Investment and Integration: The Case of AEC

Transcription

1 Investment and Integration: The Case of AEC Sufian Jusoh, Yangon AEC Workshop - Brisbane 19 May

2 Investment promotes economic growth and development by building better Infrastructure Goods Services 2

3 The Challenge of Creating New and Better Jobs 3 3

4 Not All Investments Are the Same, Nor Do They Have the Same Impact on Economic Development Natural resource -seeking Strategic asset -seeking Market -seeking Efficiency -seeking 4 4

5 Why Does the Type of Investment Matters? Because each type of investment creates different types of jobs Type of Work Agriculture Apparel Automotive IT Hardware Knowledgeintensive Because each type generates different kinds of jobs. Business Services High-skilled, technology intensive work Moderate skilled, varied labor intensities work Low-skilled, labor-intensive work Small-scale household based work Economic upgrading 5 Source: Gereffi, Luo, April 1, 2014, World Bank Policy Research Working Paper No

6 Towards ASEAN Community 2015 ASEAN COMMUNITY 2015 ASEAN Security Community (ASC) ASEAN Economic Community (AEC) ASEAN Socio- Cultural Community (ASCC) The Peaceful, Prosperous, and People-Centric ASEAN Production/Supply Regional Production Base Single Regional Market Consumption/Demand Dual Track Strategy 6

7 AEC Blueprints Single Market & Production Base A highly competitive economic region A Region of Equitable Economic Developmen t A Region fully integrated into the Global Economy 7

8 BIT FTA ASEAN FTA 30 BIT with AMS Brunei Cambodia Indonesia Lao PDR Malaysia Myanmar The Philippines Singapore Thailand Vietnam 8

9 Intra-ASEAN Investment 70, , , , , , Intra-ASEAN 2011 Extra-ASEAN 2011 Total net inflow 20122/ Intra-ASEAN 20122/ Extra-ASEAN 20122/ Total net inflow 20133/ Intra-ASEAN 20133/ Extra-ASEAN 20133/ Total net inflow 10, Brunei Darussalam Cambodia Indonesia Lao PDR Malaysia Myanmar Philippines Singapore Thailand Viet Nam (10,000.0)

10 FDI Inflow in Select Economies Australia Brunei Darussalam Cambodia Indonesia Lao People's Dem. Rep. Malaysia Myanmar New Zealand Philippines Singapore Thailand

11 FDI Outflow from Select Economies Australia Brunei Darussalam Cambodia Indonesia Lao People's Dem. Rep. Malaysia New Zealand Philippines Singapore Thailand Viet Nam

12 ASEAN IGA Protection and Promotion Investor-State Dispute Settlement Mechanism ACIA AIA Agreement Schedules (I. Facilitation, II. Promotion, III. Liberalisation), Temporary Exclusion List 5 Sectors; Sensitive List 5 Sectors Protocol: Temporary Exclusion List for 5 services; Sensitive Lists for services incidental to 5 sectors. Four Pillars, Liberalisation, 2 Annexes: Approval in writing, Expropriation and compensation, ISDS Schedule: Reservation Lists; Came into force on 29 March

13 Protection Liberalisation ACIA Facilitation Promotion 13

14 Natural person of AMS Juridical person in AMS 3 rd country national through juridical person in AMS 14

15 Manufacturing Agriculture Fishery Forestry Mining and Quarrying 15

16 National Treatment Most -Favoured-Nation Treatment at pre and post-establishment Senior Management and Boards of Directors Freedom to operate without any performance requirement 16

17 More transparent, consistent and predictable investment rules, regulations, policies and procedures; Harmonised investment policies; Streamlined and simplified procedures for investment applications and approvals; and Dissemination of investment information, rules, regulations, policies and procedures. 17

18 ASEAN Investment Website

19 Main Protections Fair & Equitable Treatment Full Protection and Security Free Transfer of Funds No Unlawful Expropriati on 19

20 Alternative Dispute Resolutions Domestic Courts Arbitration Mediation Conciliation Consultation & Negotiation Domestic Courts Domestic Tribunals ICSID UNCITRAL Other Agreed Rules 20

21 Evolved Role of ACIA ASEAN Wide Investment Agreement Benchmarked for National Level Investment Law

22 Major Policy Considerations in Negative List Approach Standstill Roll Back Ratchet

23 Promoted Sectors: Manufacturing Automotive Philippines, Thailand, Vietnam Electrical and electronic Brunei, Malaysia, Thailand, Vietnam Iron and Steel Philippines Machinery and equipment Malaysia, Vietnam Petrochemicals Malaysia, Brunei Pharmaceuticals and Life Brunei Science Malaysia

24 Promoted Sectors: Agriculture and Mining Agriculture Cambodia Indonesia (including beef and fisheries) Lao PDR Myanmar (including fisheries) Philippines (including fisheries) Mining Thailand Cambodia Lao PDR Myanmar Singapore

25 Promoted Sectors: Services Education Primary, secondary, tertiary Malaysia Financial Services Banking Myanmar Insurance Myanmar Leisure Tourism and Tourism Leisure Management and Cambodia Lao PDR Malaysia Philippines Singapore

26 Stakeholders Recommendations Low awareness of AEC. Business organisations seek support mechanism for the Government to communicate AEC to business. Greater emphasis on trade in services. Should promote transparency, access to information and good governance. Harmonisation of ASEAN investment laws and procedures at a certain level will ensure the certainty and unity of the ASEAN investment regime and practices.

27 Major Policy Considerations in Negative List Approach Standstill Roll Back Ratchet

28 Juggling through the jungle: practical issues Domestic Regulations v. Liberalisation Facilitation v. Different Levels of Governance Screening v. Open Policy Transparency v. Access to information Access to Land/ IP Protections

29 Points For Research and Discussion Designing Optimum Investment Policies Encouraging Progressive Liberalisation without roll-back in policies; Regulatory Audit and Negative Listing; Making ACIA as the benchmark; Role of Domestic Legal System and Investment Attraction.

30 THANK YOU.