Dato’ Sri Mustapa Mohamed, the Minister of International Trade and Industry Malaysia chaired the 47th ASEAN Economic Ministers’ (AEM) Meeting from the 22 to 25 of August. Asean Economic Community(AEC) has been at the top list of the discussion including China’s recent yuan devaluation.The currency fluctuations created greater urgency for the AEC establishment apart from being a critical push factor for all ASEAN states.
Mustapa said closer economic integration was important for ASEAN because it would allow the region to better face external challenges. ASEAN aims to announce the formation of the Asean Community at the end of this year, which will comprise three pillars, namely the economic, political security and socio-cultural.
The necessity for AEC has been highlighted by The Asian Diplomat in its August 14 article. ASEAN need to work on proactively with its single currency/ economic union project. This could be a possible measure to mitigate drastic fiscal actions by economic giants such as China and the US to the region. The reliance of Southeast Asia as a single economy and currency could help not only in mitigating immediate financial impact but also raise the confidence level of foreign investors on the robustness of the system and reduce any panic factor – which has the potential to plunge a single state economy overnight.