Transcript “Myanmar in ASEAN: Working Toward the ASEAN Economic

Kyaw Soe Thein
Director
ASEAN Division
Foreign Economic Relations Department
Ministry of National Planning and Economic Development

Introduction: Southeast Asia, Myanmar and
ASEAN

Myanmar in ASEAN

Establishment of ASEAN Economic Community

Issues and Challenges Relating Myanmar’s to Join
AEC

Conclusion
1.1 What is Southeast Asia
 The term Southeast Asia was occasionally used by
European, especially German writers, in the late 19th
century.
 Myanmar, Thailand, Laos, Cambodia, Vietnam,
Malaysia, Brunei, Singapore, and Indonesia, were
considered as some kind of geographical unit.
 Ten Nations
 Each country has its individual style.
 Unity and diversity
1.2 Socio-economic characteristics of Southeast
Asian Nations: A Brief Overview

ASEAN member countries vary widely in size,
population, and income.
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Total population of nearly 600 million and land
area of 4,495 thousand sq.km.

Indonesia is the largest, Brunei is the smallest.
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In 2011, Singapore had the highest per capita GDP of US$
(50129.9) followed by Brunei with US$ (38702.5).
Malaysia with US$ (9940.6), Thailand and the Philippines
had US$ (5115.8) and US$ (2340.9) respectively.
Cambodia had US$ (879.7) and Laos had US$ (1278.5).
Myanmar’s per capita GDP was US$ (875.1), and Vietnam
had US$ (1403.3).
The average per capita income of ASEAN countries would
be about US$ (11422.9).
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GDP growths also differ between countries.
In 2011, the fastest growing economies were
Myanmar and Lao PDR with rates of 10.4% and
8.0% respectively, closely followed by Cambodia
with 7.1%.
Thailand economic growth in 2011 was
disappointing, with a rate of 0.1%.
In term of social indicators, ASEAN 6 (Brunei,
Singapore, Malaysia, Indonesia, Thailand, and the
Philippines) generally perform better than the CLMV
countries
Table (1.1) Selected Economic Indicators (2011): ASEAN
Countries
Land Area
Pop (million)
(‘000)
Pop
Labor Force
GDP
Real GDP
GDP Per capita
Export
Import Growth
Growth (%)
(Million)
At current prices
Growth (%)
At current prices
Growth Rate
Rate (%)
(US$)
(%)
(sq km)
Brunei
(US$ million)
Inflation
5,765
0.4
2.0
0.21
16,359.6
2.2
38702.5
33.1
19.6
2.0
Cambodia
181,036
14.5
1.5
7.2
12,775.0
7.1
879.7
35.8
25.9
6.3
Indonesia
1,919,317
241.6
1.7
117.3
846,821.3
6.5
3563
29.0
30.8
5.4
Laos
236,800
6.38
2.0
n.a
8,163.3
8.0
1278.5
6.1
17.6
7.6
Malaysia
329,758
28.96
1.3
12.5
287,922.3
5.1
9940.6
8.7
8.6
3.2
Myanmar
676,577
60.4
1.0
30.1
52841.5
10.4
875.1
0.4
37.3
5.0
The Philippines
300,000
94.2
1.7
40.0
224,337.4
3.9
2340.9
-6.7
9.5
4.6
Singapore
648
5.18
2.1
3.2
259,858.4
4.9
50129.9
7.5
8.6
5.2
Thailand
514,000
67.6
0.4
38.8
345,810.8
0.1
5115.8
11.7
19.1
3.8
Vietnam
330,955
87.8
1.0
51.4
123,266.9
5.9
1403.3
34.2
25.8
18.6
Source: Asian Development Bank, Key Indicators for Asia and Pacific 2012, ASEAN Statistics
Table (1.2) Selected Social Indicators (2011): ASEAN
Countries
HDI
Life expectancy
Adult literacy
Education
Health expenditure
Infant mortality rate
Access to
(yrs)
(%)
expenditure % of
% of GDP
(per 1000)
improved water
GDP
(% of pop)
Brunei
0.84
77
97
n.a
n.a
6
n.a
Cambodia
0.52
61
85
n.a
5.6
75
61
Indonesia
0.61
68
95
26
2.6
33
80
Laos
0.52
63
82
13.2
4.5
52
57
Malaysia
0.76
73
95
18.9
4.4
6
100
Myanmar
0.48
64
95
n.a
2.0
61
71
The Philippines
0.64
70
95
16.9
3.6
29
91
Singapore
0.87
82
97
10.3
4.0
3
100
Thailand
0.68
70
96
22.3
3.9
13
98
Vietnam
0.59
72
95
19.8
6.8
19
94
Source: World Development Indicators, 2012, Asia Pacific Human Development Report, UNDP.
1.3 Myanmar: Geography, Demography, and Natural
Resources
 Myanmar
has a land area of more than 676,000 sq.km.
occupied by more than (57) million people in 2011.
 135 nationalities, multi-ethnic, multi-cultural and multireligious society.
 Myanmar, the largest ethnic group, comprises about 70%
of the country’s total population followed by the Shan,
with 8.5% of the country’s inhabitants.
 Other major ethnic group include the Kayin, 6.2% ,
Rakhine, 4.5%, and other indigenous races, 6.5%.
 rich in natural resources: forests, minerals and fish.
 an abundance of human resources- literate labors
2.1 Why Myanmar Decided to Join ASEAN
 In 1967, Myanmar was approached by friends in ASEAN to
join the regional association.
 as a founding member of the Non-Aligned Movement,
adhering to the five principles of peaceful co-existence and
neutrality, and decided not to join ASEAN.
 In 1995, Myanmar decided to join the regional association and
attained observer status, along with Laos and Cambodia, in
July 1996.

At least two reasons which led to Myanmar’s decision to join
ASEAN.
internal and external conditions had changed in the country
(2) age of globalization and regionalism
(1)
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Politically
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Economically
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peace and stability in the region
better confidence among members of ASEAN
Strengthening of external security
increase trade and investment links within the region
achieve greater development
increased efficiency
Culturally
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contribute to ASEAN through promoting its own rich traditions
2.2 Myanmar Participation in ASEAN
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the summits to ministerial meetings to officials meetings.
Several committees and sub-committees were formed to assist
the ASEAN Economic Minister
small-and medium-enterprise activities, transport, and
services.
several committees at the national level such as the National
Committee on Information and Culture, the National
Committee on Science and Technology, and the National
Committee on Social Development were formed to coordinate
with relevant ASEAN committees and subcommittees.
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The National Commission for Environmental Affairs, the
Central Committee for Drug Abuse Control (CCDAC), and the
Public Services Selection and Training Board (PSSTB) were
established to be in line with existing ASEAN committees.

Became a part of AFTA
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participating in ASEAN activities fully since its first day of
entry into the regional association.
2.3 Myanmar - ASEAN Cooperation for Economic Development
Table (2.1) Myanmar Exports to ASEAN
1990-91
Value
1995-96
%
Value
(Total)
Singapore
845.8
(Kyat million)
2000-01
%
Value
(Total)
2005-06
%
Value
(Total)
2009-10
%
Value
(Total)
%
(Total)
28.6
986.8
19.6
737.3
5.8
1532.7
7.4
3690.9
8.9
Malaysia
40.87
1.4
147.5
2.9
471.1
3.7
540.4
2.6
832.2
2.0
Indonesia
-
-
299.6
5.9
221.6
1.7
380.5
1.8
205.3
0.5
Philippines
0.22
0.07
133.1
2.6
37.8
0.2
73.2
0.4
147.6
0.4
Thailand
387.9
13.1
534.9
10.6
1831.3
14.4
7868.6
38.1
17431
42.2
Vietnam
-
-
0.97
0.02
29.5
0.2
223.8
1.08
299.8
0.7
Lao PDR
-
-
-
-
2.8
0.02
0.09
0.0004
-
-
Cambodia
-
-
1.1
0.02
-
-
-
-
-
Brunei
-
-
1.59
0.03
1.4
0.01
4.99
4.09
0.01
Source: Statistical Yearbook 2010.
0.02
Table (2.2) Myanmar Imports from ASEAN
1990-91
Value
1995-96
%
Value
(Total)
Singapore
532.4
(Kyat million)
2000-01
%
Value
(Total)
2005-06
%
Value
(Total)
2009-10
%
Value
(Total)
%
(Total)
9.6
1819.7
17.7
3646.4
24.2
3240.2
28.1
6593
28.9
Malaysia
383.5
6.9
615.9
5.9
794.0
5.3
810.8
7.01
871.3
3.8
Indonesia
17.17
0.3
350.3
3.4
534.3
3.5
336.1
2.9
760.4
3.3
Philippines
1.06
0.02
4.85
0.04
75.1
0.5
32.4
0.3
77
0.3
Thailand
554.8
10.1
1318.8
12.8
1970.7
13.1
1376.2
11.9
2069.6
9.1
10.6
0.1
42.7
0.3
57.1
0.5
148.4
0.6
Vietnam
Lao PDR
-
-
-
1.1
0.01
-
-
-
-
Cambodia
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Brunei
0.04
0.0007
0.02
Source: Statistical Yearbook 2010.
Table (2.3) Foreign Direct Investment Flow into Myanmar from ASEAN
Country
31-1-2002
Number
of Amount
Projects
Brunei
31-1-2013
%
(US$ million)
of
Total Number
Investment
of Amount
Projects
%
(US$ million)
of
Total
Investment
-
-
-
2
3.04
0.007
Singapore
70
1541.6
20.8
83
2167.0
5.2
Malaysia
31
151.1
2.0
43
1031.3
2.5
Indonesia
11
240.0
3.2
12
241.5
0.6
Thailand
49
1290.2
17.4
61
9568.1
22.9
The Philippines
2
146.7
1.9
2
146.7
0.4
Cambodia
-
-
-
-
-
-
Lao PDR
-
-
-
-
-
-
Vietnam
-
-
-
5
361.8
0.9
Source: Directorate of Company Administration and Investment, Ministry of National Planning and
Economic Development.
3.1 Why ASEAN decided to establish AEC
 9th ASEAN Summit agreed to establish the ASEAN
Economic Community (AEC) as the end goal of
economic integration as outlined in the ASEAN
Vision 2020.
 As a single market and production base
 To make the ASEAN region a more dynamic and
stronger segment of the global supply chain
 the integration of its Member Countries and
enhancing the region’s economic competitiveness.
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To strengthen the implementation of its existing
economic initiatives.
ASEAN Free Trade Area (AFTA), ASEAN Framework
Agreement on Services (AFAS) and ASEAN Investment
Area (AIA)
accelerate regional integration in the priority sectors
facilitate movement of business persons, skilled labor and
talents
strengthen the institutional mechanisms of ASEAN,
Dispute Settlement Mechanism to ensure expeditious and
legally binding resolution of any economic dispute.
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goals are being pursued through the Initiative for
ASEAN Integration (IAI) and the Roadmap for the
Integration of ASEAN (RIA).
deepening and broadening of integration of ASEAN
shall be accompanied by technical and development
cooperation in order to address the development
divide and accelerate the economic integration of
Cambodia, Laos, Myanmar and Vietnam so that the
benefits of economic integration are shared
3.2 Economic Implications of Myanmar to Join AEC
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expects general regional trade area (RTA) advantages from
joining ASEAN and AEC
greater trade, service, and investment links within the region
increased attractiveness to foreign direct investment (FDI)
from outside the region, more secure access to the greater
ASEAN market,
improved resource allocation from specialization according to
comparative advantage,
economies of scale in an enlarged regional market,
enhanced industrialization prospects of small and medium
enterprises,
spill-over effects, and infant industry learning effects with
improved quality control, design, and marketing and thus
improved competitiveness in the world market .
3.3 How Ready was Myanmar to Join AEC
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Myanmar has made a commitment to establish an ASEAN
Economic Community (AEC) and actively participating and
coordinating with other member countries.
Chair of ASEAN in 2014
To develop a viable stock exchange by 2015
To develop the capital market, and the Capital Market
Development Committee and its sub-committee are now
endeavoring to implement the road map for the development
of capital market in Myanmar, which is drawn up in
accordance with time frame of ASEAN Capital Market Forum
(ACMF).
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Custom modernization preparedness, measures for
rationalization, simplification, and harmonization are trying to
be consistent with ASEAN Singe Window (ASW)
Custom clearance time which usually takes two days for
containerized cargo of import and one day for containerized
cargo of export is targeted to reduce to 30 minutes.
the aim of facilitating investment procedures and getting
opportunities in doing business, government issues two
notifications relating to land used and foreign currency
One Stop Service in company registration is finished one day
if the documents are completed.
the standard and conformance areas
performance and factors of IPR in line with AEC measures
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Development of capital market in Myanmar
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need to improve legal and regulatory framework
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need to the development of issuing system
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private sector participation
SMEs development
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poor infrastructure with regards to power,
communication, transportation,
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access to world market,
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higher cost of materials and inputs,
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outdated technology,

insufficient R&D, limited knowledge and poor
management skill.

financial sector Development
 difficult
to develop the correspondent
arrangement account with foreign hard currency
in EU nations and US.
 depends on Singapore and China currency to
operate international transaction
 barrier to attract investment which is a key factor
for economic development in financial sector
from EU and US

Implementation in standard and conformance
 lack of initiator, lack of public awareness
 lack of technical infrastructure
 lack of laboratory equipments
 In ASEAN region, harmonization of standard
and conformance help to build credibility and
reputation for domestic producers and traders

Implementation of AEC
 lack of awareness on the program areas and
implementation progress even among the main
beneficiary groups and responsible department
and agencies
 the target areas of some projects are mismatch
with the specific requirement of respective
sector
 the priority areas of some programs do not
satisfy the needs and development priority of
individual country
Myanmar’s Implementation in AEC
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Phase I : 95%
Phase II : 80%
Phase III : 77%
Thank You