Assistant Secretary Charles H. Rivkin Remarks on ASEAN Economic Community at Jakarta Foreign Correspondents Club

I want to thank the Jakarta Foreign Correspondents Club for hosting this luncheon and President Joe Cochrane for his leadership at JFCC and introducing me here today. We all appreciate his authoritative work for the International New York Times.

This is an excellent venue, and you are the perfect audience, for me to speak about the United States and its commitment to strengthening U.S-ASEAN relations and to welcome the upcoming launch of the ASEAN Community, including the ASEAN Economic Community – AEC.

Our Leaders will be coming together in Kuala Lumpur, Malaysia later this month to support the launch of the ASEAN Community and to discuss the breadth of U.S.-ASEAN relations, as well as the future of our cooperation.
U.S. and ASEAN Leaders will be discussing the rich and long history of our economic relationship as well as our shared common goals for the region, including a prosperous and stable Southeast Asia.

The U.S. values ASEAN as a champion of a rules-based order in Asia, which promotes shared principals and standards.  We commend the ASEAN Economic Community’s efforts to further advance norms for cooperation in the region, and to unify ASEAN as the center of Asia’s regional architecture.

The AEC will not only enhance ASEAN Member State competitiveness but also strengthen the economies of the region through promoting a market-oriented trade and investment environment.

We know it’s been a long road to the launch of the ASEAN Community, and there will be a lot of work to come.  To fully capitalize on the benefits of an economic community, ASEAN Member States will need to maintain focus on the AEC after its launch and translate this into a sustained commitment which builds on this foundation for years to come.

Indonesia will play a critical and central role in achieving the full benefits of the AEC.  As the largest Southeast Asian democracy, Indonesia is poised to be a strong economic leader, and can promote trade and investment liberalization to benefit greater economic integration in ASEAN.

The U.S. and Indonesia share many of the same goals for the region at large, from building a rules-based order that levels the economic and commercial playing field to creating a sustainable and secure framework to address other challenges.

The United States and Indonesia also share many of the same values and principles, from religious tolerance to the importance of the free market.  As two of the largest democracies in the world we recognize that what we say and do together matters.

We have a strong bilateral foundation to build from: the U.S.-Indonesia Comprehensive Partnership, which President Obama inaugurated in Jakarta in 2010.  This partnership has led to much closer cooperation on a wide range of issues, such as, security, education, and health.

Presidents Obama and Jokowi underscored the strength of that partnership last week, when they met to discuss the depth and breadth of our bilateral relationship in all its forms, from economic to strategic.

A number of key deliverables were achieved during this visit, including more than $20 billion in U.S.-Indonesia commercial deals.

The two leaders discussed ways that we can expand bi-lateral cooperation on key strategic global and regional issues such as climate change, energy and maritime security.

They talked in particular about the importance of working together to build a more economically integrated ASEAN, which is central to our economic and strategic interests as a Pacific nation.  And that is what I want to talk about today.

The ASEAN Member States represent one of the fastest growing regions on the planet and a major source of the world’s rapidly growing middle class.
ASEAN is not only Asia’s third largest economy, but our fourth largest trading partner.  In fact, the total value of our bilateral trade in 2013 was $234 billion – an increase of more than 70 per cent over the past 12 years.

Our companies are the top investors in ASEAN with more than $226 billion in foreign direct investment stock – and that’s more than China, Japan, and South Korea’s investment combined.

This relationship is obviously good for American companies and the jobs they bring to our shores, but it’s also good for the more than 600 million people in ASEAN’s member states. Our companies locally hire and train employees in all 10 ASEAN member states. They transfer knowledge and technological advances and they invest in local communities.

As Secretary Kerry has said, foreign trade should be viewed as an opportunity, not a threat. Globalization is a force driven not only by technology, but also by the aspirations of people around the world for opportunity and a better life.

That’s why the United States has worked to facilitate U.S.-ASEAN trade and investment, and to build greater awareness of commercial opportunities.

As you know, we recently announced the completion of our negotiations for TPP. While I recognize that only four of the 10 ASEAN member states are in TPP, this agreement has broader implications for ASEAN and the region at large, and its goals are highly complementary to ASEAN’s goals in establishing an ASEAN Economic Community.

TPP and the AEC both provide a path towards more open trade and investment, as well as deeper economic integration and more business-friendly environments across the region.

As we work together to promote higher standards, we’ll create even greater regional integration. Beyond TPP, if you consider the Transatlantic Trade and Investment Partnership, the trade deal that we are currently negotiating with the European Union, we could soon have a widely adopted set of the highest standards that apply to a majority of the world’s biggest economies.

Both TPP and the ASEAN Economic Community will provide a path towards higher regional standards, increased trade and investment, and deeper economic integration.

ASEAN economic integration is the glue of a strong, united ASEAN.  A more integrated and unified ASEAN Economic Community will not only provide opportunities for U.S. business, but it will allow ASEAN to play an even stronger role in security peace and prosperity in the region.

It will also bring enormous benefits to the more than 600 million people who comprise these 10 nations. And it will help Southeast Asia capitalize on its opportunity to solidify its position as an economic powerhouse.

Those outcomes are good for the region, good for U.S. companies, good for our economic relationship and also important strategically, as the United States counts on ASEAN to be a unified source of stability in the Southeast Asia region.

We continue to deepen our ASEAN ties. We have invested tens of millions of dollars and launched a number of economic initiatives, dialogues and workshops which are focused on our economic cooperation and supporting the goals of the AEC.

For example, we are about to launch an innovation challenge for young aspiring entrepreneurs in We will ask them to propose potentially transformative ideas, so that we can connect them to leading U.S. private sector companies, as well as U.S. universities and venture capital.

We are launching workshops to address the rampant practice of environmental crimes, such as wildlife trafficking, illegal logging, and illegal, unreported and unregulated fishing.

We also continue to work with ASEAN to promote environmentally sustainable energy, and we have amplified our commercial outreach via business dialogues, reverse trade missions, and road shows either planned or already executed.

And this year, we have launched two new dialogues with ASEAN on aviation and ICT – two of the sectors where my Bureau has the interagency lead.

As you know, Southeast Asia is one of the busiest and fastest growing aviation markets. So we are working to develop a framework that will enable the United States and ASEAN to create more channels of transport that will grow trade and open markets on both sides. As a dialogue partner for the ASEAN Telecommunications and Information Technology sectoral
body, we are working to promote internet connectivity, mainly in rural and other underserved areas, as well as greater use of eCommerce, particularly by SMEs.

Our new “Global Connect” initiative, which we launched at the UN with the Presidents of Estonia, Tanzania, and the World Bank, seeks to create these and other outcomes, as we work together to bring 1.5 billion people online by 2020.

We are also encouraging government leaders, multilateral development banks and industries to prioritize digital access so they can keep pace with the 21st century economy. The U.S. plans to partner with interested countries to develop strategies that can create enabling environments to spur connectivity as well as entrepreneurship, cross-border information flows and open and competitive marketplaces.

ASEAN can be central to this effort in Southeast Asia as we deepen our cooperation on connectivity and through our Telecommunication Ministry consultations.  We encourage all ASEAN countries to join this initiative, which will support the goal of ASEAN economic integration.

That includes working together to create enabling environments for innovation and entrepreneurship to flourish in Indonesia and in the ASEAN region.

In Bali, I will be part of the launch of the first ever Eastern Indonesia Angel Investor Network. It’s important because it’s the first ever angel investment network outside Jakarta.

The network – known as EIAN – is housed at Hubud, a collaborative co-working space in Ubud Bali, where entrepreneurs, small business owners, and potential investors can come together, join networks, and build startups.

Hubud is an entry point into Indonesia for both venture capitalists and startups seeking to launch a business in Asia.  Many American companies are currently working out of the Hubud space.

Making these connections between entrepreneurs and small business owners with potential investors is integral for small start-up communities to find their footing and launch their business.

I will also help kick off the Innovation Bali events, through an event at Rumah Sanur and Kumpul in Bali.  Kumpul is an entrepreneurship incubator housed inside the Rumah Sanur creative space in Bali.

This event will encourage young Indonesians to start their own business. And it will help equip existing Indonesian entrepreneurs with practical information such as pitching skills, working on a business model, and customer validation techniques.

I’ll be engaging directly with entrepreneurs at both of these events and will talk about U.S. government support for the growth of startups and entrepreneurship throughout Indonesia.

As we know, successful entrepreneurs make for successful economies. Helping to build a supportive environment for entrepreneurs is one of the best ways we can help create jobs, and sources of tax revenue for local services.

ASEAN Members State play a direct role in creating the right enabling environments for innovation and entrepreneurship to flourish.

Cultures of entrepreneurship, when they take root, can help to solve some of the most intractable challenges the world faces. That includes the lack of inclusion for women and minorities, slow economic growth, poverty, unemployment, and violent extremism.

When we can spread a vibrant culture of entrepreneurship across ASEAN, we can help contribute to regional economic growth, expanded supply chains, and broader regional connectivity.

Indonesia can serve as a leader in setting the stage for this kind of growth, which in turn can benefit the entire region.  We support Indonesia’s work to forge a more unified role for ASEAN in addressing regional and cross-border challenges.

ASEAN’s leadership has helped to preserve peace among its diverse member nations for nearly 50 years, and it is precisely this stable foundation that has allowed economies here to take off.

I’d like to close with a few final points.  First, the economic future for ASEAN looks bright.  The ASEAN middle class is growing by leaps and bounds and the work force is young, full of innovative ideas and energy.  The AEC will tap into this potential across the Community’s citizens and bring even more opportunities to Southeast Asia’s youth by reducing barriers to trade, and enhancing the flow of services, capital, and skilled labor flow.

The U.S. is committed to building off of this important moment in ASEAN’s history, the launch point for the broader ASEAN Community.  We will continue to seek out new opportunities to expand U.S.-ASEAN economic ties and we will leverage the richness of our existing relationships to the mutual benefit of both U.S. and ASEAN citizens.

President Obama’s Rebalance to Asia created a “new normal” of sustained and high level commitments to this region.  This new normal is showcased through U.S. investments, through our trade ties, through our technical cooperation and capacity building efforts in the region, and perhaps most importantly, through our people-to-people ties.

The U.S. is committed to the continuous strengthening of our relationships in Southeast Asia.  We will be with ASEAN every step of the way, through the launch of the ASEAN Community, and through both the challenges and opportunities of what this “new normal” brings us next.
Thank you.