About the establishment, ASEAN Economic Community (AEC), free trade agreement and positive as well as negative impact of ASEAN in International Business viewpoints.
By Swikar Dahal
2. ESTABLISHMENT
• The Association of Southeast Asian Nations, or ASEAN, was
established on 8 August 1967 in Bangkok, Thailand, with the
signing of the ASEAN Declaration (Bangkok Declaration) by the
Founding Fathers of ASEAN, namely Indonesia, Malaysia,
Philippines, Singapore and Thailand.
• Brunei Darussalam then joined on 7 January 1984, Viet Nam
on 28 July 1995, Lao PDR and Myanmar on 23 July 1997, and
Cambodia on 30 April 1999, making up what is today the ten
Member States of ASEAN.
5. About
• The Association of Southeast Asian Nations (ASEAN ) is a
political and economic organization of ten Southeast
Asian countries.
• ASEAN aims to promote collaboration and co-operation
among member states, as well as to advance the interests of
the region as a whole, including economic and trade growth.
• ASEAN is built on three pillars: the ASEAN Political-Security
Community (APSC),the ASEAN Economic Community (AEC),
and the ASEAN Socio-Cultural Community (ASCC).
6. ASEAN:
ASEAN covers a land area of 4.4 million square kilometers, 3%
of the total land area of the Earth.
If ASEAN were a single entity, it would rank as the seventh
largest economy in the world, behind the US, China, Japan,
Germany, France and the United Kingdom.
With over 600 million people, ASEAN's potential market is
larger than the European Union or North America.
ASEAN includes 227 of the world’s companies with more than
$1 billion in revenues, or 3 percent of the world’s total.
7. Aims and Purposes
• To accelerate economic growth, social progress, and cultural development in the
region.
• To promote regional peace and stability.
• To promote collaboration and mutual assistance on matters of common interest.
• To provide assistance to each other in the form of training and research facilities.
• To collaborate for the better utilization of agriculture and industry to raise the
living standards of the people
• To promote Southeast Asian studies.
• To maintain close, beneficial co-operation with existing international organizations
with similar aims and purposes.
8. FUNDAMENTAL PRINCIPLES
In their relations with one another, the ASEAN Member States have adopted
the following fundamental principles, as contained in the Treaty of Amity and
Cooperation in Southeast Asia (TAC) of 1976:
• Mutual respect for the independence, sovereignty, equality, territorial
integrity, and national identity of all nations;
• The right of every State to lead its national existence free from external
interference, subversion or coercion;
• Non-interference in the internal affairs of one another;
• Settlement of differences or disputes by peaceful manner;
• Renunciation of the threat or use of force; and
• Effective cooperation among themselves.
9. • The ASEAN Free Trade Area (AFTA) which was established on 28
January 1992 includes a Common Effective Preferential Tariff (CEPT)
to promote the free flow of goods between member states.
• Brunei, Indonesia, Malaysia, the Philippines, Singapore, and
Thailand have eliminated 99.65% of their tariff lines, Cambodia,
Laos, Myanmar and Vietnam have decreased tariffs on 98.86% of
their lines to the 0-5% tariff range in 2010, and are projected to
eliminate tariffs on these goods by 2015, with the ability to do so
for a few import duty lines until 2018.
10. ASEAN Economic Community
• ASEAN seeks economic integration by creating an ASEAN
Economic Community (AEC) by end-2015 to establish
a common market based upon the four freedoms. The single
market will ensure the free flow of goods, services,
investment and skilled labor and the free flow of capital.
• The ASEAN Economic Community is founded on four basic
initiatives: creating a single market and production base;
increasing competitiveness; promoting equitable economic
development; and further integrating ASEAN with the global
economy.
11. Positive Impact
• Free Trade Agreement
• Tourism
• Collaboration and co-operation
• Promotes peace and stability
12. Criticisms of ASEAN
• South China Sea dispute
• Problem of Myanmar
• Lack of effective implementation
• Diversity
