OPENING REMARKS BY MINISTER CHAN CHUN SING AT THE 21ST ASEAN ECONOMIC MINISTERS – ASEAN INVESTMENT AREA (AEM-AIA) COUNCIL MEETING ON WEDNESDAY 29 AUG 2018, 12.15PM AT SHANGRI-LA HOTEL SINGAPORE
Your Excellencies,
Distinguished Delegates,
Ladies and Gentlemen,
1. On behalf of my delegation, I would like to warmly welcome you to Singapore, and to the 21st ASEAN Economic Ministers – ASEAN Investment Area (AEM-AIA) Council Meeting.
2. ASEAN remains one of the fastest growing regions in the world today.
a. This can be attributed to our ability to attract foreign investments.
b. As of 2016, the stock of Foreign Direct Investment (FDI) in ASEAN stood at USD1.9 trillion.[1]
i. This represented over 20 per cent of all FDI stock in developing countries, and 8 per cent of global stock investments.[2]
c. In fact, ASEAN receives more investments than mainland China and India combined.[3]
3. ASEAN’s economic performance and attractiveness as an investment destination has owed much to sustained policy interventions, built upon the ASEAN Economic Community (AEC) vision.
a. Our vehicle for creating a free and open investment regime in our region is the ASEAN Comprehensive Investment Agreement (ACIA).
i. Through its four prongs of investment liberalisation, investment protection, investment facilitation and investment promotion, the ACIA has helped establish a liberal, facilitative, transparent and competitive investment environment in ASEAN.
4. However, we shall not rest on our laurels.
a. Studies have shown that the ASEAN investment landscape is uneven.[4]
b. Furthermore, many other emerging economies have moved ahead of us in terms of their openness to investment.[5]
c. Some other regions are also taking a leaf from our book.
i. They are now banding their markets together as an integrated market, just as we did, to create a stronger collective value proposition for themselves as we have done as well.
d. ASEAN hence may not remain complacent and continue to work hard for the favour of our investors.
5. Furthermore, ASEAN needs to avoid the middle-income trap.
a. Our economies need to evolve to accommodate and benefit our young, literate and growing population.
i. To do so, we need to bolster Research and Development (R&D), innovation and training, so that our industries and workers can ascend value chains.
6. We are also in need of infrastructural investments.
i. Some studies estimate that ASEAN needs more than USD2.1 trillion of investments in infrastructural spending by 2030.[6]
ii. However, current trends would only cover USD910 billion.
iii. Our ability to link cities to cities, businesses to consumers, solutions to problems, and opportunities to citizens hinges upon maintaining a strong influx of investment in connectivity.
7. It is with these objectives in mind that Singapore puts forward proposals to further enhance the ASEAN Comprehensive Investment Agreement (ACIA).
a. An improved ACIA would signal ASEAN’s continued commitment towards building a more investor-friendly region.
b. Greater liberalisation and transparency would go a long way towards boosting business confidence and retaining investments.
c. Our meeting today is an opportunity for us to engage on some of these new ideas, and explore ways to continue improving the ASEAN investment environment.
8. I look forward to your ideas and constructive discussions today, and your continued support as well.
Thank you.
[1] Source: UNCTADStat.
[2] Source: UNCTADStat.
[3] Source: OECD Publication, “OECD Southeast Asia Investment Policy Review 2018”, 2018.
[4] Source: OECD Publication, “OECD Southeast Asia Investment Policy Review 2018”, 2018.
[5] Source: OECD Publication, “OECD Southeast Asia Investment Policy Review 2018”, 2018.
[6] Source: HSBC Research, 2017.