Asian Economic Integration Should Commit to Open Regionalism

Asian economic integration should be based on open regionalism and take into account the diversity of its member countries, said a senior Singapore official on Thursday.

Speaking at a seminar on Asian economic integration, Lim Hwee Hua, Senior Minister of State for Finance, said Asian economic integration should not lead to a closed and exclusive regional trading bloc which would be detrimental to Asia's economic growth.

The integration will lead to an environment where companies could operate across Asian countries and beyond in a borderless manner, where goods, funds and information flow freely and at minimal cost, she elaborated.

She pointed out that the recent failure of the World Trade Organization (WTO) Doha Round has lent greater impetus towards regional integration - not to encourage protectionism, but to sustain the momentum for liberalization so that all will derive maximum benefits from economic globalization.

Another key success factor for Asian economic integration, she said, was managing Asian diversity.

The path towards successful Asian economic integration should adopt a pragmatic approach that recognizes and accommodates the diverse interests and developmental levels of its members, she said.

Holding regular and frequent dialogues is also an important aspect of managing diversity within Asia, she added.

In addition, increased regional financial integration could lead to an enhancement of economic integration and growth for Asia, she said, adding that because deeper financial integration could help to channel Asia's large pool of savings towards financing investments within the region.

The Association of Southeast Asian Nations (ASEAN) plays a key role in the integration process, the senior official said.

As ASEAN itself, a market with 576 million population and a combined gross domestic product of 1.3 trillion U.S. dollars, is a significant market.

As well as the regional bloc has paved the way for the wider regional economic integration process through the free trade agreements (FTAs) that it has negotiated or is currently negotiating with China, Japan, South Korea, India, Australia, New Zealand and the EU.

While Asian economic integration has economic benefits for Asia, she warned, negative side effects should also be addressed, such as economic restructuring and labor market disruptions. 

 

Source: CRIEnglish