Despite a rather somber global economic outlook for 2023, countries in Southeast Asia are expected to experience relatively positive levels of economic growth. The optimism—particularly among the Association of Southeast Asian Nations (ASEAN) countries—was showcased throughout the World Economic Forum’s Annual Meeting 2023 in Davos, Switzerland.
“We are confident, if you can play a role like this, that ASEAN becomes the centre of economic growth in the region,” said Luhut B. Pandjaitan, the Coordinating Ministry for Maritime Affairs of Indonesia.
ASEAN, a regional trading bloc established in its earliest form in 1967 in Bangkok, consists today of ten countries: Brunei Darussalam, Cambodia, Indonesia, Lao People’s Democratic Republic, Malaysia, Myanmar, Philippines, Singapore, Thailand and Viet Nam. The bloc is home to over 660 million people and facilitates regional economic integration.
Economic optimism in ASEAN
ASEAN’s total gross domestic product (GDP) hit $3.3 trillion in 2021, making up 3.5% of global GDP, according to bloc figures. Indonesia is the bloc’s largest economy by far.
In 2022 and 2023, ASEAN’s real GDP growth is forecasted to be 5.2%, according to the Organisation for Economic Co-operation and Development. Economic growth, however, varies drastically by country, with Myanmar on the low end and the Philippines on the high end.
“ASEAN for us, for the Philippines, is a strength,” said Teresita Sy-Coson, the Vice-Chairperson of SM Investments Corporation, a major retail, banking and property corporation in the Philippines.
Philippine President Ferdinand Marcos Jr also attended the Annual Meeting where he discussed geopolitical forces in the world today and post-pandemic economic growth in region.
“Our unemployment rate now is lower than it was before the pandemic,” Marcos Jr stated. “As long as the unemployment rate stay low, then the recessionary forces are something that we can resist.”
China is, by far, ASEAN’s largest trading partner. In 2021, trade between ASEAN and China hit $669 billion, marking a 29% year-over-year increase.
Total goods and services trade with the United States hit $362 billion in 2020. In 2021, total direct foreign investment in ASEAN hit nearly $180 billion.
“If you look geographically at the formation of ASEAN countries, we are the only region that connects the West with East,” said Anutin Charnvirakul, the Deputy Prime Minister and Minister of Public Health of Thailand. “Nobody could pierce through the eastern hemisphere without passing through the ASEAN region.”
Source: We Forum