Minister tips Asean to overtake US economy

Palm oil: one of Asean’s big earners. Source: Wikimedia

Malaysian trade and industry minister Ong Ka Chuan says the formation of the Asean Economic Community (AEC) at the end of 2015 had led to predictions that the 10-member bloc could become the world’s fourth largest economy by 2030, after China, India and the European Union.

He predicted that the region’s GDP would double to US$4.7 trillion by 2020 as Asean’s goods reached new markets.

“Intra-Asean investments stood at US$23.8 billion in 2014, 15.7 per cent higher than the previous year, making up some 17.33 per cent of all direct investments in the region,” Ong said.

He said foreign direct investments (FDI) into Malaysia from elsewhere in Asean increased by US$526 million in 2010 to US$2.2 billion last year, while the percentage of intra-Asean FDI rose from 6 per cent in 2010 to 24 per cent in 2015.

The services industry was the prime mover for the AEC with the import-export of services increasing from US$354 billion in 2007 to US$619.7 billion in 2014, Ong said.

“Similarly, intra-ASEAN services trading [rose] from US$89.5 billion to US$172.6 billion during the same period,” the minister said.

When Japan’s Foreign Minister Fumio Kishida met his Thai counterpart Don Pramudwinai in Bangkok he expressing support for the AEC.

He praised the aim to eliminate tariffs and simplify customs procedures and said Japan would strengthen cooperation with Thailand and rest of Asean.

Kishida is visiting Myanmar, Thailand, Laos and Vietnam after a trip to China last week.

He met Laos Prime Minister Thongloun Sisoulith on Thursday to reiterate Japan’s desire to work closely with Laos to reduce tensions over the South China Sea dispute, his officials said.

The premier is expected to visit Japan to join an outreach session of the G7 summit of the world’s leading economies on May 26-27 in the central Japanese prefecture of Mie.

Bangladesh, Indonesia, Laos, Papua New Guinea, Sri Lanka, Vietnam and Chad will join the G7 leaders for talks on Asian and African development at the summit.

Laos holds the rotating Asean presidency this year.