The enactment of the regional economic cooperation scheme ASEAN-China Free Trade Agreement (ACFTA) is an interesting phenomenon accompanying political-economic changes in the East Asian region. The regional economic cooperation scheme first proposed by then-Chinese Prime Minister Zhu Rongji in 2000 was driven more by political considerations. China's rise as a global economic power was seen as a threat to ASEAN. Accordingly, China's involvement in regional forums is considered very important for ASEAN in creating regional stability. ASEAN-China FTA is an economic instrument, which is also part of ASEAN's political agenda to support regional stability. Indonesia, as the most influential country in ASEAN, supports regional economic cooperation, and always emphasizes the importance of ASEAN centrality in the face of uncertain changes in the world political economy. Unfortunately, Indonesia's support to ASEAN-China FTA, and Indonesia's stance on ASEAN centrality, turn out to be expensive in the socio-economic costs, namely: (i) Indonesia's unpreparedness in building the competitiveness of its economy, in line with the integration of the national economic system into the wider regional economy, and (ii) the economic unpreparedness actually caused by sharp differences of interest among domestic actors and exacerbated by the weakness of the government to overcome the differences.

Indonesia is the largest Muslim country in the world. Would a free trade agreement (FTA) with the country be beneficial both economically and politically to the United States? What kind of benefit could Indonesia expect? This book presents a case for improved trade relations between Indonesia and the United States and recommends advancing exploratory talks toward a US-Indonesia FTA. The authors present a detailed study of the stakes involved in the various areas of the proposed negotiation and estimate the FTA's potential for trade creation, trade diversion, and welfare under different scenarios.

This book analyses the relations between Indonesia and China in the regional dynamics of Southeast Asia. The rising China has influenced global and regional constellations, and also has direct impacts for Indonesia. While this fact should be viewed as an opportunity that needs to be fully utilised for the benefit of national development of Indonesia, we should also prepare for the threats embedded in this development, especially from the service and labour sectors. As such, this book suggests that equal positions in relations between Indonesia and China are absolutely necessary, since both countries need each other in their efforts to maintain the continuity of their development. It also argues that to further strengthen its position in relation to China in the future, Indonesia's diplomacy requires an integrated grand design that supports the creation of economic and political power in the face of the emergence of China's economic and military power.

Chandra provides a political-economic analysis of the dynamic relationship between ASEAN economic integration and Indonesian nationalism. This book is suitable for those interested in contemporary Southeast Asian affairs.