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Asean Integration:
It is time we pick up speed


Q: You said that “Asean will be fully integrated by 2015 and there will be a boom in Asean as a whole”. How far do you think, the 10 nations have been successful in implementing Asean vision 2020?

First, Afta (Asean Free Trade Agreement) was created, which somewhat made the group more business and trade oriented. Then the Asean Chamber of Commerce was set up, followed by the Asean Business Advisory Council (ABAC). I was the first chairman of the ABAC in 2003. It was a tough job because I had to raise funds in four months. It rolled on, however. The vision 2020 has now been advanced to 2015. I agreed with this fasttrack policy because we need to speed up as the global economy and technology began to accelerate. For 40 years Asean has been on a slow boat. It is going to be different now. Yet it will be difficult moving fast because Asean countries have themselves been competitors producing similar products and targeting the same markets. They have been suspicious of one another, probably. So it has not been easy to change the mind-set of the members. But it is time Asean picked up speed.

Q: Many international organisations like EU have shown tremendous interest in th Asean block. What do you think is Asean’s competitive advantage over other nations?

There is a lot of scepticism over Asean integration. How could we be a single market when we compete against one another? Unlike in the WTO, where they
have a voting system and those members who are found violating the rules get punished. But in AFTA and Asean there’s no such thing as a rule-based system, no
binding agreement. Delegates would meet and initially agree on certain duties and tariffs on products. But then eventually they find it difficult or impossible to push
them through their cabinets. There are no commitments, no penalty but everything has to be based on consensus, and every country has to agree. If one country is absent, decisions cannot be made. Regarding Asean’s competitive advantage, you can see Asean for the last 3 decades has grown much faster than Europe. We
have had consistent growth despite the financial crises. Besides, Asean is rich in energy and natural resources, labour (cheap and skilled).

Q: What are the difficulties the countries are facing promoting intra -Asean trade?

There is no promotion. Secondly, everything is consensus, no penalty. In AFTA we agreed that goods must be levied from 0 to 5% but that is not the case in
many instances. We do not have Asean single window custom clearance. There are plans but the problem is implementation is slow. We are waiting for the charter
to come into existence. Unfortunately, I don’t see a unanimous endorsement.

Q: The five original members of ASEAN are well advanced as compared to the other five late entrants. There have been certain apprehensions among the former in the opening up of their markets to the low-wage neighboring countries, price being the root cause. Do you think Asean can overcome such hesitation?

According to the Asean Vision 2015, there will be free flow of goods, capital, funds and people. But now they only want skilled people. But I think if we want to be a strong Asean we should not be afraid of that. That is our strong point. You have to think about the region and no only of your own country. How can you convince foreign investors to invest if you don’t allow the low wages to come. Members of Asean are too much inwardlooking and not enough confident.

Q: What are the main sectors you have prominent business in?

I have logistic companies, a network of convenient stores in Indonesia and Asean, the trucking business, shipping, banks, resource, industrial estates, handicrafts, manufacturing, furniture manufacturing, trading etc. The major Thai companies also want to do business with me in other sectors. I have businesses outside Indonesia, in Asean.

Q: What made you expand your business in Asean?

What advise would you give to other people who want to follow in your footsteps to look at Asean for business?

In the free trade era, with APEC coming in, it’s basically a free market orientation where all the goods and services will come to your country. Many Indonesian
businessmen are very protective asking the Government not to let competition come in. But I advise the government that it should be the other way round. Forget that you belong to any particular country, you are in Asean. We have agreed to be one market, have team spirit and healthy competition so that we can compete with Europe, Japan and the US as a regional bloc.

 

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