Total foreign direct investment (FDI) flow from China, Japan and Korea – collectively called the Plus Three Countries – not only maintained an upward trend, but surged 62.4 per cent when it increased from US$9.2 billion in 2009, to US$14.9 billion last year. These investments make up one-fifth of the total FDI flows into ASEAN last year.
Meanwhile, total trade between ASEAN and the three East Asian countries last year increased 28.9 per cent to US$533.3 billion. Exports increased by 34.9 per cent while imports increased by 23.5 per cent. Total trade between ASEAN and these countries make up 26.1 per cent of ASEAN’s total trade last year.
The figures were revealed to the ASEAN Economic Ministers (AEM) and Economic Ministers of the People’s Republic of China, Japan and the Republic of Korea here this week, when the 14th Consultation among them were held on 12 August. The Consultation was held as part of the programme at the 43rd AEM Ministers Meeting and Related Meetings held here this week.
During the Consultation, the Ministers discussed regional and global economic developments, especially Japan’s economic recovery from March 11 earthquake and tsunami in Northeastern Japan. They acknowledged that it is important to promptly ensure the smooth flow of goods, services and people in the region. The Ministers also acknowledged Japan’s cooperation, including the effort of training programme to improve the quality of logistics in ASEAN.
The ASEAN Plus Three process continues to be a main vehicle to achieve the long-term goal of building an East Asian community. The Plus Three process and the EAS play a complementary and mutually reinforcing role with other regional mechanisms in community building efforts.
The 14th AEM-Plus Three Consultation in Manado were co-chaired by H.E. Dr Mari Elka Pangestu, Indonesian Trade Minister as this year’s AEM Chair; H.E. Chen Deming, China’s Commerce Minister (MOFCOM); Mr. Kenji Goto, Deputy Director General, Ministry for Economy, Trade and Industry of Japan (METI); and H.E. Kim Jong-Hoon, Minister for Trade of the Republic of Korea.
Singularly, the three countries also held independent Consultations with the AEM at this week’s Meetings here. On 12 August, China’s MOFCOM held its 10th Consultation with ASEAN and the Republic of Korea held its 8th Consultation with ASEAN. After the AEM-Plus Three Consultation, Japan’s METI held its 17th Consultation with ASEAN yesterday.
On China, the ASEAN-China Free Trade Area (ACFTA) agreement which was launched on 1 January last year to full fanfare has been fruitful. Last year, trade between ASEAN and China returned an upward trend, after a decline in 2009 due to the global financial crisis. ASEAN’s exports to China increased by 39.1 per cent, from US$ 81.6 billion in 2009 to US$113.5 billion last year. This helped China to move a rung up as ASEAN’s second largest export destination. Imports also increased by 21.8 per cent from US$96.6 billion in 2009 to US$117.7 billion last year. China remains as ASEAN’s largest trading partner and accounts for 11.3 per cent of ASEAN’s total trade. Conversely, ASEAN was China’s fourth largest trading partner and accounts for 9.8 per cent of China’s total trade, but so far in the first half of this year, ASEAN improved to become China’s third largest trading partner.
On Korea, two-way trade relations between ASEAN and the Republic increased 31.3 per cent from US$74.7 billion in 2009 to US$ 98.1 billion last year. Exports grew by 31.2 per cent amounting to US$45.0 billion while imports increased by 31.4 per cent to US$53.1 billion. Korea remains as ASEAN’s fifth largest trading partner, while ASEAN was the second largest trading partner of Korea last year. FDI flow from Korea to ASEAN more than doubled – it shot by about 155.7 per cent from US$1.4 billion in 2009 to US$3.8 billion last year, making Korea ASEAN’s fourth largest investor last year.
On Japan, the year 2010 recorded a strong rebound of ASEAN-Japan trade, signalling a recovery from the global economic crisis. Both exports to and imports from Japan showed significant increases, with exports rising 32 per cent from US$78.1 billion in 2009 to US$103.1 billion last year. Total trade increased by 26.7 per cent to US$203.9 billion last year. Japan is ASEAN’s third largest trading partner last year with a 10 per cent share of ASEAN’s total trade. Conversely, ASEAN is Japan’s second largest trading partner (after China). FDI from Japan to ASEAN surged by 124.3 per cent from US$3.8 billion in 2009 to US$8.4 billion last year. Japan holds a share of 11.4 per cent of total inward investment to ASEAN last year.
Japan’s Consultation with the AEM was co-chaired by Minister Mari and H.E. Banri Kaieda, METI Minister.