Slide 1

We'll look today at the Association of Southeast Asian Nations or ASEAN, and the Asian Development Bank. They are co-located and interdependent. The ASEAN membership of 10 nations are all members of the Asian Development Bank except for Brunei Darussalam. These organizations are important to us because they represent the area of the world that will be our main competition in the future. We should also anticipate student interest in the area after the tsunami. We'll look first at the Asian Development Bank because it was born one year earlier than ASEAN.

Slide 2

ADB is a multilateral development bank—“multilateral” because it involves many countries; “development” because it is concerned with economic growth and cooperation, and “bank” because it lends money. Its clients are the developing countries of Asia and the Pacific. Its shareholders are its members. ADB is a working partnership of the developing countries of the region and the developed countries of the world.

Slide 3

Today, ADB membership has grown to 63 countries. Palau is its newest member. Forty-five are from the region. These include the most populous countries in Asia and the tiniest island states of the Pacific. Neither Russia nor the countries of the Middle East are members. Eighteen members from outside the region include most of the richest countries in the world. The largest shareholders are Japan and the United States . They constantly vie for power and have done so since the beginning of the organization. As nations join the bank the balance between borrowing countries and donating countries has been and will continue to be readjusted. The concern is to keep the power concentrated in the countries of the area.

Slide 4

The supreme body is the Board of Governors, with one governor for each member country. It meets once a year. In 2002, for example, the Board met in Shanghai ; in 2003, in Manila . The governors elect the 12 members of the Board of Directors. Each member has an alternate. The directors and alternates live in Manila . The Board of Directors meets 40–50 times a year. The directors represent their governments and are organized into constituency groups. Australia , Canada , People's Republic of China, India , Indonesia , Japan and the United States have permanent seats on the Board. Smaller shareholders rotate the director positions. The president and 4 vice-presidents run the Bank, one from Asia, one from the US and two from Europe .

The president is Japanese—the seventh Japanese to hold the position. He chairs the Board of Directors. The president is not the only Japanese bureaucrat in the organization. Many of the staff are Japanese and the organizational culture is Japanese. It is established that people from the Ministry of International Trade and Industry will take an administrative leave and go work for the ADB. All in all, ADB has more than 2,000 employees. They come from about 50 countries. More than half are Filipinos. The staff is organized into more than 20 functional groups; a recent reorganization has brought programs and projects staff together into groups with country focuses.

Slide 5

This is ASEAN today.

Slide 6

The first group to meet were the foreign affairs ministers and until 1975 they were the dominant partners. During this time the organization was primarily a cultural and diplomatic organization without much force. The one thing they agreed on was that they'd never, never interfere within each other's borders. In 1975 finance ministers began to meet and trade talks became more serious. In 1976 the heads of government met for the first time, then again in 1987 when they decided to meet more frequently until 1995 when it became annual. This shift from foreign ministers to heads of state increased the pressure to produce substantive change.

Slide 7

ASEAN Free Trade Area or AFTA was the real birth of ASEAN as a power. AFTA was initiated at ASEAN summit in 1992. It is a comprehensive program of regional tariff reduction, and was later broadened & accelerated, and reaffirmed during Asian Financial Crisis of 1997-98. The crisis wasn't helped much by ASEAN but it finally convinced everyone that regional controls were needed. The original signatories were Brunei Darussalam, Thailand , Indonesia , Malaysia , the Philippines and Singapore . They were originally going to have the treaty in force by 2005 but they had it finished by 2003 with the first signatories. They have reduced tariffs on over 99% of the products on their agreed list to between 0-5%. The newest states, Cambodia , Myanmar , Laos , and Vietnam have 66% of their lists reduced.

The 5 founding members always wanted everyone in Southeast Asia to be a part of the organization but the Vietnam War, Pol Pot and one or two other difficulties intervened. Finally, in the '90's they realized their original ambition.

Slide 8

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In addition to these ties, ASEAN and the United States have a long relationship. The United States was always a “dialog partner” but in the beginning we were focused on the Vietnam War and our dealings with ASEAN were completely filtered through that. We signed the U.S.-ASEAN Joint Declaration on Combating Terrorism on August 1, 2002. Also, The third meeting of the Association of Southeast Asian Nations (ASEAN) – U.S. Informal Coordinating Mechanism (ICM) took place in Bangkok on November 1, 2004. The ICM reviews progress on development projects between the United States and ASEAN, and considers proposals for further cooperation.

Slide 9

Let's compare the two organizations. ASEAN has 10 members and all are full members. ADB has 63 members but they are not equal in power or shares. As I may have mentioned before, all the members of ASEAN except Brunei are members of the ADB. Japan is a member of ASEAN +3, and the founding member of the ADB.

When China wanted to join ADB the problem was Taiwan which was a founding member. The rules said they couldn't bounce a member unless they'd defaulted, and Taiwan hadn't even borrowed since the seventies. They handled this very practically by saying that the founding of the bank took place after the victory of the Chinese Communist Party in '49 so that Taiwan never claimed in the ADB to represent all of China . So they changed their name to Taipei , China and allowed the PRC to join the bank. Vietnam was also allowed to take over South Vietnam 's shares when it joined. The US is a dialog partner with ASEAN as mentioned before and a founding member of the ADB.

Slide 10

ASEAN is a good source of data for its original member countries, and the statistical yearbook is online. It features tables of data that cannot be downloaded into Excel. It includes health, education and trade data, however the trade data does not include Vietnam, Laos or Cambodia and other data sets don't always include the latest members or the same ones every time. Sometimes it's Vietnam that's left out, sometimes Cambodia and Laos . It's important to remember this when you're looking for data on a particular country, you have to look at each data group to be sure that the country is included. They link directly to the statistical agency of each country and they are working hard to standardize collection of statistics among the membership. SSRC Ready Reference has the statistical yearbooks of Indonesia (1998), Philippines (2003) Singapore (2004) Thailand (1996) and Malaysia (1993) as other sources for the data, but ASEAN also has Cambodia , Brunei , and tourism stats for Myanmar . They don't have a link to a statistical office for Laos and Vietnam .

ADB has a lot of data online, and they collect data on the ASEAN countries as well as other Asian nations. They do their own analysis. We'll talk later about ARIC, a good statistical source.

ASEAN's publications are all online and are grouped according to whether they are political or economic. The ADB counts their publications annually, rather than in total.

Slide 11

The Index to International Statistics does not include ASEAN's publications in its index. The Annual Report is much more of a glossy brochure type of document with very little data, it does provide a quick overview of the highlights of the organization for each year. Princeton has paper copies of the annual report and the documents series, but we do not subscribe to a paper copy of Business ASEAN. It's a quarterly newsletter that promotes business in the region by highlighting new ventures and the latest economic news. The most useful of these publications is the yearbook which was published for the first time in 2002 and we'll look at it when we visit the website. By the way, the ASEAN Economic Bulletin is NOT published by ASEAN but by the Institute of Southeast Asian Studies .

Slide 12

These periodicals are indexed by the Index to International Statistics. Princeton has paper copies of Key Indicators, Asian Development Review, Asian Development Outlook, the Annual Report, and the ERD working papers and we've cataloged 10 other serials.

Key indicators has demographic data, economic data, and poverty indicators including education, health and environmental data. Asian Development Review is semi-annual and has articles and analysis of the collected data, Development Outlook includes forecasting information and good business information including business formation procedures and costs. The Annual Report has all the information about contributions, loans, subscriptions and voting power by country as well as by project and sector. The Fact Sheets aren't indexed by IIS but they are a great resource. Each fact sheet has loan information and co-financing arrangements and voting stock and contractor lists and all kinds of information about individual members. They're online and we'll look at one or two when we go to the website.

Slide 13

There are three websites because I wanted to introduce you to the Asia Regional Information Center (ARIC) . It provides an array of regularly updated information about the economic performance and prospects of 16 Asian nations: Indonesia , the Republic of Korea , Malaysia , the Philippines , Thailand , Brunei Darussalam , Cambodia , Lao PDR, Myanmar , Singapore , Viet Nam , the People's Republic of China , Bangladesh , India , Pakistan and Sri Lanka . Presented in an easy-to-navigate format, ARIC offers users a variety of unique services. It provides a clearinghouse of information on (i) economic and social developments, (ii) financial and corporate restructuring initiatives, and (iii) structural reforms. It also provides resources on major development and emerging policy issues.

Website visits: ASEAN publications page, statistics page, member stats links

ADB show finance page and catalog searching in publications

ARIC show “download database”,

Slide 14

ASEAN had faced crisis before with haze from Indonesia 's forest fires, the economic crisis of '97, terrorism and SARS. In 2000 they had set up an organization they called the troika of the current, past and future presidents. They were supposed to be the early response team for any crisis, but they have not been very effective and the rapid response to the tsunami came from the heads of state who met within 7 days and hammered out some agreements and set up an action plan. One of the biggest concerns right away was making sure that the tourism industry for the rest of the area was affected as little as possible. They are working on developing an early warning system.

The best way to get detailed information about the tsunami from ASEAN is to use their links to the individual country's statistical bureaus. Indonesia is tracking some data province by province but it's in their language (Bahasa Indonesia). Others don't have this level of detail. Don't forget that Sri Lanka is not a member of ASEAN so its information would be available through the website below.

ADB's response was set up a special fund for re-building and they have done a lot of the assessment of the areas hit. The Asia Regional Information Center has created a tsunami web site . It contains news articles and country assessments. These are from several sources but they're gathered together and indexed by country responses, international responses and assessments. The related websites list has the websites set up by each country.

Slide 15