Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

ASEAN 2030


Published on

ASEAN 2030 - Towards a Borderless Economic Community by Masahiro Kawai, Dean and CEO Asian Development Bank

Published in: Business
  • Be the first to comment

ASEAN 2030

  1. 1. 11 Masahiro Kawai Dean and CEO Asian Development Bank Institute ERIA-Harvard-ASEAN Secretariat Symposium: Realizing a more Integrated, Competitive, Equitable, and Resilient ASEAN Community 30 October 2012, Phnom Penh, Cambodia ASEAN 2030 Toward a Borderless Economic Community
  2. 2. Outline  Key Messages  SWOT Analysis  Aspirations  Challenges and Enabling Factors  Policy Options  Conclusions: Toward a Borderless Economic Community
  3. 3. 3  Economic issues have assumed central stage in ASEAN since its creation 45 years ago => An ASEAN Economic Community will be created in 2015  Economic slowdown in the West and rising competition from the PRC and India bring ASEAN at a crossroads => A RICH ASEAN by 2030: Tripling per capita incomes and people’s increasing quality of life to OECD levels; or Losing Centrality: Slowdown to 3% growth and a rise in security and political tensions–depends on right policy mix  Need for deep structural reforms and bold initiatives for regional cooperation: ASEAN must evolve beyond the AEC toward a truly borderless economic community Key Messages
  4. 4. 4 Strong macroeconomic fundamentals Abundant natural resources Young, growing population and expanding middle class Strong FDI record and regional production networks Ability to manage diversity and solidify ASEAN institutionalization Huge development gaps within and across countries Low education attainments and large unskilled workforce Lack of regional strategy to promote investment in R&D Incomplete achievement of the AEC by 2015 and lack of vision for integration beyond 2015 Weak ASEAN Secretariat and need for an efficiency update of ASEAN’s governance principles Main Strengths Main Weaknesses ASEAN SWOT Analysis
  5. 5. 5  Central, strategic location in expanding Asia with huge market potential  Deep manufacturing and technology links with Northeast Asian economies  Strong financial cooperation initiatives to build on  Potential to develop regional hubs in various new areas  Convener of Japan, PRC, Korea & India, and regional groupings  Loss of regional centrality due to the rise of PRC and India  Vulnerability to external shocks due to high degree of economic openness and trade dependence on US and EU  Loss of internal cohesion due to competition with PRC and India  Unresolved territorial disputes  Inability to collectively manage climate change, energy security, disaster management Main Opportunities Main Threats
  6. 6. 6  Ambitious yet pragmatic 2030 targets  Triple average per-capital GDP, with higher growth in CLMV countries than elsewhere to help close development gaps  Increase average people’s quality of life to reach today’s OECD levels  Realize a Resilient, Inclusive, Competitive, and Harmonious region – A RICH ASEAN ASEAN 2030 Aspirations
  7. 7. 7 2030 GDP Projections & Aspirations
  8. 8. 8 Quality of Life: Dimensions & Indicators
  9. 9. 9 Reaching OECD Levels (2 examples)
  10. 10. 1010 A “RICH” ASEAN by 2030
  11. 11. Challenges and Enabling Factors 11
  12. 12. 12 Singapore Brunei Dar. Malaysia Thailand Indonesia Overcome Land & Demographic Constraints Diversify the Economy Improve the Business and Investment Climate Foster Human Capital Strengthen Macroeconomi c Management Increase Labor Productivity Improve the Business and Investment Climate Foster Human Capital Narrow Inequalities and Foster Social Cohesion Develop Economic Infrastructure Improve the Business and Investment Climate Foster Human Capital Cultivate Technology and Innovation Capabilities Diversify the Economy Improve the Management of Natural Resources Primary Challenges by Country - I
  13. 13. 13 Philippines Viet Nam Lao PDR Cambodia Myanmar Improve the Business and Investment Climate Strengthen Governance and Institutions Diversify the Economy Foster Human Capital Strengthen Governance and Institutions Develop Economic Infrastructure Develop Economic Infrastructure Foster Human Capital Diversify the Economy and Develop the Agricultural Sector Strengthen Macroeconomic Management Strengthen Governance and Institutions Foster Human Capital Improve the Management of Natural Resources Reduce Poverty Diversify the Economy and Develop the Agricultural Sector Primary Challenges by Country - II
  14. 14. 14 2030 Challenges by Income Group
  15. 15. ASEAN-Wide Challenges and Enabling Factors Key 2030 Challenges Enhancing macroeconomic and financial stability Promoting economic convergence and equitable growth Forging a competitive and innovative region Managing natural resources and sustaining the environment Enabling Factors Broadening and deepening financial markets Harnessing human capital Building seamless connectivity Strengthening governance Enhancing ASEAN's institutional framework and empowering the Secretariat 15 Beyond the realization of the AEC by 2015 Toward a borderless economic community by 2030
  16. 16. 16 Macroeconomic & financial stability Maintain macroeconomic and financial stability Avoid future crises and contagion Economic convergence & equitable growth Narrow development gaps within & across countries Smoothen intra-ASEAN labor movements and reduce inequalities, social tensions, and discrimination Challenges - I:
  17. 17. 17 Competitiveness and innovation Reduce cost of doing business across ASEAN countries Accelerate technological diffusion & absorption Capture synergies between science & industry Exploit comparative advantage in tropical agriculture Capitalize on the increasing inflow of tourists Natural resources and the environment Protect the environment and manage climate change Ensure energy supply & security Manage natural resources and avoid their depletion Challenges - II
  18. 18. 18 Develop efficient markets in support of the real sector Increase effectiveness of financial intermediation Improve the recycling of regional savings for regional investment Cope with the aging population and slowing work force growth Invest in higher quality education systems, including tertiary education and science & maths in basic education Financial markets Human capital Enabling Factors - I Connectivity Foster ability to trade, travel, & transit Update existing facilities in transport & communication Harmonize rules, standards, & regulations Governance Promote use of transparent rules & regulations Manage national institutions effectively Strengthen national civil services
  19. 19. 19 ASEAN’s institutional framework, governance and the Secretariat  Power of the ASEAN Secretariat  ASEAN’s decision-making processes  National sovereignty and ASEAN ASEAN’s regional and global roles Enabling Factors - II
  20. 20. 20 Enhancing macroeconomic & financial stability Strengthen ASEAN mechanisms to participate in wider regional initiatives and create an ASEAN Financial Stability Dialogue Start a dialogue and establish regional guidelines on fiscal sustainability Introduce a flexible coordination mechanism to maintain intraregional exchange rate stability in normal times while allowing for flexibility in times of stress Promoting economic convergence & equitable growth Improve coordination to channel external assistance to CLMV countries through the Framework for Equitable Economic Development Introduce an ASEAN-wide system for freer, managed movement of unskilled labor Establish an ASEAN Convergence Fund by enlarging the ADF, entrusting professionals for its administration Policy Options - I
  21. 21. 21 Forging a competitive & innovative region Create an ASEAN Competitiveness Institute to promote region-wide yet country-specific R&D strategy and innovation policy Establish an ASEAN agency for the certification & standardization of Made-in-ASEAN products Form an ASEAN Tourism Council to promote multi-country tours and adopt a single ASEAN Visa for qualified tourists Managing natural resources and sustaining the environment Adopt long-term development strategies that mainstream green growth, reflecting regional priorities to protect the environment Harmonize countries’ environmental laws & standards and promote green products’ development using common standards Adopt national policies to tax environmental “public bads” and eliminate harmful subsidies that encourage inefficient use of natural resources, especially fissile-based Policy Options - II
  22. 22. 22 Create an ASEAN College of Financial Supervisors Invest in scientific & technical skills Expand scholarships and student exchanges and credit transfer system Financial markets Human capital Policy Options - III Connectivity Strengthen private sector links and operationalize the ASEAN Infrastructure Fund Expedite the implementation of the ASEAN Connectivity Master Plan Governance Adopt an ASEAN-wide competition policy & legal framework
  23. 23. 23 Empower the ASEAN Secretariat Enhance its legal capability to attain trust & respect in enforcing commitments by member countries Increase its financial & human resources (to match the operational costs expected to rise to $200M by 2030) Revisit the equal budget contribution principle based on contributing capacity & expected benefits Improve decision-making processes & efficiency Adopt a more flexible decision-making system to allow operational issues to be decided through qualified majority, while maintaining consensus for fundamental issues Enhance ASEAN’s institutional framework Shift more responsibilities from national to ASEAN Create new functional institutions based on members’ interest to serve as regional champions, with the Secretariat’s coordinating role Raise ASEAN’s global role Speak with a louder voice in international forums by entrusting the ASEAN Chair and the Secretary General more Policy Options - IV
  24. 24. 24 The path beyond AEC 2015—to realize the aspirations of a RICH ASEAN by 2030—requires a solid vision of a truly borderless economic community ASEAN leaders need to make the best commitments possible today for meeting the aspirations of a RICH ASEAN tomorrow A right mix of deep domestic structural reforms and bold cooperation initiatives is needed Different country-specific solutions reflect the diversity of ASEAN economies as part of a region-wide strategy ASEAN leaders, policymakers and businesses need to think globally, coordinate regionally, and act nationally Conclusions: Toward a Borderless Economic Community by 2030
  25. 25. Thank you! For more information: Dr. Masahiro Kawai Dean & CEO Asian Development Bank Institute +81 3 3593 5527