Productivity key to sustained Asean growth

To transition to a more mature and sustained growth path and to stay competitive, Asean countries would need to deepen labour, capital and product market reforms.

Published Wed, Jul 8, 2015 · 09:50 PM

Asean

BY some measures, the goal of Asean nations to forge a single market and production base that stitches together 10 countries into a coherent, integrated whole of sizeable scale has had a good headstart. Many more multinational companies now have a regional approach to strategy in Asean, even as they await the formal creation of the Asean Economic Community (AEC) by the end of 2015.

Asean's recent performance has been impressive. The region has grown 5.5 per cent annually since the 2008 global financial crisis and drawn in significant foreign direct investment (FDI) and portfolio flows. In 2013, FDI inflows reached a peak of US$125 billion, 9 per cent of the global total.

While Asean's 10 countries and 625 million people are at different stages of development, millions have already joined the middle class, who are now driving consumption and investment. The region is fast becoming a major economic force in Asia and a driver of global growth.