Businesses see ASEAN economic integration more as an opportunity than a threat

The majority of businesses perceived ASEAN economic integration to present more of an opportunity rather than a threat. In addition, investor interest in the ASEAN region remains strong and more businesses are seeing ASEAN as one region in making their investment decisions. These are some of the key findings from the 2013 ASEAN-BAC (ASEAN Business Advisory Council) Survey on ASEAN Competitiveness as ASEAN pushes on with its efforts to realize the ASEAN Economic Community (AEC) by the end of 2015.
The 2013 Survey collated 502 usable responses across various firm-size categories, age, ownership profiles and industries from all ten ASEAN member economies. The 2013 Survey is the third wave of a Survey that has been conducted since 2010 by ASEAN-BAC in collaboration with Dr. Marn-Heong Wong, Assistant Professor at the Lee Kuan Yew School of Public Policy (LKY School), National University of Singapore. Findings from successive waves of the Survey and related policy recommendations have been presented to ASEAN Leaders and Economic Ministers by ASEAN-BAC at their annual dialogue and consultation sessions. The 2013 Survey Report, prepared by Marn-Heong Wong and Andre Wirjo of the LKY School, was released on December 9.
The Survey found that more than half of the businesses considered ASEAN economic integration to pose a low or very low threat to their organizations (Figure 1a), rating the threat level at an average of 2.49 on a scale of 1 (very low) to 5 (very high). Close to 60 percent of the businesses considered ASEAN economic integration to be providing high or very high opportunity for their organizations (Figure 1b), giving the opportunity level an average rating of 3.59 on a scale of 1 (very low) to 5 (very high). However, the Survey also noted that a lower share of small or local firms shared this sentiment.
Figure 1: Organization’s view of ASEAN economic integration as threat vs. opportunity
Source: Wong, M-H. and Wirjo, A., 2013. Findings from 2013 ASEAN-BAC Survey on ASEAN Competitiveness, Jakarta: ASEAN Business Advisory Council.
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Businesses continued to view the ASEAN region’s competitiveness for investments positively. More than half of the businesses that had internationalized [engaged in export or outward foreign direct investment (OFDI) activities] or planned to do so within the next three years (2013 – 2015) indicated an ASEAN country as the most attractive country in the world for their OFDI (Figure 2). This reflected investors’ sustained or increased interest in ASEAN countries, most notably Myanmar. ASEAN’s attractiveness also continued to be rated higher than China’s both as a market for goods and services and as a production location.
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