AS Malaysia considers the potential of aligning with powerful supranational groups like BRICS, it’s crucial to balance these ambitions with the effectiveness of its long-standing relationships within Asean.
BRICS is an acronym derived from the names of the original members, Brazil, Russia, India, China – which formed the bloc in 2006 – and South Africa, which joined in 2010. Many other countries have since joined, including from Asia.
With its growing influence, BRICS offers significant opportunities for diversification, trade, and global partnerships. How-ever, Malaysia’s leadership in Asean, especially with its upcoming chairmanship in 2025, is equally vital.
Asean has long been a cornerstone of Malaysia’s foreign policy and regional development, fostering collaboration, stability and economic growth. As BRICS evolves into a formidable bloc, Malaysia must ensure that its engagement with it complements rather than detracts from its commitment to Asean unity and cooperation. Balancing both partnerships will enable Malaysia to maximise its global influence while staying rooted in its regional foundations.
Turning to Asean, as chair Malaysia could lead efforts to strengthen financial cooperation, fostering economic resilience and reducing reliance on external currencies like the US dollar. This would not only benefit Malaysia but also contribute to a more stable and self-reliant Asean.
Malaysia as chair must make a forward-thinking move by recognising the potential of the Asean currency unit (ACU), a concept discussed in the past which has yet to be realised.
The ACU symbolises a shared vision of greater financial integration and stability within the region. I believe with Malaysia at the helm of Asean in 2025, there is a unique opportunity to revisit and refine this concept, potentially paving the way for stronger regional monetary mechanisms.
The ACU was first proposed in 2006 at the Asean+3 (Asean plus China, Japan, and South Korea) summit as part of broader efforts to strengthen financial cooperation and integration in the region. This idea emerged in the aftermath of the 1997 Asian financial crisis, which highlighted the vulnerabilities of Asean economies exposed to a heavy reliance on external currencies, especially the US dollar.
While the ACU remains a theoretical concept, it holds promise as a tool for enhancing financial stability, promoting regional trade and reducing dependence on external currencies.
For Malaysia, the ACU could provide a more stable economic environment, helping to shield it from global currency fluctuations and fostering closer ties with its Asean partners. As Malaysia looks to strengthen its leadership within Asean, promoting and participating in discussions around the ACU could enhance its regional and global standing.
VKK RAJASEKARAN TEAGARAJAN
Chief executive officer
Entrepreneurial Development Advisory Centre
