Last month, ministers from the UK and ASEAN held their first joint Economic Dialogue. It produced commitments to boost trade, create new digital partnerships and focus on building sustainable infrastructure.
It is a sign of the times that during the coronavirus pandemic countries are forging new diplomatic partnerships and reshaping existing relationships. The latest example is the UK and ASEAN, whose trading links are well established but are now set for a reboot.
Last month, UK Secretary of State for International Trade Liz Truss met with her ASEAN counterparts, chaired by Vietnam’s Tran Truan Anh, 2020 Chair of the ASEAN Economic Community. Despite the UK’s long history of working alongside the Southeast Asian bloc, this was the first time their economic representatives had come together—albeit virtually. It followed the UK’s application to become a Dialogue Partner of ASEAN in June.
“ASEAN really matters to us,” Natalie Black, Her Majesty’s trade commissioner for Asia Pacific, told ASEAN Today. “The UK has deep and enduring roots with ASEAN, stretching back to its creation in 1967. We hope our relationship with ASEAN will strengthen and grow.”
A focus on sustainable growth and digital tech
COVID-19 has opened many peoples’ eyes to the idea that a greener, more sustainable world is a better place to live. As traffic levels dropped during lockdowns, the air became clearer and some animals thrived where before they struggled. Unsurprisingly, the UK and ASEAN are keen to work together to ensure anything they put in place is environmentally responsible.
This is not an entirely new approach as the UK is already offering technical assistance to develop green financial systems and energy efficiency in the region. However, recent moves to affirm its commitment to low-carbon initiatives, for example, could be indicative of a global shift in infrastructure planning.
Meanwhile, the UK sees ASEAN as having enormous potential and expects it to play a vital role in the rapidly developing digital economy. In June, the UK launched its Asia Pacific Digital Trade Network and will now set up a UK-ASEAN Digital Business Challenge to give companies in the region further assistance to meet challenges.
“By increasing UK digital tech expertise on the ground across key markets including Thailand, Singapore and Indonesia, we hope to forge new partnerships for the digital economy,” Black explained.
This is a good time for the UK to build stronger links with ASEAN
These are challenging times for the UK and Prime Minister Boris Johnson’s government. COVID-19’s arrival left him personally in intensive care at a time when he might otherwise have been negotiating the precise terms of his country’s final withdrawal from the European Union (EU).
Furthermore, Scotland is making more noise about a second bid for independence, a report claimed Johnson’s government ignored threats of Russian interference in elections and he has to carefully manage the UK’s relationship with China and the US as public approval of both declines.
Against this backdrop, it is unsurprising that the UK has looked to build on its good relations with ASEAN and revised its agreements with a sympathetic and willing partner. The move should benefit both parties. Brexit threatens to have a hugely negative impact on trade between the two parties, particularly as the UK could still leave without a formal deal with the EU, which would see it revert to World Trade Organisation (WTO) terms.
However, as Black told ASEAN Today, the UK is taking the positive view that freedom from the EU could help both parties. “We are working to establish the UK as a central hub of free trade,” she said. “We are currently negotiating free trade agreements around the world…we look forward to working with ASEAN countries to make progress at the 12th WTO Ministerial Conference.”
That will come as an enormous relief to those countries in Southeast Asia, in particular Cambodia, Indonesia, the Philippines and Vietnam, who rely heavily on the UK for its exports.
A strong spirit of collaboration between the two parties
As UK Secretary of State for International Trade Truss said following her meeting with ASEAN representatives, “The current crisis proves now more than ever the importance of international engagement and finding global solutions to global challenges.” The dialogue is just one example of how countries can work together to accelerate economic recovery and boost preparedness for similar events in the future.
It also affirms the UK’s commitment to diversify economic and trade links all over the world. A global supply chain is far stronger than a local one, and there are plenty of examples of industries struggling to cope with COVID-19 thanks to being overly reliant on one source of materials or resources.
“COVID-19 has highlighted the importance of building diverse and robust supply chains,” Black said. “Diversifying trade links increases the resilience of global supply chains and the security of the global economy in the future.
“The UK continues to respond to global trade tensions by defending the multilateral rules-based trading system. We will work to make sure the rules-based system is based on open, market-orientated policies and is transparent and fair,” she added.
Furthermore, given that Southeast Asia experienced the impact of the coronavirus before it arrived in Europe, ASEAN countries are further along the journey towards recovery. Any help they can get is welcome, but experts might also be able to apply what they have already learnt to digital solutions that could benefit both ASEAN and the rest of the world. Partnerships with the UK could accelerate developments.
As Black put it, “The post-COVID-19 world will be one that is characterised by rapid digital adoption, and ASEAN is at the heart of this sea change in lifestyle and business transformation. We hope to strengthen our digital partnership with ASEAN, enabling businesses to recover and ensuring preparedness for the fourth industrial revolution.”