With the ASEAN Economic Community being about two months away, ASEAN continues to organize functional cooperation in Southeast Asia in a wide range of areas through various agencies that implement regional programs under its umbrella. These include (among others) the Center for Biodiversity, the Center for Energy, both of which originate from programs undertaken with the European Union (EU) and are governed by boards made up of ASEAN senior officials and the ASEAN Secretary-General.
Among the various functional initiatives for economic cooperation introduced in ASEAN so far, AFTA is the most successful one. It was launched in 1992 to increase the group’s ‘competitive advantage as a production base geared for the world market’; it has worked as an effective tool to sponsor trade liberalization, introduce a practice of adhering to reciprocal commitments and institutionalize constructive dialogue among the Region’s members.
ASEAN’s 10 members remain diverse in terms of their declared political and ideological backgrounds, and while the very large income gap among them is slowly closing, some have more advanced economies than others.
Companies active in ASEAN or wishing to become active in ASEAN and take advantage of the opportunities the AEC has to offer, have ‘wishes’ to ASEAN governments and the ASEAN Secretariat how to create an environment in which business in ASEAN can strive and be more conducive to investment and job generation. This is the reason why ECCP, years ago, joined attempts to form the EU-ASEAN Business Council (EABC), composed of European Chambers in ASEAN and MNCs active in the Region.
The EABC is a strong supporter of ASEAN’s regional economic integration process. The aims and goals of the ASEAN Economic Community (AEC), as set out in the Blueprint in November 2007, are welcomed and well supported by European business more generally. Once achieved, they will undoubtedly boost economic and social development in the region to the benefit of the broad population and the countries of ASEAN. The Member States of ASEAN should be applauded for their foresight and ambition.
We recognise that the movement towards these aims and goals is a process: the “deadline” at the end of 2015 is just a point in time, rather than a “big bang”. There is much work that remains to be done, and the comments and recommendations included in this paper should be seen as part of this process. Our aim is to highlight some areas where, in our opinion, further work is required to achieve one of the key stated goals of the AEC, i.e. the elimination of non-tariff barriers (NTBs) to trade.
The EABC takes a broad overview of market access and trade-flow restrictions across the ASEAN region and highlights some common themes across the region, namely:
* The scope for improvement in efficiency of customs procedures and greater harmonisation between ASEAN Member States;
* The need for more predictable application of regulations and procedures;
* Continuing restrictions on foreign ownership and control in many sectors; and,
* The lack of harmonized standards or the mutual recognition of standards across many industries and economic sectors.
ECCP is on the executive board of the EABC and is hosting an executive board meeting in Manila this week. The objective of the EABC is to be a driver for constructive change within ASEAN, addressing challenges and opportunities ASEAN offers and to assist companies in their ASEAN advocacy.