The Secretary-General of ASEAN would like to convey his appreciation to the United States of America for giving the ASEAN Secretariat an opportunity to update the APEC Ministers Responsible for Trade on the latest developments in ASEAN with the recently concluded 18th ASEAN Summit in Jakarta, Indonesia.

Under the Chairmanship of Indonesia this year, which has for its theme “ASEAN Community in a Global Community of Nations”, the following three priorities have been outlined: (i) ensuring significant progress in achieving the ASEAN Community; (ii) ensuring that the regional architecture and regional environment remain ASEAN-centered; and (iii) commencing deliberation on an ASEAN vision beyond 2015.

Realizing the AEC by 2015

Despite the regional and global challenges, implementation of the AEC Blueprint continues to be on track showing good progress in ASEAN’s phased implementation of the measures in realizing the AEC by the year 2015. The liberalization of trade in goods and services under the ASEAN Trade in Goods Agreement (ATIGA) and the ASEAN Framework Agreement on Services (AFAS) continue to be on track in transforming ASEAN into a single market and production base. Member States remain committed to exerting maximum effort and ensuring the timely implementation of the measures in the AEC Blueprint, especially in addressing impediments that include coordination at the national and regional levels. In order to strengthen regional monitoring capacity, the ASEAN Integration Monitoring Office has been established to assist the ASEAN Secretariat and Member States in monitoring the progress of the AEC.

Significant developments have taken place in the first, second and fourth pillars of the AEC, i.e. the single market and production base, a competitive economic region and integration into the global economy, respectively. Noting the lag in the third pillar, which is on equitable economic development comprising development of Small and Medium Enterprises (SMEs) and narrowing the development gap both within and between ASEAN Member States, the Economic Ministers have given additional emphasis on this pillar. They have recognized SMEs as an important segment of the economy and therefore the need to bring them into the mainstream of regional integration by giving them access to technology, financing and markets. It is also recognized that narrowing the development gap is crucial to achieving a more balanced, inclusive and sustained ASEAN Community. In line with the renewed focus on SME development and narrowing development gap, a framework or a set of guiding principles for equitable economic development in ASEAN, including sustainable high-impact targets, would be develop within this year.

Several strategic action plans have been put in place to provide the necessary infrastructure for AEC building. The ASEAN Tourism Strategic Plan (2011-2015), the ASEAN Strategic Transport Plan (2011-2015) and the ASEAN ICT Master Plan 2015 also contribute to the enhancement of regional connectivity consistent with the Master Plan on ASEAN Connectivity. The last Summit reaffirmed Member States’ commitment to enhance regional connectivity not only to link the archipelagic Member States with mainland ASEAN but also to expand connectivity to the East Asia region and beyond.  

Global Economic Development and Challenges

ASEAN is confident that economic growth within the community will settle at more sustainable levels this year between 5.7 percent and 6.4 percent. Despite ASEAN’s economic resilience, risks still remain. The surge in capital flows and emerging inflationary pressures combined with strong commodity price volatility in the region pose challenges to ASEAN’s economic resilience. The Leaders of ASEAN therefore also emphasized the need for stronger regional coordination and cooperation to address global challenges that affect not only food and energy security but also to sustain economic recovery. With the recent establishment of the ASEAN Integrated Food Security Framework and the ASEAN Plus Three Emergency Rice Reserve that would be in place later this year, the thrust of regional cooperation would now be on addressing the challenges brought about by high commodity prices and food price volatility. The Economic Ministers also noted the importance in addressing macroeconomic issues not only at the national level but also through coordination and cooperation at the regional level. The ASEAN Plus Three Macro Economic Regional Surveillance Office (AMRO) in Singapore is expected to play a critical role in strengthening macroeconomic coordination and financial cooperation at the regional level.

Evolving Regional Architecture

ASEAN is determined to play the central role in the emerging regional architecture using the ASEAN Plus One FTAs as building blocks. Current efforts are therefore geared towards determining how best these FTAs could be consolidated, identifying possible gaps and recommending the best possible modality for a deeper and broader FTA, taking into account the recommendations made in the Studies on the East Asia Free Trade Area (EAFTA) and the Comprehensive Economic Partnership in East Asia (CEPEA).

ASEAN’s Leaders have time and again emphasized the mutually reinforcing roles of the ASEAN Plus One, ASEAN Plus Three (China, Japan and Korea) and the East Asia Summit (EAS) in an ASEAN-driven regional economic architecture. The Russian Federation and the United States will be participating at the EAS starting at the 6th EAS scheduled in Bali in November 2011. With the enlargement of the EAS, Leaders were confident of the contribution of the EAS to the promotion and maintenance of a stable and peaceful environment in the region. The EAS shall therefore continue to be a forum for Leaders-led discussion on traditional and non-traditional security threats. Strategic geo-political issues of common interest shall also be deliberated alongside the five existing EAS priority areas (i.e. energy, finance, disaster management, education and avian flu prevention), and ASEAN Connectivity.

Post-2015 Vision for ASEAN

The Indonesian Chairmanship has prompted discussions on a vision for ASEAN beyond the ASEAN Community 2015. The regional landscape is rapidly changing, therefore, for the ASEAN Economic Community to remain relevant, Member States need to start thinking on how economic integration could be further deepened and broadened not only among the Member States but also between ASEAN and its FTA partners. Further, ASEAN will need to ascertain what form or path it will take beyond 2015. 

ASEAN and APEC

ASEAN and APEC share the same end-goals, though the approach may be different, e.g. to integrate the economies of their respective membership. ASEAN may have been more successful in integration efforts and in achieving its trade liberalization goals but could learn from APEC in pursuing initiatives that would support an open market. Structural reforms and trade facilitation initiatives, such as the Single Window, Self-Certification, and SME development are some of the areas that ASEAN could benefit from the experiences of APEC, with the mutual sharing of experiences defining the synergies between ASEAN and APEC. With seven of the ten ASEAN members in APEC and with almost all of the economies participating in the EAS in APEC, ASEAN and APEC just have to mutually reinforce each other towards the achievement of their respective goals and the realization of their respective economic integration objectives. The ASEAN Secretariat stands ready to collaborate with the APEC Secretariat for our mutual benefit and in building a stronger Asia Pacific region.