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Thursday 17 Aug 2017 | 14:23 | SYDNEY
Thursday 17 Aug 2017 | 14:23 | SYDNEY

ASEAN-Australia: New deal and old arguments

By

COMMENTS

26 February 2009 11:06

For sheer complexity, look beyond the big bilateral relationships with China, Japan or India and consider Australia’s dealings with ASEAN. A lot of history will be standing in the hall when the Trade Ministers of Australia and New Zealand sit down with their ten ASEAN counterparts to sign the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA). Australia attaches a series of firsts to the treaty:

AANZFTA is Australia’s first multi-country (plurilateral) FTA. It was the first time Australia and New Zealand have been involved jointly in negotiating an FTA with third countries. It was the first time ASEAN has embarked on comprehensive FTA negotiations covering all sectors including goods, services and investment, intellectual property simultaneously. And, the agreement is the most comprehensive trade agreement that ASEAN has ever negotiated.

Achieving the treaty forced Australia and New Zealand to act together as a single economic entity in ways they’ve never had to attempt in dealing with the South Pacific. The Closer Economic Relations between Australia and New Zealand provided a starting base. But getting a common position between Canberra and Wellington pales compared with the ten-dimensional chess involved with getting a deal with ASEAN.

As always with ASEAN, this nominal trade deal is heavily weighted with political history. One ghost at the signing will be the former Malaysian Prime Minister, Mahathir Mohamad. Mahathir’s scepticism about APEC hardened from recalcitrance into an outright veto of any new ASEAN linkages with Australia throughout the 1990s.

That’s why Australia was absent from the Asian side when the Asia-Europe summits started in 1996. And the Mahathir veto prevented any effort to build a free trade agreement between ASEAN, Australia and New Zealand. Mahathir’s departure from office opened the way for work to start on the creation of AANZFTA. That trade breakthrough was also crucial in getting the leaders of Australia and New Zealand through the door into the East Asia Summit.

Mahathir was always such a vocal opponent of any Oz role in Asia that his personality quirks tended to obscure the deeper dynamics in Australia’s intricate involvement with ASEAN. 

A fascinating illustration of the constancies and the changes in the relationship is contained in 30 year-old Australian Cabinet documents released last month. Among the selected foreign policy documents from 1978 posted by the National Archives you’ll find a ‘Report for Cabinet on Australia’s relations with the ASEAN countries’. Bear in mind that this is three years before Mahathir became Prime Minister. In 1978, ASEAN was just over a decade old and still consisted of the founding five nations.

One change is that in 1978 it was Australia on the defensive over its protectionist instincts. Three decades later, Australia and New Zealand are (relatively) the free trade purists, while Malaysia and Indonesia cling to tariff coverage for their car industries.

A constant from 30 years ago is Canberra’s worry that ASEAN no longer sees Australia as ‘a reliable, steady and valued partner’. Instead, Cabinet was told that ASEAN viewed Australia as ‘a selfish, introverted nation oblivious to the consequences of the region’s dynamic externally orientated process of economic growth.’

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