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Chapter (5): ASEAN

5.7. Emerging Asian Regionalism: SCO, EAEU, BRICS, and APEC

significant part of sovereign prerogatives and authorities is transferred to some regional supranational institutions. Nonetheless, in its interstate and partnership model of integration, the SCO’s consensus model of decision-making confirms the equality of all participants regardless of their potentiality or opportunity.396 Such model of interstate interaction has practically provided an institutional platform for the progress of Eurasian development in its integration processes including the implementation of China’s One Belt, One Road initiative forming an overarching partnership between Eurasia and Asia-Pacific.397

Historically speaking, the ancient Silk Road as “coronary arteries” of the civilization of human being has been able to connect the East and the West through different cultures, religions and empires thus serving as the accelerator for the development of trade, economy and human civilization. Silk Road in fact connects China, Central Asia, the Middle East, Europe and North Africa. It encompasses about 30 countries from China to Europe and from India to Central Asia. The combined GDP of these countries accounts for 55% of the world’s total while covering a region about 37% of the earth surface area with population and proven reserves accounting for 70% and 75% respectively.398 Perhaps this is why China’s initiative plan so called The Silk Road Economic Belt looks appealing.

The SCO is considered a classic intergovernmental organization based on the principles of mutual respect and sovereign equality, territorial integrity of states, and non-interference into their internal affairs while rendering peaceful dispute settlement by way of consultation and negotiations. Article 15 of the SCO Charter (7 June 2002) enjoins that the SCO is explicitly endowed with the international legal personality by which it can interact and maintain dialogue with other states and international organizations.399 The SCO has considered the candidacies of Iran, India, and Pakistan in recent years among which the latter two have already become members. Iran is still seeking to become a consolidated member as of now.

The SCO legal framework contains 122 documents mainly related to the economy, which have the role of facilitating trade and investment, as well as banking and financial activities, manufacturing, agriculture, transport, communications, customs and development of tourism. These documents, however, consists only of 7% of the overall SCO contractual and legal framework. The organization needs to take further

396 Alimov, Rashid. “The Shanghai Cooperation Organisation: Its role and place in the development of Eurasia.”

Journal of Eurasian Studies, 2018, p. 115.

397 Ibid, p. 114.

398 Silk Road Economic Belt Construction: Vision and Path; Report Released at “The Silk Road Economic Belt Construction and Future: 12 Countries Think Tank Forum.” In: The Eurasian Era: Blue Book of Silk Road Economic Study 2014-2015. Renmin University of China, 2014: pp. 2, 3, 4.

399 Kembayev, Zhenis. “The Silk Road Economic Belt and the Shanghai Cooperation Organization.” KIMEP University’s School of Law. In: The Eurasian Era: Blue Book of Silk Road Economic Study 2014-2015. Renmin University of China, 2014: pp. 61-62.

measures to implement the Program of Multilateral Trade and Economic Cooperation within the member states (adopted in 2003), while materializing the development of projects contained in the SCO 2017-2021 will.400

The Eurasian Economic Union (EAEU) is an economic union of states located in central and northern Asia as well as Eastern Europe. The Treaty establishing the EAEU was signed in 29 May 2014 by the leaders of Belarus, Kazakhstan, and Russia and came into force in January 2015. The union has now five members including Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia. The above Treaty provides a legal and regulatory basis for the functioning of the EAEU. This Treaty includes articles concerning free movement of goods, services, capital, and labour within the union basing its fundamental principle of four

“freedoms.”401 Moreover, a Declaration was signed in 2018 on Further Development of Integration Processes within the Framework of the EAEU during which the member states agreed to level up the Ease of Doing Business by expanding cooperative ties among member states enterprises while improving the business environment in the common economic space, and promoting investment.402

The above efforts confirm the fact that Asia’s strengthening position as a driver of global economy has been progressive towards deepening regional integration aimed at increasing the competitiveness of the industries in the region while reducing the costs of their product for the market. In this process, further crystallization of integration efforts while involving more countries into the process of such integration shall strengthen the SCO’s and EAEU’s attempts in establishing the policy of multilateralism vs.

unilateralism. It is anticipated that necessary institutional basis for such improvement will gradually mature with a more developed form of cooperating framework within both the SCO and EAEU thus leading to further deepening of interaction with the countries of Southeast Asia.403

As indicated, BRICS consists of the five major emerging national economies of Brazil, Russia, India, China, and South Africa. The association was formed in 2009 by the first four members with the inclusion of South Africa in 2010. Many argue that the emergence of such associations as the SCO, EAEU, and BRICS is in fact an integral part of the globalization processes in shaping a multipolar world. This trend has created a new institution in modern international relations through strategic partnership at the

400 Alimov, Rashid. “The Shanghai Cooperation Organisation: Its role and place in the development of Eurasia.”

Journal of Eurasian Studies, 2018, p. 116.

401 “What is the Eurasian Economic Union (EAEU),” EEC. Moscow, Astana, August 2017, Retrieved from:

http://greater-europe.org/archives/3895

402 Eurasian Economic Integration 2019. ”Eurasian Economic Bank, Center for Integration Studies, Moscow, 2019:

page 17, and page 123.

403 Alimov, Rashid. “The Shanghai Cooperation Organization: Its role and place in the development of Eurasia.”

Journal of Eurasian Studies, 2018, p. 124.

regional, interregional, and transregional levels.404 The BRICS five nations combined would be the largest entity on the globe in many respects according to Goldman Sachs, as they are considered among the biggest and fastest growing markets encompassing emerging and developing markets of the world.405

The legal and international nature of the above associations is a crucial factor for their development.

Beyond the international law framework in formulating the relational issues, the BRICS countries tend to use a more delicate tools and diplomatic means with less financial and other costs. The interstate and partnership of the BRICS is based on the Economic Partnership Strategy (7th BRICS Summit: Ufa, Russia, 2015) which provides the basis for cooperation. Moreover, the BRICS Trade, Economic and Investment Cooperation Road Map up to 2020 has been recently signed comprising of major projects in the fields of infrastructure, industry, and agriculture. Also, the Xiamen Declaration (China, April 9, 2017) was signed to improve the trade and investment cooperation while increasing the complementarity and diversification of the economies.

In Shanghai (September 2017), a plan was also signed for cooperation on promoting investment, trade facilitation including trade in services, e-commerce, and intellectual property. The BRICS Strategic Customs Cooperation Program was also signed including mutual recognition of the results of customs control and mutual assistance in law enforcement. This program serves to simplify the customs procedure in mutual trade while harmonizing the customs rules and procedures using advanced information technologies.406

Taking into account the fact that the BRICS countries occupy about a quarter of the world’s land, 42% of the world’s population while having 30% of the world GDP, and 20% of the world trade,407 strengthening of the above legal and institutional framework in conformity with international law could effectively contribute to the development of the global economy thus increasing the economic and political influence of the developing world in particular upon the issues of integrative development.

Asia-Pacific Economic Cooperation or APEC is considered an intergovernmental association and the premium forum for facilitating trade and investment, cooperation, and economic growth within the

404 -Luzina T.V. & Dudareva E.A. & Akhmetshin E.M. & Yankovskaya, V.V. "The International and Legal Framework for Transregionalization of Trade and Economic Cooperation of the BRICS Countries.” European Research Studies Journal, 2018, p. 166.

405 Koba, Mark. “BRICS: CNBC Explains.” Updated 2015; Retrieved from: http://www.cnbc.com/id/44006382

406 Luzina T.V. & Dudareva E.A. & Akhmetshin E.M. & Yankovskaya, V.V. "The International and Legal Framework for Transregionalization of Trade and Economic Cooperation of the BRICS Countries”; European Research Studies Journal, 2018, p. 172.

407 Ibid, with reference to: BRICS Joint Statistical Publication 2017, p. 272.

Pacific region. APEC operates based on equal respect and open dialogues and non-binding commitments.

Therefore, it has no treaty obligations for its member countries, and decisions within the APEC are reached by consensus while commitments are on a voluntary basis. APEC 21 member economies account for approximately 55% of the world’s GDP, 44% of the world trade and 40% of the world’s population.408

APEC was established in 1989 to bear out some goals and purposes including the enhancement of economic growth and prosperity while strengthening the Asia-Pacific community. Since then, the organization has attempted to reduce tariffs and other barriers to trade across the Asia-Pacific region in view of increasing economic efficiency and exports among the member countries. In 1994 in Bogor, Indonesia, the leaders of the APEC member economies adopted a vision called the “Bogor Goals” that included free and open trade and investment in the region by 2010 for the industrialized members and by 2020 for developing economies. Such vision is to create jobs by providing opportunities in international trade and investment. It also helps lower the costs of production while reducing the prices of goods and services. Moreover, APEC is also a forum to create a safe and efficient movement of goods, services and people across the region through economic and technical cooperation as well as policy alignment.409