Challenges of ASEAN, The More the Merrier!

We’ve previously discussed ASEAN’s potential. In this post, we are going to explore the challenges that they are likely going to face in the upcoming years. Tourism is a significant driver of the economic sector’s accommodation, food services, wholesale, and retail trade, which heavily impacts Southeast Asian countries. This is evident with Cambodia, Thailand, Indonesia, Myanmar, and the Philippines recording an average 79.4% international arrivals decline in 2020 (ADB, 2022). Agro-processing and garment industries are also challenged by supply chain disruption, lack of diversification, and sustainable growth. The third sector facing challenges is the electronics sector, where data shows that focus countries have an increasingly unbalanced trade with their main competitor, China. Fourth is digital trade, with focus countries having connectivity gaps, automation issues, tax base erosion, and lack of development in MSMEs.

The education disparity between rural and urban areas is still high in the socio-cultural sector. This caused several ASEAN countries to have a low Human Development Index (HDI) compared to other regions such as Europe, East Asia, or North America. The disparity also influences the issue of rapid urbanization as people from rural areas choose to migrate, searching for better living conditions. ASEAN countries struggle to distribute wealth and development outside rural areas (Sheng & Thuzar, 2012). Rapid growth led to insufficient water supply and waste management, leading to a deteriorating environment further influenced by climate change. It also contributes to cultural change as more people require more housing and commercial complexes that destroy existing cultural communities. 

In the political and security sector, the closest issue needed to be addressed by ASEAN is their one voice and centrality over the South China Sea and internal politics, such as the Myanmar situation. Because of how ASEAN works, no policy or agreement can be made without consensus. Thus, if one member state goes in a different political direction, it would impact ASEAN’s collective work and eventually be unable to make decisions. In the case of the South China Sea and Myanmar, every member has a different opinion. Furthermore, delicate security matters of the region still find difficulties due to complex and hierarchical bureaucracy. It is interesting to observe how the ASEAN consensus will significantly impact the sector. The sustainability of security is important to note in this group.

Source:

ASEAN. (2021). ASEAN Development Outlook: Inclusive and Sustainable Development. ASEAN Secretariat. Retrieved September 7, 2022, from https://asean.org/wp-content/uploads/2021/07/ASEAN-Development-Outlook-ADO_FINAL.pdf.