Regional Integration: A Sectoral Approach

ASEAN countries are currently engaged in a two-pronged effort to create a fully integrated ASEAN Economic Community while increasing the international competitiveness of their member countries. These efforts are being driven by trade agreements, both among the ASEAN countries and with partners elsewhere in Asia and beyond. ASEAN countries’ linkages with global production networks have been further strengthened and transformed by China’s emergence as a regional production centre. In order to reap fully the benefits of their increasing integration and to rebalance their growth, ASEAN countries will need to reduce their excessive export dependence on a narrow range of electronic products (mostly parts and components) and move up the technological ladder in the value chain. ASEAN countries also need to develop more niche and specialty products in the nine priority goods sectors (PGS) in order to develop new growth areas.