China and ASEAN: shaping regional dynamics together

By Imran Khalid | Gwadar Pro Sep 5, 2023

Editor's Note: The writer is a freelance columnist on international affairs based in Karachi, Pakistan. The article reflects the author's opinions and not necessarily the views of Gwadar Pro.

The on-going 43rd ASEAN Summit holds paramount significance as the Association of Southeast Asian Nations endeavors to establish itself as a pivotal regional player, boasting immense economic growth and investment potential.

This strategic pivot could potentially transform ASEAN into a dynamic catalyst for global economic expansion, coinciding with China's ascent up the industrial hierarchy through its commitment to sustainable, technology-driven development. It aspires to become the vanguard of global growth, propelled by China's ascendancy in the realm of sustainable, technology-centric development.

However, in a marked departure from past gatherings which were primarily centered on internal affairs, the 43rd summit is expected to concentrate on cultivating external relationships and engage robustly in extraregional dynamics. Chinese Premier Li Qiang is representing China in this summit. Li’s visit underscores China's unwavering commitment to strengthening ties with ASEAN nations and fostering regional cooperation, demonstrating China's proactive role in promoting regional stability and prosperity.

Notably, ASEAN is set to engage with Asia-Pacific nations. These engagements will span multifarious dimensions, including security cooperation, investment collaboration, and expanded market access opportunities. The stage is thus set for ASEAN to evolve into a pivotal linchpin in shaping the future of regional and global dynamics, fostering cooperation, stability, and prosperity. As ASEAN recalibrates its strategic compass, the global stage is poised for a shift, with the association poised to emerge as a formidable player.

ASEAN summits have continually pivoted their attention towards the interplay between ASEAN and its strategic partners. China is perhaps the most significant nation in the neighborhood with which ASEAN has forged comprehensive strategic partnerships. China occupies a distinct and paramount position in the Asia-Pacific- and a natural partner of ASEAN. China's role extends beyond being a mere comprehensive strategic partner; it weaves itself into the ASEAN+3 regional cooperation mechanism, counting Japan and the Republic of Korea among its members.

Furthermore, China actively participates in ASEAN affairs through the East Asia Summit mechanism, contributing to the multifaceted tapestry of its engagement with ASEAN. The profound nature of China's engagement finds its most prominent expression in the economic realm. Robust, organic economic ties between China and ASEAN member states underscore the profound influence of China's economic performance on the economic prospects of ASEAN as a whole. This symbiotic relationship shapes the contours of regional growth and development, amplifying China's role as a pivotal player in the ASEAN narrative.

A robust bilateral trade volume of $975.3 billion in 2022 between China and ASEAN was recorded. To further enhance this trade, efforts are underway to fast-track negotiations for China-ASEAN Free Trade Zone 3.0. Furthermore, ASEAN and China play pivotal roles in the Regional Comprehensive Economic Partnership (RCEP), facilitating nearly 65 percent of tariff-free trade in goods among RCEP members. The trajectory in China's GDP growth carries implications for developing Asia, particularly the pivotal ASEAN region, which is integral to the broader developing Asian landscape. ASEAN is anticipated to achieve growth rates of 5.3 percent in 2023 and 5.0 percent in 2024.

It is undeniable that China's economic pace has reverberations across the growth spectrum of developing Asia and ASEAN. Over time, the industrial supply chains have evolved in the Asia-Pacific, intricately weaving together the economies of China and ASEAN member states. At the same time, ASEAN member states have played pivotal roles as Belt and Road partners since 2013, contributing to a burgeoning portfolio of completed and ongoing projects within the framework of this transformative initiative. The fruits of this collaboration have been mutual, yielding substantial benefits for all involved.

In Laos, a remarkable high-speed railway now stands as a testament to this partnership. Meanwhile, Indonesia celebrated the completion of the 142-kilometer-long Bandung-Jakarta high-speed railway earlier this year, marking another milestone in the region's connectivity efforts. Malaysia's East Coast Rail Link (ECRL), spanning 665 kilometers with a standard gauge double-track railway, embodies the spirit of this infrastructure endeavor. Additionally, the ambitious Malacca Port project, launched two years ago, promises to alleviate the demands on Singapore's bustling port upon its completion, further enhancing regional trade and connectivity. In Myanmar, 2021 saw the launch of a slew of Belt and Road projects, encompassing high-speed railways, highways, and dams.

These vital infrastructure ventures serve a dual purpose: enhancing the flow of goods between China's landlocked Yunnan, Guizhou, and Xinjiang Uygur regions while also bestowing considerable advantages upon Myanmar. Thailand, Cambodia, and Vietnam are also actively engaged in diverse Belt and Road collaborations, involving the construction of railways and highways. Singapore's pivotal role is indispensable to the initiative, particularly in realms like investment, environmental protection, finance, and legal services. Even as a relatively small nation, Brunei exerts significant influence in finance and oil sectors, cementing its status as a valuable partner in the initiative.

However, the path to further strengthening collaboration between China and ASEAN faces some challenge hurdles, most notably in the realms of climate change and the digital economy. Both sides confront the daunting realities of climate change, necessitating joint action. However, meaningful collaboration demands the establishment or deepening of agreements on a spectrum of cross-border industrial regulations, which may spark differences of opinion. Similarly, the digital landscape presents challenges. With digital trade now of paramount importance, regional digital regulations wield immense influence over trade and economic development for both China and ASEAN.

These regulatory matters extend beyond economic implications, touching upon security concerns, thereby intersecting with political considerations. In essence, the domains of climate change and digital regulations stand as pivotal arenas with far-reaching implications, influencing the course of mutual discussions and the evolving China-ASEAN partnership. Premier Li's visit stands to bolster this momentum, generating lucrative opportunities in high-growth sectors and commodities, ultimately enriching a shared community. It also promises to amplify the existing momentum of cooperation and development, creating lucrative prospects in burgeoning industries and resources, ultimately enhancing collective well-being.

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