The Benefits of AEC

BY

Nattanicha Siamnikorn

(Mimi) G.1106
The Benefits of AEC Nattanicha Siamnikorn (Mimi)
G.1106
The Benefits of AEC

Introduction

ASEAN Economic Community, AEC, consists of 10 members from different

countries which are Singapore, Indonesia, Brunei, Malaysia, Philippines, Cambodia,

Vietnam, Laos, Thailand and Myanmar (ASEAN Member States, n.d.). AEC was

established after the integration of ASEAN. It is designed to allow a better skilled labor, free

movement of goods, services and investment among the ASEAN members in Southeast Asia

within the year of 2025. Also, AEC will increase the strength of ASEANs economic.

Moreover, AEC will lead ASEAN to become the fourth largest economy in the world by

2030, following behind the influential countries such as United States and China. Therefore,

it is important to know how AEC will increase the Southeast Asians economic rates. Also,

what are some changes that AEC will bring to the members countries in Southeast Asia.

Additionally, looking forward on Southeast Asian economic development and progress. At

last, AEC will help create better Economic changes in the Southeast Asia.

Investment

AEC will help create better Economic changes in the Southeast Asia. It will increase

investment rates among the ASEAN countries as there are more trades and foreign companies

interested in investing their capital according to the AEC new policies. There are some

websites stated that the investment in ASEAN will be improved and increased by many

foreign countries. The article stated that ASEAN is committed to building an investment

environment to attract businesses: it created the ASEAN Comprehensive Investment

Agreement (ACIA), which includes commitments towards the liberalization and protection of

cross-border investments operations, together with best practices for the treatment of foreign

investors and investments. (Benefits of the ASEAN Economic Community AEC, 2016).
The Benefits of AEC Nattanicha Siamnikorn (Mimi)
G.1106
The ACIA policy had been published to make sure that there will be an increase in investment

rates among the ASEAN countries following the AEC blueprint. Many new articles have been

published to the estimated rates of the investment that will occur in Thailand in the next

couple years. As the article stated, Thai foreign investment in ASEAN almost tripled over

the past 10 years to $24.9 billion as of 2015, 34.1% of which was in CLMV. Foreign direct

investment from ASEAN to Thailand doubled during that period... (AEC: One year on,

2017). Thailand economy including the investment rates are shown as a triple profit from the

past. Thailand proved that there are increased rates in their investment by the foreign

companies. These are some examples of the articles that represent the growth of ASEAN

investment rates in AEC blueprint. Therefore, those AEC policies will prove that Southeast

Asias economic rates will definitely be improved better than before.

Unemployment Rates

AEC will help reduce unemployment rates. ASEAN unemployment rates will be

decreased as AEC will create workforce policies which will give convenience to both

companies and workers. So, more companies will emerge and they require massive

workforce in order to run their business. Therefore, a large number of unemployed people

who live in one of the ASEANs countries will be able to find their job easily. Variety of

economics websites have been discussing on the AEC benefits of reducing the rate of

unemployment among Southeast Asia region. The article mentioned, It is predicted that the

economic growth and the increased workforce mobility arising from the AEC can generate

around 14 million new jobs in the region by 2025. Local industries that require specialized

labor will also be able to employ professionals from other ASEAN nations, thereby

increasing productivity and cost-effectiveness of labor. There will be a free flow of skills and

talents across the ASEAN member states, greatly improving the allocation of human
The Benefits of AEC Nattanicha Siamnikorn (Mimi)
G.1106
resources. (Fong, n.d.). By the year of 2025, new jobs will be produced and more people

will get hired to work in the industries. Not only increasing the human resources but also

increasing Southeast Asian productivity. ASEAN will be a massive hub of workforce. There

are a great number of news stated about the MNP policy created by ASEAN Economic

Community. This policy will definitely benefit the AEC workforce. As the passage stated,

The ASEAN Agreement on the Movement of Natural Persons (MNP) is an agreement

signed which has delivered a legitimized framework so as to affluence the cross-border

movement of people from different ethnicities, in this way the people will be able to engage

in trade and investment. Basically, this concept is generated to facilitate the free flow of labor

from one part of the region to another for better opportunities and integration. (Benefits of

the ASEAN Economic Community AEC, n.d.). Southeast Asian workers will be able to

travel around ASEAN countries with ease as there is MNP policy which will help to improve

the quality of the workforce and open widely for work options. These are some examples of

the news article which will prove that AEC will obviously create new policies to reduce the

unemployment rates among the ASEAN countries. Also, improving the workers potential

and giving convenience to Southeast Asian workforce so they can travel to other countries to

find better jobs that suit them. Therefore, ASEAN economics will become better as most of

their populations have jobs so they are able to make a living which indicate that there will be

greater circulating fund in the countries.

Trades

Trades between countries will be operated easily among the ASEAN members

because of the new policy called AFAS. This new agreement will play an essential role in the

convenience of trades also helping the Southeast Asia economics increases as well as more

investment will be occurred. Once the AEC blueprint has been published, the article named
The Benefits of AEC Nattanicha Siamnikorn (Mimi)
G.1106
Benefits of the ASEAN Economic Community from AECconnect (n.d.) website has been

discussing on the trade policy that will affect ASEAN economics to be better. This economics

website published, For the ASEAN members, the free flow of goods was practiced in 2010,

as no duties were applied on the above-mentioned countries and duties were eradicated. Other

implications are also taking place including the reduction of technical barriers for the purpose

of trade. Agreements like the ASEAN Framework Agreement on Services (AFAS) are also

being signed so as to achieve the free flow of services. As the article mentioned, AEC will

create a trade policy which is AFAS in order to manage the free flow of products among the

ASEAN countries to be connected with one another easily without difficult communication.

Also, one of the Asian business and economics news suggested that foreign investment will

support ASEAN trades as free trade agreement will expand around the ASEAN countries

causing an increase in capital. Mr. Christopher W. Runckel (n.d.), economics and business

journalist, posted one of the famous article on Asia Opportunities, All ASEAN countries

are more important to foreign investors if they are considered as one node in a larger regional

market of nearly 600 million people - a single market. The ASEAN Free Trade Agreement

will be expanded to zero tariffs on almost all goods by 2015. ASEAN plans to remain

engaged with the global economy through regional-level free trade agreements - today,

ASEAN has such agreements with China, Japan, Korea, India, Australia and New Zealand.

Therefore, AEC will keep its economic progress with other countries around the world as

ASEAN is one of the biggest single market where many foreign investors are interested in

investing their money. According to AEC new AFAS agreement and the relationship of the

ASEAN countries with the developed and wealthy countries around the continents will make

Southeast Asian Trades operated easily. There will be more investments through trades which

will produce more circulating funds in the countries. Moreover, once the countries gain huge

profits, the rates of economics among the ASEAN countries will increases.
The Benefits of AEC Nattanicha Siamnikorn (Mimi)
G.1106
Conclusion

In conclusion, AEC will help create better Economic changes in the Southeast Asia.

AEC will increase investment rates by attracting many foreign investors to invest in its

members countries. ASEAN Economic Community will help reduce unemployment rates,

there will be more economic growth, many new companies will hire workforce. Additionally,

trades between countries will be operated easily due to AEC new trade policies. These factors

are backed up by official news websites and articles which mainly focus on economics

among Southeast Asian region. All of the websites agree that AEC will bring ASEAN

benefits. As well as, there are some statistics evidences to show the increases in Southeast

Asian economics. This position that AEC will help create better Economic changes in the

Southeast Asia because it is important for business and economic industries to know how

AEC will increase the Southeast Asians economic rates. As well as people, should know

what are the changes that AEC will bring to their countries. Furthermore, there should be

studies on Southeast Asian economic development and progress. By knowing these aspects,

will help you be able to plan your business investment in the future.

References
The Benefits of AEC Nattanicha Siamnikorn (Mimi)
G.1106
ASEAN Member States. (n.d.). Retrieved February 7th, 2017 from

http://asean.org/asean/asean-member-states/.

AEC: One year on. (2017). Retrieved February 21st, 2017 from

http://www.bangkokpost.com/print/1174057/.

Benefits of the ASEAN Economic Community AEC. (2016). Retrieved February 21st, 2017

from http://aseanup.com/benefits-asean-economic-community-aec/.

Benefits of the ASEAN Economic Community AEC. (n.d.). Retrieved February 22nd, 2017

from http://www.aecconnect.com/en/blog/2016/3/21/benefits-of-the-asean-economic-

community-aec.

Fong, W. (n.d.). HOW THE ASEAN ECONOMIC COMMUNITY WILL CHANGE

SOUTHEAST ASIA. Retrieved February 22nd, 2017 from

http://www.nlb.gov.sg/sure/how-the-asean-economic-community-will-change-

southeast-asia/.

Runckel, C. (n.d.). Asia Opportunities: ASEAN Economic Community (AEC). Retrieved

February 22nd, 2017 from http://www.business-in-asia.com/asia/asean_

economic_community.