The ASEAN Economic Community has been a hot topic for many years, where China emerges once again as one of the most active dialogue partners.  However, before we proceed with the discussion, it is relevant to first understand why China is heavily involved in a region-specific integration to begin with.
This question illuminates a major problem in the largely optimistic coverage of Sino-ASEAN relations: China’s extensive power in the ASEAN internal politics, and the lack of ASEAN mechanism to prevent China from having a free hand in the ASEAN region.
China’s power extends over the ASEAN interests
This is one of the greatest challenges that the ASEAN community needs to overcome before turning its attention to the fostering of economic trade. China’s power is especially prominent in the political strife regarding South China Sea, where China’s land reclamation activities have intensified in 2015, superseding the scales of its ASEAN counterparts. This includes the expansion of the land area of the islands by sucking sediments and transferring them on the reef, as well as constructing port facilities, military buildings and airstrips. In Derek Watkin’s words, “the installations bolster China’s foothold in the Spratly Islands, a disputed scattering of reefs and islands in the South China Sea more than 500 miles from the Chinese mainland.”
From his remark, we see that not only is China’s activities causing harm to the environment, it is questionable whether China’s conduct complies with the United Nations Convention of the Law of the Sea.
China has, until now, defended itself under the name of “mutual benefit”. Yet, even behind this questionable argument of “mutual benefit”, it is clear that its national benefit overshadows that of others. During the enactment of ACFTA, the Chinese State Councilor Dai Bingguo said, “China will support the development of ASEAN-China free trade agreement (ACFTA) steadily and elaborately through close communication and negotiation with ASEAN, so as to seek mutual benefits and win-win results.”
However, the extent to which this benefit is mutual is questionable, given that, since the establishment of ACFTA, ASEAN’s goods trade with China has gone from surplus to a $45 billion deficit in 2013?
Prashanth Parameswaran explains China’s strategy as the following: an “incremental assertiveness, a two-pronged approach where China is gradually strengthening its position while cementing economic ties with neighboring states to draw them closer into China’s orbit, thereby making them think twice about challenging Beijing.”
Lack of integration in ASEAN
The key challenge for ASEAN is that it has little common ground and it is a loose collection of countries with different economies at various stages of development. For example, the average GDP per capita for ASEAN as a whole was $12,254 in 2013, but ranged from Cambodia ($1,008) at the low end to Singapore ($55,182) at the high end (see Table 5). The World Bank classifies Singapore and Brunei as high-income economies, and the remaining eight ASEAN members as developing economies. There has not been a united voice that contests that of China’s, and the ASEAN Way of going with the flow has resulted from this.
Ongoing Corruption in individual ASEAN countries
The current disparities in economic power are worsened with the major corruption scandals, such as Malaysia’s Prime Minister Najib Abdul Razak’s case of corruption of more than $600 million from state-run investment firm 1Malaysia Development Berhad (1MDB), Indonesia’s House Speaker Setya Novanto’s request for a 20 percent stake in a $4 billion company, and Philippines’ Vice President Jejomar Binay’s plunder charges related to past contracts he signed as a Mayor.
The ASEAN region faces a twin problem, where China’s national interests are driving its aggressive policies and the ASEAN countries lack regional unity to counteract it. The first step that needs to be taken is to counter China’s autonomy by strengthening the voice of the ASEAN countries. Possibly, Singapore could take the lead as the region’s economic powerhouse, given its intimate relationship with China. These concerted ASEAN efforts could gradually help the ASEAN countries stand firmly by their economic and political interests.