The Association of Southeast Asian Nations (ASEAN) —Brunei Darussalam, Burma, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, and Vietnam—makes up one of the world’s fastest growing economic regions. In December 2008, ASEAN’s Charter came into force, granting ASEAN status as an international legal entity. With an estimated combined gross domestic product (GDP) of $2.1 trillion and a combined population of about 609 million people, ASEAN is a regional economic force that is quickly becoming the free trade hub of Asia. It has concluded free trade agreements with China, India, Japan, Korea, and Australia/New Zealand, has completed a Trade and Investment Framework Arrangement with the United States, and is in the process of pursuing several other trade and investment agreements. The ASEAN-China FTA, which came into force in 2010, represents one of the largest free-trade zones in the world, with an estimated 2.0 billion consumers. ASEAN is also pursuing further internal integration with the establishment an Economic Community (target date 2015), which would harmonize trade laws and permit the free movement of goods, services, labour, and capital to create a single market and production base.
Today, ASEAN’s growth is being driven by a growing middle class, economic integration of the 10 economies and its proximity to the massive Chinese and Indian markets. The region is an increasingly important global value chain player and a preferred production base for many multinational companies exporting to East Asia, North America, and Europe. It is also an important air and sea transportation gateway and a critical access point to China. Lack of infrastructure such as power, roads, and airport as well as outdated information and communications technology infrastructure represents one of the most serious obstacles to economic growth in the region. Significant investment across a wide range of sectors is required.
The ASEAN economies, like most countries worldwide, have not been spared by the recent European debt crisis and the uncertainties of a volatile global environment; some economies of the region were even showing signs of a slowdown in the third and fourth quarters of 2011. However, many observers believe that with the right combination of vigilance and adequate policies, growth in the ASEAN region will remain robust through 2016. To fuel its future growth and increasing consumer demand, ASEAN will require access to significant natural resources, value-added products, and services.
The Government of Canada has identified ASEAN as a Global Commerce Strategy (GCS) priority market—based on extensive consultation with government, academic and Canadian business and industry representatives—and has developed a comprehensive Market Plan that identifies the following sectors as offering clear market opportunities well suited to Canadian capabilities and interests in the region:
Canada-ASEAN Commercial Relations, 2007-2011 ($ Millions)
Source: Statistics Canada
Text alternative for graph of Canada-ASEAN Commercial Relations
The Government of Canada will continue to influence ASEAN trade, investment and economic policies and regulations in favour of Canadian interests. Canada is currently negotiating foreign investment promotion and protection agreements (FIPA) with Indonesia and Vietnam, and has recently adopted a Joint Declaration on Trade and Investment with ASEAN, which seeks to strengthen bilateral commercial ties. Canada’s Trade Commissioner Service is reinforcing its ability to provide market intelligence and in-market support through both the addition of resources in the region, and through the development of new online tools. Furthermore, the ASEAN Commercial Network, established in 2009, is now hosts a number of virtual sector teams that focus on specific sectors, such as infrastructure, cleantech and ICT to better share information and resources and identify trade and investment opportunities within ASEAN as a whole. Trade Commissioners will continue to actively promote Canadian commercial capabilities throughout the ASEAN countries, while providing Canadian companies with the market intelligence, connections and support they need to capitalize on specific opportunities.
Canada has a number of bilateral trade and investment policy instruments in place that are helping to facilitate and support Canadian commercial engagement in the region:
Unless otherwise stated, all data is for 2011 and expressed in Canadian dollars. All data based on latest available national statistics drawn from a variety of sources, including Statistics Canada, Export Development Canada, Bank of Canada, IMF WEO, and UNCTAD.
For further information about ASEAN, visit the Foreign Affairs and International Trade Canada website or contact the Trade Commissioner Service at 1-888-306-9991.
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