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After the bank of BRICS its time for a bank of ASEAN?

Saturday April 20, 2013
A bank for Asean?
By DALJIT DHESI
daljit@thestar.com.my

THE decision to create a development bank last month by the five major emerging economies of Brazil, Russia, India, China and South Africa, known as BRICS in short, was an interesting development.

The move was seen as an alternative venue for funding to the existing global financial lenders like the International Monetary Fund (IMF), the World Bank, and other regional development banks in Africa, Asia and Latin America.

These countries have in principle agreed to create a development bank to provide initial funding for infrastructure projects worth US$4.5 trillion.

The announcement of the creation of the BRICS Bank in Durban, South Africa was viewed by many commentators and industry observers as the shifting of the economic power from the west.

Although the proposal to create a BRICS development bank was well received by its member countries, the mechanism in which it would operate was not spelt out in detail.

The Organisation for Economic Co-operation and Development (OECD) secretary-general Angel Garra was reported in a foreign press as saying one of the important things which the proposed bank needed to consider was its criteria for loans and the policy for the conditions of the loans.

So, if the BRICS nations are pushing for such a bank to be established, then should Asean also consider developing an Asean bank? Local economists are quick to point out that its establishment would depend on its mandate.

A local prominent economist feels the setting up an Asean bank is less compelling if its focus is on development financing given the presence of the long established Asian Development Bank (ADB).

Moreover, regional initiatives such as the Asian Bond Markets Initiative (ABMI), Asian Bond Fund (ABF) and Credit Guarantee and Investment Facility (CGIF) were already in place to increase the flow of the region's surplus savings into infrastructure and private investments via the regional bond markets.

However, the economist says if the proposal for an Asean bank is aimed at accelerating financial integration to support the creation of the Asean Economic Community by 2015, then it could be a worthwhile pursuit given the relatively small and segmented banking markets as well as the slow pace of financial integration among member countries.

While the concept of an Asean bank is appealing, its sources of funding, mandate and implementation approach would have to be thought out carefully given the smallish and highly-segmented domestic banking markets in the region.

Who knows maybe a few years down the road, the Asean regulators and governments may announce the establishment of such a bank if its mandate and objectives are met in view of the growing importance of Asean as the region's economic power house.

A recent research by the Economist Corporate Network (ECN) and sponsored by Baker & McKenzie suggested that global companies were optimistic about the opportunities that the Asean Economic Community would bring.

Companies saw the potential growth opportunities in Asean in the short as well as long term, it said, adding that the region grew in real terms by an annual average rate of 5.5% between 1999 and 2012, and the number of middle class households in Asean was projected to rise from 40 million in 2010 to 85 million by the end of 2017. This provides a strong base for consumer growth, it noted.

A bank for Asean?

ASEAN looking a bit like ’97

Apr 22, 2013

An economic upturn always has the potential for crisis. Members of the Association of Southeast Asian Nations (ASEAN) appear to be blessed with an economic boom. But there is a feeling of deja vu as current circumstances closely resemble those on the eve of the Asian financial crisis, which started in July 1997.

The Thai capital of Bangkok is enjoying an unprecedented construction boom, with the prices of new condominiums in Wacharapon and Sai Mai districts having doubled in the past three years while new shopping centers are being built in the commercial section of Si Lom. Signs of a boom are also seen in rural cities as well, with new buildings cropping up in Chiang Mai and other areas.

As of the end of 2012, more than 8,000 Japanese corporations had advanced into markets of Thailand while their American, European, South Korea and Taiwanese counterparts are also stepping up their business activities there.

On March 19 the government of Prime Minister Yingluck Shinawatra surprised the world by announcing plans to construct four high-speed railway lines, including the 680-kilometer Bangkok-Chiang Mai line and the 450-km Bangkok-Nong Khai line, at cost of 2 trillion bahts (about ¥6.5 trillion), which is equivalent to a whacking 20 percent of the nation’s gross domestic product. Finance Minister Kittirat Na Ranong said the funds will be raised through domestic and overseas borrowing, which will be paid back over 50 years. The sum is enormous even with a simple comparison with the ¥300 billion Japan borrowed from the World Bank to build the bullet train line between Tokyo and Osaka in time for the 1964 Tokyo Olympics. Repayment of the debt ended in 1981.

In what appears to be another reckless spending spree, the Yingluck government since 2011 has been providing farmers with loans, using the seed rice it received from them as collateral. Because the assessed value of the rice was set 40 to 50 percent higher than the international market price, many farmers have chosen to default on the loans. The loan scheme has turned into a scheme of subsidies. It is feared this situation will burden the government to the tune of ¥200 billion to ¥300 billion a year.

The resulting high price of Thai rice has caused the country to fall from its position as the largest rice exporter in the world (through 2010) to a third place behind Vietnam and India.

A boom harboring potential crisis is also noticeable in Indonesia, whose gross domestic product accounts for 40 percent of ASEAN’s total GDP. The number of automobiles sold there in 2012 surpassed 1 million for the first time, and sales of home electric appliances registered an increase of 13 percent in January from the same month of 2012. After entering his second term in 2009, President Susilo Bangbang Yudhoyono is blessed with national economic stability and strong personal consumption. It’s about to make his country the undisputed ASEAN leader.

There is a downside. Indonesia recorded a trade surplus of over $20 billion in 2010 and in 2011. But it suffered a deficit of $1.626 billion in 2012 as exports fell 6.6 percent from the previous year as shipments of coal to China and manufactured goods to Europe dropped. Meanwhile, imports increased 8 percent because of growing imports of consumer goods for the wealthy and middle classes and of production equipment for foreign-owned factories operating in Indonesia.

This sharp turn indicates that Indonesia has not escaped the industrial structure typical of developing nations, where a domestic boom results in increased imports of both consumer and capital goods, which negatively affect trade balance.

To prevent overheating from consumption, the Indonesian government in June 2012 adopted new rules requiring purchasers of motorcycles — one of the biggest purchase items for salaried workers — to make a down payment equivalent to 20 to 25 percent of the price. This caused motorcycle sales in 2012 to fall 11.8 percent to 7.06 million units. It is estimated that sales this year will plummet further to about 5.5 million units.

Despite the government move, strong demand still prevails, creating “bottleneck inflation.” The consumer price index (CPI) for February rose 5.3 percent from the same month of 2012. As this is so close to the upper limit of the central bank’s inflation target of “4.5 percent give or take 1 percentage point,” the bank may turn to a tight money policy.

Vietnam has also suffered from the pressure of rising prices. With a tight money policy, the rise in CPI fell from 18.1 percent in 2011 to 9.1 percent in 2012. But this has resulted in a net decrease in investment in fixed assets while consumer spending rose by a mere 6.2 percent — quite low for a developing country.

Auto sales in 2012 fell 33 percent to fewer than 100,000 units while sales of motorcycles fell 3.7 percent to 4.23 million units due to a cap placed on their production volume and restrictions on import of parts.

In Japan, certain circles make much of Vietnam, Indonesia and the Philippines (known by the acronym “VIP”) because of their economic growth. But these countries have achieved high growth rates at the expense of trade deficits, fiscal deficits and inflation. In 2012, the fiscal deficit amounted to 2.96 percent of GDP in Vietnam, 1.62 percent in Indonesia, and 1.88 percent in Indonesia. Though these numbers are far smaller than those of Japan and other advanced nations, they are expected to balloon as these countries spend huge sums on infrastructure construction and other projects in 2013.

This tendency draws a large inflow of capital from foreign sources, reflected in the stock markets. Since the spring of 2012, benchmark stock indices in Thailand, the Philippines, Indonesia and Malaysia have continued to hit new highs. Capital inflows from overseas, trade and fiscal deficits, stock and property market bubbles, an overall construction boom — all are reminiscent of ASEAN countries on the eve of the 1997 Asian financial crisis.

To prevent recurrence of the crisis, the Chiang Mai Initiative for multilateral currency swaps among ASEAN countries, China, Hong Kong, Japan and South Korea was adopted. ASEAN countries also have tried to reduce trade deficits and accumulate foreign reserves. Although their financial stabilization mechanism has been strengthened, an onslaught by speculative funds could be massive.

Another potential threat to ASEAN nations, China and South Korea is the recent fall in the value of the Japanese yen. This again resembles the situation in 1997. At that time, the value of the yen declined from ¥94 to the dollar in 1995 to ¥108 in 1996 and to ¥120 in 1997 before the crisis.

If Japan improves its competitiveness thanks to a cheap yen, ASEAN countries will lose their competitiveness. Their exports and industrial production will decelerate, thus leading investors to withdraw funds from the countries. Thus it’s possible that a new Asian currency crisis could be touched off by the economic policy of Prime Minister Shinzo Abe, which calls for massive monetary easing to end deflation and to lower the value of the yen.

The impact of a new Asian crisis would certainly be far more serious than the previous crisis, because this time China is in the same boat as ASEAN countries. China is beset with rapidly rising wages, a rising currency (renminbi) that is weakening Chinese export competitiveness, and a rapid decrease in state-owned companies’ profits. With the trade surplus shrinking, the economic growth rate fell to 7.8 percent in 2012. To help buoy the economy, China has increased investment in infrastructure construction. The government hopes to raise the necessary funds through land sales, which will lead to higher land prices. Bubbles are coming back.

Investors fear that any burst of economic bubbles in ASEAN would cause a chain reaction involving China. This would lead to large-scale flights of capital from China. A new crisis encompassing China and ASEAN would greatly impact natural resources- exporting nations like Australia, Brazil, Canada and Russia. The shock from the new crisis would dwarf the Lehman Brothers shock of 2008.

While ASEAN countries undoubtedly have high potential for economic growth, their economies are still plagued by structural weaknesses. It is high time they became more aware of the potential risks that could stymie a promising future.

ASEAN looking a bit like '97 - The Japan Times
 
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SBY kicks off ASEAN tour
Bagus BT Saragih, The Jakarta Post, Jakarta | World | Mon, April 22 2013, 12:38 PM

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State visit: President Susilo Bambang Yudhoyono (second left) and his wife Kristiani Herawati (right) are seated at a table for lunch with his Singapore counterpart Tony Tan (second right) and his wife Mary Chee Monday in Singapore. Yudhoyono will also receive an honorary degree of Doctor of Letters from Nanyang Technological University of Singapore during his visit to the city-state. (AP/Wong Maye-E)

President Susilo Bambang Yudhoyono has departed to Singapore where he will begin his five-day state visit to three ASEAN nations.

The Garuda Indonesia Boeing B737-800 carrying the President, First Lady Ani Yudhoyono and delegates took off from Halim Perdanakusuma International Airport in East Jakarta on Monday morning.

Among Cabinet members accompanying the President were Coordinating Minister for Political, Legal, and Security Affairs Djoko Suyanto, Foreign Minister Marty Natalegawa, Defense Minister Purnomo Yusgiantoro and Cabinet Secretary Dipo Alam.

"I will attend the Indonesia-Singapore annual Leaders’ Retreat in Singapore, then I will visit Myanmar to have a bilateral meeting with President U Thein Sein in Nya Pyi Taw," Yudhoyono told a press conference before departing.

From Myanmar, Yudhoyono will fly to Bandar Seri Begawan, Brunei Darussalam, to attend the 22nd ASEAN Summit.

On the sidelines of the summit, Yudhoyono will also attend the 9th Brunei-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA) Summit and the 7th Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT) Summit.

Yudhoyono said he would also receive an honorary doctorate from Nanyang Technological University’s (NTU) Rajaratnam School of International Studies (RSIS).

In 2009, the NTU was put under the scrutiny of the Indonesian people following the death of the Indonesian student, David Hartanto Widjaja.

A Singaporean court declared David had committed suicide. His family believed it was not possible for David to intentionally end his life, saying he had displayed no signs of depression. The public outcry at that time pushed the Indonesian government to carry out decisive action to ensure Singapore would bring “justice and the truth.”

The visit to Myanmar, meanwhile, will come amid the long-time sectarian violence involving the Rohingya muslims.

"The conflict involving the Rohingya has always been in Indonesia's attention. We will ensure that the democratization process in Myanmar is in place," Yudhoyono said.

The President and delegates are scheduled to return to Indonesia on April 26.

SBY kicks off ASEAN tour | The Jakarta Post
 
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Phl to push for Asean integration despite territorial dispute
By Aurea Calica (The Philippine Star) | Updated April 24, 2013

MANILA, Philippines - The Philippines will push for the integration of the Association of Southeast Asian Nations (ASEAN) alongside a legally binding code of conduct in the West Philippine Sea despite territorial disputes involving member countries.

President Aquino leaves tonight for the 22nd ASEAN summit in Bandar Seri Begawan in Brunei with members of his Cabinet.

Deputy presidential spokesperson Abigail Valte said yesterday Malacañang is optimistic the West Philippine Sea issue will be discussed with Brunei as chairman of ASEAN.

“We’re optimistic that we will see progress because of the 22nd summit,” she said.

Valte said the Philippines is grateful that Brunei had put maritime security as one of the priority issues to be tackled.

“How crucial is this particular (summit?) There is a new chairman of the ASEAN, the priorities also change,” she said.

“I understand that Brunei, as chair, has now set their own list of priorities for the agenda to be taken up in the summits to follow. On our part, regardless of the chairmanship, we have always been pushing for this particular (issue). We’ve been consistent in pushing for our interventions.

“As you know, last year there was an (ASEAN) consensus that it’s time to talk about this particular subject matter. And we will see what will happen in Brunei...how the talks on the code will push forward.”

Last week, Department of Foreign Affairs spokesman Raul Hernandez said the summit’s theme under Brunei’s chairmanship is “Our People, Our Future Together,” emphasizing the importance of realizing the vision of an ASEAN community by 2015.

This year also marks the 46th year of ASEAN’s existence. Last year’s summit was held in Phnom Penh, Cambodia.

Hernandez said several things will be discussed in the summit: the ASEAN Community 2015; the ASEAN’s central role and the regional architecture; ASEAN’s future direction; and exchange of views on regional and international issues.”

He added that “the three pillars of the ASEAN community which we hope to be able to establish in 2015” will also be taken up: political security, the economic community, and socio-cultural, as well as administrative matters and “how to run and direct ASEAN as it goes forward,” he said.

Observers have questioned the ability of ASEAN to integrate in two years because of disputes among members, different levels of economic development and other concerns.

Thailand and Myanmar have a border dispute, while the Philippines, Malaysia, Brunei and Vietnam claim some areas in the West Philippine Sea.

But having one political voice and becoming a single market will make ASEAN strong and more progressive.

Phl to push for Asean integration despite territorial dispute | Headlines, News, The Philippine Star | philstar.com
 
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Myanmar's ready for challenges of ASEAN chairmanship: foreign affairs official
Published on Wednesday, 24 April 2013

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Aung Linn, the director general of ASEAN affairs department under the Ministry of Foreign Affairs, seen after the Senior Officials' Meeting yesterday (Photo - EMG)

Myanmar is prepared to face the challenges of the chairmanship of the Association of Southeast Asian Nations (ASEAN), senior official visiting in Brunei for the 22nd ASEAN Summit told Eleven Media yesterday.

“We are prepared to face all the challenges - the economic challenges, political challenges, social challenges, and everything,” Aung Linn, the director general of ASEAN affairs department under the Ministry of Foreign Affairs, said after a meeting between the senior officials of member nations.

Myanmar will take the chairmanship of ASEAN in 2014, and is preparing for it, Aung Linn said.

He noted that solving the territorial disputes in the South China Sea and achieving the ASEAN Economic Community (AEC) will play critical roles at the time Myanmar chairs the ASEAN next year.

“Regarding the South China Sea issue, our country is not directly involved in it. However, as a member of the ASEAN, we will stand and work together with ASEAN countries and the others to solve them,” he said.

With regard to achieving the AEC by 2015, he said, “There are goals towards AEC. We will have to fulfill these goals as ASEAN members.”

He also said Myanmar is continuing its reforms towards democracy. The country is reforming its economic and social sectors but is still lagging behind in terms of development for which it is perceived as driving force for more reforms, he told the foreign reporters.

The 2-day ASEAN Summit will start today, and it is the first one held by Brunei which took ASEAN chair in 2013.

Myanmar's ready for challenges of ASEAN chairmanship: foreign affairs official - Eleven Myanmar | Eleven Myanmar
 
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Timor Leste one step closer to ASEAN membership
Bagus BT Saragih, The Jakarta Post, Jakarta | World | Sat, April 27 2013, 10:13 AM

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President Susilo Bambang Yudhoyono had fulfilled his commitment to promote Timor Leste’s ASEAN membership during the 22nd summit in Bandar Seri Begawan in Brunei Darussalam, a minister says.

Foreign Minister Marty Natalegawa said on Friday that the ten member states had agreed to Timor Leste’s participation in its next meetings thanks to lobbing by Indonesia.

“We are still waiting for a formal decision,” Marty said at Halim Perdanakusuma Airport after arriving from Bandar Seri Begawan.

Marty was part of a delegation accompanying President Susilo Bambang Yudhoyono on his five-day ASEAN tour, which also included state visits to Singapore and Myanmar.

The approval of Timor Leste’s bid to have a greater role in ASEAN was also included in the summit Chairman's Statement.

“We were encouraged by the progress in discussions by the ASEAN Coordinating Council [ACC] and the ACC Working Group [ACCWG], on all relevant aspects related to the application by Timor Leste, as well as its possible implication on ASEAN, and agreed to explore the possibility of Timor Leste’s participation in ASEAN activities within the context of its need for capacity building,” the statement read. (ebf)

Timor Leste one step closer to ASEAN membership | The Jakarta Post


RI brings Timor Leste a step closer to ASEAN membership
Bagus BT Saragih, The Jakarta Post, Jakarta | Headlines | Sat, April 27 2013, 10:07 AM


The Association of Southeast Asian Nations (ASEAN) agreed to allow Timor Leste to “participate” in the grouping’s next meetings, thanks to lobbying by Indonesia during ASEAN’s 22nd Summit in Bandar Seri Begawan in Brunei Darussalam, Foreign Minister Marty Natalegawa said on Friday.

“It was a small but significant improvement [in Timor Leste’s bid to attain full ASEAN membership],” Marty said at Halim Perdanakusuma International Airport in East Jakarta after arriving from Bandar Seri Begawan. “We are still waiting for the formal decision on it.”

The foreign minister, however, did not delve into the limitations on Timor Leste’s “participation” in ASEAN’s upcoming meetings.

Marty was among President Susilo Bambang Yudhoyono’s delegation carrying out a five-day ASEAN tour, which also included state visits to Singapore and Myanmar. The Garuda Indonesia Boeing 737-800 carrying the President, First Lady Ani Yudhoyono and delegates touched down on Friday afternoon.

The approval of Timor Leste’s bid to have a greater role in ASEAN was also included in the summit chairman’s statement.

“We were encouraged by the progress in discussions of the ASEAN Coordinating Council [ACC] and the ACC Working Group [ACCWG] on all relevant aspects related to the application by Timor Leste, as well as its possible implication for ASEAN, and agreed to explore the possibility of Timor Leste’s participation in ASEAN activities within the context of its need for capacity building,” the statement read.

Indonesia’s commitment to supporting Timor Leste’s bid to join ASEAN was also reiterated by Yudhoyono when he met visiting Timor Leste Prime Minister Xanana Gusmao in Jakarta last month.

The “small” improvement achieved in Bandar Seri Begawan might be seen as a “big” step by Dili as Timor Leste’s bid to join the bloc has been to no avail for years, despite Indonesia’s repeated stress on the importance of having Indonesia’s former 27th province in ASEAN.

Indonesia annexed Timor Leste (at that time East Timor) in 1975, but lost control of it after a referendum in 1999. Timor Leste formally declared independence in May 2002.

Dili has proposed its inclusion as an ASEAN member since 2007 but its formal application was submitted in 2011 under Indonesia’s ASEAN chairmanship.

Before leaving for Jakarta, Yu-dhoyono said that Indonesia’s next task after the summit would be ensuring its readiness to welcome the ASEAN Economic Community (AEC) in 2015.

“You ought not to say that ‘we’re not ready’. Stop complaining. Let’s do something together,” he told the press in Bandar Seri Begawan as quoted by Antara news agency.

The President said that he would immediately set up a committee to ensure the readiness of Indonesia to welcome the AEC. He said that he had assigned Coordinating Economic Minister Hatta Rajasa to establish the committee.

The committee will include representatives from a wide variety of backgrounds, including the state government, local administrations, business, labor unions and experts. The committee will identify, among others things, industrial sectors that still need to be enhanced ahead of the implementation of the AEC.

http://www.thejakartapost.com/news/2013/04/27/ri-brings-timor-leste-a-step-closer-asean-membership.html
 
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I explain the importance of USPTO patents for a higher Filipino standard of living

In the comment section:

Martin Su • 4 minutes ago

There is a strong correlation between the inventiveness of a country and its income level.

Last year in 2012, Taiwan ranked fifth in the world and was granted 11,624 USPTO (U.S. Patent and Trademark Office) patents. China ranked ninth in the world and received 5,341 USPTO patents.

In sharp contrast, the Philippines received only 46 USPTO patents.

In conclusion, if Filipinos desire a higher standard of living then you will have to become more inventive. If you are stuck in the middle-income-trap, it is due to your failure to innovate.

Article link: Middle-income trap | Inquirer Opinion

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Related information:

Greater China opens up a 2,663 USPTO-granted patents lead on Germany!


Mainland China could pass France and the U.K. in the number of USPTO (U.S. Patent and Trademark Office) granted patents by next year. Greater China comprises mainland China, Hong Kong, and Taiwan.

The four largest exporters in the world (e.g. #1 China by using Greater China patents, #2 U.S., #3 Germany, and #4 Japan) are also the four largest USPTO patent holders.

PATENT COUNTS BY ORIGIN AND TYPE, CY 2012

Patents granted by the United States for the year 2012.

1. U.S. 134,187 patents
2. Japan 52,773
(Greater China 17,704)
3. Germany 15,041
4. South Korea 14,168
5. Taiwan 11,624
6. Canada 6,459
7. U.K. 5,876
8. France 5,857
9. China 5,341
10. Italy 2,546
...
India 1,733
Singapore 841
Hong Kong 739 (Patent office counts Hong Kong as a separate entity)
Russian Federation 339
Brazil 256
Malaysia 219

These countries are sometimes mentioned by the media as the "next China":

South Africa 158
Mexico 153
Poland 96
Greece 93
Argentina 67
Turkey 55
Thailand 46
Philippines 46
Ukraine 42
Chile 38
Egypt 28
Indonesia 12
Vietnam 4
 
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Surakarta hosting ASEAN Blogger Festival
The Jakarta Post, Jakarta | World | Sun, May 12 2013, 2:17 PM

The local chapter of the ASEAN Blogger Community is hosting the 2013 ASEAN Blogger Festival Indonesia (ABFI), aimed at increasing public awareness of the establishment of the ASEAN Economic Community in 2015.

Three-hundred bloggers from all over Indonesia and other ASEAN member nations are in Surakarta, Central Java, from May 10 to 12, for the event, sponsored by the Foreign Affairs Ministry and the local administration, among others.

Advisor of the Indonesia-chapter ASEAN Blogger Community, Ambassador Hazairin Pohan, said Surakarta was chosen to host the festival to promote the city's heritage sites to ASEAN member nations in which it would become ASEAN cultural heritage-connecting ***.

“Indonesian bloggers back the establishment an ASEAN Blogger Community, marked by an awareness on the importance of creating a caring and sharing society among netizens in ASEAN towards the establishment of the ASEAN Economic Community in 2015,” a statement made available to The Jakarta Post on Saturday said.

The statement said that the festival would feature discussions on social media in the ASEAN integration process; workshops on photo and video blogging, online businesses, and online advocacy; heritage site visits; exhibitions; cultural performances; competitions, among other things. (ebf)


ASEAN dolls sold in Phitsanulok are becoming popular
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PHITSANULOK, 10 May 2013 (NNT) - A shop in Tha Thong, Muang district, Phitsanulok has become popular, selling ASEAN doll pottery in many shapes and sizes.

The dolls replicate pairs of male and female folks dressed in traditional costumes of each ASEAN country, attracting the passers-by to enter the shop. Mrs.Pornthip Yuchamnong, 27, the owner of the shop says that originally the shop sold pots and dolls for garden decorations. However, as many government and private sector units are enthusiastic in promoting the advent of ASEAN Community and holding several events showcasing ASEAN culture on a regular basis, while ASEAN exhibitions in schools have also become common, the shop decided to bring in ASEAN dolls to cater for those exhibitions.

Mrs. Pornthip designs the dolls herself and sends her patterns to pottery factories in Nakhon Ratchasima, or Khorat, to be made and sent back to the shop. She anticipates her shop to be the first in Thailand to make ASEAN dolls from pottery. The dolls come in three sizes, 50 and 70 centimeters and 1.1metres tall, each in 10 sets of ASEAN costumes with a starting price of 18,000 baht per set. Schools and government units have shown great interest by making several orders. For those interested, the numbers to contact are 083-4114153, 084 -626 1265.

Thai Asean Dolls |
 
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Indonesia Seeks to Develop ASEAN Furniture Zone in Solo
By Jakarta Globe on 6:07 pm May 23, 2013.


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Workers weave rattan chairs in Jakarta in this December 12, 2012 file photo. (JG Photo/Yudhi Sukma Wijaya)

Solo, Central Java. An Indonesian business association on Thursday said it sought to partner with Asean furniture makers to develop a special zone in the Central Java town of Solo dedicated solely for the industry.

The zone should span at least five hectares to be able to accommodate dozens of furniture makers from Southeast Asia, the Indonesian Furniture and Handcrafts Association (Asmindo) said on Thursday.

Asmindo chairman Ambar Tjahyono said the association was planning to invite 60 major furniture makers — members of the Asean Furniture Industries Council — to join in the project.

“We will invite them to invest in Indonesia, to partner with Indonesians. I wish we can build an industrial zone together in Solo,” Ambar told Indonesian news portal bisnis.com on the sidelines of an Asmindo meeting in Solo.

He added Solo was a top choice for the regional furniture zone location as it already served as a hub for Indonesia’s furniture industry, citing a 13,000-hectare area in Kalijambe, in the outskirts of Solo, where dozens of local furniture makers are based.

Ambar said the new zone was expected to support the growth of the regional furniture industry while countering the influx of furniture from China, ahead of the opening of the Asean Economic Community in 2015, which will open free trade between 10 member states of Asean.

“We want to counter this threat. Asean countries should be flooded with products from Indonesia, and Asean should be able to dam up products from China,” Ambar said.

He added that Indonesia’s furniture market was now already dominated by imported products from China.

Indonesia’s furniture exports reached $1.8 billion last year, and the domestic furniture industry is targeting to increase the figure to $2 billion this year. In January, exports reached $164 million, a 4 percent rise from the figure in January 2012.

Indonesia Seeks to Develop Asean Furniture Zone in Solo - The Jakarta Globe
 
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Japan’s Abe to Offer Myanmar 40 Billion Yen New Aid
By Mariko Ishikawa & Yuki Yamaguchi - May 25, 2013 7:57 PM PT

Japanese Prime Minister Shinzo Abe will offer Myanmar 40 billion yen ($395 million) of new funds and exempt about 200 billion yen of delinquent debt when he meets President Thein Sein today, Jiji Press reported without citing anyone.

As Myanmar’s largest creditor, Japan last year agreed to settle $6.6 billion in debt and provide loans to help repay the Asian Development Bank and World Bank. Japan has sought closer ties since the 2010 election that brought Thein Sein to power, hosting him in Tokyo last year and sending Finance Minister Taro Aso to Myanmar in January with business leaders.

Support for Myanmar will lead to growth for Japan, Kyodo cited Abe as saying to reporters in Myanmar yesterday. Abe is the first Japanese leader to visit the South Asian country in 36 years, as his nation’s companies seek to invest in an economy that has some of the cheapest labor in Asia. Myanmar’s annual pay burden for a worker in manufacturing totaled $1,100 per year, less than half the cost in Vietnam and a sixth that of Thailand, according to a Jetro survey published in December.

Japanese companies are looking to diversify manufacturing operations following recent wage increases in Thailand, Malaysia and Indonesia, and a territorial dispute with China that soured ties between Asia’s biggest economies.

Suzuki Motor Corp. got permission from Myanmar in February to form a manufacturing subsidiary to make small trucks beginning this month. Sumitomo and NEC Corp. last week signed a contract to help improve the country’s communications network.

Mitsui & Co. (8031) in March said it would import 5,000 metric tons of rice from Myanmar, its first purchase in more than four decades. The trading company may invest 15 billion yen to build three rice-milling plants in Myanmar capable of processing 300,000 tons a year for the Middle East and Africa, a Mitsui spokeswoman said in March.

Abe yesterday met opposition leader Aung San Suu Kyi, and his itinerary during the three-day visit includes a visit to the port and industrial estate at Thilawa, 25 kilometers (16 miles) south of Yangon, Myanmar’s biggest city. Mitsubishi Corp. (8058), Marubeni Corp. and Sumitomo Corp. are helping to develop the port, part of which is set to open as early as 2015.

To contact the reporter on this story: Yuki Yamaguchi in Tokyo at yyamaguchi10@bloomberg.net; Mariko Ishikawa in Tokyo at mishikawa9@bloomberg.net

To contact the editor responsible for this story: Stanley James at sjames8@bloomberg.net
 
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Rule of law – a fundamental feature of ASEAN since its inception

Thursday 30th of May 2013

MANILA, May 30 (PIA) -- The Association of Southeast Asian Nations (ASEAN) had embraced the concept of the rule of law, especially at the international level, ever since its inception in 1967, and it continues to be a cornerstone until now.

First recognised in ASEAN’s founding document the Bangkok Declaration as a means to achieve regional peace and stability, the concept of the rule of law is now enshrined in the ASEAN Charter.

“The concept of rule of law in the ASEAN Charter is read in conjunction with ASEAN’s commitment to democracy and good governance, adherence to constitutional government and to the promotion and protection of human rights,” said ASEAN Secretary-General Le Luong Minh on May 28 at the Third High Level Meeting of the Inter-Regional Dialogue on Democracy held at the European Commission in Brussels.

Minh said that the importance accorded to the rule of law has been brought to new heights in the ASEAN Charter where it is embraced officially as both a purpose and a principle despite lack of authoritative definition of concept of rule of law.

“Although the core elements of the concept, such as equality before the law and the supremacy of the law, are widely accepted, the application of this concept into national political systems and legal structures varies greatly according to the specific contexts and capacities,” said Minh.

Minh said that the rule of law is fundamental for any functioning democracy as it incorporates elements such as a strong constitution with constitutional limits on power, human rights, an effective electoral system, a commitment to gender equality, laws for the protection of minorities and vulnerable groups and a strong civil society.

Apart from its charter, the ASEAN has also developed a number of instruments and mechanisms to facilitate cooperation among its member states which help to uphold and strengthen the rule of law.

“These instruments include the ASEAN Human Rights Declaration, the ASEAN Political-Security Community Blueprint, and the ASEAN Law Ministerial Meeting,” said Minh.

“The ASEAN Way has brought us to where we are now. War among the ASEAN Member States is unthinkable. And we are one of the fastest growing regions in the world today,” he added.

The Third High Level Meeting, which discussed the rule of law, highlighted the experiences and achievements of regional organizations, and the United Nations in promoting the rule of law in the regions and globally.

The meeting was hosted by Dr. José Manuel Barroso, President of the European Commission and attended by the heads and representatives of regional organisations including the ASEAN, the African Union, the League of Arab States, the Pacific Island Forum, the Organisation of American States and the South Asian Association for Regional Cooperation.

The meeting was co-organized by the International Institute for Democracy and Electoral Assistance (International IDEA) and the European Commission.

The meeting also agreed to continue the constructive dialogue among the heads of regional organizations on the topic of democracy and development at the Fourth High Level Meeting of the Inter-Regional Dialogue on Democracy which is expected to be held in Cairo in 2014.

This next meeting in Cairo will also discuss the development of the post-2015 Development Agenda and the role that Regional Organizations can play in it.

The ASEAN Secretariat was the host of the Second High Level Meeting which was held in 2012 with the theme “Promoting and Ensuring Inclusive Political Participation and Representation in our Regions”. (www.asean.org)#

PIA | Philippine Information Agency | Rule of law ? a fundamental feature of ASEAN since its inception
 
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Timor-Leste keen to join ASEAN



gusmao.jpg


Timor-Leste's Prime Minister Rala Xanana Gusmao



SINGAPORE: Timor-Leste said it is committed to building its human resources in order to contribute fully to the Association of Southeast Asian Nations (ASEAN).

Timor-Leste's Prime Minister Xanana Gusmao made these remarks during a lecture in Singapore on Tuesday, organised by the S Rajaratnam School of International Studies.

Mr Gusmao, who is also the country’s Defence and Security Minister, noted that since 2008, Timor-Leste has enjoyed average economic growth rates of above 10 per cent annually.

However, despite having some of the world's most competitive tax rates, it still needs to radically improve its human resources, as well as build core national infrastructure and eliminate extreme poverty.

Timor Leste is the youngest nation in the Asia-Pacific.

Speaking to Channel NewsAsia after the lecture, Mr Gusmao explained why it is important to be part of ASEAN.

"In this globalising world, we cannot be alone. And looking at our geographical location, we are part of Southeast Asia. That is why we said better to join, to participate in one or another way not only to the region but to the world. We are in a small way trying to be a 'contributory' at least in ideas, in finding solutions to a few problems that we can think about or we can address,” he said.

Timor-Leste keen to join ASEAN - Channel NewsAsia
 
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More ASEAN franchises invade Indonesian market
The Jakarta Post, Jakarta | Business | Mon, June 03 2013, 10:55 AM

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Show off: Around 143 local franchises and 36 foreign franchisors attend International Franchise, License and Business Concept Expo and Conference (IFRA), which ran from Friday to Sunday at the Jakarta Convention Center. The annual event lures locals as well as global franchise players. JP/R. Berto Wedhatama

Indonesia remains an attractive destination for foreign franchising companies especially from other members of the Association of South East Asian Nations (ASEAN) despite the growing competition in the franchising business.

Malaysian Franchise Association (MFA) chairman Abdul Malik Abdullah said on Friday that Indonesia was definitely a potential market for Malaysian franchisors, where they would target not only the food and beverage sector, but also healthcare, beauty and education.

“We currently have 20 franchise brands in Indonesia and we believe that there is good opportunity to tap into the market, especially with easier flow of goods and services under the ASEAN single market in 2015,” he told the Post in the International Franchise License and Business Concept Expo & Conference (IFRA) in Jakarta.

Speaking at similar event, Singaporean Franchising and Licensing Association (FLA) general manager Wesley Goh said that there were at least 10 Singaporean franchises currently operating in the country and there would be some more to come this year.

The advertising and operation manager of Singaporean blended ice franchisor Coolblog, Winson Keh, said that his company planned to open its first outlet in the country by year end following its successful presence in Malaysia.

“We are currently looking for a potential partner here in Indonesia as we already have more than 250 outlets in Malaysia and aim for 400 outlets next year. We have also been granted ‘halal’ certification [permissible according to Islamic law] from the Malaysian government,” he said.

Besides Malaysia and Singapore, the Philippines will also expand its franchise businesses into the country. The Philippine Franchise Association chairman Samie Lim said there were currently five Philippines’ franchises already operating in the country, which range from retail to service sector, such as Penshoppe, Potato Corner and Crystal Clear Water Store.

“We are aware of ASEAN Economic Community and we expect to expand to other ASEAN countries, Indonesia is our top priority considering the huge market population and similarities we share,” he added.

Meanwhile, Indonesian Franchise Association (AFI) chairman Anang Sukandar said that Indonesia was indeed a huge market for everyone, but he was afraid franchising business at home would be dominated by foreign firms.

“We have less than 15 franchisors going global, but there are a lot more foreign franchisors coming in. I think lack of support from the government is still a problem for potential franchisors to expand their business abroad,” he added.

Both Malaysian and Singaporean franchisors enjoyed support from their respective governments. The Malaysian government provides four percent interest rate-loans for their local franchisors and gives financial assistance for those willing to go global. Meanwhile, the Singaporean government provides grants of between 50 to 70 percent of needed fund for local franchisors willing to go global as well as free business consultancy.

Indonesia’s franchising business has grown during the first several years. As of last year, there were more than 2,000 franchises including licensed business opportunities (BOS), more than double from two years previously with an estimated combined revenue of Rp 115 trillion (US$11.74 billion), or up 15 percent up from a year earlier, according to statistics from the Indonesian Committee for Franchises and Licenses (WALI). (koi)

More ASEAN franchises invade Indonesian market | The Jakarta Post

The ASEAN way of consensus based decisions remains a valid approach
By Rupa Damodaran


KUALA LUMPUR: The ASEAN way of consensus based decisions remains a valid approach despite the fast changing landscape and challenges in the region.

Brunei's second minister of foreign affairs and trade Peihin Lim Jock Seng said the 10-member ASEAN grouping to gether with its three dialogue members namely Japan, China and Korea, have promoted peace and stability through this process.

“Whatever we do (with the dialogue partners), the de cisions must also benefit the people by reducing poverty and creating employment,”he said, during a luncheon address on “Rethinking ASEAN and its responses to a changing Asia- Pacific”.

Lim however admitted that frustrations do arise but at the end of the day, it was important for the grouping to keep the `within the family'.

“There are minus x or plus x situations in certain situations but when it comes to fundamentals, it is resolved by way of consensus.”

He was asked how the ASEAN grouping is able to resolve issues with its `non interference in each others affairs' and different political systems.

One of the success stories of the regional grouping was the cooperation that followed the SARS pandemic and also the creation of the Chiangmai Initiative following the Asian financial crisis in 1997.

Lim was also confident that the `rising temperatures' in the maritime areas in the region can be cooled using the mechanism under a multilateral framework like the recently formed Regional Comprehensive Economic Partnership (RCEP).

The first round of RCEP talks which involved 16 Asia- Pacific nations – which involves ASEAN countries and its partners namely Japan, China, Korea, India, New Zealand and Japan, was concluded in Brunei last month.

Once concluded in 2015, it will serve as one of the largest trading blocs in the world with a 3.4 billion population and a combined gross domestic product (GDP) of US$21.4 trillion

Read more: The ASEAN way of consensus based decisions remains a valid approach - Latest - New Straits Times The ASEAN way of consensus based decisions remains a valid approach - Latest - New Straits Times
 
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22ND WORLD ECONOMIC FORUM ON EAST ASIA
Myanmar, Cambodia, Indonesia and Philippines agree to work on ASEAN common visa

NAY PYI TAW, Myanmar – Ministers and tourism authorities of Myanmar, Cambodia, Indonesia and the Secretary of Tourism of the Philippines have expressed their intention to collaborate with relevant government agencies and other stakeholders to facilitate travel in the region by developing a common smart visa system, and have signed the “Statement of Intent on SMART Visa” today at the 22nd World Economic Forum on East Asia. The meeting is taking place in Nay Pyi Taw from 5 to 7 June.

“By signing this letter of intent, ministers and tourism authorities agree to work hand-in-hand for the implementation of this system, whose objective will be that of eliminating those barriers to the movement of tourists which are currently creating disincentives to travel. Such objectives will be achieved in close coordination with the governmental entities in each of their respective countries,” said U Htay Aung, Union Minister of Hotels and Tourism of Myanmar. The statement of intent forms a part of joint efforts to improve growth of the national and regional travel and tourism sectors along with social integration.

More specifically, ministers of tourism have agreed to collaborate on working towards the ASEAN Common Visa initiative as called upon by leaders at the ASEAN Summit, which took place in Jakarta in November 2011. It also builds on the single visa scheme for tourism travel between Cambodia and Thailand, which was implemented on 1 January 2013. Progressive relaxation and an ASEAN common visa would also benefit non-ASEAN nationals who intend to visit the ASEAN countries.

According to Mari Elka Pangestu, Minister of Tourism and Creative Economy of Indonesia, “Considering that tourism is a priority sector under the ASEAN Economic Community and that it constitutes a significant contribution to the integration of ASEAN countries, it is important to be ‘smart’ about visa facilitation for travel.” Given the experience of other countries and regions, it is expected that ASEAN countries will also experience the positive impact of implementing a smart visa on the growth of the tourism sector, increased investments in the travel and tourism industry, and job creation.

“By recognizing the importance of the connectivity in tourism activities, the statement of intent expresses our desire to give a boost to the tourism sector by facilitating the movement of tourists across borders; by going towards a smart visa through adopting best practices; and maximizing the use of technology to reduce the inefficiencies of the traditional visa application process,” stated Ramon R. Jimenez Jr, Secretary of Tourism of the Philippines.

The statement of intent was signed during the World Economic Forum’s Travel & Tourism High-Level meeting held today under the theme “Building Myanmar's Travel & Tourism Industry: Driving Growth and Job Creation”. “Facilitating travel to stimulate economic growth and job creation is one of the pillars of the summit, and is a core activity of the Forum’s Industry Partners and Members of the Global Agenda Council on New Models for Travel & Tourism,” said Thea Chiesa, Director, World Economic Forum.

Over 900 participants from 55 countries are taking part in the World Economic Forum on East Asia, which is being held for the first time in Nay Pyi Taw, Myanmar. The meeting welcomes over 100 public figures representing 15 countries, including heads of state or government of Laos, Myanmar, the Philippines and Vietnam. More than 550 business leaders, over 60 Global Growth Companies and nearly 300 young leaders from Young Global Leaders and Global Shapers communities, together with other members of civil society, academia and media are convening to discuss the challenges and opportunities facing Myanmar and East Asia today.

22nd World Economic Forum on East Asia Myanmar, Cambodia, Indonesia and Philippines agree to work ...
 
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S. Korea hints at trilateral FM talks with U.S., China at ASEAN forum

SEOUL, June 17 (Yonhap) -- South Korea is studying the possibility of holding trilateral talks with top diplomats from the United States and China on the sidelines of a regional security conference in Brunei later this month, a diplomatic source said Monday.

The move comes as North Korea issued a surprise proposal for talks with the U.S. on Sunday, after months of raising tensions on the Korean Peninsula following its third nuclear test early this year.

Foreign Minister Yun Byung-se, U.S. Secretary of State John Kerry and Chinese Foreign Minister Wang Yi have been invited to attend the 27-member, three-day ASEAN Regional Forum, which will be hosted by Brunei on June 30.

"The government's stance is to hold multilateral meetings with relevant nations in the wake of the ASEAN Regional Forum," the source said on the condition of anonymity.

"Under the current circumstance, it would be very useful if a South Korea-U.S.-China meeting is held," the source said.

However, it remains uncertain whether top diplomats of South Korea, the U.S. and China could hold a trilateral meeting since such talks have never taken place so far.

Responding to the North's offer of dialogue, the U.S. said it has been open to talks with Pyongyang, but the North must comply with U.N. Security Council resolutions and live up to its international obligations.

In a statement, U.S. National Security Council spokeswoman Caitlin Hayden said, "Our desire is to have credible negotiations with the North Koreans, but those talks must involve North Korea living up to its obligations to the world, including compliance with U.N. Security Council resolutions, and ultimately result in denuclearization."

"We will judge North Korea by its actions, and not its words and look forward to seeing steps that show North Korea is ready to abide by its commitments and obligations," Hayden said.

Ahead of summit talks between U.S. President Barack Obama and Chinese President Xi Jinping early this month, North Korea offered talks with South Korea.

But Pyongyang's dialogue offer with Seoul, which would have been the first of its kind in years, was scuttled last week due to disputes over who would represent the two sides.

South Korean President Park Geun-hye and Xi are scheduled to hold their first summit in Beijing later this month. China has expressed frustration against its wayward ally North Korea, particularly after the North's third nuclear test in February.

S. Korea hints at trilateral FM talks with U.S., China at ASEAN forum | YONHAP NEWS
 
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It' time to put ASEAN on the map amid EU meltdown
By Jaspal Bindra (Shanghai Daily)
June 17, 2013

As demand slumps in debt-ridden Europe, the ASEAN region looks increasingly attractive for profit-hungry British corporates.

Recent data showed a 5.8 percent drop in UK exports to the European Union, underscoring the need for British businesses to look elsewhere for growth. Many have already done so - a good example being Diageo, the world's biggest drinks company, which famously set its sights on generating half its turnover in faster-growing markets by 2015. At 42 percent, it has nearly reached this mark, two years ahead of time.

Often forgotten in the excitement about China and India, the Association of South East Asian Nations is widely seen as the big growth story of 2013. Its prospects are the stuff of envy for struggling Western economies: rising incomes and spending, an abundant workforce and GDP growth easily outstripping the global average.

On top of this, ASEAN boasts a wide array of strengths: Brunei, Indonesia, Malaysia, the Philippines, Thailand and Vietnam are rich in natural resources. Countries such as Indonesia and Vietnam are strong contenders as alternative manufacturing bases to China, and Singapore is one of world's most sophisticated hubs for business and financial services. When Rolls-Royce invested in its first big aerospace manufacturing facility outside the UK, it chose to do so in the city state, making this ASEAN member its gateway to the fast-growing markets of Asia.

If it were a single economy, ASEAN (which also counts Cambodia, Laos and Myanmar) would be the world's ninth largest by GDP - bigger than India and Russia - and its third most populous with 600 million people.

A growing center of trade, ASEAN is increasingly where the action is, with corporates busy setting up distribution, sourcing and manufacturing to capture opportunities within the 10 markets and more widely across Asia. Strategically placed across important new trade corridors, ASEAN is part of the world's biggest regional trade agreement (measured by population) with China, India, South Korea, New Zealand, Australia and Japan. This ASEAN plus six grouping represents around a third of the world's GDP and almost half of its population.

Between 2005 and 2010, intra-ASEAN trade surged 55 percent, and ASEAN trade with the rest of Asia has continued to grow strongly.

In 2011, China overtook the EU as ASEAN's largest trading partner, emphasizing the attractiveness of ASEAN as a hub from which to connect with customers across Asia. Another good reason to put ASEAN on the map: it is on a path to economic convergence, with plans for an ASEAN economic community by 2015. While the plans are ambitious and some concrete achievements are needed to solidify momentum for ASEAN integration, trade is already one successful aspect.

Room for growth

The 10 members have come a long way since the Asian financial crisis of the late 1990s. Lower debt, stronger banking sectors and more robust balances of payments all help to cushion ASEAN against external shocks, as evident during the latest crisis. The Philippines was just upgraded to investment grade, following in the footsteps of Indonesia last year. And despite outperforming the rest of the world for years, ASEAN still has plenty of room for growth, with trade, a growing middle class, burgeoning consumerism and urbanization all acting as strong drivers.

Standard Chartered believes urbanization alone could yield a tripling of ASEAN's GDP per capita, and help it outpace global growth for years to come, as the less urbanized parts of ASEAN catch up with the likes of Singapore and Malaysia. This year, ASEAN growth is expected to reach 5.3 percent, against IMF's 3.3 percent forecast for the world. Not surprisingly, given the state of economies in the West, foreign investor confidence in the region has been growing steadily, with ASEAN attracting 7.6 percent of global foreign direct investment in 2011, up from 4.3 percent in 2006.

The recent efforts of Myanmar - once the world's biggest rice exporter - to reconnect with the world economy further strengthens ASEAN as a trade bloc and attractive base for multinationals including UK corporates. This year Standard Chartered has re-entered Yangon after a decade's absence. To us, as to many others, ASEAN and the wider Asia region is becoming increasingly important to our business.

As ever, nothing can be taken for granted. The 10 ASEAN member nations are very different, challenges remain on the path to economic integration and sustained growth is dependent on the right mix of fundamentals, policy and confidence. But, for now, all the excitement about ASEAN is well founded and UK corporates would do well to put the region on the map.

It' time to put ASEAN on the map amid EU meltdown - People's Daily Online
 
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