Opening remarks by H. E. Rodolfo C. Severino,
Secretary-General of the Association of Southeast Asian Nations,
at the ASEAN Investment Seminar

Tokyo, 28 February 2000

I feel greatly privileged to take part in the ASEAN investment mission to Japan and this ASEAN Investment Seminar.

We are all gathered here - we from ASEAN and you from Japan -- to take a look at ASEAN together. We are today to take a look at ASEAN as a regional economy, not as separate economies. To be sure, each ASEAN member-country is represented here, but they are here in solidarity as an association. We have come to meet with you as ASEAN.

We are fortunate in having this mission led by Her Excellency Dato Seri Rafidah Aziz, Minister of International Trade and Industry of Malaysia, about whose commitment to ASEAN and to the idea of regionalism there is no doubt.

First of all, I must echo what many observers of the ASEAN economy have been saying of late: the economic crisis is behind us, we are now back on the road of rapid growth, and we are taking measures, national and regional, to ensure that we remain on the path of growth. We also remain committed to regional economic integration and openness to the world. ASEAN is once again a region of great opportunity.

ASEAN is moving steadily toward being a truly integrated economy. Trade barriers are going down. Tariffs on almost all products traded by ASEAN’s leading trading nations will be down to 0-5 percent in less than two years. With a few exceptions, tariffs will be zero not very long after that. Even now, products of companies with related operations in two or more ASEAN countries may now flow freely in the region with tariffs of at most five percent or none at all. Many Japanese companies have taken advantage of this scheme. Non-tariff barriers are being removed.

Trade among ASEAN countries is being made much easier with the harmonization of standards and procedures. Infrastructure linkages - transport, energy and telecommunications - are being expanded and strengthened.

Thus, ASEAN is fast becoming unified as a market, indeed as an economy. This means that a company that produces or otherwise operates out of one ASEAN country has all of Southeast Asia as its market. It is a market of half a billion people with a gross regional product of US$800 billion, a region of rich and diverse natural and human resources. It is a market that is back on the road of economic growth.

Because ASEAN is engaged with and open to the global economy, a company producing in ASEAN is well positioned in the international marketplace, selling to and buying from the world market with increasing ease and to growing advantage.

ASEAN is a region of great diversity, diversity among its member-nations and within them. The member-nations and parts of nations are at different levels of development. They are endowed with a great variety of natural resources. Their people have diverse kinds and levels of human skills. The prospective investor in ASEAN has a wide range of choices of location in accordance with the requirements of the line of business and where the greatest profit is to be gained.

Investments can now flow much more freely within ASEAN, with investors from one ASEAN country given access to and national treatment by other ASEAN countries. A Japanese investor in joint venture with ASEAN investors can benefit from these privileges in what is now called the ASEAN Investment Area.

Many Japanese investors and business people have long recognized the natural economic ties between Japan and Southeast Asia, ties based on complementary endowments, geographical proximity and cultural affinity. For decades, trade has flowed in ever-rising volumes between Japan and Southeast Asia to the benefit of both. Japan is today, and has been for a long time, ASEAN’s leading trading partner and biggest market. For decades, Japanese investments have moved to Southeast Asia to the advantage of both. Japan accounted for nineteen percent of the total approved foreign direct investment in manufacturing projects in ASEAN from 1980 to June 1999. Japan provided twenty percent of net foreign direct investment flows into ASEAN in all sectors from 1995 to June 1999. Clearly, among developing countries and regions, ASEAN has been a prime destination for Japanese investments. To a great extent, ASEAN’s trade with and investments from Japan are intimately related to each other, with Japanese investors in ASEAN exporting to Japan and trading with one another, as well as with the world.

Industrial development in ASEAN makes the potential for trade and investment relations with Japan even greater. As Japan re-structures its economy and ASEAN’s economies develop and further integrate, Japanese investments in ASEAN and Japanese trade with ASEAN will change in character as well as rise in level. The opportunities are expanding for many more Japanese industries and many more Japanese companies - big, medium and small.

Later in the day, we will see more vividly and discuss in greater detail the nature and magnitude of these opportunities.

In the meantime, it is for me to thank the Ministry of International Trade and Industry of Japan, the ASEAN Centre and JETRO for sponsoring this event. I thank the ASEAN Embassies in Tokyo for their support. I thank the Ministry of International Trade and Industry of Malaysia and the Malaysia Industrial Development Authority for the work that they have devoted to this endeavor. Finally and not least, I wish to pay tribute to Her Excellency Dato Seri Radidah Aziz for her excellent leadership of this mission, both onstage, here, and behind the scenes.