September 24-25, 2015
Phnom Penh, Cambodia
The Pacific Forum CSIS, with support from the US Department of State’s Export Control and Related Border Security Program and in collaboration with the Cambodian Institute for Cooperation and Peace, held a workshop on strategic trade controls in continental Southeast Asia in Phnom Penh, Cambodia, on Sept. 24-25, 2015. Some 40 Cambodian, Laotian, Myanmar, Thai, and Vietnamese experts, officials, military officers, and observers attended, all in their private capacity, along with about 15 individuals from the broader Asia-Pacific and the United States and Europe. The off-the-record discussions focused on international trade and strategic goods, the core components of an effective system of strategic trade controls, the role of national legislation, control lists and licensing procedures, detection and enforcement, interagency coordination and industry outreach, and capacity-building and assistance. Key findings from this meeting include:
Managing the flow of strategic goods in Southeast Asia will be increasingly important over the next decades. Many industrial sectors that are showing growth as economies in the region expand have dual-use potential and the major transshipment points in the region are tempting targets for trafficking networks. To better prevent proliferation and terrorism, emphasis should be placed on developing national strategic trade management programs as growth occurs rather than adapt regulatory measures and organizational arrangements after these sectors are more mature and shipping patterns are established.
Creating political will to jump-start a national strategic trade control program is crucial. Implementing strategic trade controls should not be portrayed as an onerous task. States should be encouraged to adopt simple yet comprehensive legislation and use the EU Control Lists as a starting point for determining what goods are involved.
Continental Southeast Asian participants recognized the value of strategic trade controls and were in general agreement that implementing them is in their interests. In addition to the nonproliferation benefits, they appreciate that implementing such controls will enable them to reap important economic benefits associated with integration into the international supply chain for high technology products.
Given Southeast Asia’s focus on facilitating trade, emphasis should be placed on including familiar features such as the EU control lists in strategic trade control programs. While Southeast Asian states should tailor the EU lists to fit their needs, using them as a starting point saves time and resources and provides a common basis for risk assessments by private sector companies.
In promoting the benefits of implementing strategic trade controls in Southeast Asia, it is important to highlight the side benefits. Two areas of particular interest are facilitating regional market integration as part of the ASEAN Economic Community (AEC) and building capacity and expertise to combat illicit trafficking.
Implementing strategic trade controls is best done by establishing a single, nodal agency that coordinates all relevant national stakeholders, as was done in the case of Malaysia. It is also important to remember that implementing strategic trade controls is a dynamic process. Regular updates to control lists are needed as technologies evolve and spread. For example, the increase of intangible technology transfers and the emergence of 3D-printing on a worldwide scale will demand significant changes of common practices.
Continental Southeast Asian participants stressed that they lack, and would like to receive, capacity to implement strategic trade controls. Fortunately, there is a significant amount of assistance programs available. The problem is that it is often difficult to know which donor to approach. Continental Southeast Asian states can help the process by clearly identifying their national needs and making specific requests.
UN Security Council Resolution 1540 is often viewed as a requirement to provide lists of existing laws and regulations related to control of WMD-related materials. A better approach would place emphasis on providing a comprehensive description of strategic trade controls programs that includes all activities intended to regulate the flow of strategic goods (control lists, licensing requirements, customs efforts, information sharing, and enforcement activities).
Regular training of strategic trade controls stakeholders is important for enforcement activities. Engagements like this dialogue where experts and practitioners can share insights and articulate needs are needed. Because sustainability is an issue, e-courses and e-learning should also be developed to continuously train people at reduced cost.
Regional cooperation on strategic trade controls should be strengthened. Universal implementation of strategic trade controls in ASEAN would eliminate weak links that proliferators seek to exploit. With the establishment of the AEC, implementing national-level controls is a critical first step to fully realize the regional economic integration envisioned in the AEC blueprint. States in the region must find ways to share information about product specifications and trafficking networks.
Participants had different views about the extent to which strategic trade management should be a part of the ASEAN Single Window. Some thought it would help solidify trade controls in the region, while others argued it would be too much of a hassle. All thought success or failure would depend on the specific ways in which strategic trade management principles were integrated into the AEC. This is an area for future study.