Preface

Summary

This study aims to answer the following three questions: (i) whether the ASEAN Economic Community (AEC) is achievable by 2015, (ii) the obstacles along the way in achieving it, and (iii) the measures needed for its eventual achievement.

All the experts' emphatic answer to the first question is that it would be very difficult to achieve AEC by 2015 in terms of the commitments in the AEC Blueprint. The reasons are many. Several commitments made toward AEC 2015 have not been implemented by ASEAN member states. While progress has been made in lowering tariffs and some behind-the-border economic hurdles, non-tariff barriers remain as major impediments to AEC 2015. Similar lags take place in the commitments made on the liberalization of trade in services despite the growing importance of services in the ASEAN economies. Regional institutions remain weak, as member states guard their sovereignty. When national goals differ from regional ones, decisions of political leaders tend to favor national goals. Flexibilities designed to accommodate the different levels of development of member states seem to have been used to justify non-compliance with their commitments; yet, such non-compliance is not censured, as maintaining a unified position among member states becomes more important to their leaders. Interest groups and those opposing regional competition tend to succeed in preventing their national leaderships from enforcing AEC commitments.

In the above context, the chapter writers' view is that the increased intra-ASEAN trade and investments over the years have been driven more by market forces than by regional agreements. Accordingly, it is in the interest of each ASEAN state to take unilaterally measures toward improving its business climate and liberalize trade and investment policies without waiting for regional agreements to be concluded. There is a view that the year 2015 needs to be regarded as a vision than as a hard-and-fast target year, so that the year could serve more as a benchmark of progress. Depending on the speed of progress, more measures for integration can be undertaken aimed at 2015 and beyond 2015. More than anything else, it would be in ASEAN states' interest to avoid grand designs and stress effective compliance with their existing commitments instead of concluding additional new agreements.