ASEAN: A Community of Opportunities Toward the ASEAN 2015 Community & Beyond
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1 ASEAN: A Community of Opportunities Toward the ASEAN 2015 Community & Beyond AKP Mochtan, PhD ASEAN Deputy Secretary-General
2
3 THE 25 th ASEAN & RELATED SUMMITS th ASEAN Summit th ASEAN-China Summit th ASEAN-India Summit th ASEAN-Japan Summit 5. 6 th ASEAN-UN Summit 6. 2 nd ASEAN-US Summit th ASEAN Plus Three Summit 8. 9 th East Asia Summit 9. ASEAN-Australia 40th Anniversary Commemorative Summit
4 2015 Year of the ASEAN Community Chairman s Statement We looked forward to the celebration of the establishment of the ASEAN Community in 31st December 2015 through meaningful activities that will provide greater opportunities for ASEAN citizens from all sectors of society to understand ASEAN better and experience its community building endeavors and the benefits that it delivers
5 ASEAN Leaders to Double Efforts Towards ASEAN Community 2015 JAKARTA, 18 November 2014 In a postsummit briefing conducted at the ASEAN Secretariat in Jakarta today, H.E. Dr. AKP Mochtan, Deputy Secretary-General of ASEAN for Community and Corporate Affairs, spoke on behalf of the ASEAN Secretary-General H.E. Le Luong Minh. He reported that good progress has been made with the overall implementation rate of approximately 88% across the three pillars of ASEAN Community. "The Leaders reviewed the process of ASEAN Community building and committed to redoubling efforts towards the realization of the ASEAN Community by 2015," said DSG Mochtan. ASEAN News 18 November 2014
6 ASEAN: Association of South East Asian Nations 10 MEMBER STATES Indonesia (8 August 1967) Malaysia (8 August 1967) Philippines (8 August 1967) Singapore (8 August 1967) Thailand (8 August 1967) Brunei Darussalam (7 Jan 1984) Viet Nam (28 July 1995) Lao PDR (23 July 1997) Myanmar (23 July 1997) Cambodia (30 April 1999)
7 The ASEAN Journey to Community Building Bangkok Declaration 2003 Bali Concord II 1997 ASEAN Vision Cebu Declaration ASEAN Community
8 ASEAN A Rising Economy Combined GDP US$2.4 trillion Huge market with 625+ million population Free trade agreements with major regional economies Highly connected physically, institutionally and among the Peoples
9 ASEAN - GDP Growth 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% 4.7% 1.8% 7.8% 4.9% 5.8% 5.1% Real GDP Growth for the ASEAN region is forecasted at 4.7% in 2014 and expected to pick up to 5.4% in 2015 as economic conditions such as exports and investment improve in the larger ASEAN economies.
10 ASEAN - A Rising Economy If ASEAN were a single country, it would be the seventhlargest economy in the world, with a combined GDP of $2.4 trillion in ASEAN is projected to rank as the fourth-largest economy by McKinsey & Co May 2014
11 ASEAN Gross Domestic Product 2013 COUNTRIES 1. United States 2. China 3. Japan 4. Germany 5. France 6. United Kingdom 7. Brazil 8. Russian Federation 9. Italy 10. India GDP 16,800,000 9,240,270 4,901,530 3,634,823 2,734,949 2,521,381 2,245,673 2,096,777 2,071,307 1,876,797 USD 2.4 trillion Indonesia (16) World 868,346 74,909,811 World Development Indicators database, World Bank, 22 September 2014
12 The ASEAN Community What will ASEAN realize on 31 December 2015? SINGLE MARKET, SINGLE PRODUCTION BASE COMPETITIVE EQUITABLE INTEGRATED INTO THE GLOBAL ECONOMY
13 SINGLE MARKET SINGLE PRODUCTION BASE Free flow of Goods Free flow of Services Free flow of Investme nt Freer flow of Capital Free flow of Labor
14 Trade in Goods Liberalization of Tariff ASEAN % tariff lines eliminated CLMV almost 98% tariff lines reduced to 0-5% 14
15 Facilitation of Trade Customs Standards ROO ASEAN Single Window ASW Pilot Project Customs Transit System Single regulatory regime/framework agreement (cosmetics, EEE, medical devices, traditional medicines) Harmonization of standards MRAs (pharmaceutical, EE) RVC 40% or Change in tariff classification Self-Certification 15
16 USD Billion Export, Import & Total Trade Source: ASEAN Integration Monitoring Office (AIMO) % % 30% % 20% , % 1, , % 1, % 0% , % % -20% % Intra-ASEAN Trade Trade with Rest of World Total Trade Growth Total ASEAN merchandise trade stood at US$2,5 trillion in Intra-ASEAN trade accounted for the highest share of both ASEAN s total exports (26%) and total imports (22.4%). 16
17 Trade in Services ASEAN FRAMEWORK AGREEMENT ON TRADE IN SERVICES (AFAS) Movement of Natural Persons (MNP) Agreement 9 th Package of Commitments The final 10 th Package by 2015 Negotiation of the ASEAN Trade in Services Agreement (ATISA) by
18 Facilitating movement of professionals: ASEAN Qualification Reference Framework (AQRF) Mutual Recognition Arrangements (MRAs) in 8 fields: Engineering Architecture Accountancy Surveying Nursing Medical practitioners Dental practitioners Tourism Professionals
19 ASEAN Comprehensive Investment Agreement (ACIA) ACIA signed in 2009 Protocol to amend ACIA signed in August 2014 Progressive liberalization of restrictions by 2015
20 USD Billion FDI into ASEAN % % -3.6% -41.5% % 7.1% FDI Inflows Growth 120% 100% 80% 60% 40% 20% 0% -20% -40% -60% Total FDI inflows to ASEAN rose to US$122.4 billion in 2013 from US$114.3 billion in the previous year. The EU is the top source of FDI to ASEAN, followed by Japan at 18.7% and intra-asean at 17.4%. In 2013, the majority of the FDI inflows to ASEAN went to the services sector, and about a third to manufacturing.
21 COMPETITIVE ECONOMIC REGION 5 AMS have Competition Law (CPL) and Competition Authorities in place Strengthening Regulatory Environment in ASEAN Kick-off Workshop on Sector Studies for the AEGC Advice on Drafting Competition Laws and Implementing Regulations for the AEGC Institutional-Building and Enforcement of CPL Guidelines on Developing Core Competencies Competition Regulatory Experts Secondment Building Competition Law Enforcement Capability Strategy and Tools for Regional Competition Advocacy AEGC Website Phase II Regional Competition Advocacy In-Country Workshop in CLM to Raise Awareness and/ Study on Economic Benefits and Possible Challenges of CPL Workshop on Promoting Business Compliance for CPL in ASEAN Cross-Cutting Regional Initiatives ASEAN Competition Conference Development of a Regional Cooperation Framework on Enforcement, Information- Sharing, and Technical Assistance Relative to CPL
22 COMPETITIVE ECONOMY ASEAN Connectivity Critical to enhance ASEAN competitiveness.
23 ASEAN Open Skies Policy leads to remarkable development of the ASEAN aviation Capacity of ASEAN airlines almost tripled, from 94 million seats in 2003 to 268 million seats in 2013 Capacity to absorb international arrivals also tripled, from 33 million to 99 million in the same period
24 EQUITABLE ECONOMIC REGION NARROWING DEVELOPMENT GAP Progressing together through cooperation in development ASEAN Political- Security Community ASEAN Economic Community ASEAN Sociocultural Community Initiative for ASEAN Integration Cambodia, Lao PDR, Myanmar, Viet Nam or CLMV assisted in implementing their commitments ensuring that benefits of ASEAN integration are equitably shared. A S&D/Positive-bias approach: Growing the ASEAN cake and increasing the share going to the CLMV countries. Publication on Narrowing the Development Gap in ASEAN: Drivers and Policy Options (2013) Mid-term Review of the IAI Work Plan II ( ) Completed 24
25 EQUITABLE ECONOMIC REGION Development of SMEs Strategic Action Plan for SME Development ( ) SME Service Center Web Portal, with Regional, Sub-regional Linkages SME Guidebook Towards AEC 2015 ASEAN Benchmark for SME Credit Rating Methodology ASEAN Business Incubation Network (ABINet) The ASEAN Business Awards, focusing on Young and Innovative SMEs, in collaboration with ASEAN Business Advisory Council (ASEAN-BAC)
26 INTEGRATION INTO GLOBAL ECONOMY
27 Integration of the ASEAN economy into the global economy continues by enhancing ASEAN+1 FTAs, and establishment of RCEP and ASEAN-HK FTA AFTA 1992 ACFTA 2005 AKFTA 2007 AJCEP 2008 AIFTA 2010 AANZFTA 2010 AHKFTA 2014* RCEP negotiations are on ongoing, five rounds completed (June 2014) RCEP Ministerial Meeting was held twice (2 nd Meeting in August 2014) where the Ministers reaffirmed concluding negotiations by end-2015
28 RCEP Entry Into Force Population/ Market Size ACFTA (China) ,368,160,000 AKFTA (Korea) ,424,000 AJCEP (Japan) ,080,000 AANZFTA (ANZ) ,680,700 4,544,510 AIFTA (India) ,263,200,000 World 7,200,000,000
29 Gap between rich and poor AMSs remains very large and AMSs have a mixed record on income inequality. Many regional initiatives were not able to be incorporated into national plans. Less developed Members face resource constraints to implement some regional commitments.
30 Different levels of legal framework and lack of institutional capacity hindered effective and timely implementation of regional commitments. Lack of engagements with private sector
31 Nay Pyi Taw Declaration on the ASEAN Community's Post 2015 Vision Continue to consolidate the ASEAN Community and deepen ASEAN integration Promote ASEAN as a rules-based community bound by shared principles, values and norms Promote ASEAN as a people-oriented, people-centred community through active engagement with all relevant stakeholders
32 Promote inclusive, sustained and equitable economic growth consistent with the UN's post-2015 development agenda Enhance ASEAN centrality in the evolving regional architecture Raise ASEAN's profile and enhance its relevance in the global community Enhance ASEAN's institutional capacity by strengthening the ASEAN Secretariat and increasing effectiveness of ASEAN Organs
33 CONCLUSION Community building is a work in progress that needs to be constantly nurtured rather than only roadmaps to be laid down and static goals to be met Chairman s Statement ASEAN 25 th Summit 12 November 204
34 Thank You
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