This article first appeared in Forum, The Edge Malaysia Weekly on November 20, 2023 - November 26, 2023

Asean is now working on the Master Plan on Asean Connectivity 2045 (MPAC 2045). Good to look far ahead, but not too far ahead as not to give enough creative thought on how to achieve all those desirable objectives.

One creative thought is to be a bridge between America and China. Heaven forbid! Asean leaders loudly proclaim they are equidistant between the two giants. They keep out of the mix in the contest between the two giants. Play a role in geopolitics? Come on.

However, playing a role in geopolitics does not have to take the form of just political security initiatives and gambits. It could take economic and technical shape, with proposals to achieve common good.

As Asean plans ahead, it should look at what is available now, which has not been fulfilled because of animosity between China and the US.

The Belt and Road Initiative (BRI) is a strategic plan for a network of connectivity that has been pushed back as a dark Chinese art of dominating the world through debt to hold countries and whole regions to financial ransom. It has been demonised.

Asean should embrace and incorporate it in MPAC 2045.

What? And be seen as taking China’s side? No, by proposing how the BRI can become “kosher” through suggestions that address legitimate criticism of how some BRI projects have been executed. As they say, don’t throw the baby out with the bath water.

A small suggestion would be to work for the infrastructure project listing (IPL) of existing viable BRI projects, as well as for future projects. It may not be huge in terms of financial impact but, by introducing high standards in project planning and execution, it would be a big boost to bridge a chasm in geopolitical rivalry. It would test good faith all round by achieving the following:

• It would provide an alternative source of financing, even if not sweepingly, for infrastructural connectivity;

• BRI projects would be exposed to the standards of accounting, disclosure and transparency often identified as major shortfalls in the Chinese initiative;

• The projects, therefore, will be managed and implemented according to internationally accepted standards, which will remove a source of discord over the BRI and help bring the benefits the initiative is intended to achieve without acrimony and pushback;

• With this, instead of being another source of conflict and attrition in US-China relations, the BRI can become a global bridge for cooperation in international finance and relations;

• The listings can even take place in Asia and the West, say in Shanghai or Hong Kong and the London Stock Exchange, in an expansion of dual listings with common standards and commitments;

• For projects in Asean, the listings could take place in China and the country of the project, or a preferred Asean exchange;

• There will be a growth in capital formation and capital markets that will partly help in mobilising the huge amount of funds required in infrastructure and connectivity.

While not the substitute, IPL would help debt financing by the promise to financiers of the possibility of exiting through a listing, and by the adherence to standards which a listing would require. I had introduced IPL in Malaysia when I was the first chairman of the Securities Commission, and the initiative was a boost for infrastructure development particularly in the energy sector.

There obviously is a need for an Asean power grid, which must be an important part of MPAC 2045. There already are moves on a bilateral and multilateral basis to generate, transmit and connect, particularly with respect to the supply of green energy.

Singapore, for instance, has plans to obtain 1.2gw wind power electricity from Vietnam from 2033, 10% of its annual needs, to be transmitted through subsea cables covering a distance of around 1,000km (under the South China Sea, making an Asean hands-on interest in sorting out the disputes imperative). Singapore is looking at 2gw from Indonesia and 1gw from Cambodia, with imports alone making 35% of the island republic’s energy mix in 2035.

Energy connectivity requires standards and, as we can see in Gaza today, peace and stability. On standards, the rest of Asean should take note that Singapore is embarking on the second phase of a study with the US focused on governance and financing frameworks. Asean should ask to get involved in the study whose findings should be incorporated in MPAC 2045, along with the embrace of BRI and IPL.

The governance and financing frameworks will require disciplines which would make a success of the BRI and other projects, American, Japanese, or whatever, such as those that might emanate from the Japan-Asean Comprehensive Connectivity Initiative announced by the Japanese prime minister last September. Even now, Asean should look to introducing them, and not wait to the end of MPAC 2025 and the introduction of MPAC 2045.

Under IPL guidelines, the emphasis is on disclosure, and continuous disclosure. The initial public offering will be based on a feasibility study with credible cash flow and earnings projections. There has to be immediate disclosure of significant deviations, and continuous disclosure is required so as to give investors latest knowledge on how the project is going.

Another feasibility report with new cash flow and earnings projections may be required if there are substantial and significant deviations. The discipline of transparency will remove all sorts of suspicions and accusations made against BRI, whose good intentions will always be made evident and put to the test.

In the AOIP (Asean Outlook on Indo-Pacific), apart from the emphasis on connectivity, the clearest point is on Asean leadership and centrality. The initiative on IPL for BRI would go some way towards realising connectivity infrastructure projects, but would go a long way towards bridging the gap of misunderstanding and suspicion between China and the US, for the good of the region and the world.

In the new climate of engagement promised by the meeting in California last Wednesday of the leaders of the two countries, it is a propitious time for Asean to be more active with ideas on how such engagement can find common ground in functional areas.

Asean should play a more catalytic role, particularly in economic matters — which are getting increasingly “securitised” (not in the capital markets, but geopolitical, sense) — in consonance with its centrality and increasing importance. Being equidistant between China and the US allows Asean to play such a role, interested only in achieving further economic development. In the long history of functional integration, its theory points to cooperation for the common good and to the habit of cooperation the benefits engender.

Indonesian President Joko Widodo (Jokowi), speaking at the Indo-Pacific Forum last September, talked about its transforming rivalry into beneficial cooperation. The words should be materialised with initiatives that bring nations together.

The parsimonious Asean approach to geostrategic issues — and these are increasingly affecting economic matters Asean is more enamoured with — could leave the regional grouping with outcomes damaging to its interests. At the very least, without taking sides, Asean should also actively engage like-minded states and regional groupings to arrest the steady decline of free and fair trade and the rise of open economic warfare.

Master plans such as the MPAC 2045 have to be girded by a stable world economic and political order for it to be rolled out successfully, already hamstrung as it is by financing shortfalls.

Great power competition, sometimes expressed in trade and investment conflict, and wider animosity, can dry up available financial resources, if they are not made available to projects such as the BRI because of alleged and assumed bad intentions. Efforts to bridge differences, to act practically to harmonise standards, would be in everyone’s interest. As Mao Zedong would have said: Let a hundred flowers bloom.

Tan Sri Dr Munir Majid is chairman of CARI Asean Research and Advocacy

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