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How will the ASEAN Community influence China?

Xinhua, January 2, 2016 Adjust font size:

East Asia formed its first cross-nation union, the ASEAN Community, at the turn of the new year, which is expected to lead the region to a new stage of integration and growth.

The 10 members of the Association of Southeast Asian Nations (ASEAN) officially launched the community on Thursday, forming a bloc of 600 million people sharing a political, security and economic roof.

With a total GDP of nearly 2.6 trillion U.S. dollars, the seventh globally, the community aims to create a competitive single market with free flow of goods, services, investment capital and skilled labor. It is expected to grow into the world's fourth biggest economy by 2030, according to media reports.


The Chinese Foreign Ministry welcomed the establishment of the community, calling it a "significant milestone" in ASEAN's integration.

"As a good friend and partner of ASEAN, China is confident about ASEAN' s development in the future, and wishes the ASEAN Community success," the ministry's spokesman Lu Kang said at a press conference.

Despite skepticism of a true single economic entity, experts expect the community to bring China-ASEAN cooperation closer and promote regional integration as well as boost members' economic growth.

The community will certainly inject impetus for the upgrading of the ASEAN-China Free Trade Area (FTA) and the negotiation of the Regional Comprehensive Economic Partnership, said Wei Ling, director of Asian studies institute at the China Foreign Affairs University.

China has been the ASEAN's largest trade partner, and ASEAN has been China's third largest partner since the FTA's launch in 2010. Mutual trade volume has added up to more than 370 billion U.S. dollars in the first 10 months of 2015, and the annual trade is expected to reach 1 trillion U.S. dollars by 2020.

The two last month inked a protocol on deepened cooperation on bilateral trade. As a supplement to the original agreement of the ASEAN-China FTA, the protocol covers a wide range such as trade in goods, services, investment and technological cooperation.

A unified and single ASEAN market will provide huge opportunities for China, Japan and the Republic of Korea, according to Wei. Once fully completed, the community will optimize the layout of Asia's trade, finance and manufacturing industries, bringing good to the world as a whole.

The community will better activate the implementation of Chinese initiatives such as the Belt and Road, which have synergized well with ASEAN's development and integration strategies.

The ASEAN integration raises huge demands for transport and infrastructure improvement, which China, with abundant funds and technologies, can cater to, said Wei.

The Belt and Road initiative could help promote ASEAN's development by improving infrastructure throughout the region both on land and at sea, said Kavi Chongkittavorn, senior fellow at the Institute of Security and International Studies at Chulalongkorn University of Thailand.

China also set up the Silk Road Fund and spearheaded the establishment of the Asian Infrastructure Investment Bank (AIIB), both expected to finance connectivity projects.

ASEAN nations will undoubtedly unify some economic policies within the community and objectively reduce barriers for the entry of Chinese investment, observers believe.

Under the Belt & Road initiative and the support of AIIB, Wei forecasts a new wave of growth of China's industrial investment in ASEAN countries.

The merger could also help the Chinese yuan flow into the region, according to Zhou Yongsheng, an international relations professor at China Foreign Affairs University.


China said it will continue to firmly support ASEAN's integration, and is willing to make joint efforts with ASEAN countries to build a more closely-related community of common destiny for China and ASEAN.

Despite a high-degree of inter-dependence within the community, obstacles still remain in the way of complete integration.

ASEAN is perhaps one of the most diverse regional groupings in the world, in terms of both economic development and political, ethnic, religious and cultural backgrounds, according to observers.

There is a conspicuous divide between the six older and richer ASEAN members such as Singapore and four newer and poorer members, namely, Cambodia, Laos, Myanmar and Vietnam.

Chen Qiye, associate professor at the Lee Kuan Yew School of Public Policy in Singapore, deems that it's a good chance for China to advocate the Belt and Road initiative in the nations, helping the members narrow development gaps for integration while optimizing its own economic structure.

Seizing the opportunity of the 25th anniversary for the establishment of China-ASEAN dialogue relations in 2016, experts suggest China expand mutual political trust by signing a series of friendly and cooperation treaties with the group.

China is supposed to take the lead to push for more cooperation mechanisms with the community and provide more public service goods for innovations in anti-terrorism, environmental protection and health care, according to global strategy researcher Zhou Fangye.

China should also continue to promote peaceful bilateral negotiations with related parties concerning the South China Sea issues and seek to maintain regional stability and development, said Zhou Yongsheng.