Businesses want clear AEC goals

By Business Times
JAKARTA: The Asean Business Club, a group of business leaders, has launched a report calling for clarity on the goals of the Association of Southeast Asian Nations’ integration.

The report titled “Lifting the Barriers” found that while the benefits of greater Asean integration were evident, the ways by which they may be achieved was not.

The report says that, with one year remaining until the Asean Economic Community comes into effect in 2015, the member nations must be clear on what can be accomplished.

Datuk Seri Nazir Razak, the co-chairman of the Asean Business Club and chief executive of the CIMB Group, said that if Asean economic integration was reversed, the region would risk falling down the pecking order of the new world order.

The main concern from the business community, according to Nazir, is that the region will fall short of its objectives for the 2015 deadline, leading to disappointment.

“I urge Asean leaders to review progress today, and to precisely specify what will and will not be in place by 2015, so that businesses can prepare with certainty,” he said.

The Asean Economic Community envisages a single market and production base; a highly competitive economic region; a region of equitable economic development; and of full integration into the global economy. On that particular order, the Asean economic community scorecard released in 2012 rated progress at 65.9 per cent, 67.9 per cent, 66.7 per cent and 85.7 per cent, respectively.

The Asean Business Club reports are categorized into six different sectors, namely financial services, capital markets, health care, connectivity, aviation and infrastructure, and power and utilities, which are crucial to the growth of Asean.

“The sets of obstacles that had been identified are not new,” said Tan Sri Munir Majid, the adviser for the report.

The common theme of the reports, according to Munir, is that rising economic nationalism, human resources constraints, regulatory congestions and underdeveloped infrastructure are the biggest challenges to the full and timely implementation of the Asean Economic Community.

The solutions offered by the report vary depending on the sectors, but mainly centre on the need for a coherent regulatory framework, a more flexible approach on human capital movement and increasing infrastructure investment.

Particularly, Munir went on, the Asean business community sees the need for the acceptance of the English language in bureaucratic processes and the establishment of shared Asean institutions such as an Asean credit bureau or ratings agency.