Neo-liberalism and the Working People of Southeast Asia Author(s): Rene E. Ofreneo Source: Asian Journal of Social Science, Vol. 36, No. 2, SPECIAL FOCUS: Transnationalizing Souteast Asia (2008), pp. 170-186 Published by: Brill Stable URL: http://www.jstor.org/stable/23677929 Accessed: 03-05-2018 02:10 UTC JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact
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Asian Journal
of Social Science
BRILL Asian Journal of Social Science 36 (2008) 170—186 www.brill.nl/ajss
Neo-liberalism and the Working People of Southeast Asia
Rene E. Ofreneo School of Labor and Industrial Relations, University of Philippines
Abstract
The ASEAN Economic Community is marked by a range of specific programmes to make eco nomic regionalism a successful reality. Yet, the economic liberalisation programme is a narrow one, without any clear economic development direction outside of its confines. Economic inte gration is also being driven by select corporate interests. States are not paying sufficient attention
to ASEAN's working populations. For ordinary persons to benefit from economic liberalisation and integration, ASEAN states would need to put them at the centre of their development pro grammes.
Keywords ASEAN, economic integration, transnational corporations, genetically-modified organisms
Introduction
In its Ninth Summit in Bali in October 2003, the heads of the ten member countries of the Association of Southeast Asian Nations (ASEAN) — the orig
inal ASEAN 6 (Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand) and the new ASEAN 4 (Cambodia, Laos, Myanmar and Vietnam) —
adopted a historic declaration called Concord II. In it, the ASEAN Heads of States declared that as in the case of the European Community, the ASEAN territory shall be one contiguous ASEAN Community by the year 2020. This borderless ASEAN Community shall be composed of three communities: the
ASEAN Security Community, the ASEAN Socio-Cultural Community and the ASEAN Economic Community (AEC). In this paper, I first outline the formal-legal aspects of the AEC. I then examine the realities of such a liberali
sation programme: What have the effects been on regional trade, the agricul tural sectors of the various economies and the livelihoods of workers and peasants?
Since the Summit, the vision of a robust and rapidly integrating regional
ASEAN economy has attracted a lot of media mileage, both within and © Koninklijke Brill NV, Leiden, 2008 DOI: 10.1163/156853108X298734
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R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170-186 171
outside the individual ASEAN countries. Home to over 500 million people, ASEAN is seen as the core of an even bigger East Asia Economic Community (EAEC). The EAEC unites the ASEAN bloc of ten countries with the 'dragon' economies of Japan, China (including Hong Kong), South Korea and Taiwan. Some statistics on the potential of a bigger East Asia grouping have naturally
captured the imagination of economic and political commentators. These sta tistics revolve around a two billion people-strong East Asian consumer mar ket, a collective GDP bigger than that of the United States or EU, and the world's largest manufacturing base.
Public attention on the AEC project and the "work-in-progress" EAEC has been further supported by the following developments: 1. The decision of ASEAN to further deepen the programme for the ASEAN
Free Trade Agreement (AFTA) with the launching of the 11 Priority Integration Projects (PIPs); 2. The holding in 2005 of an East Asia Summit involving the ASEAN Plus 3 (Japan, Korea and China) right after the annual summit of the ASEAN Heads of States;
3. The approval in 2002 of a Framework Agreement for an ASEAN-China Free Trade Agreement (ACFTA), which provides for certain modalities by which the individual ASEAN countries can conclude an early harvest
agreement' with China by the mid-2000s and a full-blown free-trade agreement by 2010; and
4. The announcement in 2002 that Japan will pursue its own bilateral, or Economic Partnership Agreement (EPA), talks with the ASEAN countries.
With the ASEAN Plus 3 trade talks picking up, others have decided to pursue
their own separate trade negotiations with the ASEAN member countries, both at the bilateral and regional levels. These include Australia, India, New
Zealand, the United States and the European Union. Hence, regardless of what has been said earlier on "integration", such separate negotiations would work against the interest of a collective ASEAN.
And yet, amid all the talk of regional economic integration, the working people of ASEAN — workers, farmers and other ordinary citizens — appear uninformed and, not surprisingly, indifferent to the various ASEAN economic
programmes, which are understood mainly by the economic technocrats of the various ASEAN governments. The ASEAN Trade Union Council (ATUC), in existence since the 1980s, has not been invited for any formal discussion and consultation on any of the above trade programmes. ASEAN deliberations on AFTA, PIPs, ACFTA, EPAs with Japan, and other economic projects are
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172 R. E. Ofreneo/Asian Journal of Social Science 36 (2008) 170—186
generally limited to government officials and members of the ASEAN Busi ness Advisory Council (ABAC). Overall, therefore, there are no serious attempts on the part of the ASEAN governments to inform the working population about the implications of these economic programmes on their lives. This paper seeks to outline and put forward the following observations:
1. ASEAN has no clear economic development programme outside of the existing narrow liberalisation programme;
2. The economic integration taking place is proceeding in an equally nar row manner, largely within the confines of a few corporate interests; 3. The traumatic lessons from the 1997—1998 Asian financial crisis have not
yet been fully dissected and incorporated into the policy-making pro cesses of ASEAN; and 4. If the working populations are to benefit from the regional economic integration programme, the ASEAN leadership should re-think devel opment by seeking to understand the interests of the working people and putting them at the centre of any integration programme.
Integrating ASEAN: The Main Players So what kinds of actors are most involved in ASEAN's economic integration, given ASEAN's embrace of economic liberalisation policies as a mode of inte gration? It appears that they are the entities with regional and global reach,
i.e., they happen to be the transnational corporations (TNCs) which have either regional operations in Southeast Asia or in the individual ASEAN countries. For example, automotive TNCs set up assembly plants and parts manufacturing in the individual ASEAN countries to overcome high tariff, and non-tariff, barriers and capture the domestic markets for their products.
With tariffs and trade restrictions reducing, these TNCs are now able to re-align and optimise their regional operations by changing their regional divi
sion of labour. Moves have included developing automotive hubs in areas with large emerging markets, such as in Thailand, promoting specialised parts pro
duction in others, such as in the Philippines, which has become a major pro ducer of wire harnesses, and so on. The point is that trade liberalisation across
the region has made it possible for TNCs to move products and processes more freely and to locate certain aspects of their work in certain countries based on profit maximisation and market optimisation.
The above observation is validated by the fact that the main participants
in the original ASEAN industrial complementation programme are TNCs. ASEAN industrial complementation projects are those based in two or more
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R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170-186 173
ASEAN countries complementing one another. In the past, several names had
been given to such initiatives. The latest is AICO (the ASEAN Industrial Cooperation Scheme), supposedly geared to promote a more competitive ASEAN industry. An AICO project enjoys preferential tariff rates of 0-5 per cent on all intermediate and raw material inputs.
- However, the AICO list shows mainly the following big TNCs as AICO producers: Auto and motorcyles — Toyota, Volvo, Nissan, Isuzu, Honda,
Ford, Harada, Daihatsu
- Electronics — Matsushita, Mistubishi, Samsung, Showa, Sony, Yamaha
- Others — Asahi, Bowden, Denso, Mistuba, Sanden, Yanmar - Food — Nestle
The only identifiable ASEAN' company in the AICO list is Thai Steel Cable, although it is not clear if it is genuinely controlled by Thai nationals.
The AFTA-CEPT Project: A Narrow Liberalisation Programme To achieve economic integration, ASEAN has adopted economic liberalisa tion, mainly through a tariff-busting programme called AFTA (ASEAN Free
Trade Area). Under the AFTA, a Common Economic Preferential Tariff Scheme (CEPT) was supposed to reduce tariffs on products traded within the
ASEAN region to 0-5 percent by the year 2008. The AFTA-CEPT was launched in 1992 with an original 15-year timeframe.
The AFTA-CEPT is implemented through a schedule involving four prod uct lists:
1. The Inclusion List (IL): Products in the IL are those that have to undergo immediate liberalisation through reduction in intra-ASEAN tariff rates and the removal of quantitative restrictions and other non-tariff barri
ers. Tariffs on these products should have been reduced to a maximum of 20 percent by the year 1998, and to less than 5 percent by the year
2002 (by 2006 or later for new members of ASEAN — Vietnam, Kampuchea, Laos and Myanmar); 2. The Temporary Exclusion List (TEL): Products in TEL are shielded from trade liberalisation for a temporary period, after which, all of these
products would have to be transferred to the IL and subject to the usual process of tariff reduction;
3. The Sensitive List (SL): This list contains unprocessed agricultural products, such as rice and sugar, which are given a longer period for
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174 R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170—186
integration into the Free Trade Area. For the SL category, the commit ment to reduce tariffs to 0-5 percent and to remove non-tariff barriers is extended up to the year 2010 for the ASEAN 6 (Brunei, Indonesia,
Malaysia, the Philippines, Singapore and Thailand), up to 2013 for Vietnam, 2015 for Lao PDR and Myanmar, and 2017 for Cambodia; and
4. The General Exception List (GEL): The products in this list are perma nently excluded from the Free Trade Area for reasons of national security,
the need to protect articles of cultural value, and other reasons. In their 2001 Hanoi meeting, ASEAN leaders became ambitious and decided to fast-track, to 2003, the application of the zero tariff for 60 percent of the
ASEAN products of the ASEAN 6. Table 1 shows the number of tariff bind ings committed to by the ASEAN 6 and ASEAN 4 under the four product lists. Table 2, on the other hand, shows the implementation of tariff reduc tions for the ASEAN 6 as of 2001 under the IL list.
Based on the 2001 CEPT Package, all the ASEAN 6 signatories to the CEPT Agreement were able to meet the target of reducing tariffs to 0-5 per
cent for 90 percent of their IL list (see Table 2). In addition, the ASEAN 4 members are not too far behind in the liberalisation process. As shown in Figure 1, the average tariffs have gone down to 2.68 percent, as of January 2003. According to the ASEAN Secretariat, as of January 2004, the ASEAN 6 signatories were also able to reduce to zero tariff 60 percent of the products covered by the IL list. From the various reports of the ASEAN Secretariat in Jakarta, it appears that no ASEAN member has any major problem in comply ing with the AFTA-CEPT programme.
Table 1 : Summary of ASEAN tariff bindings Country
60% of IL
IL
TEL
GE
SL
with
Total tan
lines
0% tariff Brunei
Indonesia
Malaysia Philippines Singapore
Thailand
ASEAN 6 Total
Percentage Cambodia
3,765.6 4,315.2 6,015 3,372.6 3,515.4 5,462.4 26,446.2
6,276
0
202
14
7,192
21
68
4
218
6
53 16
50
0
0
0
0
0
7
339
158
10,025 5,621 5,859 9,104 44,077
245
83
6,492 7,285 10,379 5,693 5,859 9,111 44,819
98.3
0.6
0.8
0.4
100
3,115
3,523
134
50
6,822
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R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170—186 175
Table 1: (cont.) 60% of IL
Country
IL
TEL
GE
SL
Total tariff
with
lines
0% tariff
1,673 2,984 4,984 12,756
Laos
Myanmar Vietnam
New member total
57.5
Percentage
ASEAN 10 Total
56,833 84.8
Percentage
1,716 2,419
74 48
1,177 8,835
139
51
395
210
3,551 5,472 6,351 22,196
88 21
1
39.8
1.8
9,080 13.6
734
368
1.1
0.6
100
67,015 100
Notes: IL — Inclusion List; TEL — Temporary Exclusion List; GE — General Excep tion List; SL — Sensitive List Source: ASEAN Secretariat
Table 2: Number of tariff lines with tariffs of 0-5% of the
Six Original Signatories (As of2001) Country Brunei
Number ofTariff Lines in 2001 IL (Percentage) 0-5% >5% Other Total 0-5% >5% Other Total 6,107
157
12
6,276
6,483 9,117
709
0
922
0
5,017 5,859
558
1
0
0
8,193
911
0
7,192 10,039 5,576 5,859 9,104
40,776 3,257
13
0.2
100.00
9.9
0
100.00
9.2
0
100.00
10.0
0.0
100.00
97.3
2.5
90.1 90.8
Darussalam
Indonesia
Malaysia Philippines Singapore Thailand
Total
44,046
90.0 100.0
0
0
100.00
90.0
10.0
0
100.00
92.58
7.39
0.03
100.00
Source: ASEAN Secretariat
The ultimate target of ASEAN is that by 2010, the original ASEAN 6 would have eliminated all import duties, and that the ASEAN 4 would have done the same by 2015, with some flexibility for the sensitive products. To publicise the CEPT Scheme for the ASEAN Free Trade Area to the business community, a
series of workshops on the Scheme (CEPT Outreach Programme) are being held in key cities in ASEAN. This is being undertaken with the help of the ASEAN Centre in Japan, in cooperation with the ASEAN Secretariat and the National AFTA Units of the host countries. In the area of differing tariff nomenclatures, ASEAN tried to develop an ASEAN Ffarmonised Tariff Nomenclature, an 8-digit level tariff nomenclature
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176 RE. Ofreneo / Asian Journal of Social Science 36 (2008) 170-186
Figure 1: Declining ASEAN-CEPT tariffs Tariffs are falling under AFTA Average CEPT Tariff Rates (%) At the start of the ProSram in
1993, average tariff rates were
12.76%. The average CEPT tariff rate has been brought down steadily, and as of January 1,
2003, stands at 2.68%. Status of tariff reduction ASEAN - 6
> 98.4% products in the il
> 96.2% duties at 0-5%
ASEAN - 4
> 62% products in the il > 56% duties at 0-5%
ASEAN - 10
1998 1999 2000 2001 2002 2003 > 86% products in the il
> 86.6% at duties at 0-5%
Source: ASEAN Secretariat
based on the Harmonised System (HS) of the World Customs Organisation.
Five ASEAN member countries — Indonesia, Malaysia, the Philippines, Singapore and Thailand — have also implemented customs valuation meth ods in accordance with the World Trade Organization Customs Valuation Agreement. From the foregoing, it is abundantly clear that integration is sim
ply seen as one of opening up each other's economic borders. ASEAN records do not contain any major studies and recommendations on the complementa
tion of economies, on how countries lagging in development can catch up with the more advanced ones, and how the social dimension, for example, issues of inequity and joblessness, can be addressed. There were only some discussions on brand-to-brand complementation, human resources develop ment (for example, on mutual recognition or certification of skills), and shar ing of some agricultural technology. Hence, there is a need to examine the realities of such a programme of integration and the various stakeholders within this programme. The real agendas of those at the forefront of this inte
gration need to be understood in greater detail with a view to their political constituents and their own specific economic interests. More work should be done to identify the segments of society that have been pursuing or lobbying
for such liberalisation.
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RE. Ofreneo / Asian Journal of Social Science 36 (2008) 170-186 177
The Reality of Liberalisation: Integration Successes and Failures One success indicator of integration is the level of intra-trading that has
developed among the ASEAN member countries. In the European Union, more than half of trade is intra-EU and this shows the advantage of economic integration.
Table 3: ASEAN exports and intra-ASEAN exports, ASEAN in and intra-ASEAN imports (in million US$, 1996—2002)
Total exports Intra-ASEAN exports Total imports Intra-ASEAN imports
1996
2000
2001
323,361 80,974 350,606 64,211
410,694 74,903 345,827
370,548 95,268 317,226 73,635
57,771
2002
84,488 67,640
Source: ASEAN Statistical Pocketbook 2003
Table 3 shows that ASEAN countries have been trading with one another by as much as one-quarter of their total exports and imports. This is a significant
development, since the intra-trade of the ASEAN countries had been very limited until the 1980s. However, it should be noted that intra-ASEAN trade, both at the export and import sides, have not increased significantly in the second half of the 1990s up to 2002. This means that the impact of the AFTA
CEPT, which was implemented mainly in the late 1990s up to the present, is quite limited. The tremendous intra-ASEAN trade expansion in the 1990s can be explained not by AFTA, but by the unilateral trade liberalisation policy that most of the ASEAN countries adopted in the 1990s. In fact, the greatest expan
sion in trade by the individual ASEAN countries is with the People's Republic of China, despite the latter's relatively high tariff rates. Available data provided
by the ASEAN Secretariat show that this is indeed the case. While intra ASEAN exports and imports have been increasing, extra-ASEAN exports and imports are rising even faster.
Moreover, intra-ASEAN trade is not evenly distributed between and among member countries. This is amply illustrated by the Philippine experience. Half of the country's trade with ASEAN is with Singapore. A closer scrutiny of why
this is so shows that most of the Philippine exports to Singapore are assembled
electronic products. The ostensible reason for this is that the Philippines is engaged in lower-level electronics assembly work, while Singapore focuses on higher electronics assembly or application. On the import side, Singapore is a major trans-shipment centre for products distributed in the region.
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178 R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170-186
Table 4: Breakdown of RP-ASEAN Trade 1990-2003 (By Country) Year Total Intra- Indonesia Malaysia Thailand Brunei Singapore Vietnam ASEAN (%) (%) (%) (%) (%) (%) Trade
(billion USS) 1990
1.88
12.7
21.3
15.4
5.8
38.8
5.7
1991
1.77
11.5
23.8
17.8
5.4
38.7
3.1
1992
1.90
11.6
27.1
12.4
5.0
42.2
2.3
1993
2.67
14.6
19.3
12.7
2.0
50.7
1.8
1994
3.86
11.3
16.9
14.5
1.0
55.7
1.9
1995
4.85
14.5
18.3
24.6
0.2
52.5
3.3
1996
6.97
11.4
21.4
20.0
1997
8.3
10.9
19.2
19.8
-
-
1998
8.23
8.6
25.1
17.4
-
1999
9.45
8.8
26.0
17.6
-
2000
10.98
8.1
23.0
18.8
-
-
2001
9.64
9.3
21.2
23.4
2002
11.26
8.6
26.1
19.0
-
2003
12.81
8.7
28.8
20.2
-
4.6
42.5
4.3 45.7 43.4 5.4
44.5
2.9 2.2 47.7
42.5 42.7
3.4 3.4 38.8 3.5
Notes: Computation of values into percentages was undertaken by the authors research team.
Some ASEAN economies, such as those of Indonesia, the Philippines, Thai land, Malaysia and Vietnam, have similar agri-industrial structures, meaning they produce similar industrial products, such as shoes, rubber, garments, rice, corn, sugar and so on. As a result, there is limited intra-trading among them
except for some vital products (e.g., rice). Very often, these countries even compete with one another, for example, in obtaining investments for export oriented garments.
Integration in Agriculture? With agriculture, the trajectory of the integration process taking place is some
what confusing. One reason is that most of the ASEAN countries do not necessarily complement one another in terms of food and agricultural produc
tion. For example, with the exception of Singapore and Brunei, most coun tries produce their own agricultural requirements, with some like Thailand, Vietnam and Malaysia able to produce enough surpluses for exports. Another source of confusion is the lack of unified trade and tariff regimes in agriculture, exacerbated in recent years by the tendency of some countries
to forge bilateral free trade agreements (BFTAs) with non-ASEAN countries.
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R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170—186 179
For example, Singapore has BFTAs with Australia, the US, Japan, Chile and other countries. Thus, oddly, Singapore is able to market canned juices and other agro-based products in ASEAN even if it is not an agricultural producer. Singapore's behaviour is highly opportunistic. It is a source of trade diversion in the region and demonstrates why ASEAN looks like a "Confused ASEAN", while the EU is known as "Fortress Europe". On paper, ASEAN has launched numerous agricultural initiatives. In 1993, ASILAN adopted the following as its priorities on the agricultural front: food
security, intra-/extra-ASEAN trade, technology transfer and productivity, human resources development, private sector participation, conservation of
natural resources, and ASEAN cooperation on varied agriculture-related issues. However, despite the numerous meetings and declarations on the above themes, not much has happened in regional agricultural integration. This is so because there is hardly any budget and concrete organisational structures to back up the ASEAN intents in these priority areas.
So what kinds of actors are involved in agricultural integration? A closer scrutiny of developments in the region will reveal the following actors in the agricultural integration process:
1. Home-grown ASEAN agri-based TNCs: The big agribusiness corporations,
such as CP of Thailand, San Miguel of the Philippines, the palm oil interests in Malaysia and the big food processors in Singapore, are active
in the region, putting up not only trading posts but also production
plants in the various ASEAN member states. For example, the San Miguel Corporation of the Philippines has several brewery projects and agribusiness undertakings in Thailand, Vietnam and Malaysia.
In May this year, ASEAN came up with a short list of 11 PIPs, or Priority Integration Projects, one of which is agri-based. In this agri
based project, the development of a white shrimp project in Luzon has been identified. This will be developed by a well-known Thai TNC, CP Thailand, together with its sister company in Indonesia, CP Indonesia.
2. Traders-investors from South Korea, Japan and China: These giant economies in Asia are now major agriculture-deficit countries. All these
countries are competing with one another — via the proposed ASEAN
China, ASEAN-Japan and ASEAN-South Korea agreements —- to essentially transform ASEAN, with its rich land and water resources into their backyard, i.e., as a source of food and raw materials. This is the deeper meaning of China's initiative, the 'Early Harvest Program', which is focused on agricultural products. China, itself, is not coy about
its intent, as demonstrated by the cooperation programmes it forged
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180 R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170—186
recently with the Philippines. It wants to help develop the Philippine
coconut industry, as China needs all the coconut fibre and other coconut materials it can get for its varied industrial and raw material requirements. It also wants fruit, such as bananas and mangoes from the Philippines, which it is unable to produce in commercially viable quantities within its own borders. 3. Agribusiness firms from US, Canada, Australia and the EU: The agribusi ness TNCs from these countries consider ASEAN, with half a billion
people and a large land-sea territory, a huge market with enormous economic potential. Aside from looking at ASEAN as a market destina tion for their surplus goods, such as corn and soya beans, these western
agribusiness TNCs also view ASEAN as a potential market for farm inputs, seeds and agricultural machinery.
From the Green Revolution to the Gene Revolution
The biggest agricultural integration project taking place in the region, how ever, is not through formal trading and investment arrangements, but through
technology, specifically biotechnology. Quietly and without much fanfare, the
big agri-based biotech companies such as Cargill, Monsanto and Dupont are transforming the ASEAN countryside, with some help from the Asian Devel opment Bank (ADB) and the converted' agricultural ministries of the different ASEAN governments, into a giant biotech lake.
The agribusiness TNCs have been selling the ASEAN governments the idea that the perennial problems of food and hunger in Asia can only be solved through trade liberalisation and food production intensification. Since the Green Revolution of the 1960s and 1970s is an exhausted project, they are promoting the Gene Revolution as the logical sequel to it. The agribusiness TNCs are working at several levels. First, at the policy level, they are mobilis ing the support of the region's leading rural creditor, the ADB, and convincing
the ASEAN governments of the importance of free trade and food production
intensification through biotechnology. Second, they are engaging in back channelling and talks with ASEAN and member states. Third, they are provid
ing training, demonstration farms and technical assistance on biotechnology
in each of the targeted countries. And since GMO (genetically-modified organisms) technology, a kind of biotechnology, is a controversial issue in many parts of the world and in some parts in Asia, the agribusiness TNCs market biotechnology as quietly and unobtrusively as possible, taking care that the word 'biotechnology' (which also covers other forms of hybrid agri culture) is mentioned rather than the controversial term, GMO.
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R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170—186 181
According to the ADB, "the green revolution has already run its course in
Asia" (Rosegrant and Hazell, 2000). Hence, in their reasoning, there is the need for a new food production intensification programme. This the ADB found in biotechnology. Biotechnology, or agricultural genetic engineering, which includes GMO technology, is expected to achieve what the Green Rev olution accomplished in the 1970s — miracle harvests of grains which tamed the so-called threat of mass hunger in Asia and the world.
In reality, the ADB has developed a comprehensive view of how to promote rural development in Southeast Asia and the rest of Asia. In Transforming the Rural Asian Economy: The Unfinished Revolution, a work commissioned by the
ADB and subjected to several policy workshops by the Bank in 1998-1999, Rosegrant and Hazell (2000) summed up the policy instruments which should guide the ADB's rural lending in the new millennium. The first three are:
— Enhancing rural markets through investments in infrastructure, prop erty rights, crop-specific research, economic liberalisation (to promote
comparative advantage), etc.; — Reversing environmental degradation; and — Improving governance. However, the last two policy guideposts are the most meaningful:
— Managing a new revolution in agricultural technology; and
— Managing globalisation. On the first, Rosegrant and Hazell (2000) wrote of the need to strengthen the new role of IRRI (the International Rice Research Institute) "to serve as an important intermediary between multinational companies, developed-country research centres, and the needs and capacities of national agricultural research
systems in Asia". Thus, the agribusiness TNCs, which monopolise the world's research and development on biotechnology, shall play the pivotal role of pro viding research outputs to the so-called research centres of both developed and
developing countries, not the other way. And the role of the IRRI is nothing but that of an intermediary.
For the biotechnology programme to succeed, Rosegrant and Hazell (2000) are suggesting that governments should enhance 'local capacity' to absorb the technology and form "effective partnerships with relevant multinational com
panies and biotechnology research centres in developed countries". As for 'managing globalisation', the authors suggest: "Full and effective economic liberalisation and linkage with the global economy", which entail "continued reform of fiscal and financial policies and institutions, property and contract laws that foster modern commerce, flexible and efficient factor and product
markets, and continued development of technology and human capital".
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182 R. E. Ofreneo/Asian Journal of Social Science 36 (2008) 170—186 In short, what the ADB seeks to promote is the intensification of food pro
duction via biotechnology in a liberalised and globalised economy. The link age between biotechnology and agricultural trade liberalisation is a theme that
is taken up by other spokespersons of neo-liberalism in agriculture, who too talk of both as the means of securing food security for developing nations.
C. Ford Runge and Benjamin Senauer of the International Food Research Institute (IFRI), writing in the influential Washington-based Foreign Affairs journal (May-June 2000), summed up the meaning of food security and its relationship with trade liberalisation and biotechnology as follows: First, it involves improving a developing nation's access to cheaper food from com paratively advantaged exporting countries. It is generally more efficient and cheaper than self-sufficiency, in which a nation tries to produce all crops that its population needs, regardless of the cost of the country's natural endowments. Food security also requires that richer countries lower their tariffs on all goods from developing countries so that emerging markets can earn cash to import the food they need. Finally, the drive
for food security should tap the potential of the GM technology for developing coun tries to both enhance nutrition and boost agricultural output.
In short, food security is defined as having access to the market, and such access is made possible by a free-trade arrangement and earnings by a develop
ing country from GM-based production.
The leading TNCs supporting GMO and biotechnology propagation in Asia are Cargill and Monsanto. They are very active in the ASFAN policy cor
ridors, through the ASEAN-US Business Council, which organises regular policy meetings and consultations. The most active committee in the ASEAN
US Business Council is the Food and Agricultural Committee. Meetings of this committee are generally well attended and involve senior agricultural ministers and officials of the different ASEAN governments. The committee is
headed by no less than Cargill, which openly discusses the proposal for the adoption of GMO and biotechnology, as well as free markets so that they can do business in the region freely. Among the priority policy issues identified by
the Council and the Food and Agricultural Committee are the following:
- Recognition of the food sector in bilateral and multilateral trade agreements;
- Fair, scientific, and regionally consistent treatment of biotechnology; - Commitments by ASEAN governments to reduce tariffs/non-tariff bar riers to food products; and
- Advancing the APEC Open Food System. Robert McRae of Cargill, in the ASEAN Finance Ministers Meeting in Manila on August 6 2003, stressed that "Providing MNCs opportunities effectively is
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R. E. Ojreneo / Asian Journal of Social Science 36 (2008) 170—186 183
providing your citizens opportunities", suggesting that the interests of multi
national companies (MNCs) and ASEAN citizens are one and the same. Car gill and Monsanto, in the 17th ASEAN-US Dialogue, held in Bangkok in January 2007, argued that ASEAN is a significant importer of food, while the
US is a major producer of agricultural products. They said ASEAN should establish an "open food system" to benefit from trade.
In the promotion of GMO-based agriculture, ASEAN has adopted several protocols and conducted workshops and experiments with the help of the governments and agribusiness firms from the US, Canada and Australia. Since
2001, ASEAN has been the 'beneficiary' of annual GMO and biotechnology workshops conducted by the US-based International Life Sciences Institute
(ILSI), Health Canada, Santé Canada, and the Australia / New Zealand Food Authority. These workshops have focused on how to apply the ASEAN Guide
lines on Risk Assessment of Agriculture-related GMOs, which have been developed with technical assistance from these countries and the agribusiness
TNCs. In these workshops, GMO rice, GMO corn, GMO soy bean and GMO papaya were introduced and discussed. The workshops are held annu ally in various ASEAN capital cities.
There are no records of any ASEAN government opposing GMO and biotechnology. What is recorded are comments on how to overcome civil society opposition to the propagation of GMO and biotechnology in each ASEAN country. Technical assistance is also provided to the individual ASEAN countries.
Thailand is trying to develop its capacity in GMO technology with the establishment of Biotec. In turn, Biotec has been receiving technical assistance
from USAID, Cornell, Monsanto, Cargill, Pioneer, Novartis, etc., especially in experiments involving papaya, peppers, pineapple, cassava, cotton, orchids and rice. Thailand's former Prime Minister, Thaksin Shinawatra and former Agriculture Minister Somsak Thepsuthin had also given hints about Thailand's
plan to become a regional biotechnology hub, with the possible growth of 100 Thai biotech companies. In August 2004, Thaksin was reported to have
said of the country's ban on commercial production and trade of GMOs that "the government won't let the country miss the biotechnology train". Already in July 2004, controversy erupted with the leakage of GM papayas into non-GM fields.
Other ASEAN countries are also planning to undertake GMO and bio technology research. For example, Malaysia has linked up with the University
of Clemson in South Carolina, a premier biotech research institution in the United States. A 40-person Malaysian delegation to the BI02004 conference in June 2004 in San Francisco was led by none other than Prime Minister
Abdullah Ahmad Badawi, who talked to Monsanto, Novartis and Chiron
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184 R. E. Ofreneo / Asian Journal of Social Science 36 (2008) 170—186
BioPharmaceuticals. In 2003, Malaysia launched BioValley, a hub for biotech companies and research institutions, with special focus on agriculture. Malay sia and Indonesia have also accepted GM corn but are debating if it is halal.
Singapore, on the other hand, initiated in 2006 the move to establish an
ASEAN Genetically Modified (GM) Food Testing Network. The Philippines, in the ASEAN-US Business Council meeting held in Sin gapore in October 2003, reported that it is experimenting on GMO and bio technology involving rice, corn, papaya, banana, tilapia fish, coconut, mango, tobacco, soybean, cotton, seaweeds and tomatoes. Agriculture Secretary Luis
Lorenzo also reported that the Philippines had allowed the commercial pro duction of Bt-corn. He spoke warmly of the father of the Green Revolution, Dr Norman Borlaug, saying: "Borlaug said that extending the Green Revolu tion to the Gene Revolution will provide a better diet at lower prices to many more food-insecure people". However, Lorenzo was silent on the downsides of
GMO technology that many environmentalists have documented. Since GMO has acquired a very negative connotation in the Philippines and almost every where else, the term now often used by agricultural officials is 'biotechnology'.
Economic Integration: Which Way Now? It is abundantly clear that the economic integration taking place in the ASEAN
region is happening outside the control of the working people, or the urban and rural masses of the region. Integration is in the hands of the transnational corporate interests, which naturally have their own regional and global pro grammes. In agriculture, one integration instrument is the propagation of
GMO and biotechnology, which is in the hands of agribusiness TNCs, and which have managed to establish a presence in the policy corridors of ASEAN.
These TNCs take advantage of the neo-liberal policies in place in most of the ASEAN countries, as well as the framework of the ASEAN integration pro
gramme under AFTA, PIPs and so on. In agriculture, the TNCs' favoured economists argue for a loose definition of "food security" to mean access to food. And such access, by their definition, means trade liberalisation, indus trial export orientation, and GMO and biotechnology propagation. It is also clear that social issues have been sidelined in this ASEAN integra tion programme. The social ramifications for the rural poor and the plantation
sector — which cover issues such as access to technology and food security — have not been taken into consideration. Consequences faced by workers and
unions have also been ignored by this neo-liberal agenda. Thus far, there has been little evidence to show that older industries have been given protection
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R E. Ofreneo / Asian Journal of Social Science 36 (2008) 170-186 185 as new sectors come to dominate the economies of ASEAN member coun
tries. The livelihood of workers in many of these countries would be severely undermined as a result of integration.
Will the above neo-liberal economic formula solve unemployment, inequal ity, poverty and hunger in the developing countries of the region? This is doubtful as unemployment, inequality, poverty and hunger are rooted in the
unequal distribution of resources and access to economic opportunities in society. They are also rooted in the uneven development of the economy, which is partly a legacy of colonialism, bad economic advice by neo-liberal economists, and poor global and regional integration. In neo-liberal economic policies, no space is given to state intervention to regulate capital in order to preserve jobs or to assert the ability of a nation to determine its food and agri
cultural priorities in the service of its people. Nor is any reference made to structural issues, such as the absence of sustainable industry and agriculture. In fact, the region has been developing in a very uneven manner under eco nomic liberalisation and globalisation. Development has also been very uneven in the individual ASEAN countries, with some benefiting from economic inte gration and many others, not. In some countries, the number of the excluded constitutes the large majority. Civil societies in Indonesia, the Philippines and
Thailand have extensively documented how liberalisation and globalisation tend to benefit a few, who are mainly the economic partners of transnational corporations and some skilled professionals, like IT programmers. At the same time, these processes of globalisation and liberalisation tend to marginalise many others — short-term employees, small farmers, communal
fisherfolk, small and micro-enterprises with no global linkages, domestic industries producing for the home market, indigenous peoples who do not comprehend the meaning of tradeables and exportables, workers displaced by privatisation and corporate restructuring, and many others who have no sus tainable jobs or business niches under globalisation and economic liberalisa tion. Even in tiny Singapore, there is a growing segment of old redundant workers who cannot find meaningful and secure jobs in a liberalised and glo balised economy. Such a situation is not sustainable, either politically or eco nomically. Terrorist threats, insurgency and social unrest breed in the fertile ground of social inequality and the exclusion of large sectors of the population from the benefits of growth.
And yet, the ASEAN response to development issues tends to be one-sided: more and more economic liberalisation without any clear regulatory frame work. Up to now, the lessons from the devastating 1997-1998 Asian financial
crisis have not been earnestly and rigorously discussed by ASEAN members. Four ASEAN countries were seriously hit by the crisis — Thailand, Malaysia,
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186 R. E. Ofreneo I Asian Journal of Social Science 36 (2008) 170-186
Indonesia and the Philippines. These countries adopted different approaches to attain recovery and normalcy, with varying levels of success. It appears that
those with ultra-liberal economic policies inspired by the IMF-World Bank have fared badly. This has been the case with the Philippines and Indonesia. And yet, there seems to be a kind of silent avoidance of this issue, for it raises some fundamental questions about the basis of a neo-liberal framework for ASEAN integration.
References ASEAN Cooperation in Food, Agriculture and Forestry (2000a) ASEAN Guidelines on Risk Assessment of Agriculture-Related Genetically Modified Organisms (GMOs). Biotechnology Pub lication Series No. 1. Jakarta: ASEAN Secretariat.
(2000b) Frequently Aked Questions (FAQs) on Genetically Modified Organism (GMOs). Biotechnology Publication Series No. 2. Jakarta: ASEAN Secretariat. ASEAN Secretariat (2003a) ASEAN Statistical Pocketbook. Jakarta: ASEAN Secretariat. (2003b) Handbook on Selected ASEAN Political Documents. Jakarta: ASEAN Secretariat. (2004) ASEAN Documents Series 2003. Jakarta: ASEAN Secretariat. Rosegrant, Mark and Peter Hazell (2000) Transforming the Rural Asian Economy: The Unfinished Revolution. New York: Oxford University Press.
Runge, C. Ford and Benjamin Senauer (2000) "A Removeable Feast". Foreign Affairs 79(3): 39-51.
WTO (2003) World Trade Report 2003. Geneva: WTO. (2001) Report of the 1st ASEAN-ILSI Training Workshop on Safety and Risk Assessment of Agriculture-Related Genetically Modified Organisms (GMOs). Singapore: Singapore.
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