With many of its member nations still unable to recover from the impact of the region-wide financial crisis of the late 1990s, the Association of Southeast Asian Nations must "reinvent" itself so it can play a significant role in the regionalism that is emerging in East Asia, a think tank expert from Singapore told a recent symposium in Tokyo.

"Even now, more than five years after the financial crisis began in 1997, there are continuing uncertainties in Southeast Asia," said Simon S.C. Tay, chairman of the Singapore Institute of International Affairs. "Instead of a recovery, things seem to have gotten worse."

Tay and two other scholars from the SIIA discussed ASEAN's future during the symposium -- "Growing Chinese Economic Presence: How Will ASEAN Meet the Challenges?" -- organized by the Keizai Koho Center at Keidanren Kaikan.

Tay noted that instability continues, for example, in Indonesia, the largest country in Southeast Asia. "Indonesia now has its third president in five years," he said. "There has been some discontent with the fledgling institutions of democracy, a lack of clear direction and even nostalgia for the days of Suharto."

And although no other ASEAN country was perhaps worse affected by Indonesia, "none has been unaffected and none has returned to the rapid growth rate of the past decade, when people spoke of them as near NIEs (Newly Industrialized Economies) and part of the East Asian miracle," he said.

The situation has been complicated by other factors. Following the September 2001 terrorist attacks in the United States, it was feared that Southeast Asia would become a "second front in the war against terrorism," while the Bali bombing last October "marked the real concerns that exist" in the region, Tay said.

The slowdown in the U.S. economy and lack of significant growth in Japan and Europe brought into question ASEAN's pre-1997 formula of export-driven industrialization. Furthermore, concern has been raised that China, which has attracted the lion's share of foreign attention and investment, will come to dominate the region, according to Tay.

ASEAN's function as an institution has also been criticized, he said. "It was adjudged to be ineffective in the face of the financial crisis," he said. "It also did not respond to other crises . . . like East Timor. Bickering among ASEAN member states has also been more noticeable, like the recent skirmishes between Cambodia and Thailand."

Tay noted that ASEAN was never intended to deal with the kind of crises that have affected the region over the past five years, but consensus is growing that significant change is needed, he said.

"More people have begun to talk of 'reinventing ASEAN,' " he said, although he pointed out that what exactly should change and what should be the priorities "are still being debated."

Tay observed that the "flock of flying geese" pattern of economic development, in which ASEAN followed Japan as the lead goose and the Asian NIEs, has been scattered in the aftermath of the 1997 crisis. "Many (ASEAN members) now seem winged, and the region as a whole seems to be stumbling slowly on a road to no recovery," he noted.

The flying geese pattern has been replaced by a nascent sense of regionalism in East Asia, as represented by the ASEAN plus three process involving Japan, China and South Korea, he said. Some suspect the process to be a vehicle for Chinese domination of the region, or even as a sign that ASEAN is losing its relevance as the larger body gathers momentum, he added.

Despite all these problems, Tay noted that ASEAN is not withdrawing into itself or being ignored by other players in the international community.

"Indeed, ASEAN's external engagements have become increasingly important," he said, adding, "The question is, on what basis these engagements are made -- equal partnerships or as pawns of greater powers?"

In this sense, he said, integration of ASEAN member states "is a critical project that ties to our ability to manage and grow ASEAN's external engagements to its benefit." By pursuing external engagements and internal integration, he added, ASEAN has the potential to help build a "greater institutional identity for East Asia as a whole."

Tay said the proposed ASEAN-China free trade accord, on which the two parties signed a framework agreement in November, is seen by many in the region as "our most important economic initiative."

"Potentially, it can help ASEAN compete for foreign investment as investors would then have a choice of whether to locate more investments in China or spread their investment risk by choosing ASEAN member states," he said.

Tay also pointed to deepened ties with the United States following the September 2001 terrorist attacks, with Washington concluding a treaty with ASEAN for cooperation in the fight against terrorism. The U.S. is also paying more attention to Indonesia, Malaysia, the Philippines and Singapore, he said.

While U.S. President George W. Bush has also announced a new trade initiative with ASEAN, it "clearly has geopolitical dimensions," he said. "After 9/11, concerns have been expressed about the potential of the region emerging as a second front for terrorism.

"The U.S. initiative expressly aims to promote stability and development in the region, through investment and free trade," he added.

As for Japan, Prime Minister Junichiro Koizumi has also proposed a comprehensive economic partnership with ASEAN.

Tay said he did not anticipate the partnership will including trade liberalization in sensitive agricultural products or "be concluded at the highest possible level of liberalization." However, he did point to the potential of Japan concluding bilateral FTAs or partnership agreements with individual ASEAN members, like the one signed with Singapore last year.

So this web of activity, which also includes initiatives with India, Australia and New Zealand, "seems to suggest that ASEAN still has relevance."

In reviewing these engagements, Tay said ASEAN "can and does play a useful role that goes beyond being a mere pawn in the game of great powers, even if it is not an equal to them." He also expressed hope that ASEAN will be able to "play a role in softening the sharp points of the triangle (of China, Japan and the United States) as a friend to all and a pawn of none."

And the role that ASEAN can play "depends on the degree to which its 10 member states are united politically and integrated economically," he said.

Tay noted that although ASEAN was launched in 1967 with a declared goal of fostering economic cooperation, "the reality was that political and security confidence-building and cooperation were the first priority." The economic agenda began in earnest only in 1992, with the declaration of the ASEAN FTA, he added.

"The time has come for ASEAN to deepen and accelerate its economic integration," Tay said.

He went on to add that a logical extension of the various initiatives taken by ASEAN thus far is an ASEAN Economic Community, although he admitted that such a step "requires a strong and firm commitment by ASEAN members to move forward in a credible and timely manner."

ASEAN must go beyond AFTA, he said. "Free trade and tariff reductions are necessary, but insufficient steps. Trade in services, trade facilitation, mutual recognition and other measures must augment the AFTA so that businesses may start to treat the ASEAN member states increasingly as a common economic space."

To achieve this goal, Tay proposed that ASEAN, despite its traditional emphasis on minimal institutions and a strict view of state sovereignty, must develop regional institutions that can suggest steps for national governments to take, map out actions to be taken and supervise their implementation.

Attempts must also be made to achieve an "overall balance of gains for members," he said, suggesting that some form of compensation be considered to benefit the less developed members of ASEAN to ensure political feasibility of the economic integration.

This process, he said, must also be accompanied by closer cooperation and stability in political relationships, featuring a working system to settle possible disputes among member nations peacefully. "In this regard, ASEAN can no longer hold so strictly to the principle of non-intervention," he added.

Tay emphasized that a greater desire for cohesion and institutional identity in East Asia will not lead to the creation of an exclusive and closed bloc, as illustrated by ASEAN's parallel efforts to engage with the U.S., Australia, New Zealand and India.

"East Asian regionalism must recognize and account for the primary importance of the United States to the region as a whole," he said.

He also noted that East Asian regionalism "must recognize the historical, present and potential future clashes and rivalries" among countries in the region, including the relationship between Japan and China. Every effort must be made to build confidence, he said, adding that "even without open conflict, co-existence is insufficient for deeper cooperation and regionalism."

So what role ASEAN should play? "Its role should not be that of a promiscuous lady, seeking short-term advantages and playing one off against another for narrow self-advantage. Rather, ASEAN can and should play a role as a midwife for the greater sense of regionalism in East Asia," he said.

"It should help ensure that the East Asia that arises is not one that is under the influence of any one country -- whether China or Japan -- or the extra-regional power of the U.S," he noted. "It should try to foster ties in the region that are more equal among the various states and powers . . . and that should remain open to others outside the region."

East Asians do not have a shared culture, language, religion or history, he said. "Nor do its experiences with Chinese domination during the Ming era through tribute trade, colonization and or domination by the European powers during the period of empire and Japanese occupation during World War II provide a happy history for seeing it as a single region," he added.

"The East Asia that is emerging must therefore be more one that is cohesive and able to address its own concerns, yet one that is open to other regions and powers, and internally more equal," he added.