ASEAN Social Culture Community

ASEAN ~ Global X's New ASEAN ETF : NEW YORK (TheStreet) - The flurry of new ETFs continues with the Global X ASEAN 40 ETF(ASEA_).

If you are unfamiliar with the acronym it stands for Association of Southeast Asian Nations which includes 10 countries although only Singapore, Malaysia, Indonesia, Thailand and the Philippines are captured in the fund. The fund only having five countries is probably a function of markets like Cambodia and Laos being too small.

By country, the largest holdings in the fund are from Singapore at 41%, followed by Malaysia, 33%; Indonesia, 15%; Thailand, 10%; and peculiarly 0.61% in the Philippines with a position in Philippine Long Distance. The fund is market-cap weighted with stakes in the 40 largest stocks in the region. Calling it the ASEAN 39 ETF would be odd, but this really is just a four-country fund, which is not necessarily a bad thing.

At the sector level the fund allocates 43% to financials, 15% to telecom and 15% to industrials. The largest holdings are targeted at 4% to 5% each and include mostly Singaporean banks like DBS Group Holdings and Oversea Chinese Banking along with Singapore Telecom. 

While there is no yield information available at the Global X Website the iShares MSCI Singapore Index Fund(EWS_) has yielded over 3% and the iShares MSCI Malaysia Index Fund(EWM_) has yielded over 2.5%. The yield for ASEA should also be in that range. 

The countries in the fund are all available as individual country ETFs, so the value here would be not having to be correct about one country, accessing a fundamentally healthy slice of Asia while avoiding Japan and China which for the time being have more risk factors. Note "for the time being" as these countries were ground zero for the Asian Contagion in 1998 and Thailand has had some political issues lately that could linger even though this is now not front page news. 

Part of the attraction to this region is that it came through the financial crisis fundamentally unscathed and is today on firmer economic ground than much of the world. While that is clearly the case this did not prevent these markets from going down just as much as the S&P 500 during the worst of the crisis.

ASEAN discusses humanitarian assistance options : The 10 member countries of ASEAN drafted Tuesday a concept paper for a joint coordinating committee (JCC) to overcome natural disasters by using military assets and capacities for humanitarian assistance and disaster relief (HADR).

“We are drafting a concept paper on a JCC to manage and coordinate the use of military assets and capacities for HADR in ASEAN,” Indonesian Defense Ministry’s director general of defense force Rear Adm. Moch. Jurianto told reporters.

He was speaking after opening the second workshop on the establishment of an ASEAN military joint coordinating meeting on the use of ASEAN military assets and capacities in humanitarian assistance and disaster relief in Jakarta.

Jurianto said the workshop would discuss various aspects of the joint coordinating committee, including main tasks and functions, organizational structure, jurisdiction limitations and responsibilities.

“We will also discuss where the committee will be located,” he said.

Jurianto added that results from the workshop would then be taken to the ASEAN Defense Senior Officials Meeting (ADSOM) for finalization before being forwarded to the ASEAN Defense Ministers Meeting (ADMM).

The ADSOM is slated to be held in Yogyakarta from April 26 to 30 while the ADMM will be in Jakarta from May 17 to 21.

Jurianto emphasized that the HADR was actually in the civilian domain and the military was only supporting it by providing its assets and capacities as well as coordination to get the best results.

Meanwhile, Maj. Gen. Srisaran Dhiradhamrong, adviser at the Office of the Permanent Secretary of Defense at the Thai Defense Ministry, said there were a number of problems in coordinating HADR activities between the military and civilians.

“There are several existing problems in cooperating and coordinating with civilians. We are trying to improve civil-military relations,” she said.

When asked whether ASEAN would have a rapid deployment force for a disaster, she said it would depend on each member country.

“We in Thailand have a disaster center combining all three services for in-country and outside missions,” Srisaran said.

“However, such deployment will have to be at the request of the host nation.”

Giving an example, she said that after the earthquake in West Sumatra, the Indonesian Defense Ministry contacted the Thai military attaché at the Thai Embassy to request assistance.

Simultaneously with the workshop, the Indonesian Military (TNI) hosted meetings for intelligence and operations officers as well as the ASEAN Chiefs of Defense Forces Informal Meeting (ACDFIM).

ASEAN ~ RI investment the highest in ASEAN-5 countries : Indonesia’s relatively stable political situation and improved economic fundamentals will help the nation attract more investment in 2011, Switzerland-based investment bank UBS says.

Indonesia was the only nation in the ASEAN-5, a group comprised of Indonesia, Malaysia, the Philippines, Singapore and Thailand, that was currently spending more on investment than before the 1997 financial crisis, UBS economist Edward Teather said.

“Indonesia spent more than 30 percent of its gross domestic product [GDP] on investment last year. Other ASEAN-5 countries mostly spent between 15 percent and 25 percent,” he told a media briefing on the sidelines of the UBS Indonesia Conference 2011 in Jakarta on Tuesday.

He said that higher investment in infrastructure and improving worker productivity might lead to faster economic growth in Indonesia.

“The combination of a young and growing population, moderate debt, potential productivity catch-up and healthy investment rates means Indonesia is still good for growth,” he told reporters, adding that Indonesia would remain a promising investment destination for the next several years.

Economic growth of 6.1 percent led Indonesia’s GDP to top Rp 6,422.9 trillion (US$721 billion) in 2010, according to the Central Statistics Agency.

The Investment Coordinating Board (BKPM) said the nation’s investment realization reached Rp 208 trillion in 2010, exceeding a previous estimate of Rp 160 trillion, and up 54 percent from Rp 132 trillion in 2009.

The board has set a target of creating Rp 240 trillion in investment in 2011.

Despite positive trends, Teather said that high commodity prices, particularly for oil, might lead to higher inflation, which in the end would force the government to increase subsidies and decrease investment spending.

“Don’t worry. Historically higher oil imports have been offset by increases in Indonesian commodity exports,” he said.

Teather said he expected Indonesia’s GDP to grow around 5 percent in 2011, lower than the government’s estimate of 6 to 6.5 percent.

UBS research division head Joshua Tanja, who also spoke at the briefing, said that the Indonesian government had several achievements in 2010 that would boost investor confidence, such as a clarified cost recovery mechanism for the oil and gas sector, implementing regulations to ease private investments in railroads and improving the BKPM’s performance.

He said he expected to see several milestones that would boost investment in 2011, including enactment of a land acquisition law, improved public-private partnerships in infrastructure development and revision of the 2009 Public Service Law, which mandates performance standards for state entities.

Many investors wait for the enactment of the land acqusition law which would allow the governemnt to “force” land owners to buy their land designated for infrastructure proejcts, if they refused to do so even if they had been offered fair prices.

The government said that the draft of the law would be soon submitted to the House of Representatives for approval.

“However, the government should keep its eyes on some risk factors like higher-than-expected inflation, high oil prices and delays in government reforms,” he said.

USB’s Indonesia country head, Rajiv Louis, said that stronger rupiah would be good for the country’s economy.

“Since 60 percent of Indonesia’s economy is fueled by domestic consumption and only 10 percent

comes from exports, a stronger rupiah will allow business owners to import capital goods at cheaper prices,” he said.

ASEAN ~ RI should push RP to commit to ASEAN, experts say : Indonesia and the Philippines may enjoy a harmonious bilateral relationship, but Indonesia as the chair of ASEAN this year may need to reaffirm the Philippines’ commitment to the bloc, expert says.

“So far the Philippines has tended to be inward looking and less active in regional forums because it has political instability at home,” Dewi Fortuna Anwar, an ASEAN expert at the Habibie Center, told The Jakarta Post on Thursday.

Dewi said Indonesia should ensure the Philippines’ commitment to realizing ASEAN’s plan to become a community by 2015, during the Philippines’ president’s visit to Indonesia next week.

She said that in addition to being more active in regional forums, the Philippines had to solve internal conflicts, especially pertaining to rebel groups, before turning its attention to the ASEAN Political and Security Community.

Dewi said the ASEAN Political and Security Community regulated not only how an ASEAN country dealt with others in the bloc, but also how it dealt with internal conflicts.

She said the “distance” between the Philippines and other ASEAN countries was a result of its widely perceived closeness with Washington.

Philippines President Benigno Aquino III is scheduled to meet his Indonesian counterpart President Susilo Bambang Yudhoyono on Tuesday next week during his first state visit to Indonesia since he was elected.

Presidential spokesman Teuku Faizasyah said Aquino was expected to arrive in Jakarta on Monday evening and depart Wednesday.

“The official agenda will be his visit to Kalibata Heroes Cemetery, a bilateral meeting [with President Yudhoyono], a press conference and a state banquet, all on Tuesday,” he told the Post.

During the bilateral meeting, both leaders are expected to discuss economic, political, security and sociocultural issues, as well as regional cooperation, including in ASEAN, he said.

University of Indonesia international relations expert Hariyadi Wirawan said Aquino’s first visit to Indonesia as a president might reflect the Philippines’ strong interest to make a “small alliance”, to confront the “bigger alliance” of Malaysia and Thailand.

He said Indonesia and the Philippines were both archipelagic nations dealing with similar issues, including terrorism and security.

“There’s also a large possibility for [Aquino] to initiate another idea of the US’ bigger role in the East Asia Summit… as the Philippines may represent the US’ interest in containing a more assertive China.”

ASEAN ~ RI to capitalize on ASEAN connectivity : While Indonesia is struggling to fix its poor infrastructure — roads, airports and seaports — across the country, it will soon get a help from ASEAN.

As leaders of the 10 Southeast Asian countries are poised to adopt a declaration on the Master Plan on ASEAN Connectivity — which would promote the region’s long-term strategy to improve infrastructure, institutional and people-to-people relations — on Thursday, Indonesian officials and businesspeople are preparing ways to take full advantage of the plan.

By enhancing connectivity, investors would see the regional grouping of 590 million people as one market rather than as separate countries, officials have said. The master plan proposes strategies to boost road, rail, shipping, air and other networks between ASEAN members to reduce economic disparities in Southeast Asia and help ASEAN achieve its goal of becoming an economic community by 2015.

“We will link Indonesia with the whole of ASEAN. For instance, we will connect the planned railway from Kumming in China to Singapore with ours in Sumatra and Java,” Indonesian Ambassador to ASEAN Ngurah Swajaya said Wednesday.

Besides building railways linking to the western part of Indonesia, under the ASEAN Highway program, many roads across the region will also be upgraded and standardized to link with those in other ASEAN countries, Ngurah said.

According to the master plan, 47 seaports will be built across ASEAN by 2015, with 16 in Indonesia.

On the financing side, the ASEAN connectivity projects have given member countries a solid basis from which to mobilize funding sources, via international organizations, such as the World Bank and Asian Development Bank (ADB), as well as individual donor countries, all of which have expressed interest to finance projects under the Master Plan on ASEAN Connectivity.

“Japan, for instance, will provide US$200 billion to finance various projects under the ASEAN connectivity plan,” Ngurah said.

Due to budget constraints, Indonesia has limited ability to keep existing roads and ports in good condition let alone building new ones, drawing complaints from investors on the high investment needed in Indonesia to start businesses. The government, Ngurah said, had also been preparing to connect the archipelago with internet connections or broad band as part of ASEAN ICT connectivity plans before 2015.

Vietnam Prime Minister Nguyen Tan Dung told businesspeople that a better connected ASEAN will benefit both businesses and consumers, urging them to capitalize on the various government policies that encourage business development.

ASEAN secretary-general, Dr Surin Pitsuwan, said businesses which recognize ASEAN’s connectivity potential will be the winners. “Enterprises which bank on ASEAN as a well-connected region will benefit from its role as an integrated business and investment hub.”

ASEAN, Japan set up 2011-2015 cooperation schemes : Senior officials representing Japan and ASEAN members will hold the 26th ASEAN-Japan Forum here beginning Friday to discuss efforts to foster cooperation for the 2011-2015 period.

The two parties would focus the cooperation on political security, economic, social and cultural fields in line with the leaders’ talks during the recent ASEAN-Japan Summit, ASEAN co-chair forum representative Djauhari Oratmangun said.

“We need to adjust our cooperation policies with Japan, one of ASEAN’s main partners, to cope with the changes of recent times. Therefore, we are looking forward to working closely to revise the plan of action in providing guidelines for our cooperation in the next five years,” he said.

The fields of cooperation include developing small and medium enterprises in ASEAN, environmental conservation, climate change, natural disaster management, counter-terrorism, sciences and exchange of students and youths.

Senior officials in the meeting also discussed Japan’s initial plan on ASEAN connectivity, which reflected the country’s constructive contribution in supporting the integration of ASEAN through physical connectivity, trade facilitation, an ASEAN Single Window and people-to-people connectivity.

“ASEAN countries also welcome Japan’s initiative of ASEAN-Japan Partnership for New Growth in Asia to endorse the group’s synergy toward the 2015 ASEAN Community,” Djauhari said.

Kimihiro Ishikane, the forum’s Japan co-chair, said his country is determined to fully support and cooperate with ASEAN in implementing the master plan, adding that this meeting is important to preparing a new step for the next five years of cooperation.

“As agreed by our leaders in the recent summit, we will be revising our Tokyo Declaration, which was launched in 2003, and we will be revising our plan of action which will be based upon and reflect the reality in the region,” Ishikane said.

“We very much welcome the adoption of ASEAN connectivity. The implementation of this master plan will truly promote and facilitate the integration you would be engaged in by the year 2015,” he said, adding that the results of this two-day forum would be brought to the ASEAN-Japan ministerial meeting mid next year, and would be endorsed by the leaders of both ASEAN and Japan in the next summit in October 2011.

The Japan-ASEAN Integration Fund (JAIF) has been established to finance the partnership projects.

Japan has already contributed US$400 million to the plan within the 2006-2010 period to conduct important projects covering the designated fields of cooperation, Japan ambassador for ASEAN Takio Yamada said.

“For the next five years there are many projects in the JAIF pipeline. We will contribute a significant amount of funds, roughly $150 million, and there is increasing demand from Japan to ensure the accountability and transparency of the financing,” Yamada said.

Among others, the funds granted by Japan for the 2011-2015 period would be used to establish the ASEAN Coordination on Humanitarian Assistance, which would be based in Jakarta, Djauhari said.

“The fund will be used for capacity-building activities on natural disaster management, in which Japan has strong capability,” he added.

ASEAN ~ Will ASEAN thrive in 2030? : What will the Association of Southeast Asian Nations (ASEAN) look like in the year 2030? As a durable and successful regional grouping in the developing world, ASEAN is a force for stability and cooperation in Asia. But can we take its longevity and success for granted?

ASEAN’s irrelevance or even death has been predicted several times before. At its birth in 1967, few people thought it would live to see another decade, given that the two previous attempts at regional cooperation in Southeast Asia — the Association of Southeast Asia and the MAPHILINDO (Malaysia, Philippines and Indonesia) concept — ended within a few years after their creation.

The Malaysia-Philippines dispute over Sabah in 1969, the aftermath of the US withdrawal from Indochina in 1975, the Vietnamese invasion of Cambodia in 1979, the end of the Cold War in 1991, and the outbreak of the Asian financial crisis in 1997, have all been seen as critical blows to ASEAN.

But ASEAN not only survived, it actually grew a bit stronger each time. So there is precedent, and hope, that ASEAN will be around in 2030.

But surviving is not the same as thriving. In 2030, ASEAN might keep plodding on, but will it be a key player in regional peace, stability and prosperity in Asia — a role that it currently enjoys? Here, the question becomes more difficult to answer.

The answer depends on three key questions. First, what will ASEAN’s relations be with the great powers? ASEAN’s biggest fear is that it will be swept aside by the rise of its

two most powerful immediate neighbors — China and India — and the resulting tide of great power competition will draw in the US and Japan as well.

ASEAN emerged at a time when India and China had just fought a war with each other and faced major domestic challenges, including Mao’s Cultural Revolution in China. Japan in the late 1960s and 70s was still in a recovery mode, politically if not economically. The field was thus open for ASEAN to anchor regional cooperation.

How different the situation is today! China and India are racing to join Japan and the US in the great power club, and seeking their rightful place at the top of world affairs. Japan, though stagnant economically, is reorienting itself — as a “normal state” — to an active political and military role in Asia.

Some things remain unchanged though. China, Japan and India do cancel each other out due to their mutual mistrust. All three and the US want ASEAN to accept its leadership in Asian regional cooperation.

Some imagine a concert of powers developing in Asia, wherein China, Japan, India and the US jointly manage regional security issues. This would marginalize ASEAN. As the saying in Southeast Asia goes, the grass suffers not only when the elephants fight, but also when they make love. But an Asian concert of powers would require the powers to overcome differences which are neither temporary nor trivial.

A second question about ASEAN’s future is what the state of intra-ASEAN relations will be. The ongoing skirmishes on the Thai-Cambodian border do not inspire confidence. Simmering rivalries and mistrust continue to cloud relationships between Singapore and Malaysia, Thailand and Myanmar, and Malaysia and Thailand.

But this is a far cry from the 1960s and 1970s, and there is every reason to hope that these intra-ASEAN conflicts will not doom the organization. They would need, however, to be managed carefully, especially with the help of existing and new mechanisms that ASEAN is currently seeking to develop.

The third question is perhaps the most important. What will the domestic political configurations of ASEAN countries look like? Will ASEAN countries become more open and democratic? Indonesia has surely taken a major leap towards democracy.

But there has been a major setback in Thailand and continuing frustration with Myanmar. Domestic succession in many ASEAN countries remains uncertain and even volatile. Domestic turbulence can spill over borders and limit ASEAN members’ ability to contribute to the regional public good. As a regional group, ASEAN cannot shape the domestic politics of its members, but a collective commitment to participatory democracy and regionalism helps.

The idea of a People’s ASEAN has thus far only meant fostering cultural exchanges and cooperation, not promoting or defending democracy (although Indonesia’s efforts through the Bali Democracy Forum are praiseworthy). ASEAN has made a tentative commitment to human rights, but this remains constrained by the resilience of the non-interference norm.

One could imagine ASEAN in 2030 either as the wise counselor of Asia, or the marginalized relic of the past. Approaching its mid-1960s, it could still be at its peak, functioning as a steady and calming influence on the rising upstarts of Asia: India and China. Or it might have lost its bearings, amidst the confusion of profound changes in the regional economic and military balance of power.

To avoid the latter, ASEAN’s current leaders must stay united, strengthen mechanisms for cooperation, steadfastly maintain its neutral broker image among the great powers and be attentive to their people’s voices. By doing so, they will have a good chance of retaining ASEAN’s driver’s seat in Asian regional cooperation.

ASEAN defense chiefs agree on intelligence sharing : A conference of military top brass from 10 ASEAN countries has produced seven agreements on information sharing, including on the exchange of intelligence analysis between countries in the region, during a meeting in Jakarta on Thursday.

Indonesian Defense Force (TNI) commander Admiral Agus Suhartono said the military officials discussed ways of exchanging military intelligence.

The militaries of the ASEAN countries would also cooperate on disaster management and maintaining transnational security, he said on Thursday, as reported by tribunnews.com.

He also said the military would hold joint training exercises.

“The points which we have reached an agreement on will be reported to the ASEAN Chiefs of Defense Force Informal Meeting [ACDFIM],” he said.

ASEAN urged to lead climate talks : JAKARTA: A coalition of activists from the Greenpeace, Oxfam and WWF called on the leaders of ASEAN to take the higher ground during ongoing climate talks in Bangkok.

“We are sending a message to all delegates, especially ASEAN delegates, that a fair, ambitious, and binding global deal is a matter of survival for the people of Southeast Asia,” Greenpeace Southeast Asia policy adviser Zelda Soriano said in a statement made available to The Jakarta Post.

Negotiators from the 190 countries are currently gathered in Bangkok, Thailand, in an attempt to narrow differences of the long-awaited treaty on emission cuts to deal with climate change.

This is the first formal meeting after last year’s conference in Cancun, Mexico.

“Indeed, in Southeast Asia in particular, climate change is not a debate but a grim reality. Our region is repeatedly assailed by an endless refrain of floods, landslides and drought,” Oxfam East Asia regional policy and campaigns coordinator Shalimar Vitan said.

“ASEAN delegates must therefore ensure that the adaptation gets much of the resources as it is more urgently needed and must demand much deeper emissions cuts from developed countries.”

Indonesia is the ASEAN chair this year. — JP

ASEAN ~ Insight : A victory for ASEAN : Where there is a will there is a way. Cambodia and Thailand have proven the universal applicability of this old saying when, on Tuesday, they reiterated their commitment to resolve their ongoing border dispute over the area surrounding the Preah Vhear temple through peaceful means.

After weeks of diplomatic efforts and with goodwill from all members of ASEAN, Cambodia and Thailand agreed to avoid further clashes by inviting Indonesia, as ASEAN’s current chair, to send observers to both sides of the border and engage in subsequent bilateral negotiations to find a permanent solution to the dispute.

The agreement, reached at an informal meeting of ASEAN foreign ministers chaired by Indonesia in Jakarta on Tuesday, clearly deserves special and full appreciation. It should be welcomed as a historic moment for ASEAN, in the words of ASEAN Secretary-General Surin Pitsuwan.

It represented a clear display of commitment from two ASEAN members to uphold the two most important principles enshrined in the ASEAN Charter, namely, settlement of disputes by peaceful means and the renunciation of the use of force. Most of all, it constitutes an unprecedented case where ASEAN countries agreed to use ASEAN’s own mechanisms to resolve conflict among members.

Indeed, ASEAN can now be proud of itself for a number of reasons. First, after years of being accused of doing too little to resolve conflicts and crises in its own backyard, ASEAN has now demonstrated that it can move beyond the rhetoric if it chooses to do so.

ASEAN now has a promising basis to put its conflict resolution mechanism into practice in the truest sense of the word. The agreement provides ASEAN with an opportunity to prove to itself and the international community that it will be able not only to manage but also resolve conflicts. It will show that ASEAN no longer sweeps problems under the carpet, but will utilize agreed-upon conflict resolution methods, including mediation.

Second, the Jakarta informal meeting also shows growing recognition and trust from the international community that ASEAN can manage its own problems. The decision by the UN Security Council to encourage ASEAN to address the Cambodian-Thai tensions clearly suggests that there will always be “the ASEAN Option” for ASEAN member states to use when they need. What transpired in the informal meeting was a vindication of the view that that ASEAN can work if its member states want it to work.

Third, the prospects for ASEAN to become a security community as envisaged in the Bali Concord II might not be as remote as it was before. One difficult obstacle to the realization of such aspirations has now been removed — namely, the view that ASEAN’s involvement in bilateral disputes among member states constitutes a breach of its non-interference principle.

When conflicts and differences can be resolved through peaceful means and with the help of ASEAN or other member states, we can expect a degree of certainty and predictability in interstate relations — an important prerequisite for a security community.

Fourth, for Indonesia itself, the outcome of Tuesday’s meeting serves as a source of confidence that its commitment to make ASEAN more credible and stronger is in fact equally shared by fellow members. However, it should be noted that not all ASEAN foreign ministers were present at the Jakarta informal meeting.

While Indonesia and particularly Foreign Minister Marty Natalegawa contributed in no small measure to the meeting’s positive outcome,

Indonesia could not have done much without support from other ASEAN countries, especially Cambodia and Thailand.

Yet, as Marty has stated, the outcome of the Jakarta meeting is just the beginning of a long process. While Indonesia is preparing its border monitoring mission, a number of more challenging tasks await.

First, Indonesia needs to do its best to fulfill its mandate not only as a party that will ensure that the cease-fire is observed but as a party that will mediate in the subsequent border talks between Cambodia and Thailand. Indonesia needs to put together a good team as quickly as possible to undertake this historic mission.

Second, for Cambodia and Thailand, finding a permanent solution to the border dispute will take more time and require patient negotiation from both sides. A conducive environment for talks, however, is already in place and that certainly provides a favorable context for negotiations.

Third, despite the positive outcomes of Tuesday’s meeting, ASEAN still needs to improve and institutionalize its conflict management mechanism. By doing so, “the ASEAN option” for conflict resolution will in the future automatically prevail, regardless who is the chair of ASEAN.

Fourth, as the case of the Cambodia-Thailand dispute has demonstrated, there is an urgent need for ASEAN to devote more attention and resources to strengthen its mediation capacity and intensify cooperation in peace monitoring activities.

The outcome of Tuesday’s meeting has given us new confidence that Indonesia and ASEAN are indeed well-placed to answer those challenges. ASEAN should not neither miss nor waste this opportunity. Where there is a will there is a way.

The writer is the executive director of the Centre for Strategic and International Studies, Jakarta.

Asean's expanding role in conflict settlement : Asean's often-claimed political utopia that its members had never fought an open war was shattered to smithereens during the three-day (4 to 6 February 2011) fighting along the Thai-Cambodian border.

Cambodian Prime Minister Hun Sen even went as far as to declare it a real war, which has unwittingly placed the Asean leaders and their organisation under the world's microscope.

Hun Sen has opened a Pandora's box for Asean. Now, all together, they have to find ways to smooth out these troubled relations. Otherwise, the grouping's creditability in the global arena will be severely undermined.

The attention this week will be focused on briefings at the UN headquarters in New York by the foreign ministers of the warring parties, Kasit Piromya and Hor Nam Hong, and their results. Indonesian Foreign Minister Marty Natalegawa, the current Asean rotating chairman, will be there as well to provide Asean views and to ensure after the meeting there would emerge a consensus or two, which the Asean chair can later utilise to facilitate further the peace process to end hostilities.

Obviously, it is rare for Asean warring parties to appear so readily at the UNSC. The last time Asean involved at the UN was on the burning issue of East Timor in 1999. Burma, although an Asean member, has been an "international issue" of longer standing. Since 2008, Cambodia has always wanted to raise the border fighting with the UN platform, but they were not successful. However, this time, with intense fighting and heavy artillery exchanges, quite a few UNSC members expressed concerns over renewed hostilities and decided to call for a meeting.

The current composition of the UNSC, comprising new emerging powers, allows a new dynamism that permits the Thai-Cambodian clashes to be discussed. However, the outcome of UNSC briefings and deliberations — possibly through a presidential statement-- are non-binding.

Marty knows the trend. His call for a "brief, urgent and informal" meeting with his Asean counterparts on 22 February in Jakarta is indeed an anticipation of a mandate for the UNSC for Asean, under his leadership, to take up the same "regional" responsibility.

It is an open secret that during his "shuttle diplomacy" he had been in close touch with both members of the UNSC and UN Secretary-General Ban Ki-moon.

In a nutshell, the informal gathering will follow up on the UNSC meeting and what Asean can do next to mitigate further conflict and salvage the grouping's reputation.

A more systematic approach to conflict resolution and dispute settlements as outlined in the Asean Charter, as well as those contained in the Asean Political and Security Community blueprint, will be discussed and put into practice.

Indeed, Marty is well in position to take up this formidable challenge. He knows the UN system like the back of his hands, having served there before taking up the current ministerial position. He is a respectable and world-class diplomat with friends aplenty at the UN top echelon, especially the current president UNSC ambassador Maria Luiza Ribeiro Viotti from Brazil. With abundant UN experience, connections and diplomatic skills, Marty can speak on behalf of Asean, and the UNSC will listen. He will certainly win support from all the council members to bring the matter back to existing regional mechanisms.

Despite their confrontation, Thailand and Cambodia have agreed to use the MOU 2000 and Joint Border Committee as a basis of their negotiations. Now with the ball in Asean's court, its members need to find common solutions that augur well with the Asean norms and practices.

Asean Secretary-General Dr Surin Pitsuwan understood the situation well when he released a statement early last week that the discussion at the UN represents an evolution in the Asean efforts to resolve bilateral disputes among members under the Asean Charter. He reiterated that the meeting would set a precedent for future Asean dispute settlement mechanisms.

As such, it is the most ironic development in Asean history to have Cambodia as the catalyst. Both Prime Minister Hun Sen and Foreign Minister Hor Namhong have been engaging with the UN authorities at all levels — both as friends and foes — for more than three decades. Throughout the 1980s, Asean fought hard with them to push out foreign troops to attain peace in the war-torn country. Asean dispatched its tripartite team to Phnom Penh in 1998 to help work out a political stand-off before its admission into Asean a year later.

Indeed, modern Cambodia is the product of longstanding UN peace efforts and dividends — the most cited UN success -- during the 1990s followed the signing of the Paris Peace Agreement in 1991.

UN-sponsored elections in 1993 saw the unstoppable rise of Hun Sen and his Cambodian People's Party as well as other opposition leaders. As of today, however, these opposition leaders are all living in exile, including Sam Rainsey. The only credible voices to monitor the government and its ruling party these days are the burgeoning civil society organisations, which are currently under threat by a new NGO law.

What will be the perceived future role of Asean in peace and conflict issues?

As chair, Indonesia is in a delicate situation. If previous efforts to mediate and end conflict within Asean were any guide, Asean members would remain extremely cautious. Jakarta did not succeed when it tried to mediate the Burmese crisis in 2008 even at the leaders' level. Bangkok encountered a similar problem when its proposal on the amnesty of Dawn Aung San Suu Kyi was backed by only half the members during its chair in 2009.

In recent international security issues, the UNSC often makes use of its Article 52 of the UN Charter to share burdens and delegate responsibility to existing "regional arrangements" -- for instance, the African Union in Sudan, NATO in Kosovo and Afghanistan, the Organisation of American States (OAS) in Haiti.

Ironically, a long standing common aversion for anything UN and anything collective within Asean has to be revised by the requirement of the Asean Charter, which cross-references itself to the UN Charter. In particular, Articles 22, 23 and 28 of the Asean Charter must be read in light of, or in conjunction with Articles 52 and 53 of the UN Charter, in which the 1945 founding document clearly calls for the world body to work in collaborating "existing regional arrangements" in the maintenance of peace and security.

In the final analysis, Asean has been brought to this "reality show" by its mercurial member, who would force Asean to measure up to what Marty calls "the expectation of the international community."

One big question is in order: Is Asean ready to become a pro-active, forward-looking organisation which could expose individual members to outside scrutiny and eventually erode the principle of non-interference and consensus making?

ASEAN to send monitors to Thai-Cambodia border : JAKARTA, Indonesia — Military observers will be sent to the Thai-Cambodian border to enforce an unofficial cease-fire in place since deadly clashes erupted near a disputed 11th century temple, Southeast Asian foreign ministers said Tuesday after emergency talks.

Each country has accused the other of starting the conflict in which at least eight people have been killed and thousands displaced, and both until now have disagreed on how it should be settled.

But Indonesian Foreign Minister Marty Natalegawa said after a meeting with the 10-member Association of Southeast Asian Nations that both Cambodia and Thailand had agreed to a proposal to send up to 40 military and civilian observers to the remote, mountainous area.

The unarmed observers - all from Indonesia - will "observe the commitment by both sides to avoid further armed clashes" and provide accurate and impartial reports about complaints of violations, he told reporters after the 90-minute meeting in Indonesia's capital, Jakarta.

The conflict this month involving exchanges of small arms, mortars and artillery fire is rooted in a decades-old border dispute near the Preah Vihear temple that has fueled nationalist passions on both sides.

The monument was built between the 9th and 11th centuries and sits atop a 1,722-foot (525-meter) cliff. While the temple was awarded to Cambodia by the World Court in 1962, sovereignty over adjacent areas has never been clearly resolved.

Skirmishes have erupted several times since 2008, when Preah Vihear was awarded U.N. World Heritage status, but soldiers and locals say none has been as violent as the latest clash.

The U.N. Security Council expressed "grave concern" Monday and gave strong backing to the efforts of ASEAN - which usually refrains from interfering in the internal affairs of member states - to help end the dispute.

Natalegawa indicated the regional grouping was ready to play its part.

"We are meant to resolve our problems through negotiations," he told reporters. "We are waging peace. That's what we are doing, not waging war .... so that no more guns and artilleries make a sound in our region."

"I would like to make it absolutely clear that ... the option of conflict, the option of use of force, is not meant to be on the table," he said.

While no formal cease-fire has been signed, the border has been quiet in recent days.

Earlier Tuesday, Cambodian Prime Minister Hun Sen told university graduates in Phnom Penh that he was ready to back off earlier calls for an official cease-fire, which would require a perhaps lengthy approval by the Thai parliament, if Bangkok agreed to the deployment of observers.

"Signing a cease-fire is not necessary, but the arrival of observers ... is what's most important," he said, adding monitors would be welcome to all areas inside the Cambodian border, from the front lines to military camps and ammunition warehouses.

"They can inspect wherever and whenever they want."

While Hun Sen's has sought to shift the debate to an international stage, his Thai counterpart, Abhisit Vejjajiva, has pressed hard for a bilateral solution.

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Associated Press reporter Sopheng Cheang contributed to this report from Phnom Penh.

Asean chair backs bilateral solution : The Thai-Cambodian border dispute must be resolved bilaterally, Indonesian Foreign Minister and current Asean chairman Marty Natalegawa said after meeting Foreign Minister Kasit Piromya on Tuesday.

Mr Natalegawa, who met Cambodian foreign minister Hor Namhong on Monday, said Thailand and Cambodia should settle their border dispute through two-party negotiations.

"But at the same time, there is always space for Asean and members of Asean to support the bilateral effort.

"Any engagement by Asean and by any individual country is not to replace the bilateral approach, but contrarily to support the bilateral approach," said the Indonesian Foreign Minister.

He said he got a clear message from Phnom Penh and Bangkok that both countries had a commitment to address this border conflict through peaceful means and dialogue.

"We are the family of Asean nations and there are ways and means for us to resolve whatever problems we have through negotiation and dialogue," Mr Natalegawa said.

He said both countries also said the situation had stabilised, but he would like to see the ceasefire be made more stable and consistent.

"Indonesia will be very happy if we are included in any conversation or any communication that the two governments may have on ways and means to ensure the continuity of ceasefire," he said.

Vietnam, another Asean member, has also called on Phnom Penh and Bangkok to end their border conflict around Preah Vihear temple through peaceful negotiations based on international law and the United Nations charter.

Foreign Ministry spokesman Thani Thongphakdee said Thailand and Cambodia will hold a round of talks on the border issue later this month.

Cambodia's ambassador to Thailand You Ay took a similar tone, saying the border issue should be settled peacefully at the bilateral level.

Speaking at the Couple of Love and Rival seminar on Tuesday morning, she said people should not politicise the border issue. It should be addressed at the bilateral level within the framework of the Thailand-Cambodia Joint Boundary Commission (JBC).

The border row would jeopardise regional cooperation in Southeast Asia, such as the single-visa agreement under the Acmecs (Ayeyawady - Chao Phraya - Mekong Economic Cooperation Strategy) scheme, she said.

"Educators need to teach the true history of both countries to the young generation," she said.

The Cambodian envoy also urged the Thai public to be well aware of the neutral voices, which do not take sides and have good faith.

She said the Bayon temple, a World Heritage site in Siem Reap, has 54 towers each representing the 54 provinces of the ancient Khmer empire.

"Cambodia now has only 24 provinces, because 17 of the others are in Vietnam and 13 in Thailand.

"Thai and Cambodian people share the same DNA as a consequence," she said.

She said Cambodia had never thought about claiming its 13 former provinces in Thailand, as both countries must co-exist side by side.

The border issue stemmed from the different maps used by the two countries. Cambodia used La Carte de l’annexe I which was an integral part of the (border) treaty settlement and widely-accepted internationally, while Thailand used the map unilaterally produced during 1970-1975 during the time of the Kampuchea democratic government, she said.

In a time of peace, the Joint Border Committee was the suitable mechanism to deal with border dispute, but in the armed border conflicts like this, the multilateral mechanism such as the International Court of Justice should be the proper venue, said the Cambodian ambassador.

Cambodia's KI Media website reported that Cambodian foreign minister Hor Namhong told Mr Natalegawa that the Thai military began firing first in the four clashes on the border over the last few days.

The website reported that during the meeting with Mr Natalegawa in Phnom Penh yesterday Mr Namhong accused Thailand of instigating each of the four clashes, begining on Feb 4.

The Cambodian foreign minister said after the meeting that he told Mr Natalegawa that five Cambodian soldiers were killed and 45 others were injured, according to the website. People in disputed areas had been evacuated.

Since Feb 4 the border clashes have caused three deaths in Thailand, one civilian and two soldiers, and 25 injuries, with five Cambodians reported dead and 45 injured.

A Thai soldier who was seriously wounded during the Cambodian artillery shelling of Thailand on Sunday night was reported to have died at Sapphasithiprasong Hospital in Ubon Ratchathani province today.

Sgt Thanakorn Poonperm, 30, of Task Force 23, was admitted to the hospital after being wounded on Sunday night, when Cambodia fired artillery shells across a 5-kilometre stretch of the border between Non Ao and Phum Srol villages in Kantharalak district of Si Sa Ket province.

He was pronounced dead on Tuesday.

Army spokesman Sansern Kaewkamnerd said Pvt Songkran Thongchompoo, a Thai soldier who was captured by Cambodian troops during the fighting over the weekend was released on Tuesday morning.

Col Sansern said Pvt Songkran was handed over to the Thai military attache to Phnom Penh and the soldier was returning to Thailand.

There were no clashes between Thai and Cambodian forces overnight, the spokesman said.

Si Sa Ket governor Somsak Suwansucharit said about 16,000 people had been evacuated from their homes in villages along the Thai-Cambodian border. They were staying  at 40 holding centres.

The villagers would not be allowed to return to their homes until it is certain the situation has returned to normal, he said.

The governor said seven houses in border villages had completely burned down after being hit by shells during in the cross-border fire. The government will help build new houses for the families, Mr Somsak said.