September 24, 2015    5 minute read

ASEAN Opportunities

   September 24, 2015    5 minute read

ASEAN Opportunities

The Association of Southeast Asian Nations (ASEAN) is a politico-economic organisation of 10 Southeast Asian countries: Indonesia, Malaysia, The Philippines, Singapore, Brunei, Cambodia, Laos, Vietnam, Thailand and Myanmar. The fundamental aim of ASEAN is to promote economic growth and social development within Southeast Asia. Currently, it is planning to launch its latest initiativethe ASEAN Economic Community (AEC), a single market in  Southeast Asia by the end of 2015. Despite its notable successes from an economic and political perspective, this relatively young organisation has some way to go in achieving its aims.

ASEAN Accomplishments

ASEAN’s success has primarily been its ability to foster a peaceful and stable environment in Southeast Asia to allow for its economies to flourish. Its politico-economic approach of providing a forum, known as the ASEAN Regional Forum (ARF), in which participating countries can discuss and resolve issues within the region and the implementation of various Free Trade Agreements amongst ASEAN members has contributed significantly to the region’s economic growth in recent years. Recognising the organisations importance to the region, China, Japan and South Korea has sought closer ties with ASEAN, which resulted in the establishment of ASEAN Plus Three (APT). The establishment of the APT saw the emergence of the ASEAN+3 Macroeconomic Research Office (AMRO). AMRO focuses on monitoring and analysing the APT economies in an attempt to maintain stability within the region. The growing cooperation and stability between these countries is having profound economic effects for ASEAN. Between 2001 – 2013, ASEAN’s combined GDP rose threefold, reaching $2.4 trillion. 

Boundless Opportunities

asean table

ASEAN is in the unique position of being able to influence the future of Southeast Asia. It is already attempting to do just that with its latest initiative, the AEC. ASEAN hopes to create a single production and distribution base where products can be manufactured, distributed and sold anywhere in the region. The advantages of such an initiative would increase intra-regional trade and allow for a more efficient labour market within the region. It would also make the region a much more attractive place for foreign businesses. With ASEAN-India trade reaching $77 billion in 2014 from $44 billion between 2009-2010 and the Eurasian Economic Union’s FTA expansion plans within ASEAN, the region is poised to experience significant economic and social development.

The Challenges Ahead

Despite ASEAN’s accomplishments, ASEAN can not afford to be complacent. The maintenance of its role in Southeast Asain affairs will be dependent on its effectiveness in dealing with the coming problems the organisation will face. There are many doubts surrounding the implementation of ASEAN’s AEC. Philippines’s IBON Foundation has stressed the need to abandon the AEC’s market-led growth strategy. The argument is that a greater focus needs to be placed on the people’s concerns e.g., climate change and respect for human rights. Also, there is the concern of labour mobility becoming skewed. There is the possibility of a brain drain from a member state due to inferior employment opportunities and facilities. ASEAN’s ability to listen to its stakeholders and overcome the economic difficulties in implementing the AEC will be crucial in the organisation’s success.  

Optimism 

It would not be nonsensical to be optimistic about the future of ASEAN. It has already made powerful strides in bringing economic prosperity to Southeast Asia and integrating the region into the global economy. Given recent financial unrest in China, ASEAN is providing an opportunity for foreign investors to diversify their assets within the region. The implementation of the AEC by the end of 2015 will demonstrate how far Southeast Asia has come and how far it still has to go. 

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