Korea needs to forge own path with Asean

27-Dec-2016 Intellasia | Korea Times | 6:00 AM Print This Post

South Korea should come up with its own path with the Association of Southeast Asian Nations (Asean) by strengthening cooperation in the political and social sectors in order to gain a stronger foothold there, according to market analysts.

They stressed that Korea should not try to copy China and Japan because the country’s influence and presence in the 10-member bloc is totally different from that of the two economic giants.

“Korea’s awareness of Asean and its willingness to do more business with the region will take time to grow. I understand that within Korea the comparison is often made with China’s and Japan’s ties with Asean,” HSBC Asean economist Su Sian Lim told The Korea Times.

“But these countries share a long-standing political, cultural and economic history with Asean that Korea will not be able to replicate,” the Singapore-based economist added. “So Korea needs to forge its own path with Asean.”

Venkatachalam Anbumozhi, a senior economist at the Economic Research Institute for Asean and East Asia (ERIA) based in Jakarta, said that Korea should expand its cooperation strategy to more diverse sectors.

“Efforts should be expanded to include implementing the blueprint for the Asean Socio Cultural Community where Korean expertise and experience in tackling climate change, achieving green growth and reducing inequality will be relevant and needed,” he said.

“Also, the country needs to promote more exchanges of students and young leaders through educational and professional development scholarships between Asean and Korea.”

The Asean Economic Community (AEC) will mark the first anniversary of its establishment, December 31. Following the launch, a growing number of companies from around the world are making inroads into the region.

The AEC aims to create a single market with a free flow of goods, capital and skilled labour across borders in Asean countries – Brunei, Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Laos, Thailand and Vietnam.

Korea’s senior diplomats have called for the country to take a long-term approach to capitalise on benefits the region will provide in the coming decade.

They pointed out that there is a huge market potential in Asean thanks to increasing purchasing power, the emergence of a young middle class, its third-largest population base in the world and rapid economic growth among others.

“Korean businesses should approach Asean as a region from a longer-term perspective,” said Kim Young-sun, secretary general of the Asean-Korea Centre in Seoul.

“Korean enterprises should realise this economic potential and commercial viability of Asean as a region and align corporate strategy to the progress of the AEC to fully reap the benefits.”

The launch of the AEC was seen as an ongoing process so meaningful changes will take shape over time. If they materialise as scheduled, the region will emerge as a new market. In this regard, Korean firms need to take action at an early stage of the integration process.

Korean Ambassador to Asean Suh Jeong-in based in Jakarta said that Korean firms should consider Asean as a single market.

“Korean firms should try to see both the forest and the trees and to take a think regional, act local strategy to find an optimal place for a regional production base to cover the entire Asean market,” he said.

“Given that the region has great potential to grow, Korea should not ignore this promising market even if the regional economic integration does not materialise in the near future,” he added.

Asean is expected to see its population increase to 720 million from the current 630 million by 2030 while as many as 90 million people will move into its urban areas during the period. The average income in most of member states is now below $5,000 per annum.



Category: Korea

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