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Foundation of GCC-ASEAN relations
The Gulf Cooperation Council (GCC)-Association of Southeast Asian Nations (ASEAN) formal relationship began in 1986 when the GCC Council of Ministers agreed to establish connections with Far East countries, including ASEAN. The cooperation officially kicked off in 1990, followed by mutual visits from both sides. A significant breakthrough occurred in 2009 with the first Ministerial Meeting between the two regional groupings was held in Bahrain. This meeting, attended by state ministers, high representatives, and the Secretary-General of both sides, established the ASEAN-GCC cooperation framework, aimed at increasing the possibility of trade agreements and promoting contacts between peoples and tourism. In 2010, Vietnamese President Nguyen Minh Triet, whose country held the rotating chairmanship of ASEAN, described the two blocs as complementary:
“Asian nations rely on the world’s largest oil exporting region to secure their energy needs, while Gulf states are targeting food imports and investments in farmland to secure their strategic food supply. […] You have what we don’t have, and we have in plenty of what you don’t have, so we need to join hands together”
While several contact mechanisms have been established since 1990, GCC-ASEAN relations while growing, have been spotty. An increase in GCC-ASEAN trade was noticeable from USD 77.87 billion in 2010 to USD 138 billion in 2022. The main Gulf exports to Southeast Asia include crude oil, plastic polymers, and aluminium products, while food, electronics, machinery, and vehicles head the other way.
However, these relations have primarily been bilateral, with negligible bloc-to-bloc cooperation. Singapore is the only regional country with a free trade agreement (FTA) with the GCC. Among GCC countries, the UAE has the highest trade volume with ASEAN, accounting for approximately 49 percent of the total in 2022, followed by Saudi Arabia (36%), Qatar (11%), Oman (2%), Kuwait, and Bahrain (1%). Among ASEAN countries, Singapore is the Gulf’s largest trading partner, followed closely by Thailand. The UAE has signed Comprehensive Economic Partnership Agreements (CEPA) with Indonesia and Cambodia and is negotiating similar deals with other major ASEAN nations, including Thailand, Vietnam, and Malaysia.
The ASEAN-GCC Summit: revival of relations
Diplomatic relations between GCC and ASEAN enjoyed an uptick in 2019 when Bahrain was the first country to accede to the Treaty of Amity and Cooperation of South-east Asia (TAC) – a peace pact governing inter-state relations in South-east Asia, and a pre-requisite for any party wishing to become a partner of Asean – followed by Oman, Qatar, and the UAE in 2022, and, finally, Saudi Arabia and Kuwait in 2023.
The inaugural ASEAN-GCC Summit, in Riyadh in October 2023, marked another noticeable revival of interest for Gulf nations to bolster ties with ASEAN. Jointly hosted by Indonesia’s President Joko Widodo and Saudi Arabia’s Crown Prince Mohammed bin Salman, the summit signified the beginning of formal cooperation at the bloc-to-bloc level. The ASEAN-GCC Framework of Cooperation (2024-2028) laid the foundation for a formal inter-regional engagement mechanism, outlining areas of political cooperation, security dialogue, trade, and investment.
Another positive development for Gulf-ASEAN ties has been the restoration of diplomatic relations between Saudi Arabia and Thailand after a three-decade dispute, leading to several bilateral deals in oil extraction, hydrogen, tourism, and restoration of Bangkok-Riyadh flights.
These growing ties between the Gulf and Southeast Asia come at a time when Gulf countries seek to diversify their economic and political partnerships.
The economic factor
The primary focus of the Gulf countries is to monetize their hydrocarbon resources and diversify their economies beyond hydrocarbons, especially during what is widely regarded as the last oil boom. Given the increasing energy demand in the South Pacific, this pivot is strategically important for the Gulf region. According to Pwc, Southeast Asia’s energy demand is expected to grow by 60% by 2040, three quarters of this new demand is likely to be met by fossil fuels The recent mutual visits between two regions’ leaders demonstrate that GCC-ASEAN relations extend beyond traditional trade of oil and include green economy, climate change, education, digital government, artificial intelligence, cybersecurity and halal food certification.
By leveraging their respective strengths, the two regions forge a mutually beneficial partnership that addresses both economic and strategic needs. For instance, as both groupings are pursuing net-zero emission reduction targets, their enhanced cooperation presents new opportunities for environmental cooperation. Indeed, green economy and climate change were central to the flurry of MOUs and agreements signed between the UAE, Saudi Arabia and Singapore upon the Prime Minister Lee Hsien Loong’s visit to both countries in October 2023, as well as the ASEAN-GCC Framework of Cooperation (2024-2028). These moves capitalise on readily existing Gulf clean energy investments in southeast Asia including UAE’s Masdar partnerships with Indonesia’s state electricity company and Malaysian company Citaglobal Berhad to develop a range of renewable energy projects.
The geopolitical factor
Beyond economic imperatives, Gulf countries are increasingly driven by geopolitical factors in their energy investment decisions. In an emergent multipolar world and amid perceived decline of the US interest in the Gulf, a shift towards multi-alignment and regionalism are dictating the Gulf’s foreign policy. The recent ascension of Iran, Egypt, Saudi Arabia and the UAE to the BRICS group; the membership of Saudi Arabia and the UAE with the US-led India-Middle East-Europe Economic Corridor (IMEC), and Saudi Arabia membership in China-led The Shanghai Cooperation Organisation (SCO) are examples that demonstrate Gulf aspirations to expand their strategic space and bolster economic and security ties beyond traditional partners such as the US and China. The reinvigorated relationship between the GCC and ASEAN is a testament to Gulf evolving multi-alignment approach.
“Gulf states overseas investments allow them to build long-term interdependencies as well as assert their role as energy producers and investors while building deeper political relationships with countries in the Eastern Mediterranean, African continent, the Caucuses, Central and South Asia, etc.” argued Hasan T. Alhasan, Senior Fellow for Middle East Policy at International Institute for Strategic Studies.
The outlook for GCC-ASEAN economic partnership is promising as both regions have young populations, priming their economies for growth, innovation, and entrepreneurship. The Gulf’s investments in Southeast Asia not only signify a strategic economic expansion but also pave the way for stronger political and cultural ties in the future. By leveraging their respective strengths and addressing both economic and strategic needs, the reinvigorated relationship between the GCC and ASEAN marks a new chapter in inter-regional cooperation. And as the global geopolitical landscape continues to evolve, these partnerships will be crucial in navigating the complexities of a multipolar world.
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