Mr Sam
Title - Service Sector
Insight
Business opportunities for services sector under the AEC
Contributors
Dr. Sutapa Amornvivat Vithan Charoenphon Dr. Chinnawut Techanuvat Tubkwan Homchampa Teerin Ratanapinyowong Pranida Syamananda Dr. Sivalai Vararuth Witchuda Chummee
Business opportunities for services sector under the AEC
Progress towards the ASEAN Economic Community (AEC) thus far has been rather slow with few tangible results, which may have helped explain a correspondingly slow adjustment by the business sector. Even the reduction in import duties to 0% in accordance with the ASEAN Free Trade Area (AFTA) took 17 years to materialize, while the liberalization in trade and services which started in 1996 is still behind schedule. In particular, the endeavor to allow up to 70% equity participation by ASEAN investors in 4 priority services sectors by 2010 has not met with much success as there remain member countries who ask for extension. Such type of delay can pose a risk for the businesses to adjust to major leap of changes should all the commitments have to be met within 2015 as targeted. As a result, the business sector should make a head start in making necessary adjustments. …because waiting until the full integration of AEC would result in business opportunity loss. The European Union (EU), despite its countries sharing borders and a supranational governing entity, still took 25 years to fully implement a free trade agreement that allows for trade to occur within the EU without customs. However, waiting for the full implementation of the AEC will be too long a wait, and the current progress has already allowed enough opportunities for businesses to utilize in order to expand into the ASEAN market, such as the 0% import tariffs and the free movement of labor in 7 professions which have previously been agreed upon, or the raise of the maximum equity participation allowed in services sectors which, whilst yet to reach the intended 70%, have created
Insight
Business opportunities for services sector under the AEC
Contributors
Dr. Sutapa Amornvivat Vithan Charoenphon Dr. Chinnawut Techanuvat Tubkwan Homchampa Teerin Ratanapinyowong Pranida Syamananda Dr. Sivalai Vararuth Witchuda Chummee
Business opportunities for services sector under the AEC
Progress towards the ASEAN Economic Community (AEC) thus far has been rather slow with few tangible results, which may have helped explain a correspondingly slow adjustment by the business sector. Even the reduction in import duties to 0% in accordance with the ASEAN Free Trade Area (AFTA) took 17 years to materialize, while the liberalization in trade and services which started in 1996 is still behind schedule. In particular, the endeavor to allow up to 70% equity participation by ASEAN investors in 4 priority services sectors by 2010 has not met with much success as there remain member countries who ask for extension. Such type of delay can pose a risk for the businesses to adjust to major leap of changes should all the commitments have to be met within 2015 as targeted. As a result, the business sector should make a head start in making necessary adjustments. …because waiting until the full integration of AEC would result in business opportunity loss. The European Union (EU), despite its countries sharing borders and a supranational governing entity, still took 25 years to fully implement a free trade agreement that allows for trade to occur within the EU without customs. However, waiting for the full implementation of the AEC will be too long a wait, and the current progress has already allowed enough opportunities for businesses to utilize in order to expand into the ASEAN market, such as the 0% import tariffs and the free movement of labor in 7 professions which have previously been agreed upon, or the raise of the maximum equity participation allowed in services sectors which, whilst yet to reach the intended 70%, have created