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Open Regionalism and Deeper Integration: The Implementation of ASEAN Investment Area (AIA) and ASEAN Free Trade Area (AFTA)
The AHIA also noted that "it is even more important now, in the light of the present financial crisis besetting the region, to strengthen regional co-operation in promoting greater direct investments into and within the region"
(5). All these circumstances emphasise the urgent need for policy changes in ASEAN countries.
There have been calls for strengthening regional co-operation. The Secretary-General of ASEAN on 30th April 1999, calling for regional integration in response to the Asian crisis and global economy, emphasized that:
"One painful but invaluable lesson from the current economic difficulties is that in this age of globalisation, nations can thrive and flourish only if they band together for common purposes. Through internal reforms, active cooperation and purposeful integration, ASEAN will certainly overcome the difficulties, as it has already begun to do so. ASEAN will be stronger and ready for sustainable growth and development in the new millennium. With half a billion people in ASEAN and a combined GDP of nearly US$ 700 billion, ASEAN remains an important market and platform for production". (Statement by the Secretary-General of ASEAN welcoming the Kingdom of Cambodia as the Tenth Member State of ASEAN30 April 1999, ASEAN Secretariat)
ASEAN started strengthen its closer regional co-operation in the AFTA scheme that clearly signals ASEAN countries to move up to the level of regionalisation by launching Free Trade Area: free movement of intra-ASEAN trade by realising that:
"tariff and non-tariff barriers are impediments to intra-ASEAN trade and investment flows, and that existing commitments to remove these trade barriers could be extremely improved upon". (Preamble of the Framework Agreement on Enhancing Economic Co-operation, Singapore, 28 January 1992)
(6)of ASEAN imply moves towards deepening regional integration
(7). Nevertheless, the links between individual ASEAN and non-ASEAN countries are still stronger than those regionally, and ASEAN is committed to the policy of "Open Regionalism".
ASEAN's direction and development are very much based on social, economic, and political factors and circumstances. This section will discuss legal aspects of ASEAN integration, i.e. deeper integration and "Open Regionalism"
(8), by analysing the feasibility of closer ASEAN integration following the recent initiatives when ASEAN has launched important new framework agreements for this purpose. The discussion of these new framework agreements of ASEAN and their implications for regional integration emphasises how far these agreements entail intra-ASEAN preferential treatment or more generalised liberalisation, and the balance between these.
(5)See Statement on Bold Measures in Annex 11.
(6)The new framework agreements of ASEAN imply the moves towards deeper regionalisation of ASEAN such as to enhance free movement of service suppliers intra-ASEAN under the Framework Agreement on Services. Also the ASEAN investment area, when fully implemented, it facilitates the codification of ASEAN investment laws and regulations or at least the mutual recognition of laws or regulatory coordination in order to implement the AIA and facilitate intra-ASEAN investment. This process involves various aspects of laws such as taxation, investment laws, company law, and other related laws and regulations.
(7)This is especially emphasised in The Hanoi Action Plan, which accelerated all new framework agreements of ASEAN to realise the objectives set forth in the agreements and clearly considered to enhance regional economic integration, which provided the action plan in section "II. ENHANCE GREATER ECONOMIC INTEGRATION: To create a stable, prosperous and highly competitive ASEAN Economic Region in which there is a free flow of goods, services and investments, a freer flow of capital, equitable economic development and reduced poverty and socio-economic disparities".
(8)The concept of "open regionalism" as developed and applied in these new ASEAN arrangements has not yet been discussed or analysed by scholars, so this analysis is based largely on primary sources.