A Beacon of Hope from Malaysia’s ASEAN Chairmanship?

It remains quite premature to assess the conduct of Malaysia’s ASEAN Chairmanship this year, however the released plans and targeted goals offer an optimistic outlook. Besides having a normative-sounded chairmanship theme of “Inclusivity and Sustainability’, Prime Minister Anwar Ibrahim brought out several encouraging narratives for the Southeast Asian region.

Indeed, every chairmanship agenda will have its own priorities and somehow reflects the Chair country agenda aligned with the regional interests. The first narrative that stands out written by Anwar, saying that now is the time for ASEAN’s second renaissance. Anwar stated that ASEAN is now having another transformation that will not only make the region be the participant of global economy, but able to influence and shape the international economic models and governance.

This narrative is quite relevant as countries in Southeast Asia was recorded with the high inflow of foreign direct investments reaching $230 billion in 2023 despite the global decline. Within this number, more investments on digital technologies and green infrastructures besides manufacturing sector also shows ASEAN’s adaptability to the world’s current challenges and demands. Although the substantial increase on FDI from 2022 only seen in four Southeast Asian countries: Singapore, Vietnam, Cambodia and Lao PDR, with the rest shows decline in investment inflows. It sparks a classical but very important question: how should we narrow down ASEAN economic development gaps?

The principle of ‘inclusivity’ that Malaysia emphasized in the theme needs to be translated into concrete framework of ASEAN economic integration. The room for economic complementarity to share benefits of global FDI into ASEAN among the member countries should be expanded. One of the most obvious sectors is infrastructure development that will help Southeast Asia to be more connected among each other, particularly those who shared borders. Another one is green energy infrastructure that will enable more of energy exports and imports among ASEAN states. This will not only benefit to accelerate the regional energy transition, but also to increase the intra-ASEAN trade and investment.

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In the New Year remarks of Prime Minister Anwar Ibrahim, he stated that the current complex global challenges demand ASEAN to chart new roles and directions. Without discouraging the spirit to refresh ASEAN with more confidence, the setting of new directions and roles remain questionable.

Looking into the intensified bilateral relationships between Malaysia and China, the 2025 chairmanship year is expected to be filled with more of Beijing’s active contribution. In Beijing November last year, Prime Minister Anwar appreciates China’s support through Belt and Road Initiatives (BRI) that has reshaped ASEAN’s economic landscape and enhanced our connectivity and inclusive development across member states. At the same time, Anwar proposed to establish a trilateral forum of ASEAN, Gulf Cooperation Council (GCC), together with China, aiming to expand Southeast Asia’s regional partnership with the Arabian or Middle Eastern countries. The inclusion of China shows how Malaysia perceived its largest trading partner as a convenient bridge to tap into greater economic opportunities in the Middle East.

Although this idea will most likely be welcomed by other ASEAN member states, given to the growing Middle East’s economic significance in the region, some countries might ask about Malaysia’s direction in engaging other existing dialogue partners. If this ASEAN’s engagement with the GCC involves political issues in the future, then it will add more complexities.

This positive note towards China went along with another narrative for ASEAN to maintain its unity, cohesion and centrality.

Quoted from Prime Minister Anwar remarks at Peking University, he defined that

“(ASEAN) centrality means that no nation, no matter how big should unilaterally dictate what another nation should or should not do, or how it must or must not act. Centrality also means that no member should establish distinct self-serving cartels or inward looking mini-laterals that would only serve to perpetuate the vested interests of their members at the expense of others.”

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An interesting line also presented during Prime Minister Anwar’s interview with the CGTN saying that Malaysia will promote more ‘effective collaboration’ among ASEAN member states during its chairmanship year, at the same time also applauding China’s leadership attitude that in contrast with protectionism, unilateralism, and arrogance of power.

This sentence will affect a lot if ASEAN under Malaysia’s chairmanship able to determine its effective strategy in countering the other regional blocs’ protectionist and unilateralist policies, such as the EU Deforestation Regulation (EUDR) for instance that will be implemented end of this year. In fact, both Malaysia and Indonesia perceived the EUDR as an instrument that will harm its economic interests in a form of reducing the trade exports, despite committed to promote sustainable trade compliance.

Another so called ‘innovation’ from Malaysia’s ASEAN Chairmanship is the formation of ‘informal advisory group’ that will consist of regional influential and knowledgeable statesman of Southeast Asia. This sounds a good idea as besides its functional role, these numerous icons of ASEAN will help the regional body to learn from the past experiences and practices.

Malaysia’s leadership year will also be instrumental in charting the updated document of ASEAN Vision to 2045. In the next 20 years, Southeast Asia will face critical challenges such as aging demographics, shifting industrial trends, growing major economics competition, among others that is required to be addressed in the Vision 2045 document. The forward-looking vision also needs to incorporate the voices of incoming member of ASEAN like Timor Leste, that might have a lot of distinct interests and stances in solving regional problems, given to its unique economic landscape and trajectory.

Again, Malaysia’s ASEAN leadership is giving us a fresh hope of how the region will move forward with the sense of togetherness and unity, with innovative strategy in engaging the global economic partners, and with a full confidence to chart the new directions for ASEAN. What matters is the pragmatic and realistic implementation of such hopes, and let us support Malaysia to do so.

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