Summary

• The 10 foreign ministers of the Association of Southeast Asian Nations (ASEAN) gathered in Laos for the 49^th Foreign Ministers’ Meeting from June 23-26.
• After several days of deadlock, the ASEAN foreign ministers issued their first joint statement following the July 12 UN Permanent Court of Arbitration (PCA) ruling on the South China Sea. The joint communique reaffirmed the importance of freedom of navigation in the South China Sea and non-militarization and self-restraint, but made no reference to the arbitral ruling.
• Southeast Asia is of growing economic and strategic importance to major powers and the business community, but ASEAN’s inability to take positions on contentious issues due to its consensus-based approach and pressure from third parties has limited the group’s international influence.
• ASEAN weighed modifying the rules for decision-making to prevent individual members from blocking majority-held positions at the meeting, which may signal the beginning of a longer-term transition to a majority-driven body.

Significance of South China Sea Ruling and ASEAN joint communique

On July 12, the UN PCA in The Hague ruled in favor of the Philippines in a maritime dispute, rejecting China’s expansive claims in the South China Sea and concluding that Beijing’s actions in recent years have violated international law and infringed upon the sovereignty of the Philippines. The PCA also rebuked China’s claim of “historic rights” over the South China Sea, stating that Beijing’s “nine-dash-line” has no legal basis according to the principles set forth in the United Nations Convention on the Law of the Sea (UNCLOS), an international treaty China has ratified. While China rejected the ruling, Philippine Foreign Affairs Secretary Perfecto Yasay "welcomed" the decision and affirmed the Philippines’ “commitment to efforts to pursue the peaceful resolution and management of disputes” in the region.

The majority of ASEAN members supported the ruling and called for adherence to international law. The decision was hailed not only as a decisive win for the Philippines, but also for the four other ASEAN members (Brunei, Indonesia, Malaysia, and Vietnam) that have territorial disputes with China in the South China Sea and have protested Beijing’s island-building and land reclamation activities in contested areas. Notably, Cambodia and Laos, which are major beneficiaries of Chinese aid and investment and historically have demonstrated caution in commenting on the issue, did not publicly support the ruling.

Cambodia released a statement prior to the PCA ruling reiterating its view that China and the Philippines should resolve their territorial disputes bilaterally. The statement foreshadowed the difficulty ASEAN would face in reaching a unified position in support of the ruling at the 49^th Foreign Ministers’ Meeting. Many observers anticipated that an internal split would result in a repeat of the 45^th Foreign Ministers’ Meeting in 2012 when ASEAN was, for the first time, unable to issue a joint statement due to Cambodia’s refusal to endorse language related to the South China Sea. At the time, Cambodian Foreign Minister Hor Nam Hong called it a “matter of principle” that ASEAN abstain from taking sides on bilateral disputes.

After several days of deadlock, on July 25, the ASEAN foreign ministers issued a joint communique that reaffirmed the importance of freedom of navigation in the South China Sea, as well as non-militarization and self-restraint, but made no reference to the arbitral ruling. According to ASEAN diplomats, Cambodia blocked any mention of the PCA decision in the joint statement. The group only reached agreement after the Philippines yielded its request for the statement to refer to the ruling and the need to respect international law. Chinese Foreign Minister Wang Yi publicly thanked Cambodia for supporting Beijing’s position that maritime disputes should be resolved bilaterally and for safeguarding impartiality. Other ASEAN members and Western diplomats accused Beijing of using a US$600 million aid package, awarded just a week before the meeting, to incentivize Cambodia to represent China’s view.

What does this mean for the future of ASEAN?

Most observers credited the failure to mention the ruling in the joint statement to China’s growing clout, particularly its strong economic influence over Cambodia and Laos. In contrast to China, the U.S. advocated for ASEAN to support the PCA ruling in the statement. Ultimately, ASEAN’s longstanding policy of consensus in decision-making and tradition of “non-interference” in domestic issues prevented an expression of support. Within this consensus-based framework, China needed only one objector – in this case, Cambodia – to do its bidding. Notably, ASEAN weighed modifying the rules for decision-making to prevent individual members from blocking majority-held positions at the meeting. Though no change was made, the discussion may mark the beginning of a longer-term transition to a majority-driven body.

Southeast Asia is of growing economic and strategic importance to major powers, including the United States, as evidenced by President Obama’s pivot to Asia, and the international business community is increasingly focused on the region as well. By 2025, more than half of the world’s consumers will live within a five-hour flight of Myanmar and the combined GDP of the 10 member countries will exceed that of Japan. But ASEAN’s inability to take positions on contentious issues due to its consensus-based approach and pressure from third parties has limited the grouping’s international influence. As ASG indicated ahead of the first-ever U.S.-ASEAN Summit in February 2016 at Sunnylands in California, ASEAN members have struggled to reach consensus on a common strategy to engage Beijing on tough issues that impact ASEAN members differently due to their diverse interests and relationships with China. This has been a source of consternation for U.S. and other diplomats that have sought ASEAN’s support in Asia-Pacific affairs. Ahead of the summit at Sunnylands, Assistant Secretary of State Danny Russel warned that efforts by outside parties to split, divide, or destabilize ASEAN are “doomed to fail,” and reiterated U.S. support for the ASEAN principle of consensus but cautioned against paralysis. While a transition to a majority-based framework is unlikely in the short-term, this proposed shift could help to manage the increasingly diverse interests of the 10 member countries and allow for ASEAN to play a greater and more involved role in the international arena.