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ASEAN ROADMAP
FOR INTEGRATION
 Focus is on the creation of an ASEAN
 Economic Community where there is
 a free flow of goods, services,
 investment, and free flow of capital,
 equitable economic development,
 and reduced poverty and socio-
 economic disparities in year 2020.
Economic
Implications
Favorable Implications
 the benefit of expanding markets
  and promoting competition by
  eliminating barriers to trade
  among member-countries
 “trade creation effect”
Risks
 may give rise to welfare losses (“trade
  diversion effect”)
 limited investment resources are diverted
  to the larger-scale integrated market
  (“investment diversion effect”)
 concerns on the “noodle bowl effect”, the
  potential problems that may arise as a
  result of lack of coherence among
  different overlapping agreements
Evolution of
ASEAN
Economic
Integration
ASEAN Free Trade Agreement
(AFTA)
 Put in place in 1992
 aims to promote the region’s competitive
  advantage as a single production unit
 commits members to free trade within a 15-year
  timeframe through the elimination of tariff and
  non-tariff barriers with the end in view of
  promoting greater economic efficiency,
  productivity and competitiveness
ASEAN economic community:
the ultimate goal in 2020

  Was recommended by the ASEAN
   Heads of Government last November
   2002
  In 2003, ASEAN founded on the three
   pillars of political and security
   community, economic integration
   and socio-cultural cooperation
ASEAN economic community:
the ultimate goal in 2020

 ASEAN Security Community (ASC),
 the ASEAN Economic Community
 (AEC) and the ASEAN Socio-Cultural
 Community (ASCC) was formed
 based on the three pillars
Monetary and Financial
  Integration
 sought to promote closer monetary and
  financial cooperation by way of the conduct
  of an economic review and policy dialogue as
  well as the establishment of regional
  financing arrangements
 The ASEAN Surveillance Process was
  established on October 1998
Monetary and Financial
  Integration
 May 2000- the ASEAN+3 Finance Ministers agreed
  on the Chiang Mai Initiative (CMI) and to expand the
  ASEAN Swap Agreement (ASA) to all ASEAN
  members
 “all swap providing countries can simultaneously
  and promptly provide liquidity support to any
  parties involved in bilateral swap arrangements at
  times of emergency”

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Asean roadmap for integration

  • 2.  Focus is on the creation of an ASEAN Economic Community where there is a free flow of goods, services, investment, and free flow of capital, equitable economic development, and reduced poverty and socio- economic disparities in year 2020.
  • 4. Favorable Implications  the benefit of expanding markets and promoting competition by eliminating barriers to trade among member-countries  “trade creation effect”
  • 5. Risks  may give rise to welfare losses (“trade diversion effect”)  limited investment resources are diverted to the larger-scale integrated market (“investment diversion effect”)  concerns on the “noodle bowl effect”, the potential problems that may arise as a result of lack of coherence among different overlapping agreements
  • 7. ASEAN Free Trade Agreement (AFTA)  Put in place in 1992  aims to promote the region’s competitive advantage as a single production unit  commits members to free trade within a 15-year timeframe through the elimination of tariff and non-tariff barriers with the end in view of promoting greater economic efficiency, productivity and competitiveness
  • 8. ASEAN economic community: the ultimate goal in 2020  Was recommended by the ASEAN Heads of Government last November 2002  In 2003, ASEAN founded on the three pillars of political and security community, economic integration and socio-cultural cooperation
  • 9. ASEAN economic community: the ultimate goal in 2020  ASEAN Security Community (ASC), the ASEAN Economic Community (AEC) and the ASEAN Socio-Cultural Community (ASCC) was formed based on the three pillars
  • 10. Monetary and Financial Integration  sought to promote closer monetary and financial cooperation by way of the conduct of an economic review and policy dialogue as well as the establishment of regional financing arrangements  The ASEAN Surveillance Process was established on October 1998
  • 11. Monetary and Financial Integration  May 2000- the ASEAN+3 Finance Ministers agreed on the Chiang Mai Initiative (CMI) and to expand the ASEAN Swap Agreement (ASA) to all ASEAN members  “all swap providing countries can simultaneously and promptly provide liquidity support to any parties involved in bilateral swap arrangements at times of emergency”