).

However, Indonesia still faces challenges in its services sector, as indicated by the OECD’s Services Trade Restrictiveness Index. It reveals that Indonesia demonstrates high levels of restrictiveness, particularly in legal services (scoring 0.9), accounting (scoring 0.7), and telecommunication (scoring 0.6), where a score of zero indicates complete openness and a score of one indicates complete closure to foreign services (OECD, 2022). These restrictions can potentially limit the availability of high-quality services and productivity.  Opening up the services market can effectively address these quality issues and provide opportunities for Indonesia to access higher quality services from abroad, and of course benefiting other economic sectors as well. Just like goods, high-quality and efficient services do not necessarily have to be produced domestically. Services trade allows Indonesia to access the immediate benefits of better quality services from abroad which can support other economic sectors.

Enhancing Manufacture, Fisheries and Agriculture Sector

Indonesia, being the ASEAN country with the largest population and GDP, holds other significant opportunities from the AEC Blueprint. The country’s abundant natural resources, particularly in agriculture and fisheries, further amplify its potential for economic gains through the AEC. Despite these favorable demographic and economic factors, recent industrial performance in Indonesia has been subpar. The fisheries and agricultural sectors, in particular, face weak competitiveness within ASEAN. Additionally, Indonesia faces competition from Vietnam in prawns and textiles, as well as from Thailand in the automotive supply chain within ASEAN (Aswicahyono & Soedjito, 2016). To achieve competitiveness within ASEAN, Indonesia must focus on developing a robust manufacturing base and enhancing the quality of its human capital. However, the country is grappling with persistent challenges related to infrastructure, including logistics, energy supply, and transportation, as well as an inefficient bureaucracy and corrupt institutions.

Unfortunately, Indonesia’s Business Freedom Index by The Global Economy had a decline in its value from 71 in 2021 to 67 in 2022, giving Indonesia just 57th in the Business Freedom ranking amongst 175 countries (Global Economy, 2022). In addition to that, Indonesia only ranks 95th on the Corruption Perception Index (Global Economy, 2021), indicating that practices of administrative and political corruption are still high. In order to combat these problems, Indonesia should focus on improving the regulatory environment to enhance business freedom. This may include simplifying and streamlining business regulations, reducing bureaucratic red tape, and enhancing transparency and efficiency in administrative processes. This could help create a more conducive environment for businesses to operate, attract investment, and foster economic growth in strategic sectors like agriculture and fisheries, while also giving strict regulations to mitigate the practice of corruption.

A Shift to Green Economy

The AEC Blueprint 2025 indeed emphasizes the importance of environmental sustainability and the integration of green principles into the economic policies and practices of ASEAN member states; it is specifically stated in the second characteristic of its framework, “A Competitive, Innovative, and Dynamic ASEAN”. This includes efforts to reduce GHG emissions, promote renewable energy, enhance resource efficiency, and address climate change impacts. The Blueprint also encourages the adoption of sustainable production, consumption patterns, and the promotion of sustainable agriculture, forestry, and fisheries practices (ASEAN, 2015). But even so, its implementation to shift to a greener economy is not as good as its vision. In fact, The Regional Comprehensive Economic Partnership (RCEP), the largest economic cooperation initiated by ASEAN countries to accomplish AEC’s visions, does not include a single chapter or regulation about the environmental consideration (CECPHILS, 2023). Provisions of RCEP for reducing tariffs could make non-renewable energies such as fossil fuel cheaper and more accessible to member countries. This may lead to an escalation in their utilization, particularly in Indonesia, which relies heavily on coal production and consumption. In addition, a recent study revealed that if all tariffs were eliminated among RCEP members, it could significantly increase approximately 3.1% in global carbon dioxide emissions from fuel combustion annually. This would effectively double the average annual growth rate of global CO2 emissions observed in the last decade (Tian et al., 2022).

Bright Future for Indonesia and ASEAN 

As ASEAN advances towards the realization of the AEC 2025, Indonesia faces a dual landscape of opportunities and challenges that must be addressed within a limited timeframe of approximately two years. While the AEC 2025 offers prospects for increased economic integration that could benefit Indonesia’s economy, challenges such as the need for structural reforms, increasing competitiveness, and environmental impact mitigation must be effectively navigated. Strategic planning, policy coordination, and stakeholder engagement are crucial for Indonesia to maximize the potential of the AEC 2025 and promote sustainable and inclusive economic growth. This will not only contribute to Indonesia’s prosperity and resilience but also to that of the broader ASEAN region.

 

About Writer

M. Tora Bhanu Pandito is an undergraduate student at the Faculty of Economics and Business of University of Brawijaya. His interests extend beyond the classroom, as he is deeply invested in foreign policy issues, writing research articles, and enhancing the creative economy. He had the privilege of serving as the Head of Creativepreneur for the Student Executive Board, leading several university initiatives aimed at empowering MSMEs and fostering entrepreneurship that promotes sustainable economy. Contact can be made through his email at torapandito@gmail.com.

Bibliography

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Institutional Visitation by Prince of Songkla University – FISIPOL and PSU Future Collaboration

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Yogyakarta, Friday, March 3, 2023

FISIPOL together with the ASEAN Studies Center UGM welcomed the institution from the Prince of Songkla University (PSU), Thailand. This meeting was held in Dean’s Meeting Room at 01.00 pm (GMT +7), with the purpose of discussing future research and academic collaboration and networking with academia and researchers in environmental energy, social policy, or climate change.

This meeting was attended by four representatives from the Prince of Songkla University namely Dr. Surawut Chomaitong (Dean of the Faculty of Political Science, PSU), Dr. Yasmin Sattar (Associate Dean for Academic and Research, Faculty of Political Science, PSU), Dr. Hafiz Salae (Associate Dean for Student Development and Lifelong Learning, Faculty of Political Science, PSU), and Mrs. Amney Sumalee (International Affairs Officer, Faculty of Political Science, PSU).

Meanwhile, the FISIPOL together with the ASEAN Studies Center UGM attended by Dr. Wawan Mas’udi (Dean of the Faculty of Social and Political Sciences), Prof. Dr. Poppy Sulistyaning Winanti (Vice Dean of Academic and Student, FISIPOL), Dr. Dafri Agussalim (Head of ASEAN Studies Center, FISIPOL), Yulida Nuraini Santoso, M.Sc., (Managing Director of ASEAN Studies Center, FISIPOL), and Tunggul Wicaksono (Research Manager of ASEAN Studies Center, FISIPOL).

In the discussions at this meeting, both parties discussed research collaboration, joint lectures & conferences, an exchange program for students and staff, and a cultural exchange & cooperative education program. From this discussion, it is hoped that in the future this collaboration between FISIPOL and Prince of Songkla University can be realized and carried out well.

This meeting then ended with the giving of souvenirs by each party and also taking a group photo.

#UGM #FISIPOL #ASEANStudiesCenter #PrinceofSongklaUniversity #Thailand #ResearchCollaboration #AcademicCollaboration #StudentExchange #UGM

Public Seminar – Indonesia’s Agenda in ASEAN Chairmanship 2023: Opportunities and Challenges

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Indonesia’s Chairmanship role in the midst of the dynamics of global issues that are always challenging at this time is driven by strong initiatives to build a regional region that has a stable, fast-growing, inclusive, and sustainable economy. Indonesia’s chairmanship of ASEAN in 2023 is an important momentum that needs to be utilized to create a peaceful region that upholds human and democratic values through policy alternatives oriented to the interests of the grassroots community.

On February 14, 2023, the ASEAN Studies Center and the Faculty of Social and Political Sciences of Universitas Gadjah Mada (UGM) successfully held a Public Seminar with the title “Indonesia’s Agenda in the 2023 ASEAN Chairmanship: Opportunities and Challenges”. This Public Seminar was divided into two-panel discussion sessions and had two purposes, namely first, as an arena to highlight priority agendas that are relevant to Indonesia’s Chair in ASEAN, as well as to become a means for academics and practitioners to identify policy gaps so that, further, formulate an agenda -agenda to be accomplished. Second, building networks and increasing the role of the academic community in Indonesia’s strategic policies is especially important in efforts to build Indonesia’s leadership projection in the region and the world.

In panel discussion 1, the topic was “Geopolitical Challenges and Democracy in the ASEAN Region,” which presented two speakers, namely H.E. Sidharto R. Suryodipuro (Director General for ASEAN Cooperation, Ministry of Foreign Affairs) and Dr. Amalinda Savirani (Lecturer of Department Political and Government, UGM), and was moderated by Dr. Luqman-nul Hakim (Lecturer of Department International Relations, UGM). Based on the presentation submitted by H.E. Sidharto R. Suryodipuro, the government is quite optimistic in terms of Chairmanship in ASEAN, considering this is not Indonesia’s first experience in ASEAN Chairmanship with an “at the crossroads” situation. The most important challenge is how to build a common identity as a new ASEAN political subject in the region and in the world, which will not be easy, both internally and externally. While Dr. Amalinda Savirani explained that, from an internal perspective, there are many divergent things in Southeast Asia, which makes it difficult for us to find a common ground. But at the same time, new issues such as environment, technology, and human trafficking inevitably force us to create a common ground and are expected to have a major impact on institutional maturity in ASEAN. The external challenge is that generally there are two collective identities, namely, a common ground inside or a common enemy outside. This is a matter of geopolitical turbulence, instead of being able to make ASEAN more unified, it actually has the potential to create the polarization.

For discussion panel 2 discussed the Opportunities for ASEAN as the Epicentrum of Growth and presented three speakers namely Ni Made Ayu Marthini (Deputy Marketing for the Ministry of Tourism and Creative Economy/Agency for Tourism and Creative Economy), Nella Sri Hendriyetty, Ph.D. (Head of Center for Regional and Bilateral Policy, Ministry of Finance), and Dr. Muhammad Rum (Senior Researcher of the ASEAN Studies Center, UGM), and moderated by Yulida Nuraini Santoso (Managing Director of the ASEAN Studies Center UGM). From the presentation of the three speakers in discussion panel 2, there are 3 things that can be concluded, namely, first, the fact that the existing economic deliverables are not a single issue, so they cannot be done alone or seen as a stand-alone part. And because of that we discussed at length about cooperation and the cross-pillar mechanism, perhaps it can be strengthened. Second, Indonesia has an extra challenge as Chair this year, because there is pressure to connect with the deliverables that existed last year when Indonesia became Chair of the G20, so this puts us in the spotlight. Third, it is our responsibility as Indonesian citizens to reconcile, and perhaps also to oversee efforts to achieve existing deliverables.

From discussion panels 1 and 2, it is hoped that there will be many insights that can be developed by the community or academics as both academic ideas and policy recommendations.

ASEAN’s Pathway to Sustainability Through Green Recovery Post-Pandemic Covid-19: Challenge and Opportunity

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Written by Wahyu Candra Dewi

Striking in 2020, the Covid-19 pandemic has significantly brought disruption to people’s livelihoods worldwide. Upon its initial announcement in March, the pandemic extended from a global health crisis into a global economic crisis that impacted countless nations, including ASEAN country member. As the virus spread at an unprecedented speed through human interaction, governments started to impose the policy of limiting people’s mobility and travel, causing numerous businesses to stop operating, which led to an economic downturn. After undergoing growth of around 4.4 percent in 2019, the financial situation in Southeast Asia countries declined by an average of 4 percent in the following year (Asian Development Bank, 2022b). The degree of severity varied amongst the nations. Thailand’s growth, for example, underwent a sharp contraction of 9.6 percent, while Malaysia’s economy was shrinking by 5.6 percent (Asian Development Bank, 2022b). Furthermore, according to Asia Development Bank’s calculation (2022), the pandemic Covid-19 had blotted out 9.3 million jobs which pushed 4.7 million people in the region into extreme poverty.

Nevertheless, the coronavirus outbreak was considered to create a one-a-lifetime opportunity, to change the trajectory of a country’s development. How the pandemic Covid-19 nearly drove Southeast Asia to the brink of recession showed the vulnerability of the current economic system (Hanns Seidel Foundation, 2021). Therefore, a change in today’s structure is needed to create a more resilient and sustainable economy. ASEAN governments are apparently aware of this present moment. Through ASEAN Summits in Ha Noi, Vietnam, on November 2020, country members formulated a recovery framework focusing on five key areas, including the effort to create a sustainable and resilient future referred to as Green Recovery (ASEAN Secretariat, 2020).

Green Recovery as A Pathway to Achieve Sustainability

Sustainable Development Goals (SDGs) were adopted by 193 member states of the United Nations in 2015 and consisted of 17 goals and 169 targets which cover three pillars of sustainability: people, prosperity, and planet (Suriyankietkaew & Nimsai, 2021). Under the UN 2030 Agenda, member states are committed to eradicating poverty, reducing inequality, decoupling economic growth, dealing with climate change and environmental degradation, and creating a better world for future generations (United Nations, 2015). Until 2020, the countries in Southeast Asia were lagging in terms of achieving SDGs. Albeit a thriving economic growth, the region is characterized by high levels of inequality; a lack of social protection; a sizeable informal sector; a decline in peace, justice, and robust institutions; as well as an alarming level of ecosystem damage, biodiversity loss, and greenhouse gas emission (United Nations, 2020).

ASEAN Comprehensive Recovery Framework showed how ASEAN governments have become more attentive toward sustainability goals and manifesting the effort to address the issue through Strategy Number 5: Advancing towards a More Sustainable and Resilient Futures. Looking deeper into the area of priorities, this strategy can be considered as another endeavor to pursue a chance for green recovery post-Covid-19. The approach identifies seven sectors that need to be developed by country members to achieve sustainability and resiliency, including: (1) promoting sustainable development in all dimensions; (2) facilitating the transition towards sustainable energy; (3) building green infrastructure and addressing fundamental infrastructure gaps; (4) promoting sustainable and responsible investments; (5) promoting high-value industries, sustainability, and productivity in agriculture; (6) managing disaster risks and disaster management; and (7) promoting sustainable financing (ASEAN Secretariat, 2020).

Green recovery is perceived as a crucial step that needs to be taken as a pathway for building back the world after Covid-19, necessarily in Southeast Asia. Research conducted by the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (2020) showed how the coronavirus outbreak was closely related to environmental degradation. Numerous diseases that led to the pandemic came from microbes of animals that spilled over. With the desolation of many animals’ habitats, this spill-over will likely have a higher percentage in the future. As southeast Asia is located in a tropical area that is home to a wealth of biodiversity, this region would be more vulnerable to upcoming pandemics (Asian Development Bank, 2022a). Therefore, a recovery process that could ensure the repair of environmental damage would be needed to prevent future health crises and promote and protect sustainability.

According to Asian Development Bank (2022a), implementing green recovery can create more jobs, as every USD 1 million in government green spending would generate 7.49 full-time jobs in renewable infrastructures. The existence of renewable infrastructures could create a circular economy that would significantly impact the environment: cleaner energy and lower gas emission, leading to a greater chance of maintaining global temperature. Further, economic activities that take the environmental dimension into account are expected to prevent Southeast Asia’s GDP from declining by 25 percent in 2045 and would also increase the region’s competitiveness in the global market (Hanns Seidel Foundation, 2021). This way, the development trajectory would be more sustainable and long-lasting for future generations. However, the enforcement of green recovery in ASEAN is not without challenges.

Challenge and Opportunity for Implementing Green Recovery

Increasing environmental protection awareness amongst leaders in the region opens an enormous opportunity for executing green recovery. This concern is manifested in ASEAN Comprehensive Recovery Framework, created by ASEAN as a recovery guideline post-Covid 19. Some country members have also adopted green growth or have a framework to fight climate change. Cambodia and Vietnam, for example, have specifically employed green growth as part of the national development plan (OECD, 2022). The Philippines released National Framework Strategy for Climate Change 21-22, and Singapore launched Singapore Sustainable Development Blue Print (OECD, 2022) as part of the effort to combat environmental issues and sustain growth. These approaches showed that Southeast Asia countries already have a tendency to mainstream the ecological dimension into economic development.

Nevertheless, the implementation of green recovery is being challenged by the absence of solid institutions that have the capacity to enforce the execution. The above-mentioned recovery framework is non-binding, which means that the decision to follow the guidelines is being referred back to the country member. ASEAN highly upholds the non-intervention principle as they prefer regional stability rather than enforcing values on unwilling countries, which could lead to rising tension. Therefore, non-compliance with the recovery framework would not inflict any consequences. Further, the transition into green infrastructures would need a long commitment and expensive investment. According to Asian Development Bank (2022a), green recovery would require USD 172 billion of capital annually by 2030. This would be a tough option for some developing countries in Southeast Asia with limited capital. The gain of the investment cannot be harvested immediately, even though the impact would be long-lasting. On the other hand, the government is confronted by demands from the domestic public for welfare that must be met promptly. With this dilemma, green recovery in Southeast Asia would still have a long way to go.

About Writer

  • Wahyu Candra Dewi is a graduate student in Universitas Gadjah Mada, majoring International Relations. She is interested in issues related to digital transformation, environment, and human security. Author can be contacted at wahyucandradewi@mail.ugm.ac.id

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