ASEAN ECONOMIC COMMUNITY: PLAYING A

KEY ROLE IN ASIAN ECONOMIC INTEGRATION

• In 1967 some Asian nations formed a regional organization called the Association of South East Asian
Nations(ASEAN)
• The primary objective of this was to promote intergovernmental cooperation and facilitate economic
integration among its member nations
• As an organization it has immensely helped its member nations to achieve impressive economic
growth as well as regional stability by working together
• After five decades of successful promotion of economic & intergovernmental cooperation under
ASEAN ,the member nations realized that they could achieve more if they operate together as one
economy
• Aim of moving closer to create a single free trade area for the region, the member nations agreed on
consolidating, integrating and transforming ASEAN into a community called ASEAN Economic
Community(AEC)
 CREATION OF AEC
• Established on December 2015 with the aim of opening up opportunities for members to capitalize
on their diverse resources, factors of production and advantages of their geography
• The four pillars of AEC are as follows
Single Production and market base
Competitive Economic region
Equitable economic development
Integration with the global economy
• Along with this objectives ,measures such as elimination of intra- ASEAN import tariffs and
restrictions in the goods and services, simplification of cross-border trading processes have
created immense trading opportunities
• Free labor mobility within the member nations offer the community a myriad opportunities to
develop itself into an international business hub
 CHALLENGES AHEAD
• The four pillars which are key to AEC requires specific and committed actions by ASEAN member
nations both collectively and individually
• Development divide- the existing gap in the degree of economic development among the
member nations
• Level of protectionism is not uniform
• Differences between member countries with respect to issues ranging from tax codes to foreign
ownership restrictions
• Unlike European Union, the AEC lacks a proper framework that institutionalizes the structure of
a community
THE WAY FORWARD
• ASEAN nations need to undergo structural reforms within and take bold measures to deepen the
economic integration which is a key to achieve objectives of AEC
• There is a need for proper coordination of regulations and synchronization of national policies across
member nations ,businesses
• Requires changes in domestic laws and may even need amendments in the constitutions of the
member nations to accommodate AEC accords
• The establishment of AEC is not the end goal, but a long-term dynamic process that will require true
commitment from every member
• Blueprint 2025 has been adopted which provides guidelines through strategic measures for the AEC
from 2016 to 2025