Business Matters

Anticipating the AEC


The latest Sabah incident recalls again how the countries of Southeast Asia took shape from the territorial fragments cut up by foreign colonial powers.  The task of ensuring the fit of the jigsaw pieces they inherited still occupies national governments.

Sabah or Sulu could have been a part of Brunei, as Singapore could have become integrated into Indonesia.  The restive provinces of southern Thailand at one point belonged to Malaysia, to which they were bonded by ties of family, religion and language.  Taiwan and the Philippines could have formed one political unit.  Colonial powers basically determined the boundaries of Southeast Asian nation-states.

The Asean Economic Community (AEC) hopes by 2015 to cast a seamless cover over these jagged pieces and presumably render irrelevant the distinctive national regulations that govern them.  But the AEC will not work simply on government fiat, especially since the national bureaucracies themselves still need to work out the specifics of the AEC.  We may be experiencing again the Afta of the 1980s: not the Asean Free Trade Agreement, but the Asean practice of “Agree First, Talk After.”

Many issues still await agreement within and among member-states.  The AEC blueprint envisions Asean as a single market and production base that would allow the free flow of goods, services, investment, capital and skilled labor.  This implies that Asean citizens will enjoy full market access and national treatment throughout the region.  But the simple statement conceals complex and potentially contentious issues.

Beyond the removal of tariff and other restrictions on trade in goods and services, the AEC would also require, among other things, convergent customs procedures and standards, mutual recognition arrangements on professional services, and common standards in education and training.  All of these involve work for technical experts at both the national and the regional levels.

Then comes the task of obtaining the buy-in of the public, particularly each country’s business sector on whose initiative the success of the AEC depends. The impending AEC deadline is pushing the Asean countries to clarify, document and establish consensus on their respective policies. Member-countries most oriented to the international economy enjoy an advantage in the race to gear up for the AEC.

Conversations with Thai colleagues in Bangkok last week showed how their country has been preparing for 2015.  Never mind the 22 million tourists that Thailand received last year.  Even more impressive, 1.7 million came for medical services, with the number expected to break the 2-million barrier this year.  Singapore is reportedly receiving less than .5 million medical tourists.

Thailand’s medical-tourism thrust is targeting the economic elite of Europe, the Middle East, India and China. Would the AEC allow Asean nationals to spend their medical benefits in Bangkok?  How about portable public or private education loans, which now allow Indian students to study in Manila and other Asean capitals?

To tap this broader Asean market, Thais need to be more familiar with the region.  Their government’s good fortune is that other sectors also share this view.  On Feb. 16-17, the Thailand Journalists Association (TJA), led by its president, Chavarong  Limpattamapanee, gathered over 30 print, broadcast and on-line journalists at Laem Than in Chonburi province.  Where the foreign ministers of the five founding member-countries negotiated the establishment of Asean in 1967, the TJA launched the Asean Journalists Club (AJC).

Khun Chavarong, who will also oversee the AJC operations, expressed the hope that, through better reporting, the AJC would promote greater understanding of Asean issues, such as the controversies over Rohingya refugees, South China Sea territorial disputes, and competing claims to Sabah.  It would also provide training for journalists covering critical regional problems such as cross-border pollution and encourage the pooling of information among them.

The TJA initiative appears to have received support from its members.  It has been able to attract participants to its training programs, one of 12 weeks for journalists and one of eight weeks for media executives.  The classes meet once a week for two- or three-hour sessions on Sundays.  At the end of the classroom sessions, the participants go on a field trip to one or two Asean countries.

Apart from the commitment required of the journalists taking the course, the program has also obtained the support of the business sector.  The training program, including the field trip, is fully funded by contributions from companies engaged in regional business.  The presence at the gathering of Somkiat Tangkitvanich, president of Thailand Development Research Institute, also reflected the support of academic centers for the AJC.

K. Chavarong said the AJC would like to reach out to other journalists around the region to enlist their cooperation in achieving a more informed and a more comprehensive coverage of Asean issues. Those who believe in Asean should salute this Thai initiative and cheer for its success.

Edilberto C. de Jesus is professor emeritus at the Asian Institute of Management. E-mail: edejesus@yahoo.com.

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Tags: AEC , Asean Economic Community , Business Matters , Edilberto C. de Jesus , opinion , Sabah

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