asean economic community

ASEAN ECONOMIC COMMUNITY(AEC): OPPORTUNITIES &

CHALLENGES

Ministry of International Trade and Industry, Malaysia11 November 2015 1

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Driving Transformation, Powering Growth 2

This is ASEAN’s time. And that is why it is essential that we continue with the measures to establish the ASEAN Economic Community (AEC) – ASEAN Summit, KL, 27 April 2015.

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CONFLICTS: Indonesia-Malaysia (Confrontation 1962-66) Philippines-Malaysia (over Sabah) Singapore secession from Malaysia Mindanao, Southern Thailand (ASA – Malaya, Thailand and the Philippines - 31 July

1961 ) and MAPHILINDO (Indonesia, Philippines and Malaysia-Realization of Dr Jose Rizal Vision -1963)

COMMUNISM: Cold War, arms race, proxy wars Indochina War: Vietnam, Laos, Cambodia (1955-1975) Burma: 1962

FAKTOR PENUBUHAN ASEANFAKTOR PENUBUHAN ASEAN

POOR AND LOW- LEVEL OF ECONOMIC DEVELOPMENT

Tun Abdul Razak (Malaysia)Adam Malik

(Indonesia)

Narciso R. Ramos (Filipina)

S. Rajaratnam (Singapura)

Thanat Khoman (Thailand)

Founding fathers of ASEAN

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Bangkok Declaration 1967 “Representin g the collectiv e will of the na

tions of South east Asia to bi

nd themselves together in fri

endship and c ooperation an

d, through join t efforts and s

acrifices, secu re for their pe

oples and for p osterity the bl essings of pea

ce, freedom a nd prosperity”

Keahlian ASEAN Selain Negara Pengasas

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ASEAN – at a glancePopulation 625 million

- Youth 60%

GDP USD2,398 billion

GDP Growth 4.4%

GDP per capita USD3,837

Total Trade USD2.53 trllion

- Intra-ASEAN USD608 billion

- Ratio to GDP 104.7%

Total FDI USD136 billion

- Intra-ASEAN USD23 billion

Tourist Arrivals 102 million

- Intra-ASEAN 45 %


ASEAN Community – 3 Pillars• Rules-based

Community of Shared Values and Norms

• Good Governance• Human Rights • Adherence to the

Principles of Democracy

• Single Market and Production Base

• Competitive Economic Region

• Equitable Economic Development

• Linkages to Global Economy

• Education and Human Resource Development

• Science and ICT• Entrepreneurship• Poverty Alleviation & Social Safety Net

• Health• Natural Disasters &

Environment• ASEAN’s Cultural Heritage and

Regional Identity7Driving Transformation,

Powering Growth

AEC JOURNEY

AEC 2015

Peace, solidarity, stability and harmony Commendable rates of economic growth Reduction in development gaps Improving the well-being & quality of life,

poverty reduction Strengthening regional cooperation &

collaboration Gaining global recognition as a dynamic

regional groupingDriving Transformation, Powering Growth 8

SKOP AEC 2015

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10Driving Transformation, Powering Growth

OTHER AREAS OF AEC 2015 Intellectual Property Rights

(IPR):o strengthening domestic IP systems

to deliver timely, quality and accessible IP services through a strong IP regime; and

o acceding to core international agreements.

Competition Policy: National competition law in all Member States

Consumer Protection: Focus on ensure consumer legislation in all Member States, consumer access to information, information exchange mechanism for recalled/banned products and consumer redress mechanism.

Taxation: Network of bilateral agreements to address issues on double-taxation.SME Development: SME Master Plan, SME Development Council (Public and Private Sector representatives) and information exchange on best practices.Narrowing the Development Gap: Initiative for ASEAN Integration (IAI) and capacity-building programs.


STRENGTHENING CONNECTIVITY► Development of rail/road/highways/port networks.

► Regional power transmission grid & Trans-ASEAN gas pipeline.

► ICT – Broadband corridors.

► Transport Agreements/Protocols, e.g. ASEAN Framework Agreement on Multimodal

Transport (AFAMT) ASEAN Framework Agreement on Facilitation

of Goods in Transit (AFAFGIT) ASEAN Framework Agreement on the

Facilitation of Inter-State Transport (AFAFIST) Open Skies Policy Single Shipping Market

On-Going Efforts

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RASIONAL AEC

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PENCAPAIAN AEC SEJAK 2007?

BaranganTarif Penghapusan Fasilitasi Perdagangan

(Pengurangan NTB , Mudah)

PerkhidmatanLiberalisasi 128 subsektor perkhidmatan ;

ekuiti asing sehingga 100%

PelaburanPeningkatan pelaburan yang lebih baik ; ACIA memperuntukkan liberalisasi , perlindungan ,

kemudahan dan promosi

Mobiliti KemahiranMRA di 8 profesion - Perubatan , Pembinaan dan

Pelancongan sektor

Sistem Kewangan Bersepadu

Perkhidmatan kewangan yang lebih liberal , rejim akaun modal dan pasaran saling berkaitan modal

ASEAN BersepaduInfrastruktur fizikal; Liberalisasi perkhidmatan

penerbangan penumpang dan kargo - Dasar Langit Terbuka dan Pasar Penerbangan Tunggal ASEAN

Perhubungan Global ASEAN

FTA dengan rakan-rakan Dialog

15‘Driving Transformation, Powering Growth’

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ASEAN FTAsAFTA ACFTA AKFTA AJCEP AIFTA AANZFTA

Entry Into Force 1993 2005 2007 2008 2010 2010

Market Size(Mil.)

625 1,989 672 749 1,881 650

Economic Size (US$ tri.)

2.5 12.8 3.9 7.1 4.5 4.1

Coverage GoodsServices

InvestmentDSM

GoodsServices

InvestmentDSM

GoodsServices

InvestmentDSM

GoodsServices

InvestmentDSM

GoodsServices

InvestmentDSM

GoodsServices

InvestmentDSM, MNP

E-CommerceIPR

CompetitionEcon Coop

Regional Comprehensive Economic Partnership Agreement (RCEP)

ASEAN – Hong Kong FTA

ON-GOING FTAs NEGOTIATIONS > 3 billion people (almost 50% of global population)

RCEP economies combined GDP > USD17 trillion

RCEP economies > 40% world trade

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MALAYSIA AND AEC Market: 30 million vs 625 million.

27% of Malaysia’s global trade (RM374.7 billion - 2013) is with ASEAN.

FDI inflows from ASEAN into Malaysia: USD6.2 billion (2013).

FDI flows from Malaysia into ASEAN: USD5.8 billion (2013).

Employment opportunities for Malaysians, especially for engineers, technicians, financial analyst, accountants and in other specialized skills, as ASEAN companies expand into Malaysia and vice-versa.

Regional base for Malaysian companies and SMEs.

Investments from 3rd countries using Malaysia as a base.

PKS MALAYSIA DI ASEAN


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SYARIKAT-SYARIKAT MALAYSIA DI ASEAN

Driving Transformation, Powering Growth

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SYARIKAT-SYARIKAT ASEAN DI MALAYSIA


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SYARIKAT-SYARIKAT MULTINASIONAL ASING


MALAYSIAN NETWORKS ( > 1,000 MALAYSIAN COMPANIES IN ASEAN)


Malaysia-Myanmar Business Council

Malaysia-Thai Chamber of Commerce

Malaysia-Singapore Business Council

Malaysia-Indonesia Business Council

Malaysia Business Council Cambodia

Malaysia-Philippines Business Council

Malaysia Business Chamber Viet Nam


AEC 2015: NOT A NEW INITIATIVE AEC is not a new initiative. Liberalization in the context of AEC involves:o Elimination of import duties for intra-ASEAN trade;o Removal of equity restrictions on services and investments

in ASEAN;o Removal of other forms of impediments, such as limiting the

number of services providers, etc.;o Facilitation of intra-ASEAN trade and investment by

removing cumbersome procedures, rules and regulations; and

o Facilitating the mobility of skilled people. The main goal is to remove, to the maximum extent

possible, barriers within the region to facilitate trade and economic activities.

VISI EKONOMI ASEAN PASCA 2015

• Integrasi ekonomi ASEAN diteruskan melalui Visi Ekonomi ASEAN Pasca 2015 yang merangkumi fokus berikut:

– Integrated and Highly Cohesive Economy;– Competitive, Innovative and Dynamic ASEAN;– Resilient, Inclusive and People Centered ASEAN;– Enhanced Sectoral Integration and Cooperation; and– Global ASEAN.

• Visi Ekonomi ASEAN Pasca 2015 akan turut meliputi tindakan-tindakan di bawah Komuniti Ekonomi ASEAN 2015 yang masih belum dicapai.



KEY TAKEAWAYS ON AECOPPORTUNITIES ARE CREATED CHALLENGES TO

OVERCOMERISK TO BE

UNDERSTOOD Strategic

location and ASEAN centrality

Huge market potential combined with China, India and Japan

Hub of FTAs and future transformational trade agreements such as TPP and RCEP

Manufacturing connectivity and technological links with Northeast Asia

Potential hub for education, health, tourism, R&D, logistics and financial services

Growing competitive ASEAN market

Non tariff barriers rising

Rules based ASEAN community not in place

Development gaps: income, human capital, institutions, infrastructure, good governance, regulatory coherence

Lack of ratification and implementation of ASEAN Agreements

Inadequate private sector engagement

Incomplete achievement of AEC

Vulnerability to external economic shocks

Territorial disputes & regional tensions

Rise of China and India as economic powerhouses

Terima kasih

Block 10, Government Offices Complex, Jalan Tunku Abdul Halim, 50622 Kuala Lumpur, Malaysia

Tel: 603-8000 8000 | Fax: 603-6201 2337Email: [email protected] | Website: www.miti.gov.my

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