VIETNAM’S ROLE TO RAISE ASEAN’S PRESTIGE
Author: Le Hoang Anh Tuan
Vietnam has become a driving force for the economy of ASEAN dealing with political relations and conflicts in the region. Vietnam always plays an active role in all activities to raise the reputation of ASEAN in the international arena.
1. ASEAN’s current reputation in the international arena
Across all nations of ASEAN, there is a population of over 635 million people with GDP of about US$ 3,000 billion and the total annual trade turnover of more than US$ 1,000 billion, of which intra- ASEAN trade accounts for a quarter. ASEAN is the sixth largest economy in the world, ranked after China and Japan and is expected to be the fourth largest economy in the world by 2025.
ASEAN is favored by investors, accounting for about 7% of the total global FDI inflows in 2015. Having a clear vision on indispensable importance of major countries and partners inside and outside the region in the early days, ASEAN has made great efforts to manage relations with major countries and partners in various forms while seeking to guide relations with major countries to most advantageous directions for ASEAN and Southeast Asia. To achieve this goal, ASEAN has created various types of “dialogue rule” for major countries and partners in and outside the region, based on capabilities and circumstances of each partner as well as ASEAN demands.
In essence, “dialogue rule” is a method to handle relations with major countries and partners through dialogue and cooperation at different levels to enhance trust building, avoid misunderstandings and promote co-operation instead of using force or threat. This is a unique mark of ASEAN that no other organizations in the world has.
As of 2018, ASEAN has had 10 official dialogue partners, including 8 countries and 2 international organizations, the United Nations and the European Union (EU). There have been 6 dialogue partners established since the 1970s, including: Australia (1974), New Zealand (1975), Canada, EU, Japan, the United States and the United Nations (1977). The relation with the UN will later be replaced by a comprehensive partner. After the Cold War had ended, ASEAN established a dialogue relation with four partners, South Korea (1991), India (1995), China and Russia (1996).
At a lower level, rule of sectoral dialogue focuses only on relations and dialogue in one or several sectors where the two parties have common interests. Currently, ASEAN has two sectoral dialogue partners that are Pakistan and Norway. ASEAN also conferred the status of observer to Papua New Guinea and invited a large number of guests, mainly senior officials of countries and international organizations to participate in ASEAN activities, especially High-level activities to build prestige and promote the image of ASEAN.
Furthermore, ASEAN has successfully built mutually beneficial relations and cooperation with different organizations in the region and around the world. In particular, the most significant relations that are worth mentioning are the ASEAN-UN comprehensive partnership which was established and improved in 1977, the Gulf Cooperation Council (GCC), Southern Common Market (Mercosur), and Rio Group and later the Community of Latin America and the Caribbean countries and the Pacific Alliance.
2. Reasons why Vietnam plays a pivotal role in helping to raise ASEAN’s prestige.
Economic growth
In the past 3 decades, Vietnam has occupied the position of one of the Asian countries with ongoing and almost uninterrupted growth. In particular, according to the McKinsey Global Institute (MGI) report presented on September 12, 2018 at the World Economic Forum (WEF) in Hanoi, Vietnam is among the 18 economies assessed as “achieve more dominant performance” in the last 50 years.
Vietnam has achieved the economic growth of GDP per capita over 5% in the past 20 years, along with Azerbaijan, Belarus, Cambodia, Ethiopia, India, Kazakhstan, Laos, Myanmar, Turkmenistan and Uzbekistan. The growth rate of GDP per capita on an average of 5% per year is sufficient for a country in low and middle income groups to “jump” a step on the income ladder, according to the World Bank’s rating scale (WB). This steady growth helps Vietnam to significantly raise its individual roles in and outside Southeast Asia and in the world.
In 1975, Vietnam’s economy faced numerous challenges. By the mid-1980s, GDP per capita was around 200 to 300 USD. For more than 30 years since renovation, Vietnam has opened its doors and quickly participated in a variety of large organizations. In 1995, Vietnam joined the ASEAN Free Trade Area (AFTA).
In 2000, Vietnam signed a free trade agreement with the United States. In 2007, Vietnam joined the World Trade Organization (WTO). Since then, Vietnam has signed more agreements with China, India, Japan and South Korea. The Trans-Pacific Partnership Agreement (TPP) was signed this year even without the participation of the US.
All of these agreements have helped reduce import and export taxes. Not only opening the economy, Vietnamese government also launched different reform policies. In 1986, the government officially adopted the Foreign Investment Law (FDI), allowing foreign enterprises to enter Vietnam.
The world already acknowledged Vietnam’s tireless efforts. Viet Nam rose from 77th place in 2006 to 55th in 2017 in the latest Global Competitiveness Report, released by the World Economic Forum (WEF). Vietnam ranked 68th in the World Bank’s Doing Business Index in 2017 compared to its 104th position in 2007.
Central location
Vietnam occupies an important strategic position among Southeast Asian countries; Vietnam possesses large marine reserves in the East Sea. In addition, Vietnam’s reserves of gas, minerals and oil are abundant. In times when ASEAN face difficulties, Vietnam has become one of the factors that helps ASEAN regain its strength and facilitates to overcome its crisis. Against the strength decline of the Association when the region fell into a serious financial crisis in 1997, Vietnam successfully hosted the 6th ASEAN Summit in Hanoi in 1998 with the adoption of Hanoi Plan of Action, paving way for ASEAN to overcome its financial crisis, strengthening solidarity, promoting cooperation and restoring ASEAN status and orientation for development to realize the Vision 2020.
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Vietnam has also promoted its role as an active bridge to strengthen relations between ASEAN and its partners, including contributing to solving obstacles, helping enhance relations between the parties, appreciated by both ASEAN countries and the others. Vietnam also made a positive contribution to maintaining ASEAN’s leading role in regional cooperation processes initiated by ASEAN, such as ASEAN+1, ASEAN+3, EAS, ARF, ASEAN Defence Ministers Meeting (ADMM). Vietnam has successfully completed its role as the Chair of the ASEAN Standing Committee (2000-2001), rotating Chair of ASEAN (2010) and successfully organized the 17th ASEAN Summit in 2010.
3. Vietnam’s role to raise ASEAN’s prestige.
Firstly, Vietnam plays a pivotal role in bringing the two groups of ASEAN countries together thanks to its geographical – political position and history. Vietnam has made a considerable contribution to the development of a Declaration on the Conduct of Parties in the South China Sea (DOC) and the early development of a South China Sea Code of Conduct (COC).
Vietnam always acts according to motto of “proactive, active and responsible” participation in ASEAN; plays a pivotal, positive and responsible role in each issue according to the country’s development strategy and roadmap. Vietnam promotes dialogue, builds trust, establishes and shares regional code of conduct and enhances the effectiveness of forums led by ASEAN such as EAS, ARF, ADMM and ADMM +.
Vietnam is the first Indochina country to join ASEAN helping to end the confrontation between Indochina and ASEAN. Vietnam has also helped ASEAN to partner with non-regional countries including China, Russia, India and the EU. Vietnam also made great efforts in ASEAN to ensure regional security. Immediately after having become a member, Vietnam signed the Treaty on Southeast Asia’s Nuclear-Free Area and is one of the founding members of the ASEAN Regional Forum.
Secondly, Vietnam helps ASEAN to maintain solidarity, cooperation and strengthen its international position while the Association faces difficult times due to the impact of financial and economic crises in 1997 and the global economic crisis in the 2008 via Hanoi Plan of Action (HPA) to implement the ASEAN Vision 2020.
Vietnam also strives to contribute to strengthening solidarity and unity and the central role of ASEAN. Participate in shaping the structure for multi-process, multi-sector and multi-layer of the Indian Ocean – Asia – Pacific area, Vietnam needs to deploy international integration synchronously in all fields, with a focus on economic cooperation, taking advantage of international resources for comprehensive innovation, restructuring economy associated with digital technology and innovation. Being aware of new global investment and trade opportunities from the ASEAN Community, a new trend of integration in the Indian Ocean – Asia – Pacific region as well as the development of potential markets.
Vietnam continues innovating thinking, approach and reforming organizational apparatus in accordance with situational changes and new requirements of the era. Imbued with the thought of “initiating, shaping”, Vietnam promotes its strengths in campaigning, convincing and building solidarity in the region. It also strengthens staff training at all levels, especially the strategic level to meet requirements of deep integration and the 4.0 industrial revolution.
Thirdly, in terms of economic scale, Vietnam has achieved high economic growth rates compared to other countries in the region and is always determined to be responsible for fulfilling its commitments. Vietnam has surpassed the group of Cambodia, Laos and Myanmar in ASEAN 4 to create a new level in ASEAN. Vietnam has experienced a challenging period and is transitioning to a market economy of various successes achieved. Vietnam also achieved the fastest rate in poverty elimination, so it is easy to be convincing to other countries.
Specifically, Vietnam’s export of goods to ASEAN increased nearly 12.4 times from 1.6 billion USD in 1996 to 19.9 billion USD. It was noticeable that by early July 2018, the total import-export turnover between Vietnam and ASEAN was 28.1 billion USD in which the export turnover was 12.2 billion USD while the import turnover was 15.9 billion USD. In addition, Vietnam’s tariff elimination rate under the ASEAN Trade in Goods Agreement (ATIGA) was 98% in 2018. Thus, out of the 10 FTAs that Vietnam is implementing, the FTA with ASEAN (AFTA) achieved the highest rate of tariff elimination at 98% with a performance duration of 19 years (specifically, a few goods have a duration of 25 years).
4. Vietnam’s orientation to raise ASEAN’s prestige
By 2035, Vietnam aspires to become a middle-income country of a GDP per capita of about US$ 22,000, moving towards to create a prosperous, creative, fair and democratic society.
To realize this aspiration, the Vietnam 2035 report recommends that Vietnam need to rely on three pillars and make six major transitions. The first pillar is that Economic Prosperity must go hand in hand with environmental sustainability; the second pillar is Justice and Social inclusion (also known as equality for everyone), and the third pillar is Improvement in capacity and accountability of the State.
Six major transitions need to be carried out including: Upgrading the economy while simultaneously improving the competitiveness of the private sector; Developing innovation capacity in which the private sector plays the central role; Improving the effectiveness of urbanization, strengthening connectivity between cities and surrounding areas; Sustainable development in terms of the environment and enhancing capacity to cope with climate change; Ensuring justice and social inclusion for disadvantaged groups along with the development of middle-class society; Building a modern rule-of-law state with a market economy which is sufficient and integrated and a highly developed democratic society.
As an integral part of ASEAN, Vietnam plans to continue accompanying and developing together with ASEAN to build an ASEAN Community which is closely linked, self-reliant, rich in identity, takes people’s interest as its highest priority, builds open foreign relations and plays an important international role and position, acts as a driving force for cooperation and serves as a hub for connecting regional links at different levels in a regional architecture which is forming for the regional peace, stability and prosperity.
Becoming Chair of ASEAN is the responsibility and obligation for Vietnam. It is also a huge opportunity for Vietnam to show its competence and expertise and improve its image in the eyes of other ASEAN members.
2020 is a special year for Vietnam and other ASEAN member countries since Vietnam will celebrate its 25-year anniversary of joining ASEAN. For ASEAN, it is the time point for mid-term evaluation after five years of implementing the ASEAN Community and implement the Association’s 10-year plan (2015-2025) and then prepare future plans.
Vietnam has prepared for that event in term of infrastructure, finance and human resources. More importantly, goal and interests of the community must be maintained as our top priority while trying to balance the Association’s interests with the interests of each country member.
5. Conclusion
From the roles played by Vietnam in raising ASEAN’s prestige, it can be recognized that:
Firstly, Vietnam has shown that it is an active, responsible country which has devoted initiatives and solutions to promote the central role of ASEAN and enhance the position of ASEAN in the region and the world.
Under the leadership of the Communist Party, for more than 30 years of reform and 20 years since joining ASEAN, from a poor country ravaged by the wars, Vietnam has experienced worth-noting socio-economic development within the scale of socialist-oriented market economy. The country has risen from the economic crisis, maintained macroeconomic stability with an average GDP growth of 6-7% per year and reached the average income per capita income of more than 1000 US dollars in 2008. In 2014, GDP per capita was nearly US$ 2,000 while the poverty rate fell below 8% compared to the rate of 58% in 1993. The political system and national solidarity has been strengthened, specifically the political and social situation has been stabilized and extended for foreign relations. Vietnam’s position in the international arena has been upheld.
Despite not being the founder of the Association, Vietnam is playing a more active role in ASEAN activities. Vietnam has left its unique mark on the group’s main documents, including Vision 2020 and related Action Plans, ASEAN Charter, ASEAN Plan of Action as well as other action plans. Vietnam continues to promote ASEAN’s role as a force for regional peace and security, including maintaining peace, security and maritime safety in the South China Sea.
Secondly, Vietnam always maintains the motto of positive and proactive participation.
Vietnam’s geographic location with 3,260 km of coastline makes Vietnam a center for commercial development and maritime activities in a rising Asia. This same momentum is doubled in ASEAN, in which Vietnam, which was formerly a second-class ASEAN country along with Myanmar, Cambodia and Laos, is now moving towards the first-class position.
According to the Brookings Institution, Vietnam will serve as a bridge between the first and second class countries to shorten the development gap. Once again, Vietnam is ready to hole the central role.
Vietnam has a flair for waiting for its opportunities, always refuses to take a big daring act or creates huge alliance or agreements. Therefore, Vietnam is not easy to be blocked and faces few risks to become an enemy of any country. Success achieved as well as its stable position on ASEAN economic growth and Vietnam’s frontline position in the region’s biggest security threat has made Vietnam a real leader in ASEAN foreign affairs. In addition, Vietnam plays a pivotal role in the ASEAN’s economic development as it creates more trade partnerships, opens up various opportunities for coastal transport approach and provides its neighbor countries a considerable part of the “cake” of development that Vietnam is looking for.