Vietnam PM warns of economic calamity at ASEAN summit

South East Asian leaders warned Friday the virus pandemic had swept away years of economic gains and was hindering negotiations over the flashpoint South China Sea as they met online for a delayed summit.

Vietnam, the current chair of the Association of Southeast Asian Nations (ASEAN), had wanted to use the summit to inject momentum into talks on a sprawling China-backed trade pact.

But the immediate focus for the 10-member bloc was the crippling cost of the coronavirus, which has ravaged the economies of tourism and export-reliant countries such as Thailand and Vietnam.

“It has swept away the successes of recent years… threatening the lives of millions of people,” Vietnam’s Prime Minister Nguyen Xuan Phuc said in a sobering opening address.

He emphasised the “serious consequences” of the pandemic for economic development among ASEAN’S members.

ASEAN General Secretary Lim Jock Hoi confirmed the bleak outlook, warning the region’s economy is expected to contract for the first time in 22 years.

There is also increasing angst that the fallout from the virus has provided cover for new Chinese plays in the South China Sea, the resource-rich waterway Beijing claims most of but is also contested by Vietnam, the Philippines, Malaysia and Taiwan.

In a draft statement seen by AFP, ASEAN leaders noted concerns over “land reclamations, recent developments and serious incidents” in the South China Sea.

Philippines President Rodrigo Duterte — using strong language for a leader that is seen as having pivoted toward China from its traditional ally the United States — urged all parties “to refrain from escalating tensions and abide by responsibilities under international law”.

Duterte also urged ASEAN not to be sucked into the power rivalry between Washington and Beijing.

The United States is not a claimant to any territories in the South China Sea but has sent its navy to patrol the area in support of freedom of navigation, while Beijing has slammed this as interference in regional affairs by an outside power.

– South China Sea chessboard –

Vietnam’s Prime Minister admitted the pandemic would “interrupt discussion meetings” on the so-called code of conduct, which was due to be finished in 2021 after years of talks.

In recent years Beijing has stepped up its territorial claims in the South China Sea by building artificial islands.

In April it officially named 80 islands and other geographical features in the disputed waters.

The same month Vietnam also accused Beijing of sinking a trawler, prompting the United States to warn it was “exploiting the distraction” of other states “to expand its unlawful claims”.

China is always advancing its pieces on the “South China Sea chessboard”, a senior Southeast Asian diplomat told AFP.

Beijing took advantage of the Asian financial crisis in the late 90s and the SARS outbreak to push its claims, he added: “If there is a space, they move.” 

Without directly mentioning China, Vietnam’s Phuc admitted that “strategic problems between big countries had become clear and had deepened”. 

“While the world is trying its best to fight the pandemic, there were irresponsible acts, violating international laws, that affected the security and stability of some regions including ours,” he said.

Vietnam had hoped the summit would see progress on a trade agreement known as the Regional Comprehensive Economic Partnership, which is backed by China.

But the deal, which would loop in half the world’s population and a third of its GDP, has been hampered by India’s refusal to join over access to its market for cheap goods from China, the regional superpower it is now locked in a deadly border row with.

by Tran Thi Minh Ha and Martin Abbugao in Singapore