ID :
364233
Mon, 04/20/2015 - 12:16
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Genuine Economic Growth A Key Unifying Factor For ASEAN

By Noor Soraya Mohd Jamal KUALA LUMPUR, April 20 (Bernama) -- Genuine economic growth is an important unifying factor for ASEAN countries in ensuring the regional grouping's community objective of continuous progress and prosperity can be fulfilled. Oxford Business Group (OBG) Managing Editor for Asia, Paulius Kuncinas said the expectation was high this year, and ASEAN will be seeing major initiatives as previous years' progress was slow and incremental. OBG is a global economic research group providing business intelligence with focus on high growth economy that is attractive for investors. As the chairman of ASEAN this year, Kuncinas said 2015 would be the year of opportunity for Malaysia in implementing the ASEAN agenda, and the country had a lot to gain from pursuing ASEAN-centric goals and objectives. "This year, businesses in ASEAN are asking the governments, whether they are serious or not. I personally believe that the ASEAN project would mean something, politically popular and meaningful when smaller households and companies feel the benefit," he told Bernama in an interview. Kuncinas said the regional grouping was moving in the right direction. It has achieved small but significant step such as the ASEAN passport lane, in addition to more important indicators such as active cross-border transactions, huge increase in regional trade and investment, as well as active regional oil and gas and airlines sectors. "In financial and banking sector, we can see banks, especially Malaysian banks, have been driving the integration agenda. We are seeing more activities in tourism, health and trade transactions between the small and medium enterprises (SMEs) in information technology," he added. ASEAN, Kuncinas said, had created a framework for companies to establish their presence in one country in order to operate in the whole market. "This year for the first time we hope to see it in action. Companies can be comfortable establishing bank accounts in Malaysia and can do business transactions in Indonesia, Thailand and Myanmar," he said. However, to progress further there is a pressing need to accomplish higher impact results from the ASEAN agenda initiative. "The best milestone is reducing the cost of doing business; harmonising laws and regulations in selected areas such as transportation, skilled labour movement, banking, aviation and services; and reduce bureaucracy. "Reducing the cost of telecommunications, which have very direct impact to cost of doing business and can drive the bulk of business, is something that can be achieved very quickly," he added. Theoretically, Kuncinas said ASEAN is about economic collaboration but in practical sense, the liberalisation is about reducing the cost of doing business. "We talked not only to SMEs but also larger companies, and they find it is extremely hard to cross borders even when they see opportunities because of compliance, laws and regulations. "There is a lot of hidden cost in compliance. Tariff is only 5.0 per cent of the cost, but compliance is 30 per cent. ASEAN needs to reduce to 5.0 to 10 per cent. This is what ASEAN should be. Removing barriers and cutting the red tape,” he said. Another major bottleneck in ASEAN is the cost of logistics, and Malaysia can make a real difference as it stands out as one of the countries that is doing quite well in this area. ASEAN also needs to push more trade between remote areas such as in Borneo and Palawan, or Vietnam and Borneo, thus creating more regional links. "A good example is when people travel to Borneo, they want to see the whole island. They want to see the exotic Brunei, tropical forest of Sarawak (east Malaysian state), they want to climb Mount Kinabalu (in east Malaysian state of Sabah). "However, very few operators can offer complete package experience because of lack of collaboration and part of the reason is the difficulty in doing business. It's simple things like financial transactions, poor infrastructure between countries or different labour law," Kuncinas said. He added that Malaysia was arguable the nation that had more to gain from the ASEAN integration than any other countries. "With the imposed end-2015 deadline, the urgency is definitely here. We might not get 100 per cent of the agenda being implemented but what is really important is making a tangible, visible and actionable real progress that SMEs and people at large can feel the difference," Kuncinas said. And with Malaysia driving the agenda this year for ASEAN, he said, there was huge opportunity for the grouping to matter regionally and internationally. --BERNAMA

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