The Asean Economic Community (AEC) has the potential to become a "powerful" force but it could take another 10 to 15 years before this is achieved, said OCBC chief executive Samuel Tsien.
Mr Tsien told a forum yesterday that the AEC must become a truly integrated economic community where there is a "comprehensive sharing of resources".
There are three things to work on to bring this about, he added.
"The maturity of the different economies in AEC has to be on a more even footing with each other, (and there has to be) minimal border control in the movement of goods and services."
HUGE POTENTIAL IN ASIA
I personally feel that you've got a region that is rather young and has a tremendous potential... not only in terms of the consumption in the region but also as a huge export hub. Currently it's the fourth in the world in terms of the exports that it makes across the region; only 25 per cent happens within the region. And if you're a healthcare company or a fast-moving consumer goods company, I think there's a tremendous potential.
MR RAMAN SINGH, president of Mundipharma Asia Pacific, Latin America, Middle East & North Africa, on Asia's potential
INDIA A GROWTH DRIVER
India is now the world's fastest-growing large economy at 7.5 per cent. What has contributed to that? I think one is the declining oil prices. The softening of oil prices has had a huge positive impact on the Indian economy. And the second is the fact that there's been a gradual pick-up of investment. China is moving from investment-led growth to consumption-led growth. India is moving from consumption-led growth to investment-led growth. That's where India is becoming a growth driver for Asia. ''
DR SANJAYA BARU, from London's International Institute for Strategic Studies and author of the book The Accidental Prime Minister
The latest results of listed companies have shown that growth is slowing in many sectors including property, construction and retail. While the longer-term outlook is positive, with the Asean Economic Community, Trans-Pacific Partnership and the Asian Infrastructure Investment Bank offering opportunities for businesses, the prospects for next year look more uncertain.
ST BUSINESS EDITOR LEE SU SHYAN
There should be fewer barriers for people to move freely across borders, so that "talent and labour resources can be shared across different economies", added Mr Tsien, who was speaking at the ST Global Outlook Forum at the Grand Copthorne Waterfront Hotel.
Mr Ong Keng Yong, executive deputy chairman of the S. Rajaratnam School of International Studies, who is also the former Asean secretary-general, said that the region is still facing the problem of "how to reduce non-tariff barriers" like the rules and regulations relating to borders despite progress being made on scaling back tariffs and creating free trade agreements across Asean.
However, the region has made "impressive progress" on the AEC, said Mr Tsien, "given that there are more than 600 measures that were planned to be completed by year end".
Now that the process of an integrated economic community has begun, Mr Ong said it cannot be reversed.
He said that Asean countries will continue to struggle to give "concrete results" to the agenda of building an Asean community.
But the region has developed good mechanisms in the past few years, and Mr Ong hopes Asean will take advantage of its "unique proposition in managing powers outside South-east Asia".
However, there is no doubt that the integration of Asean will
move along, and the next few years are crucial for the region, which has been working on things in the past decade, noted Mr Ong.
Mr Tsien said the stimulus that will come from China's "One Belt, One Road" initiatives, which were created to boost trade and investment, will also boost the AEC's development.
China has been Asean's largest trading partner since 2009, with trade volume to reach US$500 billion (S$706 billion) by the year end and US$1 trillion by 2020.
Mr Tsien said that the initiatives could bring Asean together to collaborate on new opportunities that will come from outside the region.
"Cross-border business activities... can stimulate demand for more investments, more private sector involvement, and more financing and capital market demands," added Mr Tsien, noting that this will bode well for all sectors in the region.