Leaders of the Association of Southeast Asian Nations (Asean) met in Indonesia on Saturday under the cloud of conflict on the Thai-Cambodia border and ongoing rights abuses in Myanmar.

Indonesian President Susilo Bambang Yudhoyono opened the two-day summit in his country's capital, which is expected to focus on long-term efforts to create a closely integrated regional economic zone by 2015.

Other issues expected to be addressed include the scourge of human trafficking in the region, food security, territorial disputes in the South China Sea, and East Timor's membership bid.

But even before the Presidents and Prime Ministers of the disparate 10-nation bloc sat down in Jakarta's cavernous convention centre, their discussions had been framed by negative news from troubled member states.

Myanmar stole the headlines on Friday when it was announced that the military-led country and serial human rights abuser had asked to chair the group in 2014.

US-based Human Rights Watch said Asean, already struggling for credibility, would become the "laughing stock of intergovernmental forums" if it gave the chair to such a pariah state.

Asean leaders are also facing mounting pressure to help end a bloody border conflict between Thailand and Cambodia which has claimed 18 lives and temporarily displaced 85,000 people in recent months.

"We realise that to ensure a peaceful and stable East Asia region, we must ensure stability and security in our region," Yudhoyono said in his opening speech.

"If conflict occurs, Asean must be capable of facilitating a forum for diplomacy and open dialogue with the intent of attaining common peace."

Until now, conflict resolution has been alien to a trade-focused group that works on a principle of non-interference in members' internal affairs, despite criticism over the years that it is nothing but a talking shop.

Its halting efforts to negotiate an end to the Thai-Cambodian conflict — a move described by Asean chief Surin Pitsuwan as a "great leap forward" — are being closely watched as a litmus test of its lofty ambitions to create a more integrated regional economic and
security community in just four years' time.

Indonesian foreign minister Marty Natalegawa met his counterparts from both countries in Jakarta on Friday and said they had agreed to accept 15 Indonesian military observers on each side of the disputed frontier.

But he said the modest observer mission, which would have no power to police a ceasefire, had yet to be dispatched because of disagreements over troop locations.

UN Secretary-General Ban Ki-moon has called for a ceasefire and said the neighbours should launch "serious dialogue", while backing Asean's mediation role. Washington has also said it supports Asean's efforts.

Asean groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

Myanmar skipped its turn to chair Asean in 2006 due to international pressure for democratic reforms, but only on condition that it could ask to lead the group when it felt it was ready.

The country's president Thein Sein met President Yudhoyono — both former generals — in Jakarta on Thursday on what is his first trip abroad as president since he was sworn in on March 30.

Natalegawa confirmed Myanmar's request would be discussed but suggested that a decision would be deferred until the country's "readiness" for the job could be assessed.

The military-led nation is a constant source of embarrassment for Asean's more democratic states, trumping other problem members such as communist Vietnam and Laos, which have significant human rights issues of their own.

Myanmar opposition leader Aung San Suu Kyi was released from house arrest in November shortly after an election, the country's first in 20 years, that led to the handover of power from the military to a nominally civilian government.

Her release was welcomed worldwide, but Western governments which impose sanctions on Myanmar want the new government to do more to demonstrate its commitment to human rights.

In his opening speech, Yudhoyono warned fellow Southeast Asian states that rising food and energy prices could drive more people into poverty and urged coordinated action to fight inflation.

"History shows that the rise of food and energy prices. Has always caused the increase in the number of people living in poverty," he said.