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After nearly half a century as part of the European Union or its precursor, the European Economic Community, the U.K. fully exited the EU at the end of last year to once again seek independent engagement with the world.   © Illustration by Michael Tsang
Asia Insight

'Global Britain' woos ASEAN in fields of former empire

But post-Brexit UK may have to wait out higher priorities for Southeast Asia

SHOTARO TANI and RHYANNON BARTLETT-IMADEGAWA, Nikkei staff writers | ASEAN

JAKARTA/LONDON -- In his memoirs, Singapore's late-founding father Lee Kuan Yew reminisced about attending a 1962 Commonwealth meeting between the British prime minister and leaders of the Dominions to discuss the U.K.'s application to join the European Economic Community, now the European Union.

Prime Minister Harold Macmillan was clear that his country saw its future in Europe as opposed to remaining close to its former colonies, including those in Southeast Asia. "Wealth was created best in large continents, like America and Europe, where good communications facilitated trade and other exchanges," Lee wrote. "An overseas empire like the one Britain had built was no longer the way to wealth."

Nearly 60 years after that conference, the U.K. has reversed course, fully exiting the EU at the end of last year to once again seek independent engagement with the world on its own terms and place a deeper relationship with Asia high on its agenda.

Of particular interest as a test of its new "Global Britain" mettle is Southeast Asia, a region with historical ties to the British Empire but now a united and economically significant force through the 10-member ASEAN group of nations.

But it takes two to tango, so does the Association of Southeast Asian Nations want more U.K. engagement?

The short answer is "yes." But the long one is "it's complicated."

British Prime Minister Harold Macmillan shakes hands with Lee Kuan Yew, prime minister of Singapore, at Admiralty House, London, on July 31, 1962.   © AP

In economic terms, ASEAN certainly cannot afford to ignore the U.K. Britain made up 12.7% of the bloc's $280 billion trade in goods with the EU in 2019, behind only Germany, the Netherlands and France. The U.K. also accounted for more than half of the EU's $15 billion inward foreign direct investment in 2019.

London has sought membership in the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) a mega-trade pact originally known as the TPP and includes some Southeast Asian nations.

But ASEAN would even "welcome the U.K.'s consideration to join the Regional Comprehensive Economic Partnership (RCEP) in the future," said Usana Berananda, director general of the department of ASEAN affairs at Thailand's foreign ministry, referring to a trade deal between China, Japan, South Korea, Australia, New Zealand and ASEAN nations.

Diplomatically, ASEAN members likely covet Britain as a counterweight to the U.S.-China rivalry underway in the region.

"ASEAN is looking for a geopolitical and strategic balance in this region," said Sharon Seah, coordinator at the ASEAN Studies Centre at Singapore's ISEAS-Yusof Ishak Institute. "ASEAN has been forced into taking sides and they don't like that. I think there is this general view that more, not less, players in this part of the world may be better at this point in time."

Cooperation in areas such as education, climate change and health care also seem to interest ASEAN countries.

But while hopes for more U.K. engagement are high, whether it can play a significant regional role from the get-go remains unclear.

A key matter is the British application for ASEAN dialogue partnership status. The group has developed close ties with such partners through regular high-level talks. The U.K., which enjoyed the status through the EU, lost it after Brexit. Troubling for Britain is that ASEAN has long had a moratorium on new dialogue partnerships, with the last admissions being India, China and Russia in 1996.

"The issue indeed is the moratorium, whether we want to lift it [for the U.K.] or not," a senior ASEAN diplomat told Nikkei Asia. "Many countries have wanted to become a dialogue partner [prior to the U.K.]. If we lift the moratorium, how do we deal [with the influx]? If we maintain [it], how do we deal with the U.K. better?... We don't want a country to feel neglected and that we prioritized another country," the diplomat said, alluding to ASEAN's principle of neutrality.

ASEAN dialogue partnership is important not just in offering countries a chance to discuss issues including the economy, market access and technology transfer, but because it is a precursor to a free trade agreement with the 10-nation grouping.

For Britain, which sees a trade deal with ASEAN as of "extremely high priority," in the words of British ASEAN Ambassador Jon Lambe, a lot hinges on what the bloc decides to do with the partnership moratorium. One of the key promises of Brexit was that it would enable the U.K. to secure new trade opportunities across the world.

Britain's Prime Minister Boris Johnson smiles after signing a trade deal with the European Union at No. 10 Downing Street in London ahead of the U.K.'s departure from the bloc on Jan. 31, 2020.   © Reuters

A potential further complication is that "not all ASEAN members are, for a variety of different reasons, equally supportive" of the U.K.'s bid, according to Bilahari Kausikan, former permanent secretary at Singapore's Ministry of Foreign Affairs. "It will take some time to reach a consensus. The U.K.'s response to the coup in Myanmar could be a complication if the U.K. overreacts."

Even if the bloc reaches a speedy conclusion, a U.K.-ASEAN trade deal is not around the corner, as the latter still prioritizes an agreement with the EU. Negotiations started in 2007 but progress has been on ice for over 10 years, reportedly over Myanmar's checkered human rights record. ASEAN nations were also locked in talks for RCEP, which sapped negotiating personnel.

But with that done, "we are ready to resume discussions with [the] EU," said Ade Padmo Sarwono, Indonesia's ambassador to ASEAN. The bloc also has Canada waiting in the wings. "Since [the] EU and Canada are already under process, I think of course we have to focus on what is already started, and [with the] U.K., let's see how things will develop," the diplomat said.

That means for now the U.K. will be limited to bilateral trade agreements with Southeast Asian countries. Britain managed to ink deals with Singapore and Vietnam last year, but they were made easier as both countries had an existing FTA with the EU that could be used as a reference point. But for more bilateral deals, London needs to start from scratch.

A key reality, however, is that bilateral trade agreements are hard to come by in Southeast Asia, as the drawn-out process with the EU shows. After suspending the region-to-region trade talks, the now 27-member group shifted to sealing bilateral pacts with Southeast Asian states, but has only been able to realize those with Singapore and Vietnam. Environmental and humanitarian issues have been stumbling blocks.

But Britain's decision to grant trade privileges to Cambodia might prove to be a blueprint for dealing with the broader region, said Carlo Bonura, senior lecturer at SOAS University of London. The mainland Southeast Asian country lost around 20% of its trade preferences with the EU last year as a result of criticism by Brussels over government human rights abuses.

Bonura also sees signals from the U.K. government that it may be more open than the EU when it comes to palm oil trade. "That would certainly be a way for the [Prime Minister Boris] Johnson government to indicate that the U.K. is a partner in the way that the EU was unable to be just over the last couple of years," he said.

"There are a couple of places where on geopolitics or on regional politics where the U.K. could say, 'this is what the EU has been doing, this is how we want to shift our position,'" he said, referring to the government's apparent retreat from using trade as a means to pursue human rights or environmental agendas like the EU. "Those positions may be far less palatable positions, but nonetheless, ones that the government may be willing to take just to ensure very stable relations, stable diplomatic relations with countries in the region."

Prince William and his wife, Kate are greeted by hotel staff after arriving at the iconic Raffles Hotel Tuesday on a 2012 visit to the former British colony.   © AP

Britain's engagement with Southeast Asia long centered on commerce -- in a letter sent by Stamford Raffles to his homeland in 1819 after setting foot in Singapore, the official who played a major role in Britain's colonial push in the region said the objective "was not territory but trade."

But the U.K. has maintained defense ties with its former colonies, most notably Five Power Defence Arrangements with Australia, Malaysia, New Zealand and Singapore. It keeps regional defense staff in Singapore as part of that, while also having a garrison in Brunei.

There has also been talk of setting up a permanent military base, reportedly either in Singapore or Brunei. The deployment of the aircraft carrier HMS Queen Elizabeth this year to East Asia is expected to include the South China Sea, where it could join the U.S. and Japanese navies in conducting "freedom of navigation" operations.

Thus, with frameworks already in place defense looks to be where Britain could move faster in deepening ties with ASEAN. But the reality is that while its members see Britain as a potential counterweight to China and the U.S., that is in a more ideological and economic sense, with little enthusiasm for a physical military presence.

"ASEAN does not want any foreign military bases in the ASEAN region," said another senior ASEAN diplomat, who added that he was against the idea of the Queen Elizabeth's deployment. If it comes, "it could increase tensions in the region because China may feel additional pressure," he said. "ASEAN is of the view that all countries must maintain a conducive situation so that discussions on the code of conduct [that would govern] the South China Sea can run well with the Chinese side. Code of conduct discussions and negotiations are a priority for ASEAN at this time."

"The region is very hesitant to engage with anything that is seen as outright, exclusively about containing China... Overall, countries are quite wary of being forced to choose sides, or being seen to do so," said Veerle Nouwens, research fellow at the Royal United Services Institute, a London-based think tank on international defense and security. Therefore, Nouwens sees framing and strategic communication by the U.K. will be as important going forward.

"It's also important to remember that the U.K., by applying for ASEAN dialogue partnership now when there is a moratorium on new members, has to be very in tune with what Southeast Asia wants and how Southeast Asia sees the role for the U.K. in the region."

Additional reporting by Dylan Loh and Marwaan Macan-Markar

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