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ASEAN Integration
& ICT OpportunitiesMark Hefner
Contents
Some ICT Information
ASEAN Introduction
AEC Introduction
ICT & ASEAN Integration
International Business
International Trade Rules
ASEAN Framework Agreement in Services
United Nations (UN)Central Product Classification
Finding the AFAS Schedules
Student task
Conclusion
What is ICT?
Information
CommunicationTechnology
Global ICT
3 billion people use the internet
Almost 7 billion cell phone subscriptions
ICT is a key driver in economic and
social transformation
10% increase in broadband penetration
increases GDP on average 1.3%
10% increase in mobile tele-density
increases GDP by 0.7%
ICT in ASEAN (2011)
ICT employs 11.7 million people
ICT contributes more than $32 billion (1.45%) to the ASEAN GDP
78% of people in ASEAN use ICT
Mobile penetration average between 1 and 138%
However it is 100% in 5 ASEAN states
Source: ICT Master Plan 2015
ASEANAn Introduction
ASEAN
Association of South East Asia Nations
The ASEAN Declaration was signed on 8 August, 1967
Thailand, Indonesia, Philippines, Malaysia, Singapore
Brunei, Vietnam, Cambodia, Myanmar and Laos
Purpose:
Regional Cooperation, economic growth, social progress, cultural development, collaboration, mutual assistance and raise the living standards
ASEAN Today
2.2 Trillion US Dollars 71.639 Trillion Baht
625 Million People
406.2 14,962.6
248,818.1
6,644.0
29,948.0
61,573.8
99,384.5
5,399.2
68,251.0
89,708.9
Brunei
Darussalam
Cambodia Indonesia Lao PDR Malaysia Myanmar Philippines Singapore Thailand Viet Nam
Nu
mb
er
of P
eo
ple
(0
00
)
Country
2013 Population
70 83 134 28 91 91 331
7,550
133 271
Brunei
Darussalam
Cambodia Indonesia Lao PDR Malaysia Myanmar Philippines Singapore Thailand Viet Nam
Pe
rso
ns
pe
r k
m^
2
Country
2013 Population Density
16,117.5 15,659.0
862,567.9
10,002.0
312,071.6
56,408.0
269,024.6297,945.8
387,534.1
171,219.3
Brunei
Darussalam
Cambodia Indonesia Lao PDR Malaysia Myanmar Philippines Singapore Thailand Viet Nam
In M
illio
ns
of U
S D
olla
rs
Country
2013 Gross Domestic Product
39,678.7
1,046.5 3,466.7 1,505.4
10,420.5
916.1 2,706.9
55,183.3
5,678.1
1,908.6
Brunei
Darussalam
Cambodia Indonesia Lao PDR Malaysia Myanmar Philippines Singapore Thailand Viet Nam
GD
P/C
ap
ita
Country
2013 GDP per Capita
Questions
How many countries are in ASEAN?
10
What are the names of the countries?
Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam
Which ASEAN country has the most people in one location?
Singapore
Which ASEAN country has the largest economy?
Indonesia
Which ASEAN country has the richest citizens?
Singapore
Which country has the fewest number of potential customers?
Brunei Darussalam
10102
ASEAN Integration
ASEAN Integration Timeline
Kuala Lumpur Summit (1997)
ASEAN Vision 2020
Bali Summit (2003)
ASEAN Economic Community
ASEAN Political Security Community
ASEAN Social Cultural Community
Cebu Summit (2007)
Accelerate ASEAN Integration to 2015
ASEAN (Integration) Blueprints
ASEAN Economic Community Blueprint(AEC) 2007
The AEC will transform ASEAN into a single market and production base, a highly
competitive economic region, a region of equitable economic development, and a
region fully integrated into the global economy
ASEAN Political Security Blueprint (APSC) 2009
The APSC will ensure that the peoples and Member States of ASEAN live in peace with
one another and with the world at large in a just, democratic and harmonious
environment
ASEAN Social Cultural Community Blueprint (ASCC) 2009
The primary goal of the ASCC is to contribute to realizing an ASEAN Community that is
people centered and socially responsible with a view to achieving enduring solidarity
and unity among the nations and peoples of ASEAN
ASEAN Economic CommunityAn Introduction
ASEAN Economic Community (AEC)
Goal
SOURCE: AEC Blueprint
Economic Integration
Brunei
Cambodia
Indonesia
Laos
Malaysia
Myanmar
Philippines
Singapore
Thailand
Vietnam
The 4 Pillars (Characteristics)
of the ASEAN Economic Community
SOURCE: AEC Blueprint
A single
market and
production
base
A highly
competitive
economic
region
A region of
equitable
economic
development
A region
fully
integrated
into the
global
economy.
PILLAR I
Single Market and Production Base
Free Flow of Goods
Tariffs Non-Tariff Barriers
Rules of Origin
Trade Facilitation
Customs Integration
e-Customs
ASEAN Single Window
Standards and Technical
Barriers to Trade
Free Flow of Services
Recognize Professional
Qualifications
Financial Services Liberalization
Free Flow of Investment
Investment Protection
Facilitation and Cooperation
Promotion and Awareness
Liberalization
Free Flow of Capital
Capital Market Development and
Integration
Greater Capital Mobility
Free Flow of Skilled Labor
Visas and Employment
Passes for Skilled Labor
Harmonizing & Standardization
SOURCE: AEC Blueprint
http://www.aseanexchanges.org/
PILLAR II
Highly Competitive
Economic Region(Free Market)
Competition Policy
Consumer Protection
Intellectual Property Rights
(IPR)
Infrastructure Development
Taxation
E-Commerce
www.aseancompetition.org
www.aseanconsumer.org
ASEAN IPR Action Plan 2011-2015
PILLAR III
Equitable Economic Development
SME Development
Implement the ASEAN
Policy Blueprint for
SME Development
Promote networking of
SME
Promote best practices in
SME development
Initiative for ASEAN Integration (IAI)Infrastructure, HR Development, ICT, Capacity Building for Regional Economic
Integration, Energy, Investment Climate, Tourism, Poverty Reduction, Improvement of Quality of Life.
Identify where IAI is needed
in CLMV
ASEAN-6 to support CLMV
Get support from other
partners such as the ASIA
Development Bank or World
Bank
Help government
develop social programs to mitigate any
negative impact of economic integration
Conduct regular studies
to assess/monitor the impact of
economic integration
SME Action Plan 2010-2015
PILLAR IV
Integration into the Global Economy
Coherent Approach towards External Economic Relations
• Review FTAs and Comprehensive Economic Partnerships (CEP) in regards to ASEAN internal integration commitments
• Establish a system for common approaches to ASEAN external economic relations while maintaining ASEAN centrality
Enhanced participation in global supply networks
• Continue the adoption of international best practices and standards in production and distribution
• Assist the CLMV countries upgrade their industrial capability and productivity in order to enhance their participation in regional and global integration
External RelationsASEAN Centrality
ASEAN Centrality
Pacific
Alliance
Columbia
RCEP
India
APEC
Hong Kong
Taiwan
Papua New
Guinea
TPP
Chile
Peru
Mexico
Canada
EAS
United States
Russia
ASEAN+3
China, Japan, Republic of Korea
AAZNFTA
Australia
New Zealand
ASEAN
Brunei Cambodia Indonesia
Laos Malaysia Myanmar
Philippines Singapore Thailand
Vietnam
Implementation Responsibilities
Relevant sectoral ministerial bodies responsible for the implementation of the Blueprint and monitoring of commitments under their respective purview
ASEAN Economic Ministers as the Ministers in charge of Economic Integration in the Council of ASEAN Economic Community accountable for the overall implementation of the Blueprint
ASEAN legal instruments shall be ratified within 6 months of signing
Develop a monitoring system and statistical indicators to track AEC integration process
Translate AEC targets and milestones into national targets and milestones
Communications
Explain the AEC objectives, benefits, and challenges to government officials, key stakeholders, and the general public
AEC Blueprint Strategy
Current AEC Status as of August 2014
Of 281 objectives
229 Objectives accomplished (82%)
52 remain and due by Dec 31, 2015 (18%)
SOURCE: 46th ASEAN Economic Ministers’ Meeting, 25-28 August, 2014
ICT and the ASEAN
Community Blueprints
ICT & the ASEAN
Political Security
Community
Blueprint
APSC
ASEAN Political Security Community
(APSC)
A Rules-based Community of shared values and norms
A Cohesive, Peaceful, Stable and Resilient Region with shared responsibility
for comprehensive security
A Dynamic and Outward-looking Region in an increasingly integrated and
interdependent world.
A Cohesive, Peaceful and Resilient Region with
Shared Responsibility for Comprehensive Security
Strengthen cooperation in addressing non-traditional security issues,
particularly in combating transnational crimes and other trans boundary
challenges (B.4.1)
Strengthen cooperation and assistance in combating and suppressing cyber
crimes including cooperation among law enforcement agencies, taking into
account the need of each country to develop laws to address cyber crimes
ICT & the ASEAN
Social Cultural
Community
Blueprint
ASCC
ASEAN Social Cultural Community
(ASCC)
ASCC Characteristics
Human Development
Social Welfare and Protection
Social Justice and Rights
Ensuring Environmental Sustainability
Building the ASEAN Identity
Narrowing the Development Gap.
Human Development
Advancing and Prioritizing Education (A1):
Use ICT to promote education and life-long learning particularly in underserved communities
through open, distance education and e-learning
Investing in human resource development (A2)
Enhance the IT skills of the workforce in ASEAN through joint training programs and courses
Promoting ICT (A4)
Increase ICT literacy in ASEAN exp., women, children, the elderly and people with disabilities
Promote positive use of the internet
Encourage the introduction of ICT at all levels of education
Initiate the early use of ICT at the primary school
Enhance the use of ICT to promote e-learning
Develop a workforce and manpower with high levels of ICT proficiency and expertise
Facilitating access to applied Science and Technology (A5)
Promote the development, use and sharing of digital content among ASEAN Member States
ICT & the ASEAN
Economic
Community
Blueprint
ASCC
ASEAN Economic Community
A single market and production base
A highly competitive economic region
A region of equitable economic development
A region fully integrated into the global economy
Single Market and Production Base
ASEAN Single Window
Accelerate the introduction of ICT for digitalized processing and exchange of
trade information
Information Infrastructure
Facilitate high-speed connection among all national systems
Intensify capacity building and training programs for national Computer
Emergency Response Teams (CERTS)
Strengthen the capacity, cooperation and coverage of ASEAN’s cyber-security
network
Encourage ICT stakeholder participation in using and developing regional ICT
infrastructure
Other ASEAN ICT Initiatives
E-ASEAN Framework Agreement 2011
To develop, strengthen and enhance the competitiveness of the ICT sector
To reduce the digital divide within and amongst ASEAN Member Countries
To promote cooperation between the public and private sectors
To develop ASEAN Information Infrastructure.
ASEAN ICT Master Plan (AIM2015)
ICT is an engine of growth for ASEAN countries
Recognition for ASEAN as a global ICT hub
Enhanced quality of life for peoples of ASEAN
Contribute towards ASEAN integration
ASEAN E-Commerce Database Project
To establish an ASEAN E-Commerce database - in order to gather and
consolidate sufficient and comprehensive information on the state E-
Commerce activities within ASEAN
The establishment of a baseline for measuring E-Commerce readiness
To provide the cooperating agencies of the ASEAN with this data collection
model for simultaneous gathering of information
To upload the findings to the ASEAN online database
ASEAN Connect Website
www.aseanconnect.gov.my
A platform for the exchange of information on all aspects relating to the
development of ICT policy and regulation in ASEAN
International Trade
Business Trades-Two Types
Goods
•Food
•Electronics
•Houses & Cars
Services
•Education
•Hospitality
• Internet
Goods (Products)
The end result of the manufacturing process, to
be offered to the marketplace to satisfy a need
or want (1)
For example,…Televisions
(1) http://www.investorwords.com/3874/product.html
SERVICE
A type of economic activity that is intangible,
not stored, does not result in ownership and
which is consumed at the point of sale (1).
For example,…tourism
(1) http://www.investorwords.com/6664/service.html#ixzz39XRbr9ow
Domestic Business Markets
Markets that are local or nearby
Markets in their Province or state
Markets that are National
Business-International
National Market
International Market
Entry Strategies• Exporting• Turnkey• Licensing• Franchising• Joint Ventures• Wholly Owned Subsidiaries
International Trade RulesGATT, the WTO & GATS
General Agreement on Tariffs and
Trade (GATT) 1948-1995
For the selling of “Goods”
PURPOSE: The substantial reduction of tariffs and other trade barriers and
the elimination of preferences, on a reciprocal and mutually advantageous
basis
GATT agreements are negotiated and signed by most of the world’s
trading nations and ratified in their parliaments.
A multilateral agreement regulating international trade by 8 rounds of
negotiation that lasted about 47 years
0
20
40
60
80
100
120
140
160
180
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
Geneva 1945
(2 Years)
Annecy 1949
(2 Years)
Torquay 1951
(2 Years)
Geneva II 1956
(5 Years)
Dillon Round 1961
(5 Years)
Geneva, Kennedy
Round 1967
(6 Years)
Geneva, Tokyo
Round 1979
(10 Years)
Geneva, Uruguay
Round 1994
(15 Years)
Doha 2001
(14 Years)
Nu
mb
er
of
co
un
trie
s n
eg
otia
tin
g
Pe
rce
nta
ge
of
tim
e u
sed
to
ne
go
tia
te/c
ou
ntr
y
Round of Talks
Length of Negotiations per Country
% time allowed each country to negotiate Countries Negotiating
SOURCE: www.wto.org/English/thewto_e/whatis_e/tif_e/fact4_e.htm
GATT Trade Rounds
Year Place/name Subjects covered Qty Value Countries
1947 Geneva,
Switzerland
Tariffs 45,000 $10
Billion
23
1949 Annecy, France Tariffs 5000 13
1951 Torquay Tariffs 8700 38
1956 Geneva II Tariffs $2.5
Billion
26
1960-1961 Dillon Round Tariffs 4.9
Billion
26
1964-1967 Geneva
Kennedy Round
Tariffs and anti-dumping measures $40
Billion
62
1973-1979 Geneva
Tokyo Round
Tariffs, non-tariff measures, “framework”
agreements
$300
Billion
102
1986-1994 Geneva
Uruguay Round
Tariffs, non-tariff measures, rules, services, intellectual property,
dispute settlement, textiles, agriculture, creation of WTO, etc
123
2001-
Present
Doha Tariffs, non-tariff measures, agriculture, labor standards,
environment, competition, investment, transparency, patents etc
160
Questions
What treaty helped to reduce tariffs and other trade barriers?
GATT
What does GATT stand for?
General Agreement on Tariffs and Trade
GATT WTO
Led to the creation of the
World Trade Organization
in 1995
World Trade Organization (WTO)
1995-Present
An international organization dealing with the rules of trade (of goods AND SERVICES) between nations.
WTO agreements are negotiated and signed by most of the world’s trading nations and ratified in their parliaments.
Its main function is to ensure that trade (goods and services) flows as smoothly, predictably and freely as possible.
The goal is to help producers of goods and services, exporters, and importers conduct their business.
WTO Membership Map
WTO Membership160 Countries
General Agreement for Trade in
Services (GATS) 1995
PURPOSE of GATS:
Create a credible and reliable system of international trade
rules (for services)
Ensuring fair and equitable treatment of all participants
Stimulating economic activity through guaranteed policy
bindings
Promoting trade and development through progressive
liberalization
Business Communication
Constructionand Related Engineering
Distribution
Educational Environmental
FinancialHealth Related
and Social
Tourism and Travel Related
Recreational, Cultural and
Sporting
TransportOther ServicesNot Included
Elsewhere
Service Sectors
GATS 4 Modes of Supply
Mode 1
Cross Border Supply
Correspondence courses
Internet Streaming Movie Service
Tele-Medicine
Website Developers
Mode 2
Consumption Abroad
Tourist Activities
Medical treatment
Language courses taken abroad.
Mode 3
Commercial Presence
Medical services provided by a foreign-owned hospital
Courses in a foreign-owned school
Services supplied by a domestic branch or subsidiary of a foreign bank
Mode 4
Presence of Natural Persons
Doctors or teachers
Intra-corporate staff transfers
Short-term employment of foreign staff in foreign affiliates
Short-term employment of construction workers or paid domestic helpers
Questions
What does the acronym WTO stand for?
World Trade Organization
How many member countries are there in the WTO?
160
What is the name of the agreement that covers the trade in services?
General Agreement for Trade in Services (GATS)
How many service sectors are there?
12
What mode of supplying a service establishes a commercial presence?
Mode 3
ASEAN Framework Agreement of
Services(AFAS)
ASEAN Framework Agreement in
Services (AFAS) 1995 Based on GATS
Eliminate substantially, restrictions on ASEAN trade in services with the end
goal of an ASEAN FTA in services (GATS Plus)
Progressive negotiations on the liberalization of trade in services
Currently, 8 rounds of negotiations completed; 72 sectors liberalized
ASEAN Trade in Services
Export of Services: 2005 $US 120.7 Billion to 2011 $US 260.9 Billion
Import of Services: 2005 $US 143.1 Billion to 2011 $US 269.1 Billion
Business Communication Construction and Related Engineering Distribution EDUCATIONAL Environmental
FinancialHealth Related and
SocialTourism And Travel Related
Recreational, Cultural and
SportingTransport
Other Services Not Included
Elsewhere
Questions
What is the purpose of the ASEAN Framework Agreement in Services?
To remove restrictions from ASEAN trade in services
Schedule of Specific
CommitmentsBusiness Services
International Trade Terms
Liberalization
None
Unbound
Commitments
Schedule of Specific Commitments
Horizontal
Horizontal CommitmentsApplies to all sectors
Please turn on your computersIf they are not already on
Central Product Classification (CPC)
United Nations Statistics Division
Used to classify Goods and Services
CPC Ver. 1.1
http://unstats.un.org/unsd/cr/registry/regcst.asp?Cl=16
Google (Verb) “CPC Ver.1.1”
EXAMPLE:
Hardware consultancy services (CPC Version 1.1: part of 83141)
CPC 83141
CPC 83141
CPC 83141
CPC 83141
CPC 83141
How to find the Schedules
of Specific Commitmentswww.asean.org
Your Task
You’re an ICT business owner
Either
You have money to invest abroad in ASEAN (You will want to see a business plan from a potential investor)
You need money to expand in Thailand (You will need a business plan to give to the potential investor)
Look at the Member Countries' Horizontal Commitments and Schedules of Specific Commitments for the 8th
Package of Commitments under the ASEAN Framework Agreement in Services
Find a country to either invest in another person’s ICT business or attract to Thailand to invest in your ICT business
Using the internet
Try to find a real business to invest in from another ASEAN country
Or…
Find a business that might want to invest in your business from another ASEAN country
Conclusion
Don’t expect 100% success from the AEC Integration Process
Everything in ASEAN does not apply to you
Understanding how ASEAN works can be beneficial
If you have question please feel free to send them to me at
Thank you for your interest in my presentation.
Mark Hefner