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ASEAN – Russia Summit emphasizes countries’ desire to strengthen their strategic ties

23:30 | 30.05.2016 | Analytic


30 May 2016. PenzaNews. International experts continue to analyze the outcome of the ASEAN – Russia jubilee Summit held in Sochi following which the Declaration titled Moving Towards Strategic Partnership for Mutual Benefit was adopted.

ASEAN – Russia Summit emphasizes countries’ desire to strengthen their strategic ties

Photo: Russia-asean20.ru

Summit participants agreed to develop their ties in economy, trade, energy, global security and culture. They also discussed specific projects in the field of oil refining, transport and education.

Speaking at a meeting of heads of delegations at the ASEAN – Russia Summit with Business Forum representatives, Russian President Vladimir Putin stressed that the parties have already accumulated considerable experience in carrying out bilateral joint projects.

“Thai companies are investing in Russia’s agricultural sector, for example, Vietnamese companies in oil and gas production, and companies from Singapore and Brunei have been investing in innovation. Russian business has been investing in mining ventures in Indonesia and Myanmar. We are working in peaceful nuclear energy development in Vietnam and plan to do the same in Laos, and are investing in the high-tech sector in Malaysia, to name a few examples. I am sure that we have all we need to give a new boost to our business ties,” Russian President stated.

During the Summit, the agreement was reached on building an oil refinery in Indonesia.

“I believe, this is a colossal project and it is important that the plant’s parts will be mostly produced in Russia, this will create a synergy. The Russian side will provide financial resources. The project will be financed by Russian banks, the refinery will mainly use Russia-made equipment, and Russian mining companies will supply raw materials,” Russian Minister of Economic Development Alexey Ulyukaev said.

The possibility of trade increasing and using national currencies in payments was discussed at a meeting with representatives of Vietnam, which army equipment is 90% of USSR and Russian origin.

“In a conversation with the Vietnamese, we discussed the future prospects of the calculation in national currencies that can significantly expand our trade with Vietnam. We are promoting this concept of using national currencies in payments. This will simplify the calculation and expand the number of participants in such cooperation,” President and Chairman of the Management Board of VTB bank Andrei Kostin explained.

Moreover, representatives of Russia and ASEAN Member States have signed a plan on cooperation in science, technology and innovations for the next ten years. The importance of interaction in the humanitarian sphere has also been confirmed by the establishment of the ASEAN – Russia Working Group on Cooperation in Education.

“This is unprecedented for ASEAN, as there is no such group with the countries with which the association has relations similar to those with Russia, such as China, the United States and India,” Russian Education and Science Minister Dmitry Livanov said.

According to him, the work of the group will help boost student exchanges from Russia and Southeast Asia, expand cooperation in science and technology and resolve the issue of acknowledging education certificates in different countries.

Prime Minister of the Lao People’s Democratic Republic and Chairman of the Association of Southeast Asian Nations Thongloun Sisoulith highly appreciated the results of the Summit.

“We express our satisfaction with the significant progress achieved over the last two decades in many areas across the political, security, economic, social and cultural dimensions. We discussed and charted our key directions to further strengthen our cooperation to work at getting the ASEAN-Russia relations to a strategic level and at efforts to promote peace, enduring stability and prosperity for our peoples in the future. More importantly at this summit we adopted the Sochi Declaration and the Comprehensive Plan for Action in 2016–2020. These documents are important for further broadening and deepening of the cooperation and partnership between ASEAN and Russia,” he said at a news conference.

According to Lak Chansok, Research Fellow at Cambodian Institute for Cooperation and Peace (CICP), Lecturer at Department of International Studies, Institute of Foreign Languages, Royal University of Phnom Penh (RUPP), at the summit top-level ASEAN-Russia leaders once again showed their political will and commitment to elevate strategic ties.

“The summit, under the slogan ‘Towards Strategic Partnership for Mutual Benefits,’ included discussions on addressing new challenges and threats to regional security and enhancing political-security, economic and socio-cultural cooperation between ASEAN and Russia,” he told PenzaNews.

According to him, expanded economic cooperation with ASEAN was one of Russia’s top priorities on the summit agenda.

“Vladimir Putin confirmed to supply energy resources and build civilian nuclear power plants in the Southeast Asian region. Meanwhile, Russia is a source of energy supply for boosting regional economic growth, and a future potential market for ASEAN,” Lak Chansok said.

He also added that for ASEAN, Moscow remains crucial in strategic competition between US and China in the region.

“ASEAN and Russia agree to enhance their political-security ties in both regional and international multilateral platforms to deal with security concerns including the South China Sea disputes, and to signal that Russia is pivoting to Asia Pacific to contain China’s rise and US’s active engagement which are seen as challenges and threats to Russia’s geopolitics and geo-strategy,” the analyst said.

In turn, Shankaran Nambiar, Senior Research Fellow at Malaysian Institute of Economic Research in Kuala Lumpur, reminded that Russia has always been a friend of ASEAN.

“This Summit clearly marks a new era of Russia’s participation in the growth and development of the region. It is also an indication that Russia wants to play a more active role in the global economy by looking beyond its traditional partners. The Comprehensive Plan of Action covered a broad range of issues. It was realistic and focused on those areas where Russia has considerable expertise,” the expert said.

In his opinion, the fact that some initiatives have already been agreed upon by Indonesia and Vietnam is a clear sign that Russia is serious in its purpose.

“Russia can help narrow the development gaps in ASEAN. It has had long-standing relations with Laos and Vietnam. Moscow has also taken steps in recent times to improve its relations with Cambodia. Russia’s active participation in the region could pave the way for its inclusion in the RCEP. Russia has already signed a free trade agreement with Vietnam; this should be followed with more bilateral agreements. These initiatives will help to spur trade and investment between Russia and ASEAN,” Shankaran Nambiar said.

The fact that geopolitical considerations were downplayed at the Summit should be viewed very positively, he said. In his opinion, it suggests that Russia wants to support the economic growth and development of the region, and puts that as a priority rather than geopolitical interests that serve its own ends.

Meanwhile, Siew Mun Tang, Head of ASEAN Studies Centre at the Institute of Southeast Asian Studies (ISEAS) in Singapore, called the Summit uneventful.

“The tone of the Sochi Declaration leans more toward aspirational and lacks substantive and tangible targets. The most interesting outcome was the Russian proposal to launch a joint feasibility study on a free trade area agreement between ASEAN and the EAEU. This initiative was met with lukewarm response from ASEAN which agreed to ‘consider’ the proposal,” the expert explained his position.

From his point of view, the scope for practical and sustained cooperation between Russia and ASEAN is rather limited because Moscow has shown little interest in ASEAN affairs and does not have much to offer to ASEAN.

In turn, Ganeshan Wignaraja, Advisor at Economic Research and Regional Cooperation Department, Asian Development Bank, Manila, suggested that amid a subdued world economy, the ASEAN-Russia Summit in Sochi facilitated information exchanges on economic opportunities and confidence building.

“The establishment of the ASEAN Economic Community will create an eventual market of 620 million people with economic opportunities for outsiders. There is potential for the spread of global supply chains from ASEAN into Russia particularly in food processing, automotives, and electronics,” the expert said.

According to him, Russia can increase energy trade, flows of tourists and direct investments with ASEAN.

“In 2015 Vietnam became the first ASEAN economy to sign a free trade agreement with the Eurasian Economic Union. Reducing trade and investment barriers between ASEAN and Russia can further economic ties,” Ganeshan Wignaraja added.

In the meantime, Zulkiply Omar, Senior Research Fellow at Malaysian Institute of Economic Research, said that it was timely summit amid the current global economic slowdown.

“The event was not just to commemorate the 20th anniversary of ASEAN – Russian Federation Dialogue Partnership, but more important it signifies the seriousness of the strategic partnership between the two regions. Sochi Declaration underlines strategic direction to be undertaken in strengthening the partnership,” the analyst noted and added that the document emphasizes Russia’s recognition of ASEAN Economic Community (AEC).

“The Declaration spells out a wide range of areas of cooperation including among businesses and researchers as well as public-private partnership. Cooperation between Russian Federation and ASEAN is expected to boost trade and investment flows between the two regions and ultimately contributing to economic growth,” the Malaysian expert said.

In his opinion, politically, ASEAN plays an important balancing role among the super powers.

“Russia’s proposal for a comprehensive free trade area between ASEAN and EAEU is very interesting strategic move to balance up with the America-led TPPA and China-led RCEP,” Zulkiply Omar added.

He also positively estimated the potential of further cooperation between Russia and ASEAN.

“The prospects of mutual cooperation between the countries are good since ASEAN is a fast growing and young economy housing more than half a billion people. Russian Federation, on the other hand, is a resource-rich economy with superior technological capability,” the analyst concluded.

Dialogue ASEAN – Russia was launched in July 1991 when Russian representatives where invited by the Malaysian Government to attend an ASEAN Ministerial Meeting.

Russia was subsequently elevated to a full Dialogue Partner of ASEAN in July 1996 at the 29th ASEAN Ministerial Meeting in Jakarta.

Russia joined the Treaty of Amity and Cooperation in Southeast Asia (1976) on 29 November 2004. This document serves as a political declaration on the norms and principles of relations among countries in the region and contains the obligation that the contracting parties are not to participate in any manner or form in any activity which may constitute a threat to the political and economic stability of another contracting party.

In 2014, the ASEAN – Russia trade turnover reached 22.5 billion US dollars, while Russia’s foreign direct investment in the region came in at 698 million US dollars in 2012–2014.

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