micro and macroeconomics analysis of ASEAN Countries (1980-2014)

1. ECON 1550
INTRODUCTORY ECONOMICS FOR
ENGINEERING
NAME MATRIC NO.
AIN NUR SYAZWANI BINTI ABDUL LATIF
NURNADHIRA BINTI ZAINAL ABIDIN
NUR RASHIDAH BINTI ROSLAN

2. SEM 2, 2015 / 2016
CONTENT
INTRODUCTION
GENERAL GOVERNMENT CONSUMPTION (CURRENT LCU)
GROSS FIXED CAPITAL FORMATION (CONSTANT LCU)
EXPENDITURE ON EXPORT OF GOODS & SERVICES (NATIONAL
CURRENCY)
INTEREST RATE (MONEY MARKET RATE, LENDING RATE)
INFLATION RATE (INDEX 2010=100)
NOMINAL EFFECTIVE EXCHANGE RATE (INDEX 2010=100)
REAL EFFECTIVE EXCHANGE RATE (INDEX 2010=100)
M2 (CURRENT LCU)
EXPORT (USD)
IMPORT (USD)
GDP (USD)

3. INTRODUCTION
This report is showed up the time series data of selected micro and macroeconomics
analysis of ASEAN Countries as the following variables; General Government
Consumption(Current LCU), Gross Fixed Capital Formation(Constant LCU), Expenditure
on Export of Goods and Services(National Currency), Interest Rate(Money Market
Rate,Lending), Inflation Rate(Index 2010=100), Nominal Effective Exchange Rate(Index
2010=100), Real Effective Exchange Rate(Index 2010=100), M2(Current LCU), Export of
Goods and Services(Current $USD), Import of Goods and Services($USD), and
GDP($USD).
ASEAN countries is Association of Southeast Asian Nations(ASEAN) was establish on 8
August 1967 in Bangkok by the five original member countries: Indonesia, Malaysia,
Philippines, Singapore, and Thailand, Brunei Darussalam joined on 8 January 1984,
Vietnam on 28 July 1995, Laos and Myanmar on 23 July 1997, and Cambodia on 30 April
1999. In recognition of the fundamental importance of improving the livelihoods and well-
being of the peoples of Southeast Asia, and the need to promote ASEAN awareness as
well as people-to-people contact through scholarships, fellowships and other exchanges,
the Leaders of the Association of Southeast Asian Nations (ASEAN) agreed to establish
the ASEAN Foundation on 15 December 1997 in Kuala Lumpur during
the Association’s 30th Anniversary Commemorative Summit.
The ASEAN Declaration states that the aims and purposes of the Association are: (1) to
accelerate the economic growth, social progress and cultural development in the region
through joint endeavors in the spirit of equality and partnership in order to strengthen the
foundation for a prosperous and peaceful community of Southeast Asian nations, and (2)
to promote regional peace and stability through abiding respect for justice and the rule
of law in the relationship among countries in the region and adherence to the principles of
the United Nations Charter. In 1995, the ASEAN Heads of State and Government re-
affirmed that "Cooperative peace and shared prosperity shall be the fundamental goals of
ASEAN."

4. Some of the major political accords of ASEAN are as follows:
● ASEAN Declaration, Bangkok, 8 August 1967;
● Zone of Peace, Freedom and Neutrality Declaration, Kuala Lumpur, 27 November
1971;
● Declaration of ASEAN Concord, Bali, 24 February 1976;
● Treaty of Amity and Cooperation in Southeast Asia, Bali, 24 February 1976;
● ASEAN Declaration on the South China Sea, Manila, 22 July 1992;
● Treaty on the Southeast Asia Nuclear-Weapon-Free Zone, Bangkok, 15 December
1997;
● ASEAN Vision 2020, Kuala Lumpur, 15 December 1997;
● Declaration on Joint Action to Counter Terrorism, 5 November 2001;
The Report analyses the economic situation of these ASEAN member countries during the
latest thirty-five period(1980-2014) for which the time series data are available. It examines
analysis through details the micro and macroeconomics developments in these ASEAN
member countries and investigates the relationship and the inter-linkages of these
developments with those in both developing and developed countries as well as the world
economy as a whole. The analysis is carried out in the light of the global, regional and
national developments, using current data on ASEAN countries, specially compiled from
various international and national sources, in addition to the databases.
Finally, the report also highlights the annual session of the time series data in the table
form and the analysis of particular time series of variables in these ASEAN countries.
Moreover, the time series has been discussed to the trend and descriptive statistics which
are mean, standard deviation, frequency and percentage of the data among the ASEAN
member countries.

5. GENERAL GOVERMENT CONSUMPTION (CONSTANT LCU)
General government final consumption expenditure (formerly general government
consumption) includes all government current expenditures for purchases of goods and
services (including compensation of employees). It also includes most expenditures on
national defense and security, but excludes government military expenditures that are part
of government capital formation. Data are in current local currency.
In this part of the study, shows the analysis of the general government final consumption
expenditure of selected ASEAN countries (Brunei, Indonesia, Cambodia, Laos, Myanmar,
Malaysia, Philippines, Thailand, Singapore, Vietnam) which is
examined. The time series data set consists of annual cover the period of 1980-2014.
In the column charts above are shown the general government final consumption
expenditure values of the selected ASEAN countries. The values of general government
consumption of many countries in this group have been gained during the period of time.
We can see that Indonesia has the highest value of general government final consumption
expenditure from 1980-2014 followed by Vietnam.

6. GRAPH 2: GENERAL GOVERMENT CONSUMPTION(CONSTANT LCU)
As displayed in the graph, all the Asian country showed considerably increase from 1980
until 2014 except Laos. However, Indonesia experienced rapid decrease in the year 1997 and
1998 but then it continues having the highest general government consumption value which is
1,000 000 000 000 000 000. On the other hand, it can clearly be seen that Laos have relatively
the lowest general government consumption values which almost no change at all for over the
years as compared to the other Asian countries.

7. GROSS FIXED CAPITAL FORMATION(CONSTANT LCU)
Gross fixed capital formation (formerly gross domestic fixed investment) includes land
improvements (fences, ditches, drains, and so on); plant, machinery, and equipment
purchases; and the construction of roads, railways, and the like, including schools, offices,
hospitals, private residential dwellings, and commercial and industrial buildings. According
to the 1993 SNA, net acquisitions of valuables are also considered capital formation. Data
are in current local currency.
In this part of the study, shows the analysis of the gross fixed capital formation (constant
LCU) of ASEAN member countries (Malaysia, Indonesia, Philippines, Singapore, Thailand,
Brunei Darussalam, Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is examined
and being analysed. The data set of gross fixed capital formation consists of annual
observations and cover the period of 1980-2014.
In the graph 1, the value of gross fixed capital formation for all the ASEAN countires are
fluctuated during the time period(1980-2014). In this data, Singapore shows the good
starting points with the huge value of this gross fixed capital compared to other countries
and starts to decline across the period. For Laos, it is just give the data within 5 years
which 1984 until 1988 and it is shows gradually increases within that years. Then it is
continuously increases from 2000 and increases rapidly until 2014. Mostly in this gross
fixed capital, all ASEAN countries involved in purchasing all the land improvements,
equipments purchases and so on.

8. GRAPH 2: GROSS FIXED CAPITAL FORMATION (CONSTANT LCU)
As displayed in the graph, we can observed that the flow values of gross fixed capital
is ununiform throuout the years. From the year 1980 until 2014 the graph showed
fluctuation flow which means all the ASEAN countries are facing up and down
improvement.

9. EXPENDITURE ON EXPORT OF GOODS AND SERVICES(NATIONAL CURRENCY)
The value of a country's total exports minus the value of its total imports. It is used to
calculate a country's aggregate expenditures. In other words, net exports is the amount by
which foreign spending on a home country's goods and services exceeds the home
country's spending on foreign goods and services. For example, if foreigners buy $200
billion worth of U.S. exports and Americans buy $150 billion worth of foreign imports in a
given year, net exports would be positive $50 billion. Factors affecting net exports include
prosperity aboard, traffic and exchange. Data are in national currency.
In this part of the study, shows the analysis of the expenditure on export of goods and
services of ASEAN member countries (Malaysia, Indonesia, Philippines, Singapore,
Thailand, Brunei Darussalam, Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is
examined and being analysed. The data set of expenditure on export of goods and
services consists of annual observations and cover the period of 1980-2014.
In the graph 1, the values of expenditure on export of goods and services have fluctuated
during the time period(1980-2014). Obviously in this data, Indonesia followed by Vietnam
give the big impact and increases rapidly from the starting year until the end of the data.
But in this case, Indonesia have the biggest changes compare to the others countries in
ASEAN countries. For Brunei Darussalam, during in the year 1989 given the value
4,853,000,000.00 and start to slowy increases through out the period.In Cambodia, with
the representation of 1,322,737,222,900.00 during 1993 it is start to increase gradually.For
Laos, it is takes time which is the most late to contributed to this expenditure on export of
goods and services during 1998 with the currency 5,248,383,808,400.00.

10. GRAPH 2: EXPENDITURE ON EXPORT OF GOODS AND SERVICES (NATIONAL
CURRENCY)
Exports of goods and services represent the value of all goods and other market services
provided to the rest of the world. They include the value of merchandise, freight,
insurance, transport, travel, royalties, license fees, and other services, such as
communication, construction, financial, information, business, personal, and government
services. They exclude compensation of employees and investment income (formerly
called factor services) and transfer payments. Data are in constant local currency.
As displayed in the graph, only two Asian country show considerably increase from 1980
until 2014 which is Indonesia and Vietnam. Meanwhile ,Indonesia dominate throughout the
year. Vietnam increasing the value starting from year 1996 until 2014 before that Vietnam
does not show any result. While for the other countries ,they showed uniform values in the
graph starting from year 1980 until 2014 which means all this country should increase their
performance in terms of good inter relationship among the countries.

11. INTEREST RATE (MONEY MARKET RATE, LENDING RATE)
Interest rate spread is the interest rate charged by banks on loans to private sector
customers minus the interest rate paid by commercial or similar banks for demand, time,
or savings deposits. The terms and conditions attached to these rates differ by country,
however, limiting their comparability.
In this part of the study, shows the analysis of the interest rate of ASEAN member
countries (Malaysia, Indonesia, Philippines, Singapore, Thailand, Brunei Darussalam,
Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is examined and being analysed.
The data set of interest rate consists of annual observations and cover the period of 1980-
2014.
In the graph 1, mostly all the countries involved in this variable which is interest rate
experiences a fluctuated graph from the early year which 1980 until the end of
the data which year 2014. In this case, Myammar again do not give any data which is
clarify that this country do not contribute any interest rate through the period of time.
For Brunei Darussalam, within 4 years which is from 1980 until 1983 the data shows that
decrease immediately and then continuously increases in the year of 1989 with the
value of 1,415,000,000.00. Furthermore, for Cambodia, this country start to give a data
from 1993 with the represation of 305,988,000,000.00 until 2014 with the reading of data
3,704,936,217,900.00.For Laos, during 1984 until 1988, the data shows rapidly increases
and its to stop for a long time and started to grow again from 2000 with the value
915,000,000,000.00 increases gradually until 2014.

12. GRAPH 2: INTEREST RATE (MONEY MARKET RATE, LENDING RATE)
Interest rate is the amount charged, expressed as a percentage of principal, by
a lender to a borrower for the use of assets. Interest rates are typically noted on an annual
basis, known as the annual percentage rate (APR). The assets borrowed could include,
cash, consumer goods, large assets, such as a vehicle or building. Interest is essentially a
rental, or leasing charge to the borrower, for the asset's use. In the case of a large asset,
like a vehicle or building, the interest rate is sometimes known as the "lease rate". When
the borrower is a low-risk party, they will usually be charged a low interest rate; if the
borrower is considered high risk, the interest rate that they are charged will be higher.
As displayed in the graph, only two Asian country increase gradually from 1980 until
2014 which is Vietnam and Indonesia. Meanwhile the other Asian countries experienced
constant flow throughout the year. On the other hand, it can clearly be seen that all
countries except Indonesia and Vietnam have relatively the lowest interest rate values
which almost no change at all for over the years as compared to the other Asian countries.

13. INFLATION RATE
Inflation as measured by the annual growth rate of the GDP implicit deflator shows the
rate of price change in the economy as a whole. The GDP implicit deflator is the ratio of
GDP in current local currency to GDP in constant local currency.
In this part of the study, shows the analysis of Inflation of selected ASEAN countries
(Brunei, Indonesia, Cambodia, Laos, Myanmar, Malaysia, Philippines, Thailand,
Singapore, Vietnam) which is examined. The data set of Inflation consists of annual
observations and cover the period of 1980-2014.
Based on the graph shown above, we can see a huge inflation showed by Vietnam in
year 1985-1999. According to our research, the average CPI inflation rate of this period
was 236%. The government introduces the so call “General Adjustment of Price, Wage
and Money”. This adjustment made inflation more serious. Only one year after adjustment,
inflation jumped to its peak of 453.5% (in 1986). The 1987-1989 macroeconomic and fiscal
crisis and hyperinflation provided the impetus for the comprehensive innovation (called Doi
Moi) that includes various macro policies to secure the economy, stimulate export and
investments and enhace economic growth. The most prominent success of this innovation
was the success of combined various supply-side policies somewhat helped ease the
excess demand strain and eventually the inflation rate suddenly dropped to 37.7% in 1989.
This success in inflation controlling suggests yhe important role of supply bottleneck and
excess demand matter in the planned economy of Vietnam.
In some year there are also the negative values of inflation which are most of them are
in the year of 1986. And the most highest negative values of inflation is Brunei.

14. GRAPH 2: INFLATION RATE
Inflation is the rate at which the general level of prices for goods and services is rising
and, consequently, the purchasing power of currency is falling. Central banks attempt to
limit inflation, and avoid deflation, in order to keep the economy running smoothly. When
the price level rises, each unit of currency buys fewer goods and services. Consequently,
inflation reflects a reduction in the purchasing power per unit of money – a loss of real
value in the medium of exchange and unit of account within the economy. A chief measure
of price inflation is the inflation rate, the annualized percentage change in a general price
index, usually the consumer price index, over time. The opposite of inflation is deflation.
As displayed in the graph, all the Asian country show the same fluctuation form from year
1980 until 2014 except for Singapore. It experienced rapid decrease in the year 1989 and
then constantly decrease. However for Brunei Darussalam, they decrease until negative
values at some years such as in 1983,1994, and 2009. For Laos, it increase in the year
1998 and 1999.

15. NOMINAL EFFECTIVE EXCHANGE RATE(INDEX 2010=100)
In simplest index form, the trade weighted exchange rate can be found as a set of
Nominal Effective Exchange Rates (NEER) in several databanks in the ESDS International
macro-data collection. A country's NEER is a weighted average of its currency exchange
rates with its major trading partners' currencies. The weightings will be based on the level
of trade with each trading partner. Thus a NEER gives a much better view of changes in a
country's terms of trade with the rest of the World than bilateral or SDR rates.
Consequently, series for NEER can be used to compare changes in the terms of trade of a
number of countries.

16. REAL EFFECTIVE EXCHANGE RATE (INDEX 2010=100)
Real effective exchange rate is the nominal effective exchange rate (a measure of the
value of a currency against a weighted average of several foreign currencies) divided by a
price deflator or index of costs.
In this part of the study, shows the analysis of the nominal effective exchange rate(index
2010=100) of ASEAN member countries (Malaysia, Indonesia, Philippines, Singapore,
Thailand, Brunei Darussalam, Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is
examined and being analysed. The data set of nominal effective exchange rate consists of
annual observations and cover the period of 1980-2014.
In the graph 1, the country which is involved in this nominal effective exchange rate
consists only 3 country which is Malaysia, Philippines, and Singapore. It is also shows
that these 3 country experience fluctuated during the time period(1980-2014).From 1980
until 1984, Malaysia increases gradually and then start to drop slowly across the period.
Same goes to Philippines and Singapore shows the same pattern with different value of
nominal effecting exchange rate based on the index 2010=100.

17. GRAPH 2: REAL EFFECTIVE EXCHANGE RATE (INDEX 2010=100)
The graph showed real effective exchange rate among the ASEAN country from
year 1980 until year 2014. From the graph ,we can observed that among 10 asian
countries, there are only 3 countries are show the record which is Malaysia, Philiphine and
Singapore. All this countries showed fluctuation flow throughout the year. Overall for
malaysia, this country are experienced gradually decrease from year 1980 until year 2014.

18. MONEY AND QUASI MONEY (M2)
Money and quasi money comprise the sum of currency outside banks, demand
deposits other than those of the central government, and the time, savings, and foreign
currency deposits of resident sectors other than the central government. This definition is
frequently called M2; it corresponds to lines 34 and 35 in the International Monetary
Fund's (IMF) International Financial Statistics (IFS). The change in the money supply is
measured as the difference in end-of-year totals relative to the level of M2 in the preceding
year. Data are in current local currency.
In this part of the study, shows the analysis of Money and quai money(M2)(current LCU)
of ASEAN member countries (Malaysia, Indonesia, Philippines, Singapore, Thailand,
Brunei Darussalam, Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is examined
and being analysed. The data set of Money and quasi money consists of annual
observations and cover the period of 1980-2014.
In the graph 1, the Money and quasi money (M2) values for all the ASEAN countries
shows increase gradually across the period. For Brunei Darussalam, its started to give
data from 1999 with the value of 6,006,431,000.00 to the rest of 2014. Meanwhile for
Cambodia, it gives the data of Money and quasi money (M2) from 1993 with the value
3,33,469,000,000.00 until the rest of the year and for the Laos the data starting from 1987.
Therefore, Vietnam started to give data from 1992 with the value of
24,878,021,000,000.The values of Money and quasi money(M2) of many countries have
fluctuated during the time period(1980-2014) and many other countries also have gained
along the period.In this data, obviously, Indonesia and Vietnam show up slightly increase
across the period compared to the other countries in ASEAN. At first, Indonesia rapidly
increases the data of Money and quasi money(M2) over the data of Vietnam until both
countries achieve 2013 to attain the same level of data of Money and quasi money(M2)
with the value approximately 4000,000,000,000,000.00.

19. GRAPH 2: MONEY AND QUASI MONEY (M2)
As displayed in the graph, only two Asian country show considerably increase from 1980
until 2014 which is Indonesia and Vietnam. Meanwhile ,Vietnam end up dominate the
result throughout the year. Vietnam increasing the value starting from year 1995 until 2014
before that Vietnam does not show any result. While for the other countries ,they showed
uniform values in the graph starting from year 1980 until 2014.

20. EXPORT (US$)
Exports of goods and services represent the value of all goods and other market
services provided to the rest of the world. They include the value of merchandise, freight,
insurance, transport, travel, royalties, license fees, and other services, such as
communication, construction, financial, information, business, personal, and government
services. They exclude compensation of employees and investment income (formerly
called factor services) and transfer payments. Data are in current U.S. dollars.
Exports of goods and services comprise all transactions between residents of a country
and the rest of the world involving a change of ownership from residents to nonresidents of
general merchandise, net exports of goods under machining, nonmonetary gold, and
services. Data are in current U.S. dollars.
In this part of the study, shows the analysis of the export on goods and services of
ASEAN member countries (Malaysia, Indonesia, Philippines, Singapore, Thailand, Brunei
Darussalam, Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is examined and
being analysed. The data set of export on goods and services consists of annual
observations and cover the period of 1980-2014.
In the graph 1, all the countires which is involved and contributed in this variable
experienced a fluctuacted during the period(1980-2014), For Myammar, this country do not
involved and contributed at all because it does not give any data.For Brunei Darussalam, it
is shows that for the first year it is decrease slowly until 1983 and continously start to
increases in the year 1989 with the value of 1,845,357,124.54. Meanwhile for Cambodia, it
is start to give data from year 1993 with the representation 406,842,504.95 and
continously increases until the end of the data. Moreover for Laos, the export of goods and
services starts to grow in the year of 1984 with a current value which is 48,571,428.57.
Lastly for Vietnam it is show that the pattern start from year 1986 with the value
1,744,152,800.95 and continue to increase rapidly until the end of the data which is 2014.

21. GRAPH 2: EXPORT (USD)
The graph above showed the export in usd among the Asian countries from year
1980 untill 2014 . As we can see ,all countries showed increase gradually by years except
for Brunei and Laos that are almost constant from 1980 untill 2014 .Meanwhile ,Singapore
experienced a slight decrease in 2008 and 2010 but for overall ,Singapore dominate the
highest export in usd .

22. IMPORT (US$)
Imports of goods and services represent the value of all goods and other market
services received from the rest of the world. They include the value of merchandise,
freight, insurance, transport, travel, royalties, license fees, and other services, such as
communication, construction, financial, information, business, personal, and government
services. They exclude compensation of employees and investment income (formerly
called factor services) and transfer payments. Data are in current U.S. dollars.
In this part of the study, shows the analysis of import of goods and service(current US$)
of ASEAN member countries (Malaysia, Indonesia, Philippines, Singapore, Thailand,
Brunei Darussalam, Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is examined
and being analysed. The data imports of goods and services consists of annual
observations and cover the period of 1980-2014.
In the graph 1, the value of imports of goods and services for all the ASEAN countries
are fluctuated during the time period(1980-2014). For Myammar, it is does not give any
data along the period because Myanmmar does not involved in contribute the import on
goods and services. For Cambodia, the data started from 1993 vith the value of
827,697,458.42 and it is start to increases. For Laos, the data of imports of goods
and services starting from 1984 with the representation of 111,428,571,43 and increases
until the end of the data. Obviously, in this data Singapore gave a lots on impact which is
rapidly increases across the period followed by Malaysia and Thailand.

23. GRAPH 2: IMPORT (USD)
The graph above showed the import in usd among all the Asian countries from year 1980
untill 2014 .As we can see ,all countries showed increase gradually by years except for
Cambodia and Laos that are almost constant from 1980 untill 2014 .Meanwhile ,
Singapore experienced a slight decrease in 2008 and 2010 but for overall ,Singapore
dominate the highest import in usd .

24. GDP(US$)
GDP at purchaser's prices is the sum of gross value added by all resident producers in
the economy plus any product taxes and minus any subsidies not included in the value of
the products. It is calculated without making deductions for depreciation of fabricated
assets or for depletion and degradation of natural resources. Data are in current U.S.
dollars. Dollar figures for GDP are converted from domestic currencies using single year
official exchange rates. For a few countries where the official exchange rate does not
reflect the rate effectively applied to actual foreign exchange transactions, an alternative
conversion factor is used.
In this part of the study, shows the gross domestic production(current US$) of ASEAN
member countries (Malaysia, Indonesia, Philippines, Singapore, Thailand, Brunei
Darussalam, Vietnam, Laos(Lao PDR), Myammar, Cambodia), which is examined and
being analysed. The data of gross domestic product consists of annual observations and
cover the period of 1980-2014.
In the graph 1, the value of gross domestic product for all the ASEAN Countries are
fluctuated during the time period(1980-2014). Obviously, in this data Indonesia contributed
a lots in the gross domestic production because the graph is slightly increases from
1980 until the rest of the data.For Cambodia, the reading is starting from 1993 with the
representation of 2,533,727,592,04 and increase through out the year.For Myammar, it is
the only country which is contributed the least in gross domestic product from 2012 until
2014.

25. GRAPH 2: GDP (USD)
As displayed in the graph, all the Asian country show gradually increase from 1980 until
2014. Meanwhile ,Indonesia dominate the highest value throughout the year. Laos
recorded as the country which holds the lowest GDP (USD) as shown above.

26. Conclusions
This study investigates the analysis of economic situation of the ASEAN member
countries during thirty-four year period (1980-2014) for which the time series data
are available. It examines the micro and macroeconomics developments in these
ASEAN member countries along these variables; General Government
Consumption, Gross Fixed Capital Formation, Expenditure on Export of Goods and
Services , Interest Rate (Money Market Rate, Lending Rate), Inflation Rate,
Nominal Effective Exchange Rate, Real Effective Exchange Rate, M2 (Current
LCU), Import and Export product and Gross Domestic Product (GDP). The report
has been discussed to the trend and descriptive statistics which are mean, standard
deviation, frequency and percentage of the data among the ASEAN member
countries. We also managed to discuss about some grapfhs’s trend that causing
them to increase, decrease and fluctuate.