Bloc business: The potential of the 11-member Asean as an integrated production system and consumer market remains largely untapped, say the writers. — AZMAN GHANI/The Star
FOR decades, integration into the global trading system has been vital to economic growth and development. Now, however, integration implies vulnerability, as powerful actors – beginning with the United States – wield tariffs, export restrictions, and financial sanctions. For South-East Asia, this turn of events represents both a warning and a call to action: countries must work together to shape their own destiny – or others will decide their fate for them.
As it stands, the 11-member Association of South-East Asian Nations’ potential as an integrated production system and consumer market remains largely untapped. Internal trade accounts for less than a quarter of Asean’s total trade – far below the roughly 60% in the European Union and even the 45% in North America under the United States-Mexico-Canada Agreement (USMCA). This lack of integration amounts to a major structural weakness, as investors continue to view South-East Asia as a collection of individual markets, not a single economic bloc.
