Executive Summary

The Association of Southeast Asian Nations (ASEAN) is an organization of countries in southeast Asia set up to promote cultural, economic and political development in the region. ASEAN has a combined population of about 620 million, ASEAN’s aggregate size surpasses US$2.5 trillion, with average annual GDP growth of around 6% over the past decade. Marking a major milestone in the regional economic integration agenda, the ASEAN Economic Community (AEC) was officially launched on 31 December 2015 to create a single market to enable the easier movement of goods, services, investment, capital and people across the region.

Established in 1967, ASEAN is a political alliance working toward regional security, socio-cultural and economic goals. The ASEAN Vision 2020 was introduced in 1997 and provides the basis for most of ASEAN’s developmental and integration initiatives up to the present day.1

The blueprint for the ASEAN Economic Community (AEC) was introduced in November 2007 to further ASEAN’s economic goals via the creation of a single market and production base with free flow of goods, services, investment and skilled labour; enhancement of ASEAN competitiveness; promotion of equitable economic development; and integration into the global economy.2 Members of the AEC committed to implementation of these goals and thus the realisation of the AEC by 2015.

The formal establishment of the AEC does not point to an end of the efforts in achieving further integration among the AEC countries, be it economic, political and socio-cultural. The AEC Blueprint 2025 was adopted by ASEAN leaders in November 2015, providing the broad directions through strategic measures in five areas for the AEC from 2016 to 2025.

The ten countries which constitute ASEAN have a combined population of over 625 million and combined nominal GDPs of just under $2.4 trillion. Combined trade flow was valued at just over $2.5 trillion at the end of 2014, testament to how deeply integrated ASEAN economies are in Global Value Chains.

“The ASEAN Way” relies on consensus building, differential and reciprocal treatment rather than firm ascension conditions and rules-based governance. The approach is justified by the fact that many of its members are still developing countries.

 
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