| Publication |
June 2004.
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| Summary/Abstract |
The Asia-Pacific region's vulnerabilities to the consequences of globalisation were vividly revealed by its financial crisis in 1997-98. ASEAN states considered the US and APEC less than helpful during the crisis, and they found the conditionalities imposed by the IMF unpalatable. But ASEAN as a regional organisation has been much weakened, and it has been working hard to revive its influence. The 'ASEAN plus 3' approach has been perceived as an important means to strengthen ASEAN's status and relevance. The ASEAN-China Free Trade Area is undoubtedly an outstanding achievement of this approach; but ASEAN has been trying to keep its options open. On the other hand, China has been concerned with the danger of a deterioration in Sino-American relations and the increasing distrust between Tokyo and Beijing. Improvement of China-ASEAN relations therefore assumes increasing significance in China's regional policy; and enhancing mutual interests and interdependence is the best way to erode the ASEAN states' perception of the 'China threat'. But China must not neglect the interests of Japan and South Korea or underestimate ASEAN's resistance to the exclusion of the US and its desire to maintain a balance of power in the region. The ASEAN-China Free Trade Area, hopefully, should also facilitate the narrowing of the gap between the more developed and the developing ASEAN members, as well as that between the more prosperous coastal provinces and the poor interior provinces in China. In many ways, the establishment of the ASEAN-China Free Trade Area represents a challenge to what can be achieved in the mutual engagement process.
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