AEC – Creating a Viable and Competitive Economic Region

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AEC: Creating a Viable and Competitive Economic Region

 

In this edition of the inexorable approach of the ASEAN Economic Community (AEC) we take a look back at one of the key planks in the very reason this regional grouping was proposed.

 

Simply put, it was to create a viable and competitive economic region capable of taking on the powerhouses such as the United States, China, Japan, and the European Union.

 

All very well in theory of course, but as has been noted, the road to its creation has been long and tortuous, and there’s still plenty of time for further issues to emerge to delay its full implementation for some years into the future.

 

One of the main focuses from those charged with developing the roadmap to the end of 2015 has been to understand the need for proper competition policy. As was noted in a discussion paper in 2010, ‘Competition policy is quite new to some ASEAN Member States with only some of them having national competition law and competition regulatory bodies.’

 

So, the various ASEAN members conducted studies on best practices in relation to the introduction and implementation of competition policy and law, looking primarily at other regional economic giants such as China, Japan, South Korea, and India, as well as Australia and New Zealand.

 

A so-called Experts Group was given the task of coordinating what will be the AEC’s competition policies and related issues at the regional level.

 

Another key component is to formulate a proper policy regarding consumer protection. Since ASEAN views itself as a ‘people-oriented community’ there are plans being laid to provide consumers with a high level of protection. A Coordinating Committee on Consumer Protection was established to foster and coordinate regional cooperation and a basic cross border redress mechanism is planned for implementation together with the development of a dedicated website.

 

One major area of concern that needed and still needs to be addressed is the level of infrastructure development in terms of transport in order to better connect the region.

 

To further this, three key agreements were signed among ASEAN states in 2010. These were multilateral agreements on Air Services, the full liberalisation of Air Freight Services, and a Framework Agreement on the Facilitation of Inter-State Transport.

 

The first two agreements are intended to pave the way for a single aviation market within the AEC. The third agreement is aimed at strengthening transport facilitation. Of course these agreements can only work if all the AEC member states ratify the documents.

 

Finally, energy security is of concern across the world and the Memorandum of Understanding (MOU) on the ASEAN Power Grid was fully ratified by all the ASEAN states with the aim of enhancing collective energy security in the region.