Development Centre

ASEAN countries returning to pre-crisis growth

 

The six major ASEAN countries have rebounded from the global economic crisis, with medium-term growth prospects returning to pre-crisis levels, according to the OECD Development Centre's 2010 Southeast Asian Economic Outlook.

With economic recovery underway across the region, GDP growth will average 6% annually across the ASEAN-6 countries over the 2011-15 period, which is about the same level as the period 2003-07.

   2010  2015  Average 2003-07  Average 2011-15
Indonesia   6.1  7.1  5.5  6.6
Malaysia  6.5  5.3  6.0  5.5
Philippines  6.0  4.4  5.7  4.6
Singapore  14.0  4.5  7.5  4.7
Thailand  7.0  5.1  5.6  5.2
Viet Nam  6.8  7.2  8.1  7.1
6 countries average  7.3  6.0  6.1  6.0

Source: OECD Development Centre (MPF-SAEO 2010) To access excel format: http://dx.doi.org/10.1787/888932344957

 

Despite this positive outlook Kiichiro Fukasaku, an economist in the OECD Development Centre, said future growth still needs to be more balanced across the ASEAN countries: ‘The global financial crisis has offered Southeast Asian countries an opportunity to rethink past growth strategies and define new development objectives. Both regional integration and national efforts will help promote more balanced growth in the region.’

To balance regional growth, Southeast Asian countries should take urgent action to improve medium-term fiscal frameworks, enhance external competitiveness by supporting new growth sectors and develop integrated regional transport infrastructure.

1. Improving fiscal policy frameworks is critical to implementing national development plans. ASEAN countries’ five-year development plans - aimed at infrastructure development, poverty reduction and social protection - will require solid public finances. “Well-designed fiscal rules, independent fiscal institutions and medium-term budgetary frameworks consistent with national development plans still need to be created,” said the Development Centre’s Kensuke Tanaka.

2. Enhancing the external competitiveness of ASEAN’s priority sectors is key to reaping the full benefits of creating an ASEAN Economic Community (AEC). A major challenge is reducing excessive export dependence on a narrow range of electronic products - mostly parts and components - and moving up the value chain. ASEAN countries should also develop more niche and specialty products within the nine priority goods sectors . For example, diversification into healthcare product markets would provide a new source of trade growth.

3. Developing a more integrated transport infrastructure is necessary to foster regional and sub-regional connectivity. Challenges include overcoming excessively high transport costs, solving urban congestion and improving competition and efficiency in air-transport. Exploring new financing methods, such as infrastructure revenue bonds - already successful in OECD countries - could also be applied to the Southeast Asian transport sector. But infrastructure alone is not enough - ASEAN countries must improve transport sector policies and regulation while seeking to boost regional co-operation, particularly through multilateral initiatives and agreements.


Press Contacts:


International: Elodie Masson, elodie.masson@oecd.org, T: +33 1 45 24 82 96
Asia: PAC Tokyo, Noriko Mimura, noriko.mimura@oecd.org, T: + 81 3 55 32 00 26

 

The Southeast Asian Economic Outlook


The Southeast Asian Economic Outlook (SAEO) is the new regional economic outlook published by the OECD Development Centre and serves as the OECD’s reference on Asia’s economic growth, development and regional integration. It focuses on the ten Association of Southeast Asian Nations (ASEAN) countries - Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Viet Nam - and addresses relevant economic issues in China and India in order to fully reflect economic developments in the region. For more information, please consult www.oecd.org/dev/asiapacific.

 

 

 

 

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