ASEAN BAC chairman Tan Sri Nazir Razak
KUALA LUMPUR: ASEAN must push structural reforms to strengthen private capital markets and enforce rules against non-tariff barriers (NTBs) if it is to remain competitive, said ASEAN-Business Advisory Council (ASEAN-BAC) chairman Tan Sri Nazir Razak.
He said existing mechanisms, such as the ASEAN Assist portal, had not been effective in addressing persons engaging in unfair trade practices or imposing barriers to trade, as businesses remain cautious about raising complaints for fear of victimisation.
"There’s no shortcut. It has to be enforcement, but the problem now is that ASEAN has no teeth,” he told Bernama on the sidelines of the ASEAN Economic Ministers’ Meeting 2025.
Nazir called for structural reforms to ensure complaints about NTBs could be acted upon.
On capital markets, he said that according to a joint study by ASEAN-BAC and McKinsey, ASEAN’s private markets were underdeveloped at 0.5 per cent of gross domestic product, compared with the global average of 1.5 per cent.
He called for reforms to review ownership rules, improve the exit environment, and support initiatives such as an ASEAN Initial Public Offering prospectus.
Nazir, who chairs the ASEAN Private Market Council, said these reforms would make investments more efficient, improve fund managers’ performance, and ultimately attract more capital from around the region.
The ASEAN Private Market Council was established under an initiative led by ASEAN-BAC to address structural barriers in private capital development.
Saying that funds such as Malaysia’s Employees Provident Fund and Singapore’s Temasek often deploy capital abroad rather than within ASEAN, he urged greater efforts to channel regional savings into local growth.
He also stressed the importance of retaining and attracting talent, while backing the ASEAN Business Entity framework to allow accredited firms to move staff and operations freely across the region.
While ASEAN attracted US$226 billion in foreign direct investment last year, up 9.0 per cent from 2023, Nazir said the real challenge was competitiveness. (US$1 = RM4.20).
"The issue is not whether we are growing. It is whether we are as attractive as we can be compared with other regions,” said Nazir.
On Malaysia’s ASEAN chairmanship, he noted the country had demonstrated leadership on tariffs, disputes, and convening world leaders, adding that October’s ASEAN Business and Investment Summit would be the crescendo of its term. - Bernama
