AMID discussions on China’s slowing but still hefty growth rate and the perennial gap between India’s potential and performance, it was left to Indonesia’s leading economist and former tourism and creative economy minister Mari Elka Pangestu to state the obvious.
And that is that Asean has a buzz which needs to be noticed.
“We tend to look outside of our own region,” said Dr Mari, who teaches at the University of Indonesia.
“Hey guys, Asean is where it’s happening,” she said in her special address at the ST Global Outlook Forum.
“Look at all the numbers. If you take Asean as one country, one economy, we are the seventh-largest economy in the world. If we grow at this rate, we are going to be the fourth. So, we’re the third pole of growth, after China and India,” she said.
Asean needed to remind itself of its own strengths, she said. “As North-east Asia is ageing, South-east Asia and India have the demographic bonus at least for another 10, 15 years.”
On the one hand, it means younger, more productive workers in the region. On the other, the ageing trend elsewhere also presents the region with several business opportunities, like grey tourism, she said.
Another aspect is Asean’s growing middle class, doubling to 160 million by 2030, with implications for Asean’s ongoing economic integration project.
“It means Asean economic integration is no longer just about ‘let’s have a regional production base so that we can be more competitive to export to outside Asean’, but Asean itself is now becoming a final market,” she noted.
Professor Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy, pointed out Asean’s growing importance in the geopolitical context.
Given the less than wholesome bilateral relationships between Asia’s major powers, Asean is a platform of choice when key countries, like the United States, China and Russia, want to talk, he said.
However, to play this leadership role credibly, Asean must retain its cohesion and ensure that the Asean Economic Community is a success after it is launched next year, he said.
“No Asean market, not even Indonesia’s, is big enough to compete with China and India if they take off,” he said, reminding Asean that it will be left behind unless it comes together.