Regional Economic Building Amidst Rising Protectionism and Economic Nationalism in ASEAN

Authors

  • Alexander Christian Chandra The Habibie Center

DOI:

https://doi.org/10.21512/jas.v4i1.878

Keywords:

Protectionism, economic nationalism, economic regionalism, ASEAN

Abstract

Despite its ambitious ASEAN Economic Community (AEC) project, protectionism and economic nationalism are on the rise in ASEAN. Protectionism, however, is not new to Southeast Asia, with governments across the region employ such an inward-looking economic policy when they enjoy economic stability, and pursue economic reform when confronted with major economic challenges. Unfortunately, embryonic industries will always exist in the region, and governments will find excuses to safeguard their existence. Consistent with the so-called 'Murdoch Schoold of critical political-economy' approach, this article mainly argues that the inclination towards protectionism in ASEDAN is primarily rooted in the domestic political-economy of ASEAN Member States. Apart from bringing about domestic regulatory changes, major economic liberalisationinitiatives of ASEAN, such as the ASEAN Free Trade Area and the AEC, significantly redistribute power and resources, and ignite struggles between competing domestic economic influences, many of which are in favour of government's protection. Whilst existing technical initiatives to address protectionism are useful, major crises that encourage major structural adjustments in all AMS might be needed to overcome fundamental protectionist inclination in the region
Dimensions

Plum Analytics

References

Ambarita, R. (2015), ‘Pekerja Indonesia Belum Siap Hadapi MEA (Indonesian Workers are not Ready in Facing the AEC)’, Sinar Harapan, 14th September, available online at (accessed 18th January 2016): http://www.sinarharapan.co/news/read/150914509/pekerja-indonesia-belum-siap-hadapi-mea

Anh, H. (2015), ‘Most Vietnamese Companies Still Not Ready for ASEAN Economic Community’, Vietnam Investment Review, 29th January, available online at (accessed 18th January 2016): http://www.vir.com.vn/most-vietnamese-companies-still-not-ready-for-asean-economic-community.html

ASEAN Secretariat (2015a), ASEAN Integration Report 2015, Jakarta: ASEAN Integration Monitoring Office, the ASEAN Secretariat.

_____ (2015b), ASEAN Community Vision 2025, Jakarta: ASEAN Secretariat, available online at (accessed 18th January 2016): http://www.asean.org/storage/images/2015/November/aec-page/ASEAN-Community-Vision-2025.pdf

Anukoonwattaka, W., and A. Heal (2014), Regional Integration and Labour Mobility, Bangkok: UNESCAP.

Bairoch, P. (1993), Economics and World History: Myths and Paradoxes, New York: Harvester Wheatsheaf.

Bisnis Indonesia (2016), ‘Tenaga Kesehatan: Antara MEA dan Sentimen Asing (Medical Professionals: Between the AEC and Anti-Foreign Sentiment’, 21st January, available online at (accessed 22nd January 2016): http://koran.bisnis.com/read/20160121/250/511703/tenaga-kesehatan-antara-mea-dan-sentimen-asing

Cadot, O., E. Munadi, and L. Y. Ing (2013), Streamlining NTMs in ASEAN: The Way Forward, ERIA Discussion Paper Series: ERIA-DP-2013-24, Jakarta: Economic Research Institute of ASEAN and East Asia (ERIA).

Chandra, A. C. (2008), Indonesia and the ASEAN Free Trade Agreement: Nationalists and Regional Integration Strategy, Lanham, MD: Lexington Books.

Chia, S. Y., and M. G. Plummer (2015), ‘Executive Summary’, in S.Y. Chia and M. G. Plummer, eds., ASEAN Economic Cooperation and Integration: Progress, Challenges, and Future Directions, Cambridge: Cambridge University Press, pp. 167-174.

De Melo, J., and A. Panagariya, eds. (1993), New Dimensions in Regional Integration, Cambridge: Cambridge University Press.

Dent, C. M. (2002), The Foreign Economic Policies of Singapore, South Korea, and Taiwan, Cheltenham: Edward Elgar Publishing Ltd.

Dharmawan, T. (2014), ‘Are Indonesian Physicians Ready for ASEAN Economic Community?’, The Jakarta Post, 6th December, available online at (accessed on 22nd January 2016): http://www.thejakartapost.com/news/2014/12/06/are-indonesian-physicians-ready-asean-economic-community.html

Evenett, S. J. (2014), The Global Trade Disorder – The 16th GTA Report, London: CEPR.

Evenett, S. J., and J. Fritz (2015), The Tide Turns? Trade, Protectionism, and Slowing Global Growth – 18th Global Trade Alert Report, London: CEPR.

Gilpin, R. (2000), The Challenge of Global Capitalism: The World Economy in the 21st Century, Princeton: Princeton University Press.

Glassman, J. (2010), Bounding the Mekong: The Asian Development Bank, China, and Thailand, Honolulu: University of Hawaii Press.

Global Trade Alert (n.d.), ‘Site Statistics’, available online at (accessed 23rd January 2016): http://www.globaltradealert.org/site-statistics#

Gomez, E. T., and K. S. Jomo (1997), Malaysia’s Political Economy: Politics, Patronage and Profits, Cambridge: Cambridge University Press.

Hettne, B., A. Inotai, and O. Sunkel, eds. (1999), Globalism and the New Regionalism, London: Macmillan Press Ltd.

Hewison, K., R. Robison, and G. Rodan, eds. (1993), Southeast Asia in the 1990s: Authoritarianism, Democracy and Capitalism, St. Leonards: Allen and Unwin.

Hoekman, B., and M. Leidy (1993), ‘Holes and Loopholes in Integration Agreements: History and Prospects’, in K. Anderson and R. Blackhurst, eds., Regional Integration and the Global Trading System, New York, NY and London: Harvester Wheatsheaf, pp. 218-245.

Huelser, S., and A. Heal (2014), ‘Moving Freely? Labour Mobility in ASEAN’, ARTNET Policy Brief, No. 40, June.

Hutchison, J. (2006), ‘Poverty of Politics in the Philippines’i G. Rodan et al., eds., The Political Econoy of Southeast Asia: Markets, Power and Contestation, 3rd ed., Oxford: Oxford University Press, pp. 39-73.

Ikenberry, G. J., D. A. Lake, and M. Mastanduno, eds. (1988), ‘Introduction: Approaches to Explaining American Foreign Economic Policy’, in G. J. Ikenberry et al., eds., The State and American Foreign Economic Policy, Cambridge, MA: Cornell University Press, pp. 1-14.

Jayasuriya, K. (2003), ‘Embedded Mercantilism and Open Regionalism: The Crisis of a Regional Political Project’, Third World Quarterly, Vol. 24, No. 2, pp. 339-55.

Jones, L. (2015), ‘Explaining the Failure of the ASEAN Economic Community: The Primacy of Domestic Political-Economy’, The Pacific Review, Vol. 19, pp. 1-24.

Kaempfer, W. H., E. Tower, and T. D. Willet (2002), ‘Trade Protectionism’, available online at (accessed 20th January 2016): http://public.econ.duke.edu/Papers//Other/Tower/Protectionism.pdf

Kicsi, R., and S. Buta (2010), ‘Protectionism and “Infant” Industries: Theoretical Approaches’, Economics and Applied Informatics, Years: XVI, No. 1, pp. 173-180.

Mahbubani, K., and R. Severino (2014), ‘ASEAN: The Way Forward’, Insights & Publications of the McKinsey and Company, May, available online at (accessed 25th January 2016): http://www.mckinsey.com/insights/public_sector/asean_the_way_forward

McDermid, C. (2009), ‘Protectionism a Dirty ASEAN Word’, Asia Times Online, 3rd March, available online at (accessed 22nd January 2016): http://www.atimes.com/atimes/Southeast_Asia/KC03Ae02.html

Mercurio, R. S. (2015), ‘Philippines Not Ready For ASEAN Integration’, The Star, 3rd November, available online at (accessed 18th January 2016): http://www.philstar.com/business/2015/11/03/1517608/philippines-not-ready-asean-integration-mvp

Milner, H. V. (1997), ‘Industries, Governments, and the Creation of Regional Trade Blocs’, in E. D. Mansfield and H. V. Milner, eds., The Political Economy of Regionalism, New York, NY: Columbia University Press, pp. 77-106.

MITI – Malaysian Ministry of International Trade and Industry (2015), ‘Media Release: 47th ASEAN Economic Ministers’ Meeting’, 24th August, available online at (accessed 25th January 2016): http://www.miti.gov.my/index.php/pages/view/2897

Negara, S. D. (2015), ‘Rising Economic Nationalism in Indonesia: Will This Time Be Different?’, ISEAS Yusof Ishak Institute Perspective, No. 59, 20th October.

Nehru, V. (2012), ‘Malaysia: Time to Liberalise Its Automobile Sector’, East Asia Forum, 13 March, available online at (accessed 22nd January 2016): http://www.eastasiaforum.org/2012/03/13/malaysia-time-to-liberalise-its-automobile-sector/

Nesadurai, H. E. S. (2003), Globalisation, Domestic Politics, and Regionalism: The ASEAN Free Trade Area, London: Routledge.

_____ (2012), ‘The Political Economy of Southeast Asia’s Foreign Economic Policies and Relations’, in S. Pekkane, J. Ravenhill, and R. Foot, eds., The Oxford Handbok of the International Relations of Asia, Oxford and New York, NY: Oxford University Press, pp. 217-240.

_____ (2014), ‘Trade Policy in Southeast Asia: Politics, Domestic Interests, and the Forging of New Accommodations in Regional and Global Economy’, in R. Robison, ed., Routledge Handbook of Southeast Asian Politics, London: Routledge, pp. 315-329.

Netto, A. (2007), ‘Race-Based Policy Spoils EU-Malaysian Ties’, Asia Times Online, 29th June, available online at (accessed 22nd January 2016): http://www.atimes.com/atimes/Southeast_Asia/IF29Ae01.html

Nottage, L. (2015), ‘Trade Helps Improve Consumer Protection in Southeast Asia’, East Asia Forum, 5th September 2015, available online at (accessed 25th January 2016): http://www.eastasiaforum.org/2015/09/05/trade-helps-improve-consumer-protection-in-southeast-asia/

Oliver, J. (2012), ‘Rise of Non-Tariff Protection Amid Global Uncertainty’, The World Bank’s Growth and Crisis Blog, 31st January, available online at (accessed 22nd January 2016): http://blogs.worldbank.org/growth/rise-non-tariff-protectionism-amid-global-uncertainty

Pasuk, P., and C. Baker (2004), Thaksin: The Business of Politics in Thailand, Copenhagen: NIAS.

Patunru, A. A., and S. Rahardja (2015), ‘Trade Protectionism in Indonesia: Bad Times and Bad Policy’, Lowy Institute Analysis, July, available online at (accessed 22nd January 2016): http://www.lowyinstitute.org/files/patunru_and_rahardja_trade_protectionism_in_indonesia_0.pdf

Plummer, M. G. (2009), The Global Economic Crisis and Its Implications for Asian Economic Cooperation, Honolulu, Hawaii: The East-West Center.

Port Calls Asia (2014), ‘PH Foreign Equity Rule, Cabotage Barriers to ASEAN Integration’, 8th July, available online at (accessed 22nd January 2016): http://www.portcalls.com/foreign-equity-rule-cabotage-barriers-to-asean-integration/#

Putnam, D. (1988), ‘Diplomacy and Domestic Politics: The Logic of Two-Level Games’, International Organization, Vol. 43, No. 2, pp. 427-459.

Robison, R. (1986), Indonesia: The Rise of Capital, Sydney: Allen and Unwin.

_____, K. Hewison, and R. Higgot, eds. (1987), Southeast Asia in the 1980s: The Politics of Economic Crisis, London: Allen and Unwin.

_____ and V. R. Hadiz (2004), Reorganising Power in Indonesia: The Politics of Oligarchy in an Age of Markets, New York, NY: Routledge Curzon.

Rodan, G., K. Hewison, and R. Robison, eds. (2006), The Political Economy of Southeast Asia: Markets, Power, and Contestation, 3rd ed., Oxford: Oxford University Press.

Schiff, M., and L. A. Winters (2002), Regional Cooperation and the Role of International Organizations and Regional Integration, World Bank Policy Research Working Paper No. 2872, Washington, DC: World Bank.

Shulman, S. (2000), ‘Nationalist Sources of International Economic Integration’, International Studies Quarterly, Vol. 44, No. 3, pp. 365-390.

Sumano, B. (2013), ‘Explaining the Liberalisation of Professional Migration in ASEAN’, Ph.D. thesis, School of Politics and International Relations, Queens Mary, University of London, London.

Tacujan, P. (2013), ‘Protectionist Clauses in the Philippine Constitution Restrict the Flow of Foreign Direct Investment’, The Philippine Star, 3rd June, available online at (accessed 22nd January 2016): http://www.philstar.com/business/2013/06/03/949375/protectionist-clauses-philippine-constitution-restrict-flow-foreign

Tempo (2015), ‘Insinyur Indonesia Dinilai Belum Siap Hadapi MEA (Indonesian Engineers Are Not Ready in Facing the AEC)’, 11th December, available online at (accessed 18th January 2016): http://bisnis.tempo.co/read/news/2015/12/11/090726937/insinyur-indonesia-dinilai-belum-siap-hadapi-mea

Thanh Nien News (2015), ‘PetroVietnam Calls for Protectionism, Says Cheap Imports Will Hurt Local Refineries’, 17th September, available online at (accessed on 22nd January 2016): http://www.thanhniennews.com/business/petrovietnam-calls-for-protectionism-says-cheap-imports-will-hurt-local-refineries-51421.html

Vietnamnet (2014), ‘Steel Sector Wants Longer Protectionism’, 8th November, available online at (accessed 22nd January 2016): http://english.vietnamnet.vn/fms/business/115817/steel-sector-wants-longer-protectionism.html

Yean, T. S., and S. B. Das (2015), ‘Domestic Consensus Vital for ASEAN Economic Community Beyond 2015’, ISEAS Yosuf Ishak Istitute Perspective, No. 50, 14th September.

Wad, P. (2009), ‘The Automobile Industry of Southeast Asia: Malaysia and Thailand’, Journal of the Asia Pacifc Economy, Vol. 14, No. 2, pp. 172-93.

Warrier, E. (2011), ‘A-Z Glossary’, in E. Warrier, ed., The Politics of Fair Trade: A Survey, London and New York: Routledge, pp. 131-246.

Downloads

Published

2016-08-09
Abstract 1549  .
PDF downloaded 599  .