7.    SOUTHEAST ASIA

7.1   New Zealand has long standing interests in the security and welfare of Southeast Asia and an extensive web of bilateral and regional links. The Five Power Defence Arrangements (FPDA) link New Zealand, Australia and the UK with Singapore and Malaysia.

7.2   The ten countries of Southeast Asia which now make up ASEAN have a common interest in managing their regional affairs so as not unnecessarily to invite external interference in their region, and have been largely successful in doing so. The Association helps them manage their relations with each other, including a number of sensitive territorial disputes. It also enables member countries to engage in a political and security dialogue with some of the major players in the international arena. But the credibility of the grouping was damaged by its inability to respond to the Asian economic crisis; its coherence by its expansion to include the three countries of Indochina and Myanmar.

7.3   That ASEAN does still work is shown by the priority its members give it and the acceleration and expansion of the ASEAN Free Trade Agreement (AFTA) during a time of economic crisis. ASEAN is also looking for economic opportunities beyond the region, as evidenced by its agreement to a task force with New Zealand and Australia to explore the feasibility of a free trade area linking AFTA with CER by 2010. There have been efforts to promote a collective response to the problems caused by the smoke haze resulting from land and forest fires. A regional action plan has been devised (the ASEAN Co-operation Plan on Transboundary Pollution) and there have been eight ASEAN ministerial meetings to deal with the problem. The joint approach reflects a growing recognition of the desirability of developing regional solutions to address transnational problems.

7.4   The admission of Vietnam, Cambodia, Laos and Myanmar to the organisation fulfilled a long held ASEAN dream to unite Southeast Asia in one regional organisation. But the differences in economic structures and political growth mean that ASEAN is in many ways having to operate in two tiers.

7.5   Ethnic separatism is not a new phenomenon and will continue to cause problems for governments in the region. The Philippines Foreign Secretary has warned that the "disease" of separatist turmoil might spread if the territorial integrity of Indonesia is not maintained. There have been indications of Muslim groups in the southern Philippines demanding that the government hold a referendum to decide whether the areas they control should remain within the republic. Muslim separatist elements in the south of Thailand may make similar demands. The situation will be exacerbated by suspicions that elements in neighbouring countries (and outside the region) are supporting the rebels. (See annex for a map depicting current hotspots in Southeast Asia).

7.6   It is the future character of Indonesia which will most decisively influence the stability of the region; its size alone ensures that. It is remarkable that Indonesia has managed a major economic crisis and political transition as well as it has. But there are a number of pressure points that suggest caution should temper optimism about the country's future.

7.7   Decentralisation, perhaps leading to a de facto Indonesian federation, may deflate some of the secessionist pressures in Aceh and other wealthier outlying provinces, although genuine progress would not be without adjustment costs elsewhere, notably on Java itself (which has long enjoyed net welfare transfers). But the pressures unleashed through unravelling 32 years of centralised, authoritarian rule will inevitably be a destabilising force for the medium term. If Indonesia remains unified over this transition, the resulting more democratic and representative Indonesia will contribute positively to regional security.

7.8   On balance we are inclined to the view that Indonesia will emerge from its political and economic turmoil reasonably intact. Given the magnitude of its problems, its size and its ethnic diversity the level of violence has been comparatively small. There has not been a generalised breakdown in law and order. And Indonesia's civilian and military leadership is intent on holding the state together.

7.9   But the national cohesion of Indonesia will be a regional concern for at least the medium term. Were Indonesia's unity to fracture it could produce widespread conflict at national and communal levels. The resultant humanitarian crises might well be restricted to the Indonesian archipelago (ie, mass refugee movements abroad would not be inevitable), but could present the international community with a peace-keeping challenge in some circumstances.

7.10   East Timor is likely to become fully independent within the next two years. In the meantime, it will be focussed on reconstruction and on building international links. In recognition of its geography, its current leadership has indicated interest in ASEAN membership; association with the Pacific Forum has also been mooted. The East Timorese leadership recognises the need for working relations with Indonesia. If East Timor is not to become a regional basket case external support will be required for some time. This will include some military support for the short to medium term, but the longer term requirement is for assistance in nation-building. East Timor will have expectations of international support, including from New Zealand, for the foreseeable future.

7.11   Southeast Asia sits astride key international waterways which connect East Asia (including Japan) with Europe and the Middle East. Piracy has become a serious problem in these waters and could in time prompt a multilateral response. The waterways also provide the routes whereby many illegal migrants reach Australia (and some try to reach New Zealand). Some of these issues will provide reason for external involvement in the region, including by New Zealand; this will generally be welcomed by ASEAN.

7.12   Islands and reefs in the South China Sea are the subject of conflicting territorial claims with little underlying agreement as to how disputes should be resolved (because that might prejudice the claims). The four ASEAN claimants have sought to present a united front to China. There is a possibility of incidents taking place between one or more protagonists in these waters, but these will be managed. The United States has disclaimed any interest in the competing territorial claims but has declared an interest in the freedom of navigation and the safety of shipping.

7.13   The actions and interactions of the US, Japan and China affect all the countries of Southeast Asia. The United States presence in the region is generally welcomed as that of an extra-regional power which can usefully control Japan and balance China. But the exercise of its power (eg during the Asian financial crisis) and its espousal of human rights or trade policies can irritate or offend Asians, and increasingly the United States cannot take its influence in the region for granted. The US presence is more of a factor in North Asia than Southeast Asia.

PREVIOUS | CONTENTS | NEXT