IDEAS ASEAN Prosperity Forum 2019

On 22 October 2019, IDEAS organised the ASEAN Prosperity Forum in collaboration with the ASEAN Studies Center, Chulalongkorn University. The event was held at the Intercontinental Hotel, Bangkok. The purpose of the event was to present and discuss the findings of the ASEAN Prosperity Initiative.

Laurence Todd, Director of Research at IDEAS, provided an insight of what the 3 reports had to offer. With respect to the ASEAN Integration Report, he explained that it is designed to highlight issues and raise questions over the development of ASEAN and its role in supporting the prosperity of its member states and its citizens. Subsequently, he gave a summary of the book “An Evolving ASEAN” by elucidating that the book covers a broader perspective of ASEAN and where it stands in its current trajectory towards integration.

Next, Azam Wan Hashim, Researcher at IDEAS, presented on the success of the ASEAN Economic Community (AEC). He argued that while the total trade in goods between ASEAN and the world has increased over time, the rate of intra-ASEAN trade has remained relatively stagnant. A similar trend is also seen in intra-ASEAN trade in services, as from a total value of US$703b of trade in services between ASEAN and the world, only a mere 16.5% of trade in services are intra-ASEAN. He also discussed on investments and FDI flows, concluding that ASEAN members have increasingly flowed towards the manufacturing and services sector. The main takeaways from his presentation was that while ASEAN has been making progress rather slowly, 647 action lines have been fully or partially implemented. This was further supported as ASEAN member states have become significantly integrated into global value chains which have been pretty successful in developing ASEAN as a production base.

Keynote at the forum was delivered by Dr Narongchai Akrasanee, former Minister of Commerce, Thailand. In his speech he spoke about how ASEAN is shaped by the politics of democratisation and the economics of industrialisation. These are driven partly by United States desire to limit Soviet influence in the region. However, moving forward, these will no longer be relevant. Instead ASEAN’s trajectory will be influenced by post-Westernisation politics and the digitalisation of the economy.

Dr Narongchai’s speech was followed by a quick presentation by Jayant Menon, IDEAS Senior Fellow and Lead Economist at the Asian Development Bank (ADB). Jayant his book titled “An Evolving ASEAN: Vision and Reality”. He gave an overview of the 7 chapters of the book and raised several questions, most notably “What were the original motivations for the creation of ASEAN, and what was the original vision for ASEAN cooperation?”. He declared that “ASEAN is the most successful grouping amongst those of the developing world”, commending how ASEAN has transformed in many aspects, especially from a political security organisation to dealing with various issues in the economic arena. He highlighted that there has been rapid economic development in all member states; hence reducing poverty and improving living standards. Dr Jayant then drew attention to the challenges that ASEAN face. Through this, he stressed that ASEAN ought to balance political and economic objectives, strengthen the AEC’s implementation and ASEAN’s institutions and lastly, balance global, regional and national interests. He reinforced that this can only be done provided that relationships are built upon trust, respect and personal friendships between member countries.

The final part of the forum is a panel discussion consisting of Dr Narongchai Akrasanee, Dr Suthad Setboonsarng, former Deputy Sec. General of ASEAN, Prof. Suthiphand Chirathivat from ASEAN Studies Centre, Chulalongkorn University and Dr. Deunden Nikomborirak, Director of Research, Thailand Development Research Institute (TDRI).

The panel reiterates that ASEAN is responsive exercise. The intra-regional trade only consist of around 20% of total trade volume, while the rest are with external partners such the US, Japan and China. Because of this, ASEAN members tend to readily sign up for trade agreements such as CPTPP and RCEP compared with fellow ASEAN countries. Because of this ASEAN may not be an optimal trade area given that member states are more integrated in the global value chain of other external parties. In order to move forward, member states need to identify areas where all can mutually benefit and build a binding agreement around that.

The panel also identified problems in the way the AEC’s progress was measured. Currently progress is measured by activities i.e. how many sub-sectors are liberalised. However, many liberalised subsectors have little commercial and economic impacts. One interesting example was the case of Thailand liberalising its transport sector. The problem is that this only applies to transportation pulled by human or animal-power. This shows the lack of real commitment among members. By measuring actual impact of each liberalisation, a clearer picture of the progress of the AEC can be built.

Lastly, the panel agree that greater participation of the private sector is needed due to the limited capacity or capabilities of some member states’ bureaucracy.

October 22, 2019

9.00 am – 12.00 pm

Pinnacle 1 & 2, Intercontinental Bangkok, 973, Ploenchit Road, Lumpini Road, Pathumwan, Bangkok 10330
2019-11-27T15:17:28+00:00 27th November 2019|Previous Events|Comments Off on IDEAS ASEAN Prosperity Forum 2019