AEC 2015 and Beyond: Realizing ASEAN Value Chain
Keywords:
AEC, global value chains, governance, upgradingAbstract
The integration of the ASEAN (Association of South East Asia Nations) into economic community aims to establish a single market and production base, a competitive region, a region with equitable economic development and a region integrated into the global economy. While current analyses mainly highlight on opportunities and threats of the implementation of ASEAN Economic Community (AEC) and its impact upon domestic economy of its member countries, the paper suggests a shift of analysis beyond 2015 toward the competitiveness of the AEC and its members in facing other regions and countries in global economy. Thus the main issue and challenge is how the divergent socio-economy of the AEC members becomes strength rather than weakness in a formation of the ASEAN value chain. The ASEAN value chain recognizes a fragmentation and integration of economic activities at the same time which requires a division of role and labor between the AEC member countries. Individual members of the AEC do not need to undertake the full range of value chains but takes part in particular tasks/activities/functions in which the country has comparative and competitive advantages. By realizing the ASEAN value chain, it will widely open opportunities for its member countries to fully join the economic community, to improve competitiveness through human capital and capability, and to capture increase share of value added created domestically through an upgrading toward high-skill content activities over time.
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