Published On: Thu, Jun 4th, 2015

Developments, Structures, and Relationships between European Union and ASEAN

Nation states are seeking closer economic ties. Most of this is done by setting up bilateral treaties or creating multinational unions. Two of the biggest international unions are the “European Union” (EU) and the Association of Southeast Asian Nations (ASEAN). While ASEAN comprises approximately an amount of 600 million, the population of European Union is about 507 million people. The following article will have a brief look on the historical development, the structures and the relationships between those two political and economic unions.

The European Union

The EU developed from the European Coal and Steel Community (ECSC), which was founded 1951 after World War II as a way to prevent further wars in Europe. The creators of the ECSC intended to create a common market for coal and steel with the intention to expand the communities between the six founding nations (Belgium, France, Germany, Italy, Luxembourg and Netherlands). 1956, the founding nations of the ECSC made another agreement, creating the European Economic Community (EEC), which led to an even broader common market and a customs union. In 1965, those two Unions where merged to the European Community (EC).

Finally, in 1992, the European Union was founded in the city of Maastricht, Netherlands. With the Maastricht Treaty, the European Citizenship was introduced. European citizenship provides the right to vote in European elections. In addition, European citizens have the right to free movement, settlement and employment across the EU.

In 1999, the monetary union was established, leading to the introduction of the “Euro” as currency in most member states. Another treaty, the Schengen Agreement, provided that citizens of the participating states are free to move without passport controls.

In 2007, the EU-Member states signed the Treaty of Lisbon. This agreement consists of two treaties, which form the constitutional basis of the EU. The Treaty of Lisbon amends former EU-related treaties. Today, the EU is a political and economic union of 28 member states, governed by supranational institutions and led by negotiated decisions of the member states.

It is a system of supranational laws that assimilates the different laws of the member states, which still are sovereign within their powers. Foreign policy is consolidated by the High Representative for the Common Foreign and Security Policy. With the Treaty of Lisbon, the Charter of Fundamental Rights of the European Union was also put into effect, which determines the basic rights afforded to citizens in the EU.

ASEAN – Association of South East Asian Nations

ASEAN was founded 1967 by Thailand, Indonesia, Malaysia, the Philippines and Singapore. The aim of the union was to increase economic development, social progress and political stability among the member states. Later, Brunei, Cambodia, Laos, Myanmar and Vietnam joined the ASEAN community. The aim of the Union was widen to include security, cultural and ecological issues.

ASEAN is different from the EU. There isn’t supranational institution. The heads of the ASEAN member countries meet one time a year at the ASEAN Summit. Its main institution is the ASEAN Secretariat located in Jakarta. The basic purpose of the Secretariat is to provide a greater efficiency in the cooperation of the ASEAN organs and in the implementation of projects and activities.

ASEAN consists of three communities: The ASEAN Political-Security Community (APSC), the ASEAN Socio-Cultural Community and the ASEAN Economic Community (AEC). Those single communities consist of different bodies that work on related subjects. The APSC was installed to ensure peace within the countries in the region in a democratic and harmonious environment. Conflicts shall be prevented and the political development shall be enforced.

The ASEAN Socio-Cultural Community focuses on the social aspects of the community. Its aim is to build up a common identity in which the society can develop and the quality of life can be lifted.

In 2009, the member states decided to create a common economical market. Targeting economic integration, the ASEAN Economic Community (AEC) shall be established in 2015. The AEC aims for the establishment of a single market and production base, a competitive economic region, economic development and a full integration in the global economy.

EU Supranational Institutions

As aforementioned, the EU is governed by supranational institutions. Those are:

  • The European Parliament is located in Brussels, Belgium. It is a directly elected parliamentary institution but they cannot introduce new laws. Their role is to vote on initiatives proposed by European Commission. The seats are allocated to each state according to population, the maximum number of members is 751. Another important task of the EP is the control of the executive. The European Parliament votes on the selection of members to the European Commission who are submitted by the President of the Commission.
  • The European Commission is located in Brussels and Luxembourg, this institution serves a dual purpose. The Commission is the executive body of the EU. It is managing the day to day business of the EU and supervises the member states in how they incorporate the EU directives. The Commission also has the power to introduce legislation so it is responsible for proposing legislation to the Parliament. Every member state of the EU sends one Commissioner. Each one is elected as commission president by the Parliament.
  • The Council of the European Union. The Council of the European Union represents the executive governments of the member states of the EU. Depending on the discussed topic, they will send their responsible minister to the Council. The Council is the second legislative branch in the EU. Most of the proposed laws from the Commission need to pass both, the Parliament and the Council. In some special fields, like budget, justice and taxes, only one of the institutions has to decide.
  • The European Council is easily confused with the Council of the European Union. The European Council comprises of the heads of governments of the EU member states along with the President of the Commission and the Council’s president. The purpose of the Council is to determine the general political directions and priorities. The Council can be defined as “collective presidency” of the EU. However, the European Council has no legislative power.
  • The Court of Justice of the European Union is in Luxembourg. This court interprets the laws of the EU and its application. If national courts thinks that their national law collides with EU Regulations, they will file a request to the Court of Justice and the court will review it. The Court of Justice of the European Union also reviews the legality of acts of the EU itself.
  • The European Central Bank is located in Frankfurt, Germany. This institution is the central bank that administers the Euro-zone monetary policy. The Eurozone consisting of the 19 EU Member States that introduced the Euro as their currency. The main task of the bank is to maintain price stability.

The EU and ASEAN Relationship

ASEAN and the EU maintain a close relationship. This dates back to 1972, when the EU (at that time EC) became the first formal dialogue partner of ASEAN. The EU-ASEAN dialogue first aimed for a Free Trade Agreement (FTA). Since the negotiations are in abeyance at the moment, the EU focused on making FTAs with single ASEAN member states. The EU has set up a Free Trade Agreement with Singapore and is negotiating for more agreements of this type with Malaysia, Vietnam and Thailand. The aim still is to achieve a region-to-regional trade agreement one day. The EU is ASEANS third largest trading partner, while ASEAN is EU’s fifth largest.   The EU is the largest investor in ASEAN countries, with an average investment of annual €13.6 billion (2005-2012).

The ASEAN Secretariat and the EU conduct seminars on several topics such as regional economic integration, liberalization of services, reducing technical barriers to trade and facilitation of trade in general. International travel between citizens of both communities are increasing every year. This leads to the exchange of culture and knowledge. In addition, there is a growing student exchange.

The regions have set up a Research Framework Program, in which knowledge is exchanged. The EU also provides humanitarian aid to the ASEAN region to help those affected by conflicts or natural disasters. The EU is interested in the establishment of the ASEAN Economic Community and is financially supporting this aim in different programs.

Future Prospects

While governance of the nations in the EU are consolidating authority more and more, the ASEAN member states still have a long way to go. A similar supranational system like the one of the EU is hardly imaginable, since the situation in Southeast Asia is completely different from the one in Europe. The badge of liberal democracy in Europe helped find consensus in the region since the modest beginnings, while Southeast Asia consists of range of vastly different political systems.

No matter how the ASEAN Community will develop, the region already benefits from the association. While the EU may can act as a model for the future development, the ASEAN community will have to find its own way in order to face the regional characteristics of the Southeast Asian Region. Even if it looks like ASEAN will miss the December 2015 deadline for implementing the AEC, this objective still seems achievable at some future date. If ASEAN continues and intensifies its efforts to reduce trade restrictions and income disparity among the member nations, the economies will move even closer together. This is a positive effect for the wealth of the entire region. Once having established the basic pillars, ASEAN community will accelerate its development.

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  1. Avatar John Page says:

    Excellent article. Very interesting.

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Developments, Structures, and Relationships between European Union and ASEAN