Network of East Asian Think-Tanks (NEAT)
Memorandum No. 10Introduction
1.
The Network of East Asian Think-Tanks (NEAT) held its 19th Country Coordinators
Meeting (CCM) and 11th Annual Conference (AC) in Kuala Lumpur, Malaysia on 26-27
August 2013. Attending these two events were the representatives of all 13 ASEAN Plus
Three (APT) countries.
2.
Following the decision taken at the APT Senior Officials Meeting (SOM) on 18 May
2013 to form a closer linkage with the NEAT, Track I officials participated and interactedwith Track II. NEAT is highly appreciative of the APT SOM decision and the attendance ofmembers of the APT SOM and the ASEAN Plus Three Macroeconomic Research Office(AMRO).

Moving East Asia Forward: Vision, Goals & Challenges
3.
NEAT reaffirms that the goal of community building in East Asia is to promote thewelfare and well-being of its peoples by realising the East Asian Vision of Peace, Prosperityand Progress.
3.1
In order to promote an East Asia that is peaceful, community building must be basedon universal values, including good governance, the rule of law, democracy, human rights
and international law and norms. East Asian countries should promote these values ascommon goals.
3.2 In order to promote an East Asia that is prosperous, community building must be
based on development that is not just impactful but also inclusive, socially justand sustainable.
3.3 In order to promote an East Asia that is progressive, community building must be
open to the world at large, pragmatic, future-oriented, rational and scientificallyand technologically based.
4.
Importantly, the inter-relationships among the factors promoting peace, prosperity andprogress must be recognised – one cannot be attained, nor can it be pursued, at the expense ofthe others. All three are needed to impart a strong sense of well-being, security andconfidence to the region.
5.
The realisation of this vision for East Asia faces opportunities as well as challenges,
both internally and externally.
5.1 East Asia is characterized by diversity. Differences in size, resource endowment,
human capability, levels of economic development and standard of living canbring about opportunities as well as challenges. So do other factors, such as
forces of globalization. It is important to manage these factors well while
respecting diversity so as to make them better serve regional community building.

15.2 East Asia must thus build engaging, creative and dynamic diplomatic, economic
and social institutions that can facilitate the process of moving the region forward.
These rely heavily on political and economic initiatives but should be broadened
to the intellectual and social as well.
6.
NEAT discussed these and other opportunities and challenges facing East Asia at its
CCM and AC The following are the main findings:
6.1 The importance of coordination between NEAT and APT SOM is to be stressed.
The participation of Track I officials in the 11th Annual Conference has proved tobe a success and a good start, and should be continued in future AnnualConferences.
6.2 The NEAT Chair should be invited to APT SOM meetings in the future as anobserver.
6.3 Given the complex political and economic realities in East Asia, the promotion ofrule-making, along with common values and norms, is important in ensuring thatthe region continues to be stable and secure.
6.4 NEAT should rise to the challenge of broadening its research activities beyond
functional cooperation to include political and security matters. This should bedone in a constructive manner.
6.5 In the financial arena, NEAT noted the good progress in the Chiang Mai Initiative
Multilateralization (CMIM) and the key role that the AMRO played in ensuringconfidence in the East Asia region.
6.6 While APT countries must continue to assume the primary responsibility for theirstability by adopting prudent macroeconomic policies, there is broad agreementthat both the CMIM and AMRO needs to be developed and strengthened further.
6.7 The pursuit of sustained dialogue is the best way to ensure peace in the region.
East Asia should review and further streamline its regional institutions in order toform a more cohesive regional identity beyond functional cooperation.
6.8 The broadening and deepening of East Asian integration requires bridging
development gaps, improving soft and hard infrastructure and supporting existing
institutions towards more inclusive growth. In this regard, the developing
countries of Cambodia, Laos, Myanmar and Vietnam should be given emphasis.

NEAT Working Groups
7.
NEAT respectfully submits recommendations in the following three areas for theconsideration of the APT:
7.1 Connectivity Cooperation in East Asia : Financing Infrastructure Connectivity inEast Asia: Problems and Solutions27.2 Enhancing People-to-People Connectivity – Education, Tourism and Cultural
Exchange
7.3 Social Welfare Policies in East Asia: Sharing Experiences for a New Ground of
Regional Cooperation

Connectivity Cooperation in East Asia: Financing Infrastructure Connectivity in East
Asia: Problems and Solutions
8.
Regional connectivity has a strategic role in furthering and enhancing trade andinvestment, narrowing development gaps and facilitating people-to-people contacts. It is
widely anticipated that infrastructure investment can be a new driver for growth but thelimited sources of infrastructure financing are a matter of concern.
9.
The following are key recommendations to mobilize private investment and turn theregion’s savings into infrastructure investment in an efficient manner:
9.1 Establish the East Asian Infrastructure Partnership Forum (EAIPF). The EAIPF
would be a major coordinating mechanism among APT countries to carry outexchange and cooperation on infrastructure planning, align national infrastructuredevelopment plans with the region’s connectivity targets, lay down a strategic
master plan on East Asian infrastructure development and investment, andcoordinate and oversee the implementation of the Plan. Study Groups under theEAIPF can be established to consolidate the concept and make feasible
recommendations to push forward APT Partnership on Connectivity.
9.2 Upgrade the existing financing cooperation mechanism from the ASEAN
Infrastructure Fund (AIF) to the East Asia Infrastructure Fund (EAIF). Suchexpansion can be developed together with Plus Three countries in terms ofcontribution, membership in Board of Directors, project selection criteria andproject operation and administration.
9.3 Conduct a feasibility study for a new financial institution specialized ininfrastructure investment in the APT region to add capacity to the existingregional financial institutions. The initial conception will involve a two-tierequity structure allowing the separation of the decision-making right from thereturn right. The mode of investment will mainly include loans and guarantees.
9.4 Facilitate financing through full use of the Asian bond market by:
9.4.1 Separating the infrastructure connectivity bonds from corporate bonds andrelaxing the issuer restraints on the infrastructure connectivity bonds;
9.4.2 Securing a higher credit rating than an individual sovereignty credit rating.
For this, credit guarantees for regional connectivity projects should enlist
joint credit ratings by the project-domiciled countries or regional financialinstitutions;39.4.3 Improving the clearance system for the infrastructure connectivity bondmarket and establishing an integrated East Asian clearance institution for
the infrastructure connectivity bonds;
9.4.4 Prioritising the private market and asset-backed securities market, andbringing in various investors with customized contracts and a more flexible
interest repayment structure; and,
9.4.5 Enhancing cross-border supervision of the Asian bond market. This will
include the establishment of an information sharing and consultation
mechanism, an integrated system of supervisory indicators and amechanism of risk isolation that separates risks in Asian bond market fromthat in the national financial markets by better supervising the market
players and business operations.

Enhancing People-to-People Connectivity – Education, Tourism and Cultural Exchange
10.
NEAT believes that education, tourism and cultural exchanges are very importantelements for the formation of the ASEAN community as they are strongly related with thepeople’s mobility and connectivity. As such, the following are key recommendations forenhancing people-to-people connectivity:
10.1 Expand and support the current higher education network system among
ASEAN＋3 countries; i.e. enlargement of Campus Asia Project by Japan, China
and South Korea to ASEAN Countries, and partnership enlargement of ASEAN
University Network (AUN) to the East Asian countries under ASEAN+3University Network (ASEAN+3 UNet) with a characteristic of multi-layeredsystem. To transform the existing ASEAN ＋ 1 international exchange andcooperation programmes into the ASEAN＋3 framework;
10.2 Promote systematization of regional quality assurance and credit transfer
systems of higher education in ASEAN＋3 with cooperation of current systems,
i.e. ASEAN University Network – Quality Assurance (AUN-QA), ASEAN
Quality Assurance Network (AQAN), Asia Pacific Quality Network (APQN),
ASEAN Credit Transfer System (ACTS), and Collective Action for Mobility
Program of University Students (Campus Asia);
10.3 Promote cultural exchanges through regional common projects such as thedesignation each year of one city in East Asia countries as the “East AsianCultural City” which was launched during the ASEAN Plus Three
Commemorative Summit in Phnom Penh, Cambodia on 19th November 2012 toattract people’s concern to the Asian culture including popular culture;
10.4 Develop cultural exchanges among youth to act together towards fostering asustainable development within regional society. The exchanges should include“study tours”, “green tourism” or “rural tourism” which will provide theparticipants with the opportunities to interact with local community, to beexposed to rich traditions, as well as to enjoy diverse natural environments;4

10.5 Enhance institutional building and people skills for cultural exchange andtourism, i.e. to establish a regional language training framework and to createknowledge sharing system on culture and tourism of ASEAN + 3 countries;
10.6 Develop academic collaborative research on historical artifacts and to promotepreservation and protection of cultural assets and cultural heritage, and culturalindustry development by making visible systems and capacity building of
human resource;
10.7 Establish a trans-national collaborative higher education and research institution
in East Asia on regional and global issues like "APT Cyber University" that was
originally proposed by the NEAT Korea to foster understanding of different
cultures and diversity; and10.8 Establishing a regional financial support system to encourage people’sconnectivity through educational and cultural exchanges including tourism.

Social Welfare Policies in East Asia: Sharing Experiences for a New Ground ofRegional Cooperation
11.
Social welfare is an important element of inclusive growth which will contribute to amore sustainable future of the development of APT Countries. With the growinginterconnectedness created by globalization, social welfare policies should be a new area forregional cooperation in order to build a stronger foundation for an East Asian Community.
12.
Below are key recommendations to promote cooperation on social welfare policies
among the APT Countries:
12.1 Mainstream social welfare as key priority of the national development strategies
of APT Countries.
12.2 Create more opportunities and initiate efforts at regional level to facilitate
exchanges of information, capacities, technology, experiences and resources inorder to develop effective domestic policies on social welfare.
12.3 Promote more bilateral and multilateral cooperation among APT countries onsocial welfare (not only policies) such as the Japan-Indonesia collaboration in
implementing the Mother and Child Record Book.
12.4 Identify means to improve the social welfare system in each country to create amore resilient society.
12.5 Formulate collaborative research agenda to tackle social welfare policies andissues in APT countries that can be used to draw-up policy recommendations forregional cooperation on the improvement of social welfare system in APTcountries.
12.6 Support reforms on the social welfare systems in APT countries, including in
the efforts to include those in the informal sectors.

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12.7 Strengthen institutional capabilities and coordination among government
agencies and ministries related to social welfare policies in the APT Countries.
12.8 Identify and support programs and initiatives to help vulnerable/marginalizedgroups in the APT countries.
12.9 Showcase good practices and successful examples of social welfare policies in
the APT countries.
12.10 Recognize, involve and encourage stakeholders such as organizations andindividuals to contribute to broad-based participation in implementing social
welfare policies in APT countries.
12.11 Incorporate social welfare considerations, wherever possible, into regional
economic cooperation mechanisms.

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