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| with DBAV Executive Director, Hyunju Park (middle) and DBAV Chairman, Remco Gaanderse |
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| with fellow-panelists in the dialogue with the audience |
ASEAN leaders adopted the ASEAN Economic Blueprint in 2007 to be the masterplan for the establishment of the ASEAN Economic Community (AEC) by 31 December 2015 and eventually a full-fledged ASEAN Community by 2020.
Recently, the Dutch Business Association Vietnam (DBAV) organized a luncheon talk, under the name "ASEAN Economic Community - 2015 & beyond" in Ho Chi Minh City.
In my 45-minute talk, I outlined both the achievements thusfar and the challenges still ahead. Although the ASEAN-6 states (Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand) have managed to make significant progress on import tariff eliminations and the easing of foreign investment regulations, the other member states (Cambodia, Laos, Myanmar and Vietnam) are lagging behind and need till at least 2018.
Intra-ASEAN trade stands at around 25% and cross-border M&As at around 9%, with Malaysia, Singapore and Thailand as frontrunners. This relatively low figure (which, off course, excludes major investors (and non-ASEAN states) China and Japan), however, will rise, due to the fact that, in particular, the cross-border investments into Myanmar have risen dramatically in 2014 and will continue to do so in 2015.
Sceptics have pointed out that economic disparison between member states will prove to be a major hurdle in realising a true AEC. But even within the EU, there is still a large economic divide between the Nordic countries and Eastern Europe member states and the fact that a powerful economy like Germany plays a leading role in the Union (as Singapore, Malaysia and Thailand do in ASEAN), is not necessariy a bad thing. While ASEAN multinationals have been engaged in cross-border investments for quite some time, the AEC will, in particular, open doors for SMEs of, for example, tech-savy young Vietnamese and Indonesians to take on cross-border adventures.
Is 31 December 2015 a deadline ? No, it is rather a milestone in the work in progress, which is called "ASEAN Community".
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This article appeared earlier in e-magazine Business Trends Asia
