As Asean governments pursue economic cooperation, businesses should do their part and accept more competition at home, said Prime Minister Lee Hsien Loong.

Speaking at the opening ceremony of the two-day Asean Business and Investment Summit yesterday, he noted that businesses are not always supportive of opening up their own domestic markets to foreign competition.

Despite initiatives that have helped businesses reduce barriers and costs, they may lobby governments to impose regulations or keep industries closed to protect themselves.

PM Lee urged about 1,000 regional policymakers and business leaders at the summit to think of the bigger picture.

"The more integrated and open our markets are, the more conducive our rules and business environments to foreign investment, the larger the pie will grow, and the more we will all benefit," he said.

Responding to PM Lee's speech later, Singapore Business Federation (SBF) chief executive Ho Meng Kit said the point that businesses should support opening up domestic markets to foreign competition is "important and timely".

The summit, organised annually by the Asean Business Advisory Council, takes place on the sidelines of the main Asean summit. These meetings cap Singapore's chairmanship of Asean, before it is passed on to Thailand.

In his speech, PM Lee noted that Asean members have "grown and prospered" as their economies developed and they grew more confident about deepening economic ties.

The results of some of these moves are visible today, he said, citing examples like the Asean Single Window, which helps traders cut costs by expediting cargo clearance and reducing paperwork, and the Asean Agreement on e-Commerce to facilitate cross-border e-commerce transactions within the region, which was signed yesterday.

PM Lee also encouraged businesses to take full advantage of the council's recommendations on digital transformation and expand their regional footprint.

The Asean Economic Community 2025 Blueprint, for example, will help guide member countries to deepen economic integration, open up new growth frontiers and create fresh business opportunities, he said.

"Asean has great potential, but fully realising it depends on whether we choose to become more integrated and work resolutely towards this goal in a world where multilateralism is fraying under political pressures," he said.

PM Lee had previously warned that the US-China trade war could adversely affect Singapore's growth.

"We must play our respective parts as government and business leaders to pursue this vision," he said. "Only then can Asean continue to be a dynamic region of growth, and only then can we secure a prosperous future for all."

SBF's Mr Ho said that Asean countries have benefited immensely by being open to the world in trade and investments, which has brought jobs and technology, raised living standards and lifted millions out of poverty, among other things.

"However, there is a danger that Asean follows the way of other advanced developed countries in adopting more protectionist measures," he said, noting that while the regional bloc has brought tariffs down, non-tariff measures and barriers have increased.

He cited "significant non-tariff barriers" in the agri-food sector, such as nutritional labelling, halal certification, pre-market product registration as well as import and export certification.

These non-tariff measures and barriers must be reduced to improve Asean integration and competitiveness, he said.

For example, trade facilitation measures and Customs improvements could help more small and medium-sized enterprises in the region capitalise on e-commerce and do business with the world.

"Reducing behind-the-border measures is good not just for foreign competitors. Such unilateral reforms in individual Asean countries are also good for local businesses as they improve the ease of doing business in these countries," he said.

Dr James Zhan, a senior director of investment and enterprise at the United Nations Conference on Trade and Development, said that "more and more foreign investments are moving towards Asean countries partly because they want to bypass a type of protectionism".

"We are optimistic that in this region, it will continue to be a bright spot for investment," he said during a panel discussion yesterday.