Why ASEAN is successful & SAARC has been unsuccessful


Presented by, Ved prakash mishra

and liberalization of nontariff barriers. and Thailand. the five founding nations. ASEAN had shifted its emphasis from a purely political one to an economic focus. Malaysia. . incentives to expand trade and investment in member countries. Brunei joined the Association. 8. ASEAN countries focused on dealing with external threats in the region. ‡ However. Singapore. 1967 with the signing of the Bangkok Declaration by Indonesia. ASEAN nations in the intervening years have established various preferential trading arrangements. ‡ In the early years. In 1984. since the late 1970s. including tariff reductions. the Philippines. for example the Vietnam War and China's cultural revolution.‡ The Association of Southeast Asian Nations (ASEAN) was founded on Aug.

trade associations/traders and local communities to comply with legality and sustainability ‡ To seek sufficient technical and financial assistance through collaborative initiatives .‡ To assist ASEAN Member Countries in adopting effective and enforceable legislation for CITES {CONVENTION ON INTERNATIONAL TRADE IN ENDANGERED SPECIES OF WILD FAUNA AND FLORA}implementation ‡ To promote networking amongst relevant law enforcement authorities in ASEAN countries to curb illegal trade in wild fauna and flora ‡ To promote research. monitoring and information exchange on CITES-related issues ‡ To encourage industry groups.

1985 by Bangladesh. ‡ To cooperate with regional & international organization with the similar aim & objective.‡ The South Asian Association for Regional Cooperation (SAARC) is an economic and political organization of eight countries in Southern Asia.To promote the welfare of south Asia and improve their quality of life. at the Association's 14th summit. social progress with active collaboration & mutual cooperation. Nepal. Pakistan. . It was established on December 8. ‡ Objective. Bhutan. In April 2007. Afghanistan became its eighth member. ‡ To develop culture. Maldives. India and Sri Lanka. ‡ To get hold with the development country. economy. ‡ give all individuals the potential to live in dignity.

‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ASEAN Brunei Darussalam Cambodia Indonesia Laos Malaysia Myanmar Philippines Singapore Thailand Vietnam SAARC ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ Afghanistan Bangladesh Bhutan India Maldives Nepal Pakistan Sri Lanka .

2008a. social and cultural development and to establish peace and stability through justice amongst its member nations. ASEAN Secretariat. Lao PDR attained the highest GDP growth in the region (8. The objectives of the Association are to accelerate regional economic.‡ The total area of the ASEAN region is 4. In 2008. followed by Brunei Darussalam ($ 35.7 trillion (ASEAN Secretariat. Total ASEAN trade for the year was about USD 1.622) and Malaysia ($ 7.580.6 and regional GDP growth of 4.4%). 2008b). seven members achieved per capita GDP higher than $ 1000.Out of the ten member countries. The highest GDP for a participating member was Indonesia (USD 511 billion). with per capita regional GDP of USD 2.969). total regional GDP for ASEAN was USD 1. while four members attained 6% or higher GDP growth rate.4%. .44 million square kilometers with a current population of about 584 million. followed by Thailand (USD 273 billion) and Malaysia (USD 222 billion).046). The highest per capita GDP was achieved by Singapore ($ 36.5 trillion.

Australia New Zealand Free Trade Area. ASEAN . . AFTA was introduced in 1992 with the objective to develop a regional competitive advantage including the economic efficiency and productivity of its member nations. As a result. ASEAN intraregional trade increased from 20 percent to almost 25 percent of total regional trade (ASEAN Secretariat. The average yearly growth was 28. Besides AFTA.‡ ASEAN has made significant progress in developing intra-regional economic relationships. 2009). AFTA removed tariff and non-tariff barriers within the region.26 billion USD in 1993 to almost 80 billion USD in 1996.Japan Free Trade Area. These areas include ASEAN . ASEAN members have developed some free trade areas outside the region. ASEAN -India Free Trade Area.3 percent. The Preferential Trading Arrangement (PTA).China Free Trade Area and ASEAN . ASEAN . the Enhanced PTA Program and the ASEAN Free Trade Area (AFTA) are remarkable examples of the economic cooperation.Republic of Korea Free Trade Area. exports among ASEAN countries increased from 43.

‡ Establishment of powerful regional cooperation is attainable through strong economic harmonization among the members.‡ The vision of ASEAN leaders reflects the aspiration for greater regional cooperation. ‡ Successful harmonization results in a monetary policy that provides a stronger base for economic integration. ‡ The analysis would focus on three main questions: 1) how much trade would occur among ASEAN members if their trade elasticity with respect to economic and geographic variables were same as those achieved in the Euro-model (This amount has been considered as potential trade) 2) What is the pattern of the gap between actual trade and potential trade 3) What is the growth potentiality for ASEAN intra-regional trade .

ASEAN start their journey with an objective of fostering regional economic. considering their process of regional cooperation and integration as similar to EU. ‡ This process provides better opportunity to measure the success of ASEAN·s regional integration of intraregional trade. proceed through intra-regional trade agreements to reduce trade barriers and reach at the stage of expanding extra-regional trade agreements with major trade partners. estimation of their success level at this stage would provide scope for further study on their journey towards currency union and its impact on trade integration. . social and cultural development. ‡ In addition.‡ They uses gravity model to measure the pattern of intra-regional trade enhancement through regional economic integration for EU and to apply it for ASEAN. ‡ Like EU.

even as we count 450 million among the world·s poorest people and 50% of the world·s illiterates within our seven nations. and enhancing security through intra-regional interdependent relationships. ‡ less than 1% of the share of global trade. just 1. ensuring protection against the negative fall-out of globalization. .‡ In most other parts of the world. for promoting collective interests. there has been little progress even in respect of intra-regional trade.5% of the World Gross Product. regionalization has been accepted as the fastest route to prosperity. which accounts for barely 5% as compared to 62% for the EU and 55% for NAFTA. ‡ Within SAARC.

and perennial absence of trust between India and Pakistan. .‡ Many reasons exist for the uneven progress of SAARC: most have to do with intra-regional political tensions. and so on. ´It was a top-down concept. ‡ SAARC was established in 1985 with neither a sincere. Nepal and Bangladesh. occasional conflict. and most involve India. nor a strong political will among its member states to subsume short term nationalist objectives for the long term national and regional good. the periodic hiccups in relations between India and her other neighbors ²Sri Lanka. collective and grand vision. The chronic tension. foisted on us without any preparationµ is the common sentiment certainly of former Indian diplomats.

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