REGIONAL ECONOMIC INTEGRATION FOR IMPROVING CROSS-BORDER AREA IN SEBATIK ISLAND Nuri Widiastuti Veronika Subdivision of Hearing Treatise and Publication Coordinating Ministry for Political, Legal, and Security Affairs of the Republic of Indonesia Jalan Medan Merdeka Barat No. 15, Jakarta Pusat 10110 [email protected] Abstract The proximity of Sebatik Island to Malaysia and its distance from Indonesia have been the causes why Sebatik people tend to perform economic activities with Tawau, Malaysia. Sebatik people have been depending on Tawau to sell their various agricultural commodities and fisheries products. However, informal cross-border trade between Sebatik-Tawau that have been implemented over the past few years has been challenged by some underlying economic problems. Those underlying economic problems are the apparent causes for the lower standard of living of most Sebatik people compared to Tawau inhabitants. As Sebatik people depend on Tawau to fulfill their daily needs, they will have to deal with more hardships since there is a discourse to stop the cross-border trade relations by the government of Tawau. ASEAN Community 2015 which is oriented to establish the regional economic integration in Southeast Asia, may be one solution to the economic problems dealt by the people of Sebatik. Keywords: ASEAN, regional economic integration, Sebatik, Tawau Abstrak Letak Pulau Sebatik yang berada dekat dengan Malaysia dan agak jauh dari Indonesia telah menjadi penyebab mengapa orang-orang Sebatik cenderung melakukan kegiatan ekonomi dengan Tawau, Malaysia. Orang-orang Sebatik telah tergantung pada Tawau untuk menjual berbagai komoditas pertanian dan produk perikanan mereka. Namun, perdagangan informal lintas-perbatasan antara Sebatik-Tawau yang telah dilaksanakan selama beberapa tahun terakhir dihadapkan dengan berbagai masalah ekonomi yang mendasar. Masalah-masalah ekonomi yang mendasarinya adalah standar hidup kebanyakan orang Sebatik yang lebih rendah dibandingkan dengan penduduk Tawau. Karena orang-orang Sebatik bergantung pada Tawau untuk memenuhi kebutuhan sehari- hari mereka, mereka akan menghadapi lebih banyak kesulitan dengan adanya wacana untuk menghentikan hubungan perdagangan lintas batas oleh pemerintah Tawau. Komunitas ASEAN 2015 yang berorientasi untuk membangun integrasi ekonomi regional di Asia Tenggara, mungkin menjadi salah satu solusi untuk masalah ekonomi orang- orang Sebatik. Kata kunci: ASEAN, integrasi ekonomi kawasan, Sebatik, Tawau Tulisan ini merupakan pendapat pribadi dan tidak mewakili pandangan institusi. International & Diplomacy Vol. 2, No. 1 (Juli-Desember 2016) 69 Nuri Widiastuti Veronika Introduction and closer to buy daily needs from Sebatik Island is an island Tawau, Malaysia rather than transporting located in East Kalimantan, Indonesia some goods from Makassar or Surabaya, where the borderline between two Indonesia due to the long distance as ASEAN countries i.e. Indonesia- well as the duration needed. The intense Malaysia cuts across the middle of this relationship economically as well as island. As half of this island belongs to sosially between Sebatik and Tawau has Malaysia’s territory, it has been the gate also been ungoing for the decades even to enter Indonesia from Malaysian before both countries gain their border and also located nearby the independence from colonial rulers conflicted sea border between Indonesia- (Ministry of Foreign Affairs, 2013). Malaysia. Socio-economic life of However, there is a huge gap of welfare Sebatik people have long been depended between Sebatik and Tawau as has been with its nearby cross-border city i.e. the characteristics of Indonesian border Tawau. To travel from Sebatik to Tawau, in Kalimantan where the people of it takes only approximately 15 minutes Sebatik mostly life under the poverty using speed boat. Sebatik island is line while the Tawau people life in economically dependent to Tawau in prosperity. That is why, there were also terms of access to gain daily needs such some people of Sebatik who has been as electricity, gasoline, cooking oil, daily trying to switch citizenship to gain meal products and market to sell Sebatik economic benefit from Malaysia. people’s products (Ministry of Foreign Sebatik’s dependence to Tawau has been Affairs, 2013). From the social economic widely highlighted in Indonesian media life of Sebatik people, it is obvious that resulting in the growing concern about Sebatik-Tawau border relation represents the invasion of Malaysian influence the characteristics of Indonesian border towards the Sebatik economy (Susilo, in Kalimantan where people in Indonesia 2011). border area are less wealthy than The borderline cutting across Malaysia (Nugroho, 2012). between Indonesia and Malaysia in East The proximity to Malaysia and Kalimantan which nearly reaches the distances from Indonesia has been the 1.038 km2 has caused almost all area of causes why Sebatik people tend to this province become the gate of perform economic activities with Tawau, entrance for the distribution of goods and Malaysia. In addition, it is much easier people from neighboring country 70 International & Diplomacy Vol. 2, No. 1 (Juli-Desember 2016) Regional Economic Integration for Improving Cross-Border Area in Sebatik Island especially Malaysia. What makes may be one solution to the economic Sebatik island in East Kalimantan a problems dealt by the people of Sebatik. special attention is that because this There are three pillars of ASEAN island geographically and politically is Community 2015 i.e. ASEAN Political divided into two states region in which and Security Community, ASEAN each half of this area belongs to Economic Community, and ASEAN Malaysia and Indonesia (Susilo, 2011). Social and Cultural Community. Because of this geographical bound, the According to these instruments, the people of Sebatik from Indonesian side establishment of the ASEAN and Malaysian side are interacting to Community would lead to greater each other in almost every aspect of life integration and to move the political and especially politically, economically and security cooperation to a higher place culturally. Economically, most Sebatik- where the members shall rely Tawau economic activities are conducted exclusively on peaceful processes in the informally between the local inhabitants settlement of differences and disputes even before Indonesia and Malaysia (ASEAN Secretariat, 2012). gained their independence from the The integration on political, colonial rules. economic and socio-cultural fields However, informal cross-border ideally can be achieved through a better trade between Sebatik-Tawau that have collaboration among the regional been implemented over the past decades community. However, sometimes it is has been challenged by some underlying difficult to achieve those three fields at economic problems such as illegal trade the same time. On this, David Mitrany activities, non-standardized prices for argued that that successful collaboration agricultural and fisheries products, in one particular technical field would lacking of economic infrastructures and lead to a further collaboration in other informal labor flow. Those underlying related fields. As states and societies economic problems are the apparent become increasingly integrated due to causes for the lower standard of living of the expansion of collaboration in most Sebatik people compared to Tawau technical areas where all parties made inhabitants. absolute gains, the cost of breaking these ASEAN Community 2015 which functional ties would be great (Viotti and is oriented to establish the regional Kauppi, 2010: 126). ASEAN is no economic integration in Southeast Asia, exception from this theory where the International & Diplomacy Vol. 2, No. 1 (Juli-Desember 2016) 71 Nuri Widiastuti Veronika cooperation in economic activities Sebatik. This research is a qualitative especially the free-flow of goods, service approach research where the data and capital will ultimately lead to obtained from the literature reviews and political and socio-cultural integration. field research is analyzed using the In relation to that goal, the descriptive analysis. At the end, this purpose of ASEAN Economic paper will describe how the regional Community (AEC) is to create a large economic integration through the single market which will boost economic establishment of ASEAN Community growth and competitiveness of ASEAN, 2015 can be a means to improve the resulting in better living standards economic life of border communities in (ASEAN Secretariat, 2012). Each pillar the region Sebatik. in ASEAN Economic Community will be the basis for another, it means that the Theoretical Approach single market and production based In order to analyze the impact of inside the ASEAN region alone will be ASEAN Community towards the the trigger for the achievement of improvement of living standard of competitive economic region leading to Sebatik people, it is important to see the competitive economic region with through perspective of regional equitable economic development and at economic integration and inter- the end, the sound, healthy and strong dependence. Economic integration is the regional economy can be integrated into process by which a group of nation- the global economy. states agree to ignore their national From that background, this paper boundaries for at least some economic is divided into two main discussions: (1) purposes, creating a larger and more analyzing the underlying economic tightly connected system