The ministers exchanged views on the recent global developments and their impact on the economic performance and integration agenda in the region. They highlighted that, collectively, Asean has achieved important and positive achievements in its regional integration initiatives, and, in general, Asean member-states have remained relatively resilient in the midst of global uncertainties. The ministers underscored the significance of the year 2016 as the inaugural year of the Asean Economic Community (AEC) following its formal establishment, and highlighted the need to use this momentum by strengthening its commitment toward deeper integration under the AEC Blueprint 2025.
The ministers expressed concern over the diminished outlook in global growth, which presented inevitable challenges to the region’s economic performance. They were encouraged that Asean total merchandise trade remained resilient and reached $2.28 trillion in 2015, of which 24 percent was intra-Asean trade, highlighting the continuing development of regional production networks. Among its external trading partners, China remained the top trading partner of Asean with total bilateral trade at 15.2 percent of total Asean trade, followed by Japan at 10.5 percent, European Union (EU)-28 at 10 percent, and the US at 9.3 percent. 5. The ministers also noted that foreign direct investment (FDI) inflows to Asean stood at $120 billion in 2015. While intra-Asean FDI remained stable at $22.1 billion in 2015, its share of total FDI has increased to 18.5 percent in 2015, signalling the positive impact of Asean economic integration on promoting the region as a preferred investment destination. The EU remained the largest external source of FDI flows, accounting for 16.4 percent of the total inflows to the region, followed by Japan at 14.5 percent, the US at 10.2 percent and China at 6.8 percent. The services sector remained as the largest recipient of FDI in 2015 with $74.9 billion, or 62.5 percent, of total FDI inflows to Asean, followed by the manufacturing sector with 24.2 percent.
The ministers welcomed the finalization of the sectoral-work plans on areas under its purview, and to this end adopted the following:
- AEC 2025 Strategic Action Plan for Trade in Goods;
- the Strategic Action Plan for Services 2016-2025;
- the 2016-2015 Investment Work Programme;
- Asean Standards and Conformance Strategic Plan 2016-2025;
- Asean Competition Action Plan 2016-2025;
- Asean Strategic Action Plan for Consumer Protection 2016-2025;
- Asean Intellectual Property Rights Action Plan 2016-2025;
- Asean Community Statistical System Strategic Plan 2016-2025; and
- Asean Work Plan for Enhancing the GVC Agenda.
The sectoral-work plans will be reviewed and updated periodically to ensure their relevance and effectiveness.
The ministers adopted the Asean Trade Facilitation Framework, which would further the region’s trade-facilitation agenda in line with the AEC Blueprint 2025:
- the Asean Food Safety Regulatory Framework, which would also be adopted in parallel by the Asean Ministers on Agriculture and Fisheries and the Asean Health Ministers’ Meeting;
- n the Asean Institutional Framework on Access to Finance for the Micro, Small and Medium Enterprises (MSMEs), which would contribute to the development and empowerment of MSMEs in the region;
- the Report and Work Programme on Starting a Business in Asean, which would advance the region’s agenda in streamlining the starting a business process; and
- the Asean Guidelines for Special Economic Zone (SEZ) Development and Collaboration, which will serve as a nonbinding reference of best practices in the development and operation of SEZs and potential collaboration/complementarities in the region.
The ministers also urged Asean member-states to exert best efforts in expediting the ratification of the Protocol on the Legal Framework to implement the Asean Single Window so that the live operation of ASW can commence in 2016. They commended the ongoing works on the implementation of the Asean Customs Transit System (ACTS) Pilot Project to be conducted among three member-states, namely, Malaysia, Singapore and Thailand. The success of the ACTS Pilot Project would pave the way for the ACTS system to be rolled out to other Asean member- states. Noting the importance of this initiative in promoting seamless movement of goods across the region, the ministers called for the finalization of the Protocol 2 (Designation of Frontier Posts) of Asean Framework Agreement on Facilitation of Goods in Transit (AFAFGIT) and the full ratification of Protocol 7 (Customs Transit System) of AFAFGIT by all Asean member-states.
The ministers welcomed the completion of the signing of the Protocol to Implement the Ninth Asean Framework Agreement on Services Package done last November 27, 2015, in Makati City, the Philippines.
The ministers noted that four strategic goals in the Asean Intellectual Property Rights Action Plan 2016-2025 will be achieved in the next 10 years through 19 initiatives that span the full spectrum of the intellectual property life cycle. The ministers noted that five Asean member-states (Cambodia, Lao PDR, the Philippines, Singapore and Vietnam) are already parties to the Madrid Protocol and commended efforts by the remaining Asean member-states to move forward with their accession processes.
The ministers welcomed the significant progress in enacting comprehensive competition laws, with nine Asean member-states having such competition laws to date. They noted the key performance indicators identified in the Asean Competition Action Plan 2016-2025, which would monitor progress toward effective and enforceable competition rules that support a competitive Asean with efficient and well-functioning markets.
The ministers welcomed the strengthening of the role of the private sector as outlined in the AEC Blueprint 2025, which encourages greater involvement and more structured participation of the private sector in Asean integration work. In this connection, the ministers noted the efforts made by the Asean Business Advisory Council to initiate engagement of relevant Asean sectoral bodies, starting with the Asean Coordinating Committee on MSME, aside from its annual high-level engagement through dialogue with the Asean economic ministers, and with the Asean leaders.