ARE WE READY FOR THE AEC?

The heads of government of the 10 member states –Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, thePhilippines, Singapore, Thailand and Vietnam – formally adopted the Blueprint for the establishment of the AEC by 2015. Under the Blueprint, Asean would be transformed into “a single market and production base, a highly competitive economic region, a region of equitable economic development, and a region fully integrated into the global economy.” Fast forward eight years and one month to December 2015. No longer are we looking at a blueprint or a nebulous idea based on “four pillars,” but rather the concrete reality of a single market and community of 625 million people. Ten has indeed become one.The Blueprint has brought excitement to people in the 10 nations and investors across the world. Since 2007, the nations have been working through a long list of tasts, from the elimination of import duties, the integration of capital markets, liberalization of skilled

labour mobility, to intra-regional connectivity.The single market has proved successful in drawing global

attention to the region. Since the Blueprint was adopted in 2007,the region’s gross domestic product (GDP) nearly doubled from US$1.33 trillion to $2.57 trillion in 2014. In that year, the Asean economy was the third largest in Asia and 7th largest in the world.Total trade also increased from $1.6 trillion to $2.5 trillion. Of the total, intra-regional trade accounted for 24 per cent. Foreign direct investment inflows into Asean also rose from $85 billion or 5 percent of global FDI to $136 billion or 11 per cent. Gone are the days when investors see Asean as 10 stand-alone economies.Where do we stand today? Are we prepared for the opportunities and challenges that will accompany regional economic integration? 

This publication seeks to provide some answers to these questions, with articles provided by Asian News Network (ANN)newspapers from all 10 of the Asean member countries, as well as interviews with the top executives of many of Thailand’s leading businesses, all richly illustrated with the latest figures and statistics.Without doubt, major strides have been taken in the few short years since the Blueprint was signed, particularly in streamlining

the legislative environment and trade facilitation. Big business has adapted particularly well to the regional environment with major companies from most of the Asean states having realized the advantages of the single market many years ago. For them, the AEC means new opportunities and more business growth.But in a region where the disparities among the member countries stand out more than the commonalities, many sectors of society are struggling to come to terms with the dawning reality. Small and medium enterprises, which make up the bulk of businesses and employers in countries across the region, are wondering what will happen when their locally made products face better or cheaper imported goods. Workers in many countries worry if they will still

have jobs once better-qualified, multi-lingual people from the neighbouring countries arrive in their country to work.The reality is that the formation of the AEC in December 2015 is not the goal in and of itself. AEC integration is, rather, an ongoing work-in-process requiring constant adaptation and reinvention in the light of continuous and often unpredictable global change. The full implementation of key measures and the realisation of benefits

for stakeholders may carry through under the Post-2015 Agenda, which will need support from all. The launch of the AEC is in fact just the start of the journey for the region’s 10 countries and 625 million people.