ASEAN economic ministers meet in Indonesia

ASEAN Flags--Quoc Viet/RFA

Aug 10, 2011
AFP

MANADO: The United States and Europe are no longer the world’s economic growth engines, Indonesian Vice-President Boediono said Wednesday at the start of a meeting of Southeast Asian economic ministers.

The former central bank governor told the 43rd ASEAN Economic Ministers Meeting in Manado, Sulawesi island, that China and India were the pace-setters in the new global economy and Southeast Asia needed to adjust rapidly.

“Since the 2008 global financial crisis, it is evident that US and Europe could no longer be main engines of growth for the world economy,” Boediono told ministers of the 10-member Association of Southeast Asian Nations (ASEAN).

All of the ASEAN economies were affected by the global financial crisis.

But, thanks to the relatively sound fundamentals and quick responses, the rebound was achieved by 2010. “He said ASEAN economies were better-placed now to face “global uncertainties” such as Europe’s spreading debt crisis and the US credit downgrade, which triggered a sell-off on share markets this week.

“However, this is no time for complacency. We all have to be vigilant and be prepared with national policy responses, as well as regional policy responses and cooperation,” he said.

Southeast Asian ministers were expected to discuss progress toward the creation of an integrated economic community of almost 600 million people by 2015 during their talks in Indonesia this week.

Boediono called for special attention to be paid to enhancing competitiveness to ensure the region can hold its own against emerging regional giants China and India.

Non-tariff barriers needed to come down and micro-economic regulatory reform was required to encourage business start-ups, boost investment and improve productivity.

Boediono encouraged ministers to press ahead with the implementation of the ASEAN Framework Agreement on Services (AFAS), noting that removing obstacles to services could have a greater economic impact than cutting trade barriers.

“The services sector has been the source of most global job growth over the last decade,” he said, adding that it accounted for 30 to 70 percent of ASEAN states’ gross domestic product.

He also called for “increased regulatory transparency and predictability” across ASEAN’s disparate member states.

ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

Implementation of an integrated food security framework and rice reserve is “critical” to buttress the region against “unforeseen domestic and international shocks”, Boediono added.