The 16 member states of the East Asia Summit (EAS), asserting their collective economic weight, formally announced the creation of Economic Research Institute for ASEAN and East Asia (ERIA) in June 2008. The institute essentially reflects an attempt on the part of the Asian economic powers to create a knowledge bank, which can offer critical policy inputs to the member countries in pre-empting, preventing and improving the crisis scenarios in the eastern Asian hemisphere.

The ERIA is expected to function as a policy think-tank, providing collective policy inputs towards the processes of economic integration and capacity-building in the East Asia. The idea of ERIA, proposed by Japan in January 2007 at the 2nd summit of the EAS (Cebu, the Philippines), was later approved by member states at the third summit meeting in November 2007 (Singapore). A Governing Body, consisting of government officials, business leaders and eminent intellectuals chosen from among the sixteen member states, manages the institute. Japan has agreed to fund its activities for the first decade and the Asian Development Bank has extended its support.

The formation of ERIA, characterized as 'the OECD of East Asia' by previous Japanese Prime Minister, Yasuo Fukuda, highlights three important trends. First, twin processes of economic integration - (a) between East Asia and the developed West and (b) within East Asia - have considerably enhanced the region's collective vulnerability to market-induced instability. The all pervasive impact of current global financial meltdown, spiraling energy and global food prices, and the economic crisis of late 1990s bear testimony to the prevailing risk. Therefore, East Asia needs a collective deliberative framework which can constantly monitor the prevailing economic situation in the region. In this context, the ERIA is an important addition to the slew of risk management measures, being collectively taken since the Chiang Mai Initiative of 2000.

Second, the unrepresentative nature of global deliberative frameworks, such as the World Bank, International Monetary Fund, and OECD (Organization for Economic Cooperation and Development), has led the rising Asian economies to mend their fences through their own multilateral endeavours. None of the three rising Asian economic powers - China, India, and ASEAN - are represented at the OECD. Similarly the monetary prescriptions of the IMF are much more maligned in today's Asia. In other words, such a step points towards growing de-legitimization by the Asian countries of global institutions which have so far catered to the interests of either economically advanced countries or the developed West.

Third, the setting up of ERIA, under the ASEAN+6 framework, indicates the necessity of developing an inclusive process of economic integration, further fuelling the ongoing debate over whether an exclusive ASEAN+3 or more inclusive ASEAN+6 framework should be given greater importance. There is a growing understanding among the countries of East Asia that the process of economic integration has to be an inclusive one involving all important stakeholders and players which can offer an effective support system to the process. Certainly, it is the East Asia Summit, which offers the optimum utilization of intellectual strength and which can draw on the best ideas and practices available in the eastern Asian hemisphere. Not to forget, both China and India have emerged as engines of Asian growth and have remained comparatively less affected by the ongoing economic crisis. Therefore, the ERIA clearly vindicates the viability and appropriateness of the East Asia Summit as an overarching cooperative framework,

Now the question arises as to what the EAS seeks to achieve through the ERIA mechanism. Three focus areas have been identified so far, which also highlight three important challenges facing the region. The first important focus area is facilitate greater economic integration among the member states. The ERIA will concentrate on two structures of economic integration - ASEAN Economic Community by 2015 and East Asia Community in the future. In this way, the institute will be able to facilitate the creation of what Surin Pitsuwan, the Secretary General of ASEAN, calls, "the world's largest business space in a vibrant and more integrated East Asia."

While the member states have witnessed large-scale economic growth and social development, there has been growing concern regarding the widening divide between the rich and the poor. Therefore, the second important task of the ERIA would be to recommend ways to reduce the development gap. Finally, the ERIA has also to devise ways and means to ensure that the process of development being embarked upon by the member states is a sustainable, and therefore, a long-term process.

Such an exercise can prove to be the first important step towards collective understanding and deliberation over the complex economic issues and challenges facing the member states. However, the caveat of any such initiative lies in the process of implementation and how seriously the EAS entertains the recommendations of the ERIA. This brings us to a distinct limitation of the ASEAN-driven mechanism - even the best initiatives falter when it comes to implementation. The ongoing financial crisis is going to be the litmus test for the utility of the Institute.