Asean needs ‘bolder reforms' to attract investments in a more fragmented global economy: PM Wong

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SINGAPORE – Asean must become a more seamless and competitive single market, one that attracts businesses and investments looking for alternatives in a more fragmented global economy.
To get there, bolder reforms are needed, said Prime Minister Lawrence Wong in a video message posted on YouTube on July 5, adding that the association's 10 nations may be limited in scale individually but together have considerable weight.
Asean today has 700 million people and it forms the fifth largest economy in the world, and is projected to be the fourth largest by 2030.
The next decade will be critical to unlock its full potential, said PM Wong, who has just finished his introductory visits to Asean's capitals, with the exception of Myanmar, which he said he hopes to visit 'when the situation is more conducive'.
PM Wong said: 'Continued peace, stability and growth in Asean will transform our entire region – and this will translate to better jobs, opportunities and living standards for all our peoples.'
The key to achieving this lies in closer integration amongst Asean economies.
PM Wong noted that supply chains across the bloc already span multiple countries, leveraging their complementary strengths.
He gave the example of cotton from the Philippines. This could be spun in Thai factories, dyed and sewn in Vietnam and exported to the world.
'This is the kind of cooperation we must strengthen,' he said.
To become a more seamless and competitive single market, Asean needs to reduce trade and investment barriers and make it easier for companies to operate across borders, PM Wong said.
It also means negotiating a digital economy agreement across the bloc, and linking payment systems Singapore, Malaysia and Thailand have done, he added.
The seven other countries in the bloc are Brunei, Cambodia, Indonesia, Laos, Myanmar, Philippines and Vietnam.
Physical infrastructure including rail and power grid connections must also be enhanced and Asean must also deepen its partnership with the rest of the world, PM Wong said.
It already has seven Free Trade Agreements with external partners, including the Regional Comprehensive Economic Partnership (RCEP) – the world's largest trading bloc, he noted.
These existing agreements will be upgraded, and Asean is exploring new ones such as with the Gulf Cooperation Council (GCC) and the European Union.
These agreements open doors for businesses and make Asean more connected to global markets, he noted.
PM Wong said Malaysia – this year's Asean chair – has been pushing for these reforms and Singapore fully supports these efforts.
He added: 'The momentum will continue with the Philippines as chair next year, and when Singapore takes over as chair in 2027 – a milestone year marking ASEAN's 60th anniversary'.
PM Wong was most recently in Cambodia where the two countries on July 2 announced they will deepen their collaboration in several areas, including renewable energy, high-quality carbon credits and trade in food products.
He prioritised visits to Asean capitals because they are in Singapore's immediate neighbourhood, he said.
'We have close bilateral ties with all its members. And it is in our shared interest to have a strong and united Asean,' he said, adding that Singapore will work closely with these countries as well as others around the world, to keep Asean strong, effective, and relevant for the future.
He encouraged all Singaporeans to be 'part of this journey' and to learn more about the region, understand their neighbours and build connections.
'Because Asean's future is our future – and everyone has a role to play,' he said.
The world is going through profound changes and geopolitical tensions are rising. But this is not the first time the region has faced uncertainty, PM Wong noted.
When the bloc was formed in 1967, the world was also in turmoil – right in the middle of the Cold War, a conflict between the United States and the USSR and their respective allies.
PM Wong said: 'Our founding leaders knew we were better off facing challenges together rather than alone.'
He quoted Mr S. Rajaratnam, Singapore's first Foreign Minister, who said 'if Asean does not hang together, we will hang separately'.
He said: 'So we came together – respecting each other's sovereignty and focusing on mutually beneficial cooperation.
'That unity helped lay the foundations for peace and stability in our region.'
The region has seen conflict before and was once an arena for proxy wars by major powers, PM Wong said.
'We do not want that to happen again. Neither can we afford to have disputes divide us,' he added.
Instead, Asean must work together to preserve peace and stability and to keep the bloc open and inclusive – a region that is not dominated by any single power, but where all the major powers are engaged and invested, he said.
Source: The Straits Times © SPH Media Limited. Permission required for reproduction
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