Latest news with #KualaLumpurDeclarationonAsean2045
The Star
13 hours ago
- Business
- The Star
Asean poised for major global economic role, but challenges remain, experts say
KUALA LUMPUR/MANILA (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 Aseans 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 realise 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. - Xinhua
New Straits Times
04-06-2025
- Business
- New Straits Times
ASEAN-GCC-China: Building a resilient trilateral trade architecture
If procrastination is the thief of time, then pussyfooting around the Asean-GCC-China Summit agenda might well be wanton heedlessness! Indeed, Asean must lead, not wait, because Malaysia is well-positioned to set that agenda. While the Kuala Lumpur Declaration on Asean 2045 outlines an ambitious vision – a developed Asean that is the epicentre of growth in the Indo-Pacific – this aspiration won't come to pass in isolation. As Prime Minister Anwar Ibrahim said, Asean's journey "is a story of cooperation across borders, dialogue across differences and hope across generations." Rising as an engine of global growth hinges on how Asean diversifies its economic linkages, including with the GCC and China. The Joint Statement of the trilateral Summit and the Asean-GCC Joint Declaration on Economic Cooperation mark a significant step forward. Both documents lay the foundation for a convergence that could reshape the region's trade architecture and deepen existing economic synergies, through three interconnected tracks: the Asean-China Free Trade Area (ACFTA) 3.0 Upgrade, the Asean-GCC FTA, and indirectly, the China-GCC FTA. Each agreement is progressing at a different pace. The ACFTA 3.0 is nearing completion, incorporating new-generation chapters on digital trade, competition, green economy and regulatory coherence. On the other hand, the China-GCC FTA, long under negotiation, is close to finalisation. Meanwhile, the Asean-GCC FTA is at the feasibility study stage, with negotiations to be launched soon. It gives Asean and the GCC a rare opportunity to draw on the structure and substance of the other two negotiations and design an agreement that bridges the earlier two initiatives. The sequencing could, in fact, work tremendously in favour of Asean, positioning it as the central node in a new trade framework. What is often overlooked is that these are not discrete bilateral tracks. Rather, they weave a coherent structure connecting Southeast Asia, the Gulf and China, three of the world's most dynamic economic blocs. Such a scheme could lend further credence to the rules-based multilateral trading system, which, in Anwar's words, is being subjected to "the onslaught of arbitrary imposition of trade restrictions." It would also provide greater certainty and predictability for investors, and institutionalise Asean's centrality in the evolving global trade order. The economic logic is compelling, and the numbers are convincing. The GCC was Asean's seventh-largest trading partner in 2022, with trade totalling US$130.7 billion, and is projected to grow at 30 per cent annually. Asean-China trade surpassed US$722 billion in 2022, making China Asean's largest trading partner for the past 14 consecutive years. These relationships already run deep. What is missing is strategic coherence, something the trilateral FTA configuration could decisively address. Woven into such an arrangement must be substantial commitments in key growth sectors such as Islamic finance, digital economy, and renewable energy, which offer mutual benefits and long-term dividends. Introducing them explicitly into such an FTA would mark a refreshing departure from conventional trade accords, not to mention, create a more innovative partnership. Naturally, working together on currency settlements, cross-border payments, and sovereign wealth fund linkages could further strengthen financial resilience. Malaysia, as Asean Chair, has already taken the lead. We are pushing for the early conclusion of ACFTA 3.0, supporting a clear timeline for Asean-GCC FTA negotiations, while advancing the formation of a permanent mechanism that would coordinate the multiple trade tracks strategically. Additionally, setting up a regional business council could ensure private sector alignment, enabling businesses to benefit from this evolving topography. While some noted the absence of several GCC Heads of State at the Summit, the GCC was nonetheless robustly and adequately represented, underscoring institutional earnestness. Premier Li Qiang's attendance, meanwhile, is a clear signal of China's commitment. If a picture paints a thousand words, then the appearance of Asean leaders being flanked by GCC leaders, clad in traditional Arab attire, on one side, and Chinese leaders on the other, does make for amazing optics! Granted, while faith may move mountains, looks alone won't. But add in the substantive discussions and professed undertakings, we are looking at a level of engagement that must perforce inspire Asean to seize the moment. The coming decade will not be shaped by more of the same. It will be shaped by those who can integrate across fault lines, build resilient frameworks, and champion multilateralism with a powerful sense of purpose. A trilateral trade architecture linking Asean, the GCC and China is not just about trade flows. It is a strategic bet on a more cohesive, rules-based and opportunity-rich regional order. The ball's in Asean's court. And Malaysia, as Chair, must hit it!
New Straits Times
25-05-2025
- Business
- New Straits Times
ACC endorses Asean Community Vision 2045 ahead of Summit
KUALA LUMPUR: The Asean Coordinating Council (ACC) has agreed to forward the Asean Community Vision 2045 document to its leaders for adoption at the 46th Asean Summit tomorrow. This was one of the key outcomes of the ACC meeting chaired by Foreign Minister Datuk Seri Mohamad Hasan today. Wisma Putra said this marked the final ministerial-level meeting in preparation for the summit tomorrow. "The meeting served as an important platform for reviewing Asean's progress under the Asean 2025 Vision and aligning collective priorities toward 'Asean 2045: Our Shared Future'. "Foreign ministers exchanged views on the status of key documents and reports to be submitted to Asean leaders and reviewed developments related to Timor-Leste's full membership process. "A key outcome of the meeting was the endorsement of the final report of the High-Level Task Force on the Asean Community Vision 2045. "The council agreed to forward the vision document to Asean leaders for adoption at the summit," it said in a statement. It said Mohamad also conveyed appreciation to member states, the co-chairs of the high-level task force, and the Asean secretariat for their contributions in shaping a forward-looking vision for the region. The meeting also took note of five substantive reports and endorsed six reports for submission to the leaders. The Kuala Lumpur Declaration on Asean 2045 is scheduled to be signed tomorrow, marking a strategic milestone that will guide Asean's next phase of community-building and regional leadership.
