| Danial Norjidi |
THE economic relationship of Asean with external partners was highlighted during a panel discussion at the “Asean Beyond 50: Benefits, Opportunities and Challenges” trade dialogue yesterday.
The panel discussion, which took place at the International Convention Centre (ICC) in Berakas, featured a panel that included Yang Xiuping, Secretary-General of the Asean-China Centre (ACC), as well as Fausto DeGuzman, Political/Economic/Consular Chief from the Embassy of the United States of America in Brunei Darussalam.
During the session, Yang remarked that Asean is an important regional organisation in Southeast Asia which plays an instrumental role in promoting regional integration and maintaining peace and stability.
“Asean and China are good neighbours and good partners which enjoy geographical proximity and profound friendship,” she said, noting that since the establishment of dialogue relations between the bloc and China in 1991, political mutual trust has been deepened, practical cooperation has achieved fruitful results, and people-to-people exchanges have become ever closer.
“Asean-China relations have developed from a period of fast growth to a more mature phase of higher quality and have become the most robust and dynamic among the relations between Asean and its dialogue partners.”
Trade and investment cooperation have always been a highlight of Asean-China relations, she continued. “In 2016, despite the decline in global trade, the two-way trade volume reached USD452.2 billion. From January to May this year, Asean-China trade volume reached USD195.7 billion, marking a year-on-year increase of 16.2 per cent.
“For years, China has been Asean’s largest trading partner while Asean has been China’s third-largest trading partner. Asean is China’s fourth-largest export market and second-largest source of imports.
“China is an important source of Asean’s foreign investment. Last year, China’s investment to Asean amounted to USD9 billion, while Asean’s investment to China reached USD3 billion. By the end of May 2017, the accumulated mutual investment had reached USD183 billion.”
The secretary-general added that close economic ties between Asean and China have helped intensify the people-to-people exchanges. “Currently there are more than 2,700 flights between Asean member countries and China each week during the summer and autumn seasons. In 2016, the number of bilateral visits between Asean and China reached nearly 32 million.
“The number of student exchanges has topped 200,000. China has proposed to raise the student mobility to 300,000 by 2025.”
She also stated that the joint building of the Belt and Road Initiative has become a new highlight of Asean-China cooperation. “With the launch of projects such as the Jakarta-Bandung railway and the China-Laos railway, Asean-China connectivity has been accelerated. The China-Malaysia ‘Two Countries, Twin Park’, China-Thai Rayong Industrial Park, the China-Cambodia Sihanoukville Special Economic Zone, Brunei-Guangxi Economic Corridor, and other projects are attracting more and more investors.”
Meanwhile, Fausto DeGuzman gave an overview of US-Asean relations. “From trade and investment to the digital economy and travel and tourism, the United States and Asean have a deep and enduring relationship built around a shared economic future,” he noted.
DeGuzman added that Asean’s middle class is expected to more than double in size to 51 per cent or about 334 million people of the total population by 2030. “Asean’s growing middle class is an ideal market for US exports. Last year, Asean imported over USD1 billion in goods and services from the United States. Asean member states, taken together, rank fourth after Canada, Mexico and China as a goods export market for the United States.”
“The US agriculture sector has a special relationship with Asean, as one of the top 10 destinations for US agricultural products,” he said, noting that Asean is the sixth-largest importer of US agricultural goods, and the third-largest in Asia after China and Japan.
Touching on investments, he said that Asean member states have increased their investment into the United States by 1,000 per cent, from USD2.3 billion in 2004 to USD26 billion in 2015. “The United States receives more investment from Asean than from China and India combined.
“Conversely, Asean has received almost USD274 billion in cumulative investments from the United States, more than the United States has directed to China, India, Japan and South Korea combined.
“Over 3,000 US companies operate in Asean, and according to the Asean Business Outlook Survey of 2017, nearly 90 per cent of these companies expect their level of trade and investment in Asean will increase over the next five years.”
DeGuzman went on to note that many companies in Asean are on the cutting edge of the digital economy, and that Asean is the world’s fastest growing Internet region. He shared that it has been forecast that by 2020 the internet user base for Asean will reach 480 million, up from 260 million in 2016. Social media is used by half of Asean’s population of 630 million people, making it one of the world’s largest social media markets.
“With digitalisation comes an increased opportunity for both Asean and US businesses to reach new customers and suppliers,” he said. “Asean SMEs, much like the ones in Brunei today, stand to benefit from increased connectivity, access to digital tools and rising online consumer demand.”
Moving on to travel and tourism, DeGuzman said that nearly one million people from Asean member countries visited the United States in 2016, while almost 3.5 million Americans visited Asean, with Thailand, the Philippines, Vietnam and Singapore being the top destinations. Visitors from Asean add an average of USD5 billion to the US economy each year, he added.