ACV 2045 charts new paths for unity and innovation
KUALA LUMPUR: ASEAN's new Community Vision 2045 (ACV 2045) marks a major shift in the region's development strategy, shaping the future direction of the grouping for the next two decades.
Building on the past achievement, ACV 2045, adopted at the 46th ASEAN Summit here today, sets out ASEAN's shared long-term ambitions for a resilient, innovative, dynamic, prosperous, and people-centred region.
It is designed to ensure that ASEAN remains a key driver of peace, stability, and growth, while continuing to lead on regionalism and multilateralism in a rapidly evolving global landscape, according to the frequenly asked question (FAQ) on ASEAN 2045 : Our Shared Future.
The ASEAN Community Vision 2045 will replace the ASEAN 2025: Forging Ahead Together document, adopted in 2015, which guided the development of the ASEAN Community over the past decade.
The Vision reaffirms ASEAN's commitment to regional integration through its three foundational pillars, namely the ASEAN Political-Security Community (APSC), the ASEAN Economic Community (AEC), and the ASEAN Socio-Cultural Community (ASCC).
At its core, ACV 2045, under the Political-Security pillar, is a powerful commitment to uphold peace, security and stability through ASEAN-led mechanisms, enhance its role in regional and global affairs, and promote a rules-based international order.
The Vision reaffirms the grouping's commitment to a Southeast Asia free of nuclear weapons and other weapons of mass destruction, alongside the peaceful settlement of disputes in accordance with international law, including the United Nations Convention on the Law of the Sea (UNCLOS).
Economically, the Vision paints a compelling picture of ASEAN as a major global economic powerhouse and a seamlessly integrated single market driven by sustainability, innovation and good governance.
It also highlights financial resilience, inclusive growth, and empowerment of micro, small and medium enterprises (MSMEs) as key drivers of regional development.
In the socio-cultural sphere, ACV 2045 envisions a people-centred, where quality of life is enhanced through transformative education, decent employment, universal health coverage, human security, and fostering a shared ASEAN identity.
It also pledges to uplift the voices of women, preserve cultural heritage, and leverage sports to promote peace and unity.
The Vision also champions connectivity, aiming for a region linked by sustainable infrastructure, interoperable digital systems, resilient logistics and enhanced people-to-people linkages.
It highlights the development of smart and sustainable cities where innovation and technology drive inclusive growth and environmental stewardship.
In recognising the dynamic and complex global environment, ASEAN also acknowledges the importance of strengthening its institutional capacity and responsiveness in addressing global and regional challenges.
Through a strong pledge to translate this Vision into action, ASEAN member states commit to fully and effectively implement the commitment in the Vision and all its Strategic Plans.
The 46th ASEAN Summit is being held under Malaysia's 2025 Chairmanship theme 'Inclusivity and Sustainability'. This year also marks the country's fifth time chairing the regional bloc after 1977, 1997, 2005 and 2015.
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Economic Watch: ASEAN sees necessity to expand LCS to enhance integration, prevent external risks
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In 2023, ASEAN leaders adopted the declaration on advancing regional payment connectivity and promoting local currency transactions, eyeing leveraging local currencies for cross-border payments and establishing a task force to develop an ASEAN local currency transaction framework. Since then, progress by 2025 has been both significant and tangible, particularly through the Regional Payment Connectivity (RPC) initiative, said Tasawan Khao-uppatum, a senior researcher at Kasikorn Research Center in Thailand. The RPC has rapidly expanded from five founding central banks in 2022 to nine ASEAN members by 2025, and it aims to build seamless regional payment systems through cross-border QR code payments, especially for tourism and retail, and account-to-account transfers that enhance financial inclusion, particularly for small- and medium-sized enterprises (SMEs), Tasawan said. Now, many national systems have already been linked, including Thailand's PromptPay, Indonesia's QRIS, Singapore's PayNow, Malaysia's DuitNow, and full ASEAN-wide interoperability is expected by the end of 2025, according to the expert. "In practice, Thai consumers can now use QR code payments abroad in countries such as Japan, Cambodia, Vietnam, Malaysia, Indonesia, Singapore and some other places. Additionally, cross-border transfers with Singapore can now be done using mobile phone numbers." ENHANCE REGIONAL INTEGRATION As intra-regional trade is rapidly growing, promoting LCS through the QR code-based payment systems simplifies transactions for tourists, expatriates and small businesses, promotes financial inclusion, and boosts local economic development. SMEs can use the system to conduct international trade with lower transaction costs. In ASEAN, the adoption rate of digital payments, especially QR code payments, has grown significantly. Mohammad Faisal, executive director at the Center of Reform on Economics Indonesia, said that for Indonesia, cooperation in the implementation of local currency transactions has started since 2017 with Thailand and then followed by several other countries including Malaysia, Singapore, Japan, South Korea, and China. Faster and more interoperable payment systems support seamless trade, investment, and tourism flows within the ASEAN bloc, said Tasawan, adding that in 2024, 25 percent of Thailand's exports were settled in local currency Thai baht, up from 14 percent in 2010. "For instance, the growth of cross-border QR payment systems makes it easier for Thai tourists to spend abroad, particularly within ASEAN. The number of Thai travelers to ASEAN countries increased from 4.5 million in 2013 to 6.7 million in 2023. Likewise, the number of ASEAN tourists entering Thailand rose from 7.38 million in 2014 to 10.6 million in 2024," said Tasawan. 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The benefit of building regional payment connectivity for ASEAN is to make the ASEAN currencies more stable, stronger and more resilient against external shocks or changes in the global economy. It can also encourage an increase in intra-ASEAN trade and investment, Faisal added. By settling trade in local currencies, emerging markets aim to reduce their exposure to exchange rate volatility and external monetary shocks stemming from advanced economies' policy shifts, said Tasawan, adding that this trend signals a decentralization of global financial power -- moving away from a reliance on the U.S. dollar and toward a more balanced system where multiple currencies play significant roles regionally and globally. Experts suggest that by decreasing dependence on the U.S. dollar, ASEAN can gain greater control over its economic future and lessen its susceptibility to U.S. monetary policy. 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3 hours ago
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Malaysia Sun
3 hours ago
- Malaysia Sun
Economic Watch: ASEAN poised for major global economic role, but challenges remain, experts say
KUALA LUMPUR, June 12 (Xinhua) -- ASEAN could emerge as the world's fourth-largest economy in the coming decades, experts say, but the regional bloc must accelerate integration, strengthen institutions, and adapt to global shifts to realize this potential. Experts also urge ASEAN to act collectively to solidify its global presence. EMERGING INDUSTRY FUELING COMMON FUTURE "ASEAN, presently with an economic size of 3.8 trillion U.S. dollars, could become the fourth-largest economy on an aggregated basis but of a smaller world," said Mohd Munir Abdul Majid, chairman of CARI ASEAN Research and Advocacy, in a recent email interview with Xinhua. Mohd Munir, who is also president of the ASEAN Business Club and a senior fellow at LSE IDEAS, said technology -- particularly artificial intelligence (AI) in the services sector -- will drive future growth. He emphasized that ASEAN's access to technology should be guided by cost and technical quality. "E-commerce could be a key catalyst for intra-regional trade," Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia Berhad, said that a robust digital infrastructure, including telecommunications and smart devices, is essential. Mohd Afzanizam also highlighted the importance of logistics to ensure speedy delivery, which necessitates efficient warehousing systems. He further emphasized that payment systems, such as QR code networks, are crucial to support micro, small, and medium enterprises (MSMEs) in expanding into international markets. Oh Ei Sun, principal adviser at the Pacific Research Center of Malaysia, stated that ASEAN should prioritize high-tech sectors that offer greater value-added potential. However, he told Xinhua that traditional commodities like palm oil and petroleum would remain vital as the region catches up in advanced industries. ASEAN INTEGRATION PROGRESSING STEADILY ASEAN's economic integration has been advancing gradually, with a strong emphasis on consensus and free trade, experts say. "ASEAN's economic integration has progressed steadily rather than hastily, grounded in a consistent commitment to free trade," said Mohd Munir. According to him, ASEAN's journey began with the ASEAN Free Trade Area in 1992, followed by the launch of the ASEAN Economic Community (AEC). The process is now guided by the Kuala Lumpur Declaration on ASEAN 2045, adopted at the 46th ASEAN Summit in May. "There is a lot happening. Not fast enough or optimally, but in a clear direction," he noted, adding that ASEAN has progressed based on consensus to deepen integration and free trade. Li Yuqing, assistant professor of Institute for International and Area Studies of Tsinghua University, said ASEAN's updates to the ASEAN Trade in Goods Agreement enhance regional trade and deepen integration, supporting its goal of becoming the world's fourth-largest economy. "Above all, ASEAN is a peaceful region, which makes it a conducive location for foreign direct investment and business ventures that can come from across the globe," Mohd Afzanizam said, highlighting initiatives such as the Johor-Singapore Special Economic Zone as evidence of strengthening regional ties. INSTITUTIONAL REFORMS, STRATEGIC CLARITY NEEDED Despite progress, experts pointed out that ASEAN faces institutional limitations. Mohd Munir said the bloc's decision-making structure remains slow, and the secretariat is under-resourced, despite the ASEAN 2045 vision calling for strengthening. "The point ASEAN must realize is that there is an urgent need to develop its strategic options in a changing world. It has taken a slow and steady course on increasing intra-regional trade, labor mobility and institutional implementation, emphasizing always on consensus," he said. "But there are now big issues for decision-making that cannot follow that route." Mohd Afzanizam warned that non-tariff barriers remain a key obstacle, as member states often act to protect their domestic industries. "Continuous dialogue, both government-to-government and government-to-business, is vital to identify and bridge these gaps," he said. Oh echoed those concerns, urging ASEAN to address internal development disparities. "ASEAN should focus on eradicating the abject poverty amongst itself for the least developed member states, and escaping the middle-income trap for the developing member states," he added. CHINA TIES OFFER CHANCE FOR COOPERATION Experts believe ASEAN-China relations are entering a new phase, driven by growing investment and strategic collaboration. Mohd Munir noted that ASEAN-China relations have been close in trade and, increasingly, in investment. In the context of global trade tensions, it would be good to deepen that relationship for mutual benefit. "For China, ASEAN's economic integration provides a relatively stable regional trade environment, helping China manage external trade risks and enhance economic resilience and stability," Li mentioned. She also noted that integration makes ASEAN's investment environment more stable and transparent, enabling businesses to better access the ASEAN market and achieve more efficient resource allocation. ASEAN countries may deepen cooperation with China in infrastructure development, which would accelerate progress in the digital economy and green transition, Oh suggested. GREATER INFLUENCE AMID UNCERTAINTY Regardless of whether ASEAN becomes the fourth-largest economy, its current size already warrants greater global influence, as the bloc is urged to exercise its weight in global affairs. "ASEAN needs to be less reticent about asserting its influence and initiating new ideas in a world marked by global disorder," he added. "Deeper ASEAN economic integration would strengthen the bloc's bargaining power," Li said, adding that it would enhance its role as a regional coordinator and allow it to play a more significant role. Mohd Afzanizam said that the shift toward a multipolar world provides more platforms for diplomatic solutions rather than unilateral decisions, especially from a single superpower, which can be disruptive. "This should resonate well with ASEAN as the region has always been peaceful. Certainly, ASEAN would want to advocate this at the global arena which is a universally accepted value," he added.
