In the overall picture of ASEAN in the past half a century, ASEAN economic cooperation has been the most vibrant and vivid color with concrete and practical results. From an institution that prioritized political objectives and not yet discussed economic cooperation, (1) ASEAN has now become a strong economic link with high level of liberalization in the areas of trade in goods, services and investment, a major economy, and an important trading center on the global economic map. It is the sixth largest economy in the world and the third in Asia, with gross domestic product standing at US$2.550 billion in 2016. With the current growth momentum, ASEAN is expected to become the fourth largest economy in the world by 2050.

Promoting ASEAN economic cooperation with a highly integrated and comprehensive model

The year 2017 is a milestone in the development of the Association of Southeast Asian Nations (ASEAN) marking the 50th anniversary of the Association’s establishment. Since the Bangkok Declaration was signed by foreign ministers of five Southeast Asian countries: Indonesia, Malaysia, Singapore, Thailand and the Philippines on 8 August 1967, ASEAN has made great strides over the past years. From a region divided by differing political views, ASEAN has become a unified entity of amity, cohesion and friendship with the participation of all 10 countries in Southeast Asia. From countries facing poverty, ASEAN has now become a prosperous community with fast-growing member states considered as economic "dragons" and " tigers" of the region.

As one of the three pillars of the ASEAN Community, the ASEAN Economic Community (AEC) was officially established on 31 December 2015, demonstrating the highest political will and effort of all member countries in promoting ASEAN economic cooperation with a high and comprehensive linkage model, convergence of superior and constructive policies, the most favorable regulations for production and business in the region. The AEC aims to make ASEAN a unified market and production base with high competitiveness, balanced economic development and full integration into the global economy.

Specific results on AEC development:

1. A common market and a unified production base

ASEAN promotes the creation of a common market through free circulation of goods, services, investment, capital and skilled labor.

- On liberalization of trade in goods, on the basis of the ASEAN Trade in Goods Agreement (ATIGA), by the end of 2016, ASEAN eliminated import duties for 96.01% of the total tariff lines. The import duty removal rate of ASEAN-6 nations, including Brunei, Indonesia, Malaysia, Singapore, Thailand and the Philippines, is 99.2%, while the ratio is 90.9% in Vietnam, Laos, Myanmar and Cambodia (CLMV). By 2018, the average tariff elimination rates of ASEAN-6, CLMV and ASEAN will be 99.2%, 97.81% and 98.67%, respectively.

- Concerning the liberalisation of trade in services, within the framework of the ASEAN Framework Agreement on Services (AFAS), ASEAN has developed nine out of ten commitment packages on common trade in services, seven commitment packages on financial services, and nine commitment packages on air transport services, with a wider scope and a more intensive level compared to the commitments under the WTO framework.

- Regarding free flow of investment, ASEAN members have stepped up phasing out measures of reservation, under the ASEAN Comprehensive Investment Agreement (ACIA) signed in 2009, aimed to build an ASEAN into an attractive investment environment with measures, and initiatives to promote, protect and facilitate investment.

- For the greater free flow of capital, ASEAN members have completed the establishment of the ASEAN Framework for banking integration with measures to harmonize banking regulations and standards, and to strengthen the connectivity between stock markets, both inside and outside the area.

- Regarding the free flow of skilled labor, ASEAN has signed mutual recognition agreements on qualifications and occupational status in eight service sectors (nursing, medical practice, dentistry, accounting, engineering, architecture, survey and tourism), through the ASEAN Qualifications Reference Framework (AQRF), and the implementation of the ASEAN Agreement on Movement of Natural Persons (MNP) to create an effective mechanism towards free flow of skilled labor in ASEAN.

2. A highly competitive economic sector

In order to optimize the benefits from opportunities offered by trade and investment linkages, ASEAN countries have been actively implementing policies and measures to make ASEAN a viable economic zone with high competition on the basis of formulation of competition policy, protection of consumers, cooperation on e-commerce, infrastructure development, protection of intellectual property rights, application of international best practices and international standards.

3. A balanced ASEAN economic development

Implementing priority policies to support the development of micro, small- and medium-sized enterprises (MSMEs), ASEAN has developed Strategic Action Plans to develop MSMEs for each stage while making efforts to narrow the development gap through the ASEAN Integration Initiative (IAI) with a view to promoting ASEAN economic integration through ASEAN-6 countries to assist CLMV countries in regional integration and narrowing development gap towards a unified and evenly developing ASEAN (to date, two IAI work plans have been implemented with a total of 615 projects worth US$103.1 million, the Work Plan Phase III was adopted at the 29th ASEAN Summit).

4. Effective integration into the global economy

In parallel with the positive intra-region integration, ASEAN member states have continued to build an open-door ASEAN of integration into the global economy through executing and upgrading five free trade agreements (FTAs) signed with six partners, namely China, Japan, South Korea, India, Australia and New Zealand; carried out negotiations on the ASEAN-Hong Kong FTA (concluded in late July 2017) and the Regional Comprehensive Economic Partnership Agreement (RCEP) with these six partners. With commitments to liberalize tariffs, protect foreign investment, and enforce intellectual property rights, these FTAs help ASEAN further open to the world, expand export markets, re-allocate resources for more efficiency and enhance competitiveness while at the same time making the ASEAN investment environment more attractive and encouraging ASEAN enterprises to participate deeply in the regional and global value chains.

Economic cooperation with other key partners, such as the United States, the EU, Canada, and Russia, has also been actively facilitated by ASEAN through specific initiatives and action programs, focusing on the content of common concern, such as economy, trade, international investment, and capacity development.

Vietnam's contributions to promote ASEAN economic linkage

Vietnam officially became the 7th member of ASEAN on 28 July 1995. After more than 22 years in ASEAN, despite initial perplexity, Vietnam has participated extensively and comprehensively in all fields of cooperation, including economic cooperation, under the "being proactive, active and responsible" motto, and at the same time contributing significantly to the rise of ASEAN economic cooperation over time.

ASEAN is an important driving force for Vietnam to maintain its sustainable economic growth in recent period. It is the second-largest trade partner of Vietnam after China with an average growth rate of 14.5 % per year over the past decade. According to statistics of the General Department of Customs, total export turnover of Vietnam and ASEAN increased seven folds 22 years after Vietnam became a member of ASEAN, from $5.8 billion in 1996 to $41.49 billion in 2016, accounting for 11.8% of the total import and export turnover of the whole country. In particular, exports from Vietnam to ASEAN in 2016 reached almost $17.45 billion, up 6.8 times with an average increase of 10% per year. Imports from ASEAN into Vietnam in 2016 reached $24.04 billion, an increase of 7.2 times compared to 1996. In addition, with FTAs signed within ASEAN, competitive labor costs and favorable geographical location, Vietnam is also an attractive destination for ASEAN businesses. Investment from ASEAN countries into Vietnam in 2016 accounted for 45% of the total foreign direct investment (FDI) in Vietnam, an increase of 2.5 times compared with the same period of 2015.

Vietnam has actively participated in the process of directing development and formulating major policy decisions on ASEAN economic cooperation and specific initiatives in ASEAN economic cooperation, such as ASEAN Vision 2020 and AEC Implementation Plan, the 2009-2015 Roadmap for the ASEAN Economic Community, the ASEAN Community Vision 2025 and the AEC Master Plan, Strategic Action Plans in specialized areas for the implementation of the AEC Master Plan 2025, the Master Plan for ASEAN Connectivity and Work Plans of the Initiative for ASEAN Integration.

As a country with the third-largest population and the fourth largest area in ASEAN, in conjunction with an important geo-economic position, a model of stable and sustainable economic development in the region, Vietnam has constantly promoted its positive role in ASEAN to boost intra- and extra-regional economic cooperation and has gained positive results. Vietnam is always among the highest performing countries in the implementation of the 2015 AEC Master Plan. (2) As a coordinator of ASEAN-EU economic cooperation, Vietnam has made a positive contributions to strengthening bilateral economic and trade relations, promoting the possibility of re-launching the ASEAN-EU FTA negotiations. Vietnam has also been recognized by nations as chair of several Working Groups within the framework of ASEAN and cooperation between ASEAN and its external partners.

Vietnam has also been highly valued for leading the new ASEAN Member Countries (CLMV) to narrow the development gap and ensure that these countries fully enjoy the preferences and support given by ASEAN-6 countries and partners in the process of ASEAN economic integration. Vietnam has proactively proposed and encouraged ASEAN countries to adopt the Hanoi Declaration on Narrowing the Development Gap in 2001 to set out orientations for the implementation of the ASEAN Integration Initiative. As chair of the Specialized Group on ASEAN Connectivity, in 2010, Vietnam and other member countries completed the development of the 2010 Master Plan on ASEAN Connectivity, which has shaped the close links in transport infrastructure, institutions and people, and functioned as the basis for connectivity in East Asia and the Asia-Pacific region.

After 50 years of establishment and development with the important milestones of the formation of AEC by the end of 2015, it is still a long path for ASEAN towards building a comprehensive and robust AEC. That development path has been challenged by past and present difficulties, such as the 2008-2009 global financial crisis, and the current trend against globalization, multilateralisation of economic cooperation or protectionism. More than ever, Asia, particularly ASEAN should promote its leading position in promoting trade liberalisation and regional economic links, as well as function as a model for regional and global economic cooperation frameworks.

To do so, ASEAN member countries should continue to maintain solidarity and steadfastly pursue the chosen economic integration pathway in the last half century, affirming ASEAN’s growing role in the global economic map. In the "proactive, active and responsible” spirit, Viet Nam continues to uphold its role as an active member of ASEAN and contribute to build an ASEAN economy of integration, cohesion and high growth and sustainable development.
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(1) During 25 years, from 1967 to 1992, ASEAN did not really pay much attention to economic cooperation. While signing a series of documents enhancing security cooperation (ZOPFAN 1971, TAC 1976, SEANWFZ 1984, DOC 1992), ASEAN undertook modest economic cooperation activities, such as the establishment ASEAN Chamber of Commerce and Industry (ASEAN CCI) for consultations with the private sector in ASEAN economic cooperation in 1972, establishment of the Geneva Committee of ASEAN to coordinate ASEAN common policies at multilateral forums in 1973, adoption of the Declaration of ASEAN Concord (Bali Declaration I), which outlined a number of action programs to enhance economic cooperation in 1976 and signing of the Agreement for the Promotion and Protection of ASEAN Investment in 1987

(2) According to the ASEAN Economic Community (AEC) Scorecard in 2015, Viet Nam ranked second after Singapore in implementing priority measures with 95.5%.

This article was published on Communist Review No 899 (September 2017)