ASEAN integration may seem incremental but commitment among leaders is firm: PM Wong

KUALA LUMPUR: Integration efforts within the Association of Southeast Asian Nations (ASEAN) “may seem incremental to some” but there is “considerable determination and commitment” among the leaders, said Singapore Prime Minister Lawrence Wong on Tuesday (Oct 28).

Efforts thus far include the upgrading of the ASEAN Trade in Goods Agreement (ATIGA), which is an “important step” to enabling a “single market” within the region, he noted.

While the Digital Economic Framework Agreement (DEFA) has not been completed, ASEAN member states have reached a substantial conclusion.

“We look forward to the signing and the ratification of it eventually,” Mr Wong said, noting that the regional agreement will bring economies closer together while opening up new opportunities, such as in e-commerce and facilitating data flows between economies.

The upgraded ATIGA is aimed at achieving a free flow of goods between ASEAN member states, resulting in lower business costs, increased trade, and a larger market and economies of scale for businesses.

Meanwhile, DEFA aims to accelerate ASEAN’s transformation into a leading digital economy, fostering greater cooperation and paving the way for greater digital integration as well as inclusive growth and development. Touted as the world’s first regional digital economy arrangement, it is expected to be finalised and signed in 2026.

“These steps are already being done this year, and I'm sure going forward, we will continue to take further steps to integrate our economies further,” he said in an interview with the Singapore media at the end of the three-day ASEAN Summit in Kuala Lumpur.

“It may not be a big bang, and it may seem incremental to some, but what's important is that we are continuing to move in the right direction and there is considerable determination and commitment across all ASEAN countries and at … the highest leadership levels too.”

ASEAN leaders also recognise the need to stay united.

“There will be issues. There will be differences, but we cannot afford to be divided. We cannot afford to allow disputes to split ASEAN apart, and I think that's good,” he said, noting that this “continued strong desire” on accelerating integration and staying united is “one silver lining in the dark clouds” of geopolitical and economic uncertainties.

PRESENCE OF US, CHINA

Analysts have billed this year’s ASEAN Summit as one of the most significant in years, given the backdrop of ongoing geopolitical and economic tensions, as well as a high-profile list of attendees including United States President Donald Trump and Chinese Premier Li Qiang.

The regional bloc held separate closed-door meetings with the two superpowers – on the first and last day of the summit – and “both meetings went very well”, said Mr Wong.

China and ASEAN on Tuesday formally signed an enhanced free trade agreement (FTA) to cover emerging areas such as the digital economy, with leaders describing the move as a key step in further economic cooperation between the two sides.

“ASEAN countries have very good and close substantial economic linkages with China,” said Mr Wong.

“China is our largest trading partner, and we are happy to be able to upgrade the FTA with China, and that we are also continuing to do more with China.”

At the meeting with the US on Sunday, Mr Wong noted that ASEAN leaders appreciated Mr Trump’s role in helping to de-escalate border tensions between Cambodia and Thailand, as well as reaffirming America's commitment to being a partner of ASEAN.

“As he said, he is 100 per cent behind ASEAN, and ASEAN countries value that,” Mr Wong told reporters.

“We may be in the transition to a multi-polar world, but we are certainly not there yet, and where we are today, America is still a key global leader and continues to play a vital role in the peace, stability and prosperity of the region,” he added.

America also remains an important partner for investments, innovation, technology, finance, as well as the development and growth of the region, which is why ASEAN countries will “want to continue engaging the US”.

Asked if the impact of Mr Trump’s trade tariff policies came up during the meeting, Mr Wong said discussions “didn't get into tariffs (and) were very much at the broader strategic levels around the partnership that America has with ASEAN countries.

That said, discussions around tariffs remain “ongoing country by country”.

Mr Wong continued to say that Singapore has been asked why it has not signed trade deals with the US, while other countries have. At the ASEAN summit, Mr Trump signed reciprocal trade agreements with his Thai, Malaysian, Cambodian and Vietnamese counterparts that will see the countries work to address tariff and non-tariff barriers.

These agreements taken on by various countries aim to work out the reciprocal tariffs imposed upon countries by the US, Mr Wong noted.

Singapore, which is subject to the baseline 10 per cent tariff rate, does not need to pursue such an agreement given its FTA with the US, he said. 

“America is not going below 10 per cent so we are not pursuing such agreements. Others are, and … they will continue to do so, but we have not needed to do (so),” he said.

ADMISSION OF TIMOR LESTE

Another milestone at the summit is the admission of Timor-Leste as ASEAN’s 11th member, which was endorsed by ASEAN leaders at the opening of their annual summit on Sunday.

Timor-Leste’s formal inclusion marks the end of a 14-year process since its initial application to join the bloc. This is also ASEAN’s first expansion since Cambodia’s admission in 1999.

Mr Wong said the admission of Timor-Leste as a member came after the country had “significantly or substantially” met the criteria outlined in a roadmap.

The roadmap specifies three working plans on politics and security, economy, and social and cultural ties.

“They are the last country in Southeast Asia to come into ASEAN so they, in a way, complete our ASEAN family,” said Mr Wong.

But the prime minister also reiterated an earlier point he made that the country’s acceptance into ASEAN is “just the first step”.

“They will still need to take steps to integrate their economy with the rest of ASEAN in order to fully maximise the benefits of being part of ASEAN,” he said, noting that Singapore will provide support, such as in the form of capability-building programmes.

Following the conclusion of the Malaysia-chaired ASEAN summit, the Philippines will take over the rotating chairmanship for the annual gathering next year, followed by Singapore in 2027.

Mr Wong noted Singapore will support the Philippines as the next chair and keep the momentum going in two broad areas.

The first is to continue with concrete steps in economic integration and tap into new opportunities in the digital and green economies.

The second area is to “create frameworks and forums where ASEAN is at the centre, and (it) can engage with many different external partners”, especially amid a world that is becoming more multi-polar in nature.

“Malaysia has made quite a good progress in this direction. I'm sure Philippines will continue, and Singapore will also build on that,” he said.