Echauz, Beeya Juliane F.

BBF 4-6N

ASEAN Integration
The blueprint for realizing an ASEAN Economic Community (AEC) by 2015 was adopted and
signed by ASEAN Leaders in November 2007 in Singapore during their annual Summit
Meeting. One of the main objectives of an AEC is to create a single market and production
base by ensuring a free flow of goods, services, investment, capital and skilled labor.
The Philippines is one of the signatories in the AEC Blueprint, which means the country,
along with other ASEAN Member States (AMS), should be open to zero import duties for
ASEAN products and services by 2015. AMS nationals, meanwhile, should be able to work
anywhere in the region without a work permit.

What are the Objectives of ASEAN Integration?

(i) To consolidate existing work plans related to connectivity and prioritize and
enhance actions, taking into account related existing sub-regional cooperation
frameworks;
Physical Connectivity
(ii) To develop an integrated and well-functioning intermodal transport, ICT and
energy networks in ASEAN and the wider region; Institutional Connectivity
(iii) To put in place strategies, agreements, and legal and institutional mechanisms
to effectively realise the ASEAN Connectivity, including those to facilitate trade in
goods and services, and the appropriate types of investment policies and legal
frameworks to ensure that the investments are protected to attract the private
sector investments;
People-to-People Connectivity
(iv) To develop initiatives that promote and invest in education and life-long
learning, support human resource development, encourage innovation and
entrepreneurship, promote ASEAN cultural exchanges, and promote tourism and the
development of related industries;
Operationalization of ASEAN Connectivity

(v) To establish the principles of funding recommend appropriate funding

mechanisms and provide an estimate of the required funding to develop and/or
enhance the linkages identified in the Master Plan;
(vi) To forge win-win partnerships among the public sector, the private sector,
ASEAN peoples and the international community;
(vii) To enhance the role of private sector and local communities in the
implementation of the ASEAN Connectivity initiatives;
(viii) To draw up specific timetables for realising the goals of ASEAN Connectivity
which will complement the work being undertaken to realise the ASEAN Community
by 2015 as well as take into account the different levels of development of ASEAN
Member States; and
(ix) To prepare capacity building cooperation arrangements in ASEAN such as the
Initiative for ASEAN Integration (IAI) and other appropriate regional institutes in
narrowing the development gap within the region, and in complementing ongoing
regional efforts to realise a people-oriented ASEAN Community by 2015.

What is the purpose of ASEAN Integration?

The Integration is expected to boost investments, job creation, and incomes in the region.
ASEAN Integration is expected to level the playing field among industries in the region. Firms
should brace for an intense competition with their ASEAN counterparts. An intense
competition will therefore raise the bar for innovation, quality and productivity, which will
enable businesses to compete head on with other players.

The purpose and goals of enhanced ASEAN Connectivity are:

(i) To enhance integration and cooperation of ASEAN;
(ii) To enhance global competitiveness of ASEAN through stronger production
networks;
(iii) To enhance the well-being and livelihood of ASEAN peoples;
(iv) To enhance rules and good governance for ASEAN;
(v) To enhance connections to economic centers both within the ASEAN region and
within individual Member States and narrow the development gaps;
(vi) To enhance local economic and social development;
(vii) To enhance efforts to tackle climate change as well as promote sustainable
development; and

(viii) To address the negative impacts of Connectivity.

What is its importance to Central Banking?
Members of the Association of Southeast Asian Nations (Asean) have already begun discussions on
banks wanting to operate outside of their home country following the finalization of a banking integration
framework, the Bangko Sentral ng Pilipinas said.
Central bank Governor Amando M. Tetangco Jr. said that the other members have already started to
discuss bilaterally with other Asean members. The members from our charter also have initial discussions
with other members but still cannot reveal them because they are very preliminary.
Tetangco said that a framework for a Qualified Asean Bank (QAB) has also been established during the
meeting, which basically updated the ABIF agreed upon by member countries back in December. The
framework would now allow a bank from any of the Asean members to operate within Asean but there will
be conditions. The next step would be for governments to agree on a bilateral accord.
This means that before any Asean bank could operate in another members jurisdiction, regulators from
both countries would have to agree on a set of rules for the QAB.
At the same time, Tetangco stressed that banks aiming to be a QAB should comply with international
standards on capital and other financial reforms.
Among the ABIFs objectives are creating strong and well-managed banks in the region, exposing the
lenders to brisker competition and allowing them access to bigger markets.
The Asean central bankers have agreed to have at least one QAB operating in their jurisdiction by 2018,
Tetangco said.
In a joint statement following the Asean finance ministers and central bank governors meeting last week,
the regulators stressed the finalization of the ABIF represents a significant milestone for the region in
working towards greater financial and economic integration.
As Asean moves closer to the realization of the Asean Economic Community, ABIF will strengthen the
other initiatives under the Asean Financial Integration Framework to provide an important enabling
mechanism for ASEAN countries to accelerate the pace of regional financial integration, increase cross
border trade and investment flows and thus harness the growth potential of the region, the statement
said.