ASEAN Community was officially launched on 31st December 2015, marking a symbolic event in the ASEAN history. However, it’s just the new beginning of the long journey in making the community fully realized and integrated. ASEAN Economic Community 2015 envisages a single market and production base, a highly competitive economic region with equitable economic development and a region fully integrated into global economy (ASEAN Economic Community Blueprint, 2008). But given that ASEAN is challenged by the political, cultural and social diversity, ASEAN leaders need to be strongly committed to make what have been agreed on the paper come into reality. Uneven development in this two-speed community is one of the challenges. The wealthier Singapore, Brunei, Malaysia, Thailand, Indonesia and Philippines are far ahead of Cambodia, Laos, Myanmar and Vietnam who are lagging behind (Cambodia Daily, 2016). Therefore, will AEC truly benefit Cambodia, one of the least developed members in ASEAN?

 

Banner welcoming ASEAN Community in Phnom Penh City

Banner welcoming ASEAN Community in Phnom Penh City

Repeatedly, Royal Government of Cambodia has been criticized by independent analysts and its own citizens for failing to keep up with other member states in terms of economic development, education system, technology, infrastructure, and so on. But given that Cambodia has just maintained peace and social security after genocidal regime that turned Cambodia into an isolated and failed state, and claimed lives of million scholars, academia and civilians, one cannot deny the fact that the government has made a lot of efforts in developing the country. After the collapse of Khmer Rouge, a long-run civil war among groups from different political movements still made Cambodia inaccessible to foreign investors, tourists and diplomats. However, with Paris Peace Agreement in October 1991 that led to general election in May 1993 organized by United Nations Transitional Authority in Cambodia (UNTAC), United Nation Peace Keeping operation in 1992-1993, Cambodia restored peace and civil government under the support of UNTAC that worked on supervising all aspects of government such as national defense, foreign affair, public security, finance and information.

The growing city of Phnom Penh

The growing city of Phnom Penh

Since then, the Royal Government of Cambodia has relentlessly building and connecting Cambodia with the outside world in order to move out of the international isolation, which led to Cambodia’s establishment of diplomatic relations with different countries across the world, and to join ASEAN in 1999 as the last member state, World Trade Organization in 2004, and other regional and international organizations. So to join ASEAN Economic Community does show that Cambodia has real commitment in aligning itself with this regional bloc, and is ready to overcome the challenges coming ahead. Therefore, the Royal Government of the fifth legislature of the National Assembly of Cambodia has set out the in-depth reform as the following: 1) improvement of the investment environment and trade facilitation, 2) public financial management reform, 3) legal and judicial reform and the fight against corruption, 4) alignment between education and vocational training and the demand of the job market, 5) diversification of the growth base through the implementation of the Industrial Development Policy (Cambodia New Vision, 2014).

Thousands of housing and office blocs are being built across Phnom Penh, the capital city of Cambodia

Thousands of housing and office blocs are being built across Phnom Penh, the capital city of Cambodia

Once AEC is integrated, Cambodia is likely to enjoy a great number of benefits. First, Cambodia becomes part of the community that is connected to the global value chain, considering the ASEAN bloc is currently account for 11 percent of the global foreign direction investments inflows, which between 2007 and 2014, ASEAN trade increased by nearly $1 trillion (Cambodia Daily, 2016). Secondly, AEC has challenged Cambodia to make effort in reforming and liberalizing to improve efficiency and competiveness with other members in the region (Rithy, 2014). Thirdly, Cambodia’s small medium enterprises are likely to enjoy the advantages of lower input and transaction costs through elimination of tariffs, improved regulatory environment on services, improved trade facilitation such as custom, transportation connectivity and logistics (Rithy, 2014). Fourth, Cambodian citizens can enjoy the wide range of imported products and services with cheaper price, and it will also increase the competitive domestic market environment and consumer protection (Rithy, 2014). Last but not least, as one the least developed members, Cambodia can be provided with technical or financial assistance from more developed members in order to strive together to achieve the goals of ASEAN. In short, AEC is challenging but beneficial for developing country like Cambodia.

 

References

Asean Secretariat . (2008). ASEAN Economic Community Blueprint . Indonesia: ASEAN.
New Era of Opportunity – Growth, Change andASEAN Integration. (2014, October). Cambodia New Vision, (198), 1-8.
Parikh, T. (2015, December 31). The AEC Has Arrived, But Benefits for Cambodia Are Far Off. Cambodia Daily. Retrieved December 31, 2015, from https://www.cambodiadaily.com/news/the-aec-has-arrived-but-benefits-for-cambodia-are-far-off-104187/
Pich, R. (2014, September 16). AEC 2015: Benefits and Challenges for Cambodia. Lecture presented at ASEAN Economic Community 2015 in Dara Airport Hotel, Phnom Penh.

 

By CHEAB Puthika, ASEAN Correspondent from Cambodia

 

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