One of the interesting aspects of the AC is the so-called ASEAN Economic Community or AEC. This is the economic infrastructure of the new community. At present completely free movement of people and labor is not being implemented by the community, but there are signs that such a scenario could come to pass in later phases of the AC. For example, there are 8 occupations which will be allowed freer movement within the AEC framework and they are: accounting, dental services, architecture, surveying, nursing, tourism, engineering and medical services. Those who hail from one of the ASEAN jurisdictions and engage in the aforementioned endeavors could see their career prospects improved as a result of new markets opening for their specific skill set. In Thailand it appears AC passport holders will still be required to obtain a Thai work permit, notwithstanding the creation of the AEC .

As can be seen from the various ceremonies marking the creation of the AC it is clear that many of the respective ASEAN governments welcome the establishment of the AC with open arms. In Thailand, the establishment of the AC coupled with the plans to make Bangkok the rail hub for trade between Eastern Southeast Asia, Western Southeast Asia, and Southern China could mean that Bangkok will become a central entrepot for trade and travel. Meanwhile, Thai officials are still studying the provisions of the Trans Pacific Partnership.

How the AC will ultimately function remains to be seen as the union brings together disparate political systems and jurisdictions with radically differing economies, but one thing is clear: the AC is poised to be the most dynamic economy worldwide as the region is a crossroads for trade and the economies throughout the region appear ready to significantly expand in the future.  As of the time of this writing there does not appear to be a coordinated plan to create unified ASEAN visa structure akin to the Schengen system, but in time such a development may come to fruition

The notion that the world is moving toward a state of multipolarity leads this blogger to posit: how will the Association of Southeast Asian Nations (ASEAN) fit into the framework of a multipolar world? It seems reasonable to infer that ASEAN will become an increasingly important economic bloc following the integration of the various member states’ economies under the framework of the ASEAN Economic Community (AEC) which is set to take effect on January 1, 2015. The creation of a single economic platform which will include approximately 400-500 million people, some of the fastest growing economies in the world, and some of the most strategically important geographical locations will likely lead to greater economies of scale for businesses in the region, a larger market for goods and services for the member states, and greater leverage to trade with countries outside of the bloc. However, these issues are not entirely pertinent to the question posited above. The differences between China and an integrated ASEAN economic platform will be substantial. First, some members of ASEAN rank amongst some of the largest economies in the world, in their own right. Meanwhile other economies within the region are still developing. This could lead to a “best of both worlds” scenario for ASEAN, China, and the USA. Case in point, Thailand has seen difficulties in recent years competing with cheaper Chinese labor, but the movements of labor and capital which will come hand-in-hand with ASEAN economic integration could lead to a situation where Thai companies could utilize labor pools in developing ASEAN member countries to offset the low cost of Chinese labor and thereby mitigate previous competitive disadvantages. Furthermore, the United States may find new markets for US goods in an integrated ASEAN and new venues for the manufacture of low cost goods in developing ASEAN nations that would allow for some economic de-coupling from China by the USA, thereby allowing the United States a freer hand in making foreign policy decisions vis-a-vis China. Finally, China stands to gain due to the increase in trade between China and the ASEAN nations which has recently been evidenced by the evolving nature of the geography of the Chinese economy. In recent years, increasing economic activity has been noted in Southern China across the border from Laos, which acts as a kind of entrepot for trade between China and Thailand as well as the Greater ASEAN community. Recent discussions of a high speed rail link connecting China, Laos and Thailand have also been cause for optimism that one day this region could play host to a booming economy which will bring large numbers of people out of poverty and create wealth for the peoples of all nations concerned.

Following ASEAN economic integration, there are likely to be myriad legal challenges for those businesses in ASEAN nations and abroad wishing to gain a foothold in this burgeoning market. The legal challenges posed will likely require the assistance of legal professionals in the region familiar with new ASEAN regulations as well as the internal regulatory frameworks of the various member states.

It is interesting to note that this recent trip comes during a time where there are perceived to be increasing tensions between the United States and the Peoples’ Republic of China. Moreover, recent Chinese claims to territories in the Eastern and South China seas have caused further tensions between China, Japan, Singapore, Vietnam, and Malaysia (to name only a few). The issues surrounding dealings with China, which is one of the United States’ largest trading partners as well as a competitor for influence in the Asia-Pacific region, are likely to be at the forefront of discussions between the American President and his counterparts in the various countries to be visited. As economic growth in Southeast Asia continues, it stands to reason that building long-lasting economic ties with the region is a substantial concern. Meanwhile, smaller Asian nations may seek support from the United States in an effort to counter what some view as an overly expansionist China. All of these issues arise at a time when the Association of Southeast Asian Nations (ASEAN) is preparing for further economic integration in the form of the ASEAN Economic Community (AEC) which is set to come into effect in 2015. How ASEAN integration, Chinese expansion (both militarily and economically), and American foreign policy will interact in the months and years ahead remains to be seen, but clearly Southeast Asia remains at the forefront of geopolitics.

With respect to the Kingdom of Thailand, it appears that Thai officials are preparing for ASEAN economic integration by encouraging the creation of an ASEAN trading hub in Southern Thailand. As Hat Yai is currently a significant trading center in the Southern region of Thailand and boasts of an international airport along with multi-cultural demographics it is a logical location to capitalize upon ASEAN economic integration which would result in significant benefits for Thailand domestically as well as Malaysia and ASEAN as a whole. The economic benefits which could arise from ASEAN economic integration are virtually limitless and perhaps one day the ASEAN trading bloc could be as economically dominant as the economies of the USA and China.

Based upon information announced by the ASEAN Secretariat, in the year 2014 ASEAN appears poised to focus on quickly implementing targets for 2015. It also appears that ASEAN will be working towards unifying the community pillars of ASEAN, notably the ASEAN Economic Community (AEC), the ASEAN Socio-Cultural Community, as well as the ASEAN Political-Security Community. Post-2015, ASEAN may undertake initiatives to reinforce these efforts while also attempting to further engage other outside actors in the Asia Pacific and East Asia regions.

A recent joint statement from the visiting Chinese Premier and the Thai Prime Minister also noted that efforts are being made to improve relations between the Kingdom of Thailand and the Peoples’ Republic of China. The two leaders expressed their desire to see closer cooperation between their two nations in the form of investment in industry (with specific emphasis upon investment in the bio-plastics, green, and rubber industries).

Thailand and China renewed their commitment to promoting improved transportation infrastructure in the form of railway links between Thailand, Laos, and China. The two countries also discussed improved transportation channels in the form of roads, airports, and ports which could increase trade and tourism for both Thailand specifically and the region as a whole. The Chinese representatives reiterated their desire to assist in the building of a high speed railway system between Ban Phachi and Nong Khai, noting that payment for such endeavors may come, at least in part, in the form of agricultural goods.

The two countries also wish to strengthen cooperative efforts in the banking and financial spheres by promoting the use of the two nations’ currencies in matters involving Sino-Thai trade and investment. It also appears that the two countries are poised to discuss methods of improving RMB clearing services in matters pertaining to trade.

Most notably, at least for this blogger, was the announcement that China as well as Thailand are amenable to discussing, and possibly signing, a Memorandum of Understanding on exemption of visas. Apparently, a prospective Sino-Thai visa exemption scheme would allow holders of regular Thai and Chinese passports to enter each of these countries on a visa exemption stamp not unlike the current visa exemption stamps currently issued to travelers from many countries entering Thailand. The promulgation of a visa exemption scheme between China and Thailand could lead to increases in trade and tourism between the two nations.

Apparently, the official representatives of the Peoples’ Republic of China and the Kingdom of Thailand are also poised to sign various agreements exclusively pertaining to the Sino-Thai relationship. These agreements will deal with matters such as investment between the two nations, development of infrastructure, technology, education, and energy to name just a few areas which will be covered. As of the time of this writing, Thailand is the coordinator for relations between the Peoples’ Republic of China and the Association of Southeast Asian Nations (ASEAN) and in that capacity it appears likely that the Thai PM and the Chinese Premier will discuss matters relating to the ASEAN-China Strategic Partnership.

Meanwhile, in related news Transport Minister Chadchart Sittipunt has recently made comments regarding the linkage of the Kingdom of Thailand, Laos, and China via high speed rail systems as well as other transportation initiatives under the aegis of the Thailand 2020 program. It would appear that plans are being implemented to construct a high speed railroad linking Bangkok to Nong Khai, the Northeastern Thai province bordering Viantiane, Laos. Construction of such a railway is expected to begin in the latter half of 2014. Upon completion of the project travelers will be able to make the trip between Bangkok and Nong Khai in approximately 3 hours. The system will then link up with Yunnan, China via Laos. Furthermore, enhanced roadworks are expected to be constructed, including new four-lane roadways, in order to streamline transportation both within Thailand as well as in Laos and China.

Clearly, these efforts are likely to fundamentally change the landscape of Northern Thailand both physically and economically. The linking of Northern Thailand, Laos, and Southern China will have a significant impact upon the economies of all three jurisdictions while simultaneously changing the way in which business is currently being conducted in this region. These developments are occurring as the ASEAN countries prepare for the coming integration of the ASEAN Economic Community (AEC) and it stands to reason that further cooperation between Thailand and China bilaterally and China and ASEAN multilaterally will see economic benefits not only for Thailand, but for the other ASEAN jurisdictions as well.

According to officials at the Ministry of Labor, initially work permits may be issued for citizens of other ASEAN nations in twenty-five career fields. This prospective policy is in keeping with the provisions of the ASEAN Agreement on the Movement of Natural Persons (MNP). Professionals operating in areas involving: computers, advertising, marketing research, research and development, agriculture, telecommunications, management, education, finance, health, translation services, construction, engineering, and transport services (to name a few areas) may be eligible for a Thai work permit. Labor Ministry officials are apparently poised to utilize the National Skill Standard in order to ascertain whether approval of a work permit application for an ASEAN citizen is warranted. This measure is being undertaken in an effort to insure that only qualified workers are granted a work permit. Meanwhile, the Ministry of Labor and the Ministry of Commerce are preparing to work in conjunction with the Management System Certification Institute (Thailand) in an effort to set policies aimed at providing temporary status for qualified ASEAN citizens wishing to enter the Kingdom of Thailand.

All of these measures appear to be designed to provide ASEAN citizens with the rights and privileges that come with work authorization in Thailand. It is thought that as ASEAN becomes increasingly integrated larger numbers of foreign workers will descend upon Thailand as increasing numbers of Thai nationals seek employment opportunities in other ASEAN countries.

At the time of this writing, virtually all foreign nationals working in the Kingdom of Thailand are required to obtain work authorization in the form of a Thai work permit. Except in the case of a foreign national married to a Thai, such individuals are also required to obtain a Thai business visa in order to be eligible to apply for a work permit. As can be inferred from the information noted above, notwithstanding the integration of the ASEAN economies, foreign nationals from ASEAN countries are also likely to be required to obtain business visas and work permits before being able to legally undertake employment in the Kingdom.

Both sides noted with satisfaction the progress and the dynamism made in areas as high-level visits, trade and investment, tourism, culture and education since the adoption of the Joint Action Plan on Thailand-China Strategic Cooperation (2012-2016). Both sides agreed to maintain the momentum and, as for next steps, to deepen cooperation on high speed train, water resources management, green, renewable and alternative energy as well as education and human resource development as priority under the MOU on Cooperation on Sustainable Development. Both sides shared the view that the 3rd Meeting of the Joint Commission on Trade, Investment and Economic Cooperation should be convened soon to discuss ways to further promote trade and investment in order to achieve the bilateral trade target of 100 billion USD by 2015 set by the leaders of the two countries. Both sides also agreed to fully implement the MOU on Agricultural Trade Cooperation and facilitation trade in agricultural products and RMB should play a greater role in the business transactions between China and Thailand. Both sides reviewed the decade-long China-ASEAN Strategic Partnership and agreed that it has stood as a pillar of regional peace, stability and prosperity…

As the date approaches for the integration of the ASEAN economies thereby creating the ASEAN Economic Community (AEC) many nations around the world and within the region are likely speculating as to how ASEAN and China will interact both geopolitically and economically. In fact, the recent Thai-Chinese dialogue occurs closely after a recent ASEAN Foreign Minister’s Retreat hosted in the Thai city of Hua Hin. Mr. Surapong Tovichakchaikul, Deputy Prime Minister and Minister of Foreign Affairs of Thailand, chaired the meeting. During the course of the discussions, the issue of the Sino-ASEAN relations was discussed. To quote directly from a different press release from the Thai Ministry of Foreign Affairs:

Mr. Surapong highlighted the importance of ASEAN’s centrality in the evolving regional architecture. He suggested that ASEAN should strive towards a common and more coordinated position and speak with one voice on matters that affect the interest of ASEAN…On ASEAN-China dialogue relations, Mr. Surapong emphasized the importance of maintaining the continuing the spirit of “constructive cooperation” for mutual trust and cordial relations between ASEAN and China, including through advancing trade facilitation and promoting ASEAN’s connectivity efforts with China. He looked forward to the convening of a Special ASEAN-China Foreign Ministers Meeting on 28 – 30 August 2013 in Beijing, to further discuss ways to enhance the strategic relations between ASEAN and China.

Clearly ASEAN’s future economic position is of interest to the Foreign Ministers representing the nations which are included in ASEAN. However, the future of Sino-ASEAN relations is of key importance not only in terms of regional politics, but in terms of global economics and international affairs. How ASEAN will interact with China on key international issues in the future is of significance for many nations in the Asia-Pacific region. Meanwhile, an integrated ASEAN economic bloc could represent one of, if not the, largest economies in the world at some point in the relatively near future. By capitalizing on such a situation to improve trade relations not only with China, but with the United States and the nations comprising the European Union, the countries of ASEAN could stand to reap benefits exponentially larger than those garnered through traditional bi-lateral negotiation.

It will be interesting to see what develops at the upcoming meeting of ASEAN and Chinese Foreign Ministers.

I want to thank our friends in Thailand, who represent the longest security relationship, the longest partner that we have in Asia – 180 years of a treaty relationship with Thailand. They are our partner in the largest multinational field exercise that takes place in the region.

The Treaty noted above is the Treaty of Amity and Economic Relations Between the Kingdom of Thailand and the United States of America (sometimes colloquially referred to as the US-Thai Treaty of Amity). This Treaty could be viewed as an update of previous Treaty agreements made prior to the Amity Treaty’s ratification in 1966. The Treaty of Amity represents one of the best sources of legal protection for American Citizens and American Companies conducting business in Thailand as it provides “National Treatment” to American companies in Thailand. So long as American companies (or American owned Thai Companies) receive certification from the Thai Ministry of Commerce, they arre permitted to legally operate in Thailand notwithstanding the provisions of the Thai Foreign Business Act. There are some restrictions on the business activities which an Amity Company may undertake, but overall the Treaty is a significant boon to American businesses operating in Thailand.

The Treaty not only symbolizes strong Thai-American relations in the commercial sphere, it also is seen as a symbol of America’s long standing diplomatic and security relationship with the Kingdom of Thailand, as Secretary Kerry noted in the aforementioned quote. Thai Foreign Minister Dr. Surapong Tovichakchaikul also commented upon the close relationship between Thailand and the United States, citing a relatively recent visit to the Kingdom of Thailand by President Obama:

Last November, President Obama visited Thailand as his first stop in Southeast Asia after his reelection. His visit served to strengthen our strong partnership. My meeting with Secretary Kerry today will be a good chance to continue dialogue on our future partnership, especially as we mark 180 years of Thai-U.S. diplomatic relations this year.

Those wishing to read this press release in detail are encouraged to click HERE.

As the prospect of an integrated ASEAN Economic Community draws near, it stands to reason that the United States and Thailand will continue to maintain their close relations as Thailand will likely prove to be a significant participant in the pan-ASEAN economic bloc. This important role for Thailand within the ASEAN framework could also prove beneficial to American business in Thailand. Only time will tell.

As the Secretary noted in a statement last week on August 8, the anniversary of ASEAN’s founding, the United States is deeply committed to supporting and partnering with ASEAN…ASEAN is growing in importance. The ten ASEAN countries include two close U.S. treaty allies, valuable security partners, thriving democracies, and Muslim majority nations that are both moderate and influential. ASEAN represents the United States’ fifth largest trading partner and our fourth largest export market. Following U.S. accession to the ASEAN Treaty of Amity and Cooperation in 2009, and in a clear sign of our support for ASEAN, the United States became the first non-ASEAN country to establish a dedicated Mission to ASEAN in Jakarta in June 2010…

Those interested in reading this press release in detail are encouraged to click on the hyperlink noted above.

The United States government is clearly intent on increasing ties with the ASEAN region as the economies have such a significant impact upon the American economy. Meanwhile, many of the countries in ASEAN, including the Kingdom of Thailand, have long standing ties buttressed by cooperation politically, militarily, and economically . In short, the US-ASEAN relationship is a “win-win” for all concerned. The remarks noted above, were followed up by references to the upcoming implementation of a more integrated ASEAN Economic Community (AEC), which is due to become a reality in 2015. To quote further from the aforementioned press release:

The ASEAN-U.S. partnership is grounded in cooperation across political, security, and cultural spheres. Our engagement with ASEAN has led to tangible results in such areas as maritime security, humanitarian assistance, and disaster relief. Our work through the Lower Mekong Initiative has led to positive outcomes supporting the establishment of the ASEAN Economic Community in 2015 and development in the Lower Mekong sub-region. And the United States is committed to capacity building for the ASEAN Secretariat…

As the date for ASEAN economic integration draws increasingly close, the countries which comprise ASEAN (Malaysia, the Philippines, Singapore, Thailand, Brunei, Myanmar, Cambodia, Laos, and Vietnam) would appear to be waiting with bated breath to ascertain whether or not the transition will be a smooth one. It is this blogger’s opinion that the ASEAN Economic integration will in fact turn out to be a rather seamless transition as a great deal of time and effort has been expended by all parties to analyze possible problems and implement solutions prior to the integration itself. The United States has shown (through frequent Presidential visits to the ASEAN region as well as policies which provide support for ASEAN’s initiatives) that it is committed to not only engaging the ASEAN region, but also assisting in creating a mutually beneficial framework for US-ASEAN relations in the future.

DOHA: Ambassadors of Association of Southeast Asian Nations (Asean) in Qatar were in accord, saying Asean will meet its target to integrate the 10 nations’ economies by end of 2015, as they celebrated the 46th Asean Day yesterday at the Vietnam Embassy…Singapore Ambassador Wong Kwok Pun cited some areas that Asean has made progress on the implementation of the Asean Charter. In particular, he pointed out Asean has made headway on disputes settlement mechanism, has been working towards the implementation of the roadmap for the Asean community, and taken big steps toward an integrated and sustained economic development…

The implementation of policies which would create an ASEAN Economic Community (AEC) has been an oft-discussed topic among business and legal professionals throughout Southeast Asia. This issue is such a significant topic because by creating a unified Southeast Asian marketplace the countries which comprise ASEAN would become one of the largest markets in the world virtually overnight. That stated, there is a great deal of debate as to whether or not the transition into a unified market will occur smoothly. Some argue that the disparate laws, regulations, and policies throughout the ASEAN member states will not easily coalesce into a workable framework for businesses to operate in the region until governments in ASEAN can implement local policies to bring their regulations in line with the other ASEAN nations. On the  other hand, some argue that because ASEAN leaders have adopted a slow approach to integrating the ASEAN economies the nations which comprise this trading bloc will be able to integrate within the larger body relatively quickly.

Of further concern to both foreign nationals as well as nationals from ASEAN member nations is the promulgation of a single ASEAN visa scheme. Presently, there is not a single visa which one can obtain which would allow the bearer to travel unfettered throughout the the whole of ASEAN. However, leaders in some of the ASEAN countries are looking to remedy this. To quote from the website aseanvisa.com:

Ministers and tourism authorities of the Philippines, Myanmar, Cambodia, and Indonesia have expressed their intention to collaborate with relevant government agencies and other stakeholders to facilitate travel in the region by developing a common smart visa system…According to www.smartvisa.travel, a smart visa is a digital paperless substitute for a traditional visa that can be obtained by a traveler from a travel agent or participating airline…

Clearly, steps are being taken to create some sort of travel document which would provide immigration benefits in multiple ASEAN nations simultaneously. The impetus behind the push for a single ASEAN visa seems to stem from two sources. First, many of the ASEAN nations would appear to view an ASEAN visa as a means of increasing tourism throughout ASEAN. This would appear to especially be a concern to officials in those Southeast Asian nations which do not benefit from high tourism as compared to their other ASEAN counterparts. By creating a visa which allows for access to more than one ASEAN jurisdiction tourist travel to some countries might increase as travelers are no longer deterred in making “side trips” to less popular destinations due to a desire to avoid the need to obtain another visa. Another consideration would appear to be business travel, as ASEAN economic integration continues to gather steam it stands to reason that more foreign nationals will need to visit multiple ASEAN jurisdictions in order to conduct business in the region. By implementing policies to provide for a single ASEAN visa, business travel may increase throughout the region.

The aforementioned article also mentions the recent decision by Thai and Cambodian Immigration authorities to provide a unified visa scheme for travelers wishing to visit those two countries. To quote further from the aseanvisa.com article:

It [the single ASEAN visa scheme] also builds on the single visa scheme for tourism travel between Cambodia and Thailand, which was implemented on January 1, 2013. Progressive relaxation and an Asean common visa would also benefit non-Asean nationals who intend to visit the Asean countries…

One can speculate whether or not the Thai-Cambodian visa scheme mentioned above will one day be consolidated into a pan-ASEAN visa scheme. There are certainly arguments as to the benefits of such an integration, most notably the probable increase in tourism to all of the ASEAN nations. However, one thing remains clear: it appears that virtually all leaders of the ASEAN nations are assiduously studying the ramifications of a single ASEAN visa scheme and should their findings prove that such a scheme would be a benefit to all of ASEAN; then it is likely that such a scheme will eventually come into existence.

For related information please see: Thailand visa.