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| Overview of the ASEAN-GCC Summit. (Source: VNA) |
Both sides are ready to restart
In a recent article on the Syndication Bureau, Dr. Narayanappa Janardhan, Director of Research and Analysis at the Anwar Gargash Institute of Diplomacy in Abu Dhabi (United Arab Emirates), and Fellow of the Arab Gulf States Institute in Washington, wrote an analysis of ASEAN-Gulf Cooperation Council (GCC) cooperation in the current international context.
According to Dr. Narayanappa Janardhan, after more than two decades of little progress in cooperation, GCC-ASEAN relations are ready to restart.
Annual trade in goods between the GCC and ASEAN is about 110 billion USD. After China, India and the European Union (EU), the GCC is ASEAN's 4th largest trading partner.
However, Dr Narayanappa Janardhan said that this figure is still far from the actual potential. With a combined GDP of about US$5.5 trillion, bilateral trade between the GCC and ASEAN could grow significantly as the economic diversification process in the two regions accelerates.
Dr Narayanappa Janardhan highlighted the platforms that could underpin this growth, including the Comprehensive Economic Partnership Agreements (CEPAs) that have been signed between some member states of the two blocs and the free trade agreements (FTAs) that are likely to be signed in the future.
According to Dr Narayanappa Janardhan, the recently signed Memorandum of Understanding on the “India-Middle East-Europe Economic Corridor” will open up new trade opportunities, enhance energy resource supply channels and improve digital connectivity. Similarly, the “ASEAN Connectivity 2025” plan also promotes competitiveness, inclusiveness and community within and beyond ASEAN.
Narayanappa Janardhan, an expert, said that the vibrant GCC market and the economic diplomacy among GCC members also fit well with the ASEAN mechanism. This will facilitate new cooperation between sovereign wealth funds in both blocs.
"However, many obstacles remain, the biggest of which is probably the inherent difficulty in promoting a more substantive cooperation mechanism. Although ASEAN and the GCC had their first formal contacts in 1990, it was not until 2009 that the first ministerial meeting was held. The ASEAN-GCC Joint Vision on Trade adopted at the meeting created much promise, but the results have not been as expected," Dr. Narayanappa Janardhan commented.
Rewriting the rules of economic diplomacy
Anwar Gargash, director of research and analysis at the Diplomatic Academy, said that the ASEAN-GCC Summit in Riyadh (Saudi Arabia) from October 18-20 was an opportunity to turn the situation around.
Several GCC member states, notably Saudi Arabia and the United Arab Emirates (UAE), have begun to diversify their partnerships. Both countries have been invited to or have joined international forums, including the Group of 20 (G20), the Shanghai Cooperation Organization (SCO), and the BRICS+.
According to Dr. Narayanappa Janardhan, ASEAN-GCC cooperation is increasingly feasible as the two blocs have established a mechanism for regular foreign ministers meetings and GCC members are growing in economic stature. This will facilitate the establishment of new cooperative relations in diplomacy and security.
Dr. Narayanappa Janardhan said that this ASEAN-GCC Summit creates a framework for the two sides to continue connecting economic and diplomatic drivers.
The momentum for economic cooperation has now been strengthened. At the bilateral level, Vietnam will be the next country after Indonesia and Cambodia to sign the CEPA with the UAE. Unlike free trade agreements, the CEPA includes services to promote economic diversification. A year after the UAE and India signed the CEPA in 2022, trade between the two countries increased by 6.9%.
According to Dr Narayanappa Janardhan, the agreements between the countries could even pave the way for a broader free trade agreement between the GCC and ASEAN. In 2008, Singapore signed a free trade agreement with Qatar, which was eventually expanded to cover the entire GCC.
However, Dr Narayanappa Janardhan said that it is not easy to make things happen. The GCC is not a homogeneous entity and its members have diverse interests, which makes it difficult to reach consensus on economic issues. Previous attempts by the EU, the US and India to sign a free trade agreement with the GCC have failed, while the China-GCC FTA remains stalled.
However, Mr. Narayanappa Janardhan said that there is still room for optimism in ASEAN-GCC cooperation. GCC countries prioritize partnerships that can contribute to the implementation of their strategic goals, especially the GCC's desire to reshape the routes in the global supply chain. ASEAN countries need to make efforts to create a favorable business environment to support that goal.
The GCC has pursued an Eastward policy for decades, seeking to build long-term trade relationships to diversify away from economic dependence.
This “re-globalization” is accelerating, and with it, the rules of economic diplomacy are being rewritten, says Dr. Narayanappa Janardhan. The ASEAN-GCC Summit in Saudi Arabia is an opportunity to ensure that those rules benefit emerging economies in Asia and the Middle East.
Summit The recent ASEAN-GCC Summit had special significance and achieved the set goals with many important results. Both sides affirmed their respect for each other's role and position, committed to strengthening and deepening relations, equal and mutually beneficial cooperation; it is expected that ASEAN-GCC Summit will be held periodically every two years. |
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