The document provides an overview of the ASEAN Economic Community (AEC). Key points: - The AEC aims to create a single market and production base through several measures including eliminating tariffs and non-tariff barriers, liberalizing trade in services, facilitating investment flows, and promoting freer movement of skilled labor. - Significant progress has been made in reducing tariffs, with over 99% eliminated between ASEAN-6 countries. Attention is now turning to reducing non-tariff barriers. - Other areas of integration include mutual recognition agreements for professionals, liberalizing rules for foreign investment, harmonizing intellectual property rights, and strengthening regional connectivity through infrastructure. - The long-term vision is for

1. ASEAN ECONOMIC COMMUNITY
Datuk Dr. Rebecca Fatima Sta Maria
Secretary-General
Ministry of International Trade and Industry
‘Driving Transformation, Powering Growth’

2. ASEAN – at a glance
2
Driving
Transforma.on,
Powering
Growth
Population 625 million
- Youth 60%
GDP USD2,398 billion
GDP Growth 5.1%
GDP per capita USD3,837
Total Trade USD2,511 billion
- Intra-ASEAN USD608 billion
- Ratio to GDP 104.7%
Total FDI USD122.4 billion
- Intra-ASEAN USD21.8 billion
Tourist Arrivals 89.3 million
- Intra-ASEAN 39.9 million

3. ASEAN: Growing through economic integration
334
606
1,898
2,395
GDP (US$ mil)
760
1,172
3,162
3,832
GDP per capita (US$)
317
519
593
625
Population (mil)
1990
2000
2010
2013
Source: ASEANStat, IMF, WB, UNCTAD
306
759
2,009
2,511
Total Trade (US$ bil)
144
167
511
609
Intra-ASEAN Trade (US$ bil)
13
23
100
122
FDI Inflows (US$ bil)
Driving
Transforma.on,
Powering
Growth
3
1990
2000
2010
2013

4. 387.6 (16.2%)
860.8 (35.9%)
312.1 (13.0%)
297.9 (12.4%)
269.0 (11.2%)
171.2 (7.1%)
54.7 (2.3%)
16.1 (0.7%)
15.5 (0.6%)
10.3 (0.4%)
Source: ASEANStat
ASEAN GDP 2013 (US$ billion)
The 6 biggest ASEAN
Member States accounted
for more than 95% of ASEAN
GDP in 2013
860.8 (35.9%)
Economies at different stages of development
4

5. 888
1,037
1,548
1,909
2,707
3,460
5,679
10,421
39,679
55,183
ASEAN GDP PER CAPITA 2013 (US$)
ASEAN Av GDP Per Capita was US
$3,832 in 2013
Source: ASEANStat
5
Economies at different stages of development

6. 3rd largest market in the world
Population in million
JAPAN
128
EU
502
INDIA
1,195
CHINA
1,340
USA
310
ASEAN
625
7th largest economy in the world
GDP 2013 in US$ trillion
Brazil
ASEAN
United
France
Germany
Japan
China
United States 16.8
9.2
4.9
3.7
2.8
2.7
2.4
2.2
Fast growing economy
Real GDP Growth 2013 (%)
7.7
5.2
5.0
Japan
United States
India
ASEAN
China 7.7
5.2
5.0
2.2
1.6
… the whole is greater than the sum of its parts
6
Source: ASEANStat, IMF, WB

7. ASEAN’s Journey towards economic integration
Driving
Transforma.on,
Powering
Growth
7
TIMELINE LIBERALISATION PROCESS
1977-1992 Preferential Trading Arrangement (PTA) – 25-50% Margin of Preference on 1000
tariff lines
1993 ASEAN Free Trade Area (AFTA) – key was the Agreement on Common Effective
Preferential Tariff. Revised as ASEAN Trade In Goods Agreement in 2010
1995 ASEAN Framework Agreement on Services (AFAS) – Progressive Liberalisation
1998 ASEAN Investment Area (AIA) – Investment Liberalisation . Revised as the
ASEAN Comprehensive Investment Agreement (ACIA) in 2009
2004-2010 ASEAN FTAs with Dialogue Partners (China, Japan, Korea, India, Australia &
New Zealand) - RCEP with existing ASEAN’s FTA Partners under negotiations
(target substantial completion by end of 2015)
1993 Sub – Regional Economic Growth Areas (IMGT, BIMP EAGA,SIJORI, AMBDC)
2008-2015 Integration through ASEAN Economic Community (AEC)

8. 8
Driving
Transforma.on,
Powering
Growth
ASEAN
Economic
Community
ASEAN Socio-Cultural
Community
ASEAN
Political-
Security
Community
• 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 Identity
The 3 Pillars of the ASEAN Community

9. ASEAN Economic Community (AEC)
9
Driving
Transforma.on,
Powering
Growth
• FTAs
• Global Supply
Networks
• SME Development
• Initiative for
ASEAN
Integration
• Competition Policy
• Consumer
Protection
• IPR, Taxation
• e-Commerce
• Infrastructure
• Free flow of goods
• Free flow of services
• Free flow of
investment
• Freer flow of capital
• Freer flow of skilled
labour
Single
Market &
Production
Base
Competitive
Economic
Region
Linkages
with Global
Economy
Equitable
Economic
Development

10. AEC is a work in progress…working to
make it easier to do business
Driving
Transforma.on,
Powering
Growth
10

11. Elimination of import duties
for intra-ASEAN trade:
q ASEAN-6: 99.65% duties
eliminated (1 January
2010)
q C L M V 9 3 % d u t i e s
eliminated (1 January
2015; 7% by 2018)
11
Elimination of duties: Tip of the iceberg
Driving
Transforma.on,
Powering
Growth

12. Guiding Principle: Progressive liberalisation
12
Driving
Transforma.on,
Powering
Growth

13. 13
Driving
Transforma.on,
Powering
Growth
q Removal of equity restrictions
on services and investments in
ASEAN;
q Removal of other forms of
impediments, such as limiting
the number of services
providers, etc.;
q Tr a d e a n d i n v e s t m e n t
facilitation through removing
cumbersome procedures, rules
and regulations; and
q Facilitating the mobility of
skilled people.
The rest of the iceberg…

14. Now to step-up work on Non-Tariff Barriers
(NTBs)
14
Driving
Transforma.on,
Powering
Growth
Examples of NTBs in ASEAN:
§ Import quotas
§ Restrictions on import/distribution licensing agreements
§ Product regulatory standards
Measures to address NTBs:
§ Adoption of regional and national level of NTM Work
Programme
§ Structure to resolve NTM cases faced by businesses
§ Establishment of an interagency body at the national level
in each Member State to strengthen coordination of
domestic efforts to address NTM/NTBs.

15. 15
Driving
Transforma.on,
Powering
Growth
Trade in services: What has been achieved?
AFAS
Packages Date
of
signing
1st
Package
15
Dec
1997,
Kuala
Lumpur,
Malaysia
2nd
Package 16
December
1998,
Ha
Noi,
Viet
Nam
3rd
Package 31
December
2001
(Ad-­‐Referendum
Signing);
4th
Package 3
September
2004,
Jakarta,
Indonesia
5th
Package 8
December
2006,
Cebu,
the
Philippines
6th
Package 19
November
2007,
Singapore
7th
Package 26
February
2009,
Cha-­‐am,
Thailand
8th
Package 28
October
2010,
Ha
Noi,
Viet
Nam
9th
Package 26
August
2014,
Nay
Pyi
Taw,
Myanmar
§ Final AFAS Package: 2015

16. 16
Driving
Transforma.on,
Powering
Growth
Facilitating Movement of Professionals and Talent
ASEAN Movement of Natural
Persons Agreement (MNP)
outlines the immigration formalities
for the temporary entry or
temporary stay of natural persons:
ü limited to business visitors,
intra-corporate transferees,
and contractual service
suppliers;
ü does not cover permanent
entry and unskilled labour.

17. 17
Driving
Transforma.on,
Powering
Growth
§ MRA – Agreement to facilitate movement of ASEAN
professionals across the region.
§ ASEAN has concluded 7 MRAs; in various stages of
operationalization:
NO. MRA DATE
OF
SIGNING
1. MRA
for
Engineering
Services 9
Dec
2005
2. MRA
for
Nursing
Services 8
Dec
2006
3. MRA
for
Architectural
Services 19
Nov
2007
4. Framework
MRA
for
Surveying
Qualifica[ons
19
Nov
2007
5. MRA
for
Medical
Prac[[oners
Services
26
Feb
2009
6. MRA
for
Dental
Prac[[oners
Services 26
Feb
2009
7. MRA
for
Accountancy
Services 26
Aug
2014
Mutual Recognition Agreements (MRA)

18. 18
Driving
Transforma.on,
Powering
Growth
Evolution of Investment Liberalisation and
Protection in ASEAN
1987
Agreement for Promotion and Protection
of Investments (IGA)
1998
ASEAN Investment Area Agreement
(AIA)
2009
ASEAN Comprehensive Investment
Agreement (ACIA)

19. 19
Driving
Transforma.on,
Powering
Growth
Investment: What has been Achieved?
§ ASEAN Comprehensive Investment Agreement (ACIA)
signed in February 2009 Providing for investment
liberalization, protection, promotion and facilitation.
§ ACIA will:
• benefit investors and their investments based in ASEAN;
• maintains and accords preferential treatment among
ASEAN Member States; and
• preserves commitments made under the Framework
Agreement on the ASEAN Investment Area (AIA) and the
ASEAN Investment Guarantee Agreement (IGA).

20. 20
Driving
Transforma.on,
Powering
Growth
§ 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.
Other Areas Covered under the AEC

21. 21
Driving
Transforma.on,
Powering
Growth
§ 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.
Other Areas Covered under the AEC

22. 22
Driving
Transforma.on,
Powering
Growth
Cooperation in Other Economic Sectors:
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

23. 23
Driving
Transforma.on,
Powering
Growth
Post-2015 Economic Vision: consolidation and going
beyond…
• incorporate unfinished commitments
• Framework of the ASEAN Economic
Community 2025: covers 5 main
sections:
o Integrated and Highly Cohesive
Economy;
o Competitive, Innovative and
Dynamic ASEAN;
o Resilient, Inclusive and People
Centered ASEAN
o Enhanced Sectoral Integration and
Cooperation; and
o Global ASEAN.

24. Thank You
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