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3 - The Evolving Nature of ASEAN's Economic Cooperation: Original Vision and Current Practice
- from SECTION I - ASEAN: THE LONG VIEW
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- By Narongchai Akrasanee, Thailand
- Edited in consultation with Kee Beng Ooi, Sanchita Basu Das, Terence Chong, Malcolm Cook, Cassey Lee, Michael Chai Ming Yeo
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- Book:
- The 3rd ASEAN Reader
- Published by:
- ISEAS–Yusof Ishak Institute
- Published online:
- 22 June 2017
- Print publication:
- 17 August 2015, pp 14-16
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Summary
It is my great pleasure to be back at the Institute of Southeast Asian Studies (ISEAS) after many years and to have a chance to speak at the High-Level Conference on the Association of Southeast Asian Nations (ASEAN) today.
It could be said that my ASEAN story has developed over the years for two reasons — interest and opportunity. Out of interest, during my studies in Australia and the United States in the 1960s, I studied and then wrote my dissertation on protectionism. When I came back to Thailand, my home country, and started working, I was determined to fight against protectionism, which was basically the industrial policies of that time.
Recalling the early 1970s, when countries in the region like Singapore and Malaysia started opening up their economies, I had opportunities to work with the National Economic and Social Development Board of Thailand. My work was on industrial and trade policies. At the same time, I was doing research on regional cooperation — on ASEAN, in particular. I knew at the time that economies of scale, not protectionism, would help a country to industrialize. So ASEAN economic cooperation would definitely enhance Thailand's industrialization process. We had, at that time, the Kansu Report on ASEAN economic cooperation, which supported this concept.
And when ASEAN held its first summit in Bali in 1976, the agenda on economic cooperation, to which I had made some contribution was very much derived from the Kansu Report's recommendations. The Report's recommendations were also the origin of the agreements on the ASEAN Preferential Trading Arrangements (PTA) and ASEAN Industrial Projects (AIP).
Before economic cooperation was brought to discussion seriously in 1976–77, political and security issues featured much more dominantly on ASEAN's agenda. The economic issue was brought up at the first summit, and became ASEAN's major concern during and after the second oil crisis in 1979.
The oil crisis was a wake-up call for ASEAN countries to accelerate the process of industrialization by means of export pro-motion. There was then a consensus among ASEAN policymakers about having a serious look at ASEAN economic cooperation. For this purpose, a high level Task Force was appointed in 1985, consisting of three members from each of ASEAN's five founding members — Indonesia, Malaysia, the Philippines, Singapore and Thailand. I was a member of Thailand's team.
5 - GMS Challenges for Thailand
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- By Narongchai Akrasanee, Mekong Institute
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- Book:
- Greater Mekong Subregion
- Published by:
- ISEAS–Yusof Ishak Institute
- Published online:
- 21 October 2015
- Print publication:
- 07 February 2013, pp 74-83
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Summary
The Association of Southeast Asian Nations (ASEAN) has progressed a lot and so has the Asia-Pacific Economic Cooperation (APEC), in terms of economic cooperation. Now we are moving on Greater Mekong Subregion (GMS) economic cooperation. The GMS started later than ASEAN and APEC, but it is catching up very quickly. Discussing the issues concerning GMS economic cooperation is therefore very timely.
This chapter is about the GMS from the perspective of Thailand. In order to understand the GMS we need to look at it from the perspective of different countries because they are different, and their perspectives need to be taken into consideration to promote the GMS.
Firstly, it is useful to go back a little in history — into the socio-political history of the GMS. It is important to understand this in order to appreciate how we see things differently. I will talk a bit about the diversity of the GMS and the attempts at connectivity. I will share with you my views of what Thailand thinks of the GMS and what it wants to do about the GMS.
I have been trying to come up with a phrase to capture my sentiment about the GMS. For the time being this phrase is — “from the same beginning, through different means, towards the same end”. And that end is prosperity for the people in the area.
We can go as far back in history as we want, but what is important is our development just before and after the colonial period. I use the arrival of the Portuguese in Malacca before the sixteenth century as the beginning of the colonial era. At the time, Thailand was Siam, which was really a cultural entity — not an ethnic one — consisting of three major ethnic groups, viz., Thai-Lao, Mon-Khmer, and Java-Malay. We also had influences from China and India. This is obvious — two big countries next to us — there are lots of things we practise in Thailand that are of Indian or Chinese origin.
In the early colonial era, the Portuguese arrived in 1511, followed by the Spanish, the French, the Dutch, and later the British. During this early colonial period, Siam and the CMLV countries (Cambodia, Lao PDR, Myanmar, and Vietnam) were safe from colonization.
VII - Transition from Import Substitution to Export Expansion: The Thai Experience
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- By Narongchai Akrasanee, Thailand Development Research Institute, Somsak Tambunlertchai, Thammasat University
- Edited by Seiji Naya, Akira Takayama
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- Book:
- Economic Development in East and Southeast Asia
- Published by:
- ISEAS–Yusof Ishak Institute
- Published online:
- 21 October 2015
- Print publication:
- 01 January 1990, pp 104-120
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Summary
Introduction
Among the developing countries in Asia, Thailand stands out prominently in terms of economic growth and stability. Although not growing as fast as the newly industrializing economies (NIEs), Thailand's growth performance during the past three decades has been respectable by international standards. The industrial sector, led by manufacturing, has expanded substantially over the years, and there has been significant expansion of manufactured exports since the early 1970s. In recent years, the country also enjoyed a substantial increase in foreign investment inflows and foreign exchange earnings in terms of tourism and other service incomes.
In the early 1980s, Thailand was confronted by a number of external economic shocks: a sharp increase in oil price imports, a significant decline in export commodity prices, a large trade deficit, and increasing foreign debt. But since 1986, the economic situation has turned around rapidly. Economic growth has accelerated, export earnings have expanded, and foreign exchange receipts from tourism, foreign investment, and other forms of capital inflows have helped to alleviate the country's external balance problems. Although some basic economic problems such as rural poverty, disparity in income distribution and a prolonged foreign trade deficit remain, it is widely believed that Thailand's overall economic performance will continue to be strong for the next several years. Some even predict that Thailand will be able to join the club of newly industrializing economies in the 1990s.
Over the last three decades, Thailand has gone through the process of industrialization characterized by import substitution, and, since around the mid-1970s, industrial exports have expanded. Compared with other developing countries in East Asia, industrialization started rather late in Thailand. During the 1960s, when the Asian NIEs -were rapidly expanding their manufactured exports, the process of import substitution had just begun in Thailand. Exports of manufactures were not significant in terms of proportion of total exports until the late 1970s. At present, manufactured exports comprise over 60 percent of the country's total merchandise exports, as compared to less than 30 percent for agricultural exports. With the expected higher growth of manufactured exports relative to exports of agricultural and mineral products, the share of manufactures in total exports will be even larger in the years to come.
This paper reviews the industrialization process in Thailand in the last three decades, with an emphasis on the transition from import substitution to export expansion in the industrial sector.
VII - ASEAN Trade Policy Options: An Overview
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- By Narongchai Akrasanee, Thailand Development Research Institute
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- Book:
- The Uruguay Round
- Published by:
- ISEAS–Yusof Ishak Institute
- Published online:
- 21 October 2015
- Print publication:
- 01 January 1988, pp 199-211
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Summary
Introduction
To any country, especially the one with a free enterprise economic system, foreign trade is a means towards economic ends in terms of growth, stability and social equity. At the same time, foreign trade can be an outcome of macro-economic situations. A country would want to trade at the best possible terms measured in both volume and value. This can be achieved by various means including macro-economic structural adjustment, balance of payments measures, especially foreign exchange rate adjustment, and direct trade policy interventions.
During the period up to 1980, it was quite clear that the structure of foreign trade of the ASEAN countries was determined mainly by the individual country economic structure. The resource-rich countries of Malaysia and Indonesia exported mainly natural resources and imported manufactured goods. To a certain extent, the Philippines and Thailand also relied on natural resource exports, including agro-based products. Singapore exported manufactured goods and also served as a transit for exports of primary goods for other ASEAN countries. Thus, ASEAN foreign trade policy up to the seventies was to promote exports of primary products at the best possible terms.
After 1980 several changes have taken place, which have affected the structure of foreign trade of the ASEAN countries. Firstly, the production structure became more diversified towards manufacturing activities, the output of which were increasingly meant for export. Also, it should be borne in mind that trading in manufactured goods is notably different from trading in primary goods. It involves many more rules and regulations which require trade policy measures. And secondly, since 1985 there has been a series of realignments of exchange rates of the major currencies, which have drastically affected the structure of foreign trade of countries in ASEAN.
At present and probably in the next several decades, the structure of foreign trade of ASEAN will be determined by both macro-economic and exchange rate adjustments, and trade policies and practices. Thus, in discussing trade policy options of ASEAN we need to bear in mind the macroeconomic and exchange rate factors.
7 - U.S.-Thai Relations: Selected Case Studies in Agribusiness
- from PART IV - ROLE OF PRIVATE SECTOR
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- By Mingsarn Santikarn Kaosa-Ard, Chiangmai University-Thailand, Narongchai Akrasanee, Senior Vice-President of the Industrial Finance Corporation of Thailand
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- Book:
- ASEAN-U.S. Economic Relations
- Published by:
- ISEAS–Yusof Ishak Institute
- Published online:
- 21 October 2015
- Print publication:
- 01 January 1988, pp 177-200
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Summary
U.S.-Thai economic relations commenced in 1818 when Thailand bartered sugar for firearms. Since then, trade relations have steadily increased. By 1985 the total Thai trade with the United States reached $2.3 billion.
Previous studies on U.S.-Thai relations centred on trade in manufactured goods, direct investments, and technology transfer in which U.S.-Thai activities are concentrated. However, since President Reagan signed the Food Security Act (H.R. 1210), commonly known as the Farm Bill, which potentially affects the standard of living of 70 per cent of the Thai population who are mostly rice farmers, the future of the U.S.-Thai relations depends to a large extent on the resolution of conflicts arising from agricultural trade and possible co-operation in rice and other agribusinesses.
This paper examines the relationship between U.S. and Thai companies in agribusiness in Thailand. Adopting a case-study approach the paper argues that the U.S.-Thai relationship in agribusiness is not merely competitive but is multidimensional and this property should be exploited properly. It is suggested that both countries would gain from free and fair agricultural trade and from combining comparative advantage of the different chains of production in agribusiness. The case studies will highlight both the competitive and the possible co-operative nature of the relationship.
Overview
Despite an apparent difference in factor endowments and in the relative importance of the agricultural sector measured in terms of value-added contributions in the United States and Thailand, agricultural exports are major foreign exchange earners of both countries. In 1985, the U.S. agricultural sector accounted for only 2 per cent of GDP in 1984 but U.S. farm exports fetched $31 billion accounting for 15 per cent of total U.S. export revenue (Table 7.1). It should also be noted that this share is the lowest during the last two decades. In Thailand, the agricultural sector contributed 20 per cent to GDP (Table 7.2) in 1984 and agricultural exports accounted for about two-thirds of the total value of export earnings since 1978 (Table 7.3).
FOREWORD
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- By Narongchai Akrasanee, United Nations ESCAP Bangkok, Hans Christoph Rieger, Institute of Southeast Asian Studies
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- Book:
- ASEAN-EEC Economic Relations
- Published by:
- ISEAS–Yusof Ishak Institute
- Published online:
- 21 October 2015
- Print publication:
- 31 December 1981, pp vii-x
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Summary
Economic relations between the countries of the Association of Southeast Asian Nations (ASEAN) and the countries of the European Community (EC) have a long history as well as great future potential. Merchant adventurers, colonialists, traders, and foreign investors from Europe have in the last two centuries brought about a continuous exchange of goods, interests and ideas with Southeast Asia. In more recent times, mutual co-operation among the Southeast Asian countries of Indonesia, Malaysia, Philippines, Singapore and Thailand on the one hand and the European countries of Belgium, Denmark, France, Federal Republic of Germany, Ireland, Italy, Luxembourg, Netherlands, and the U.K. on the other have led to the creation of two economic groupings, ASEAN and the EC, dedicated to the idea of mutual benefits through trade. The EC is ASEAN's third most important trading partner, and, although the proportion of ASEAN's trade with the EC is declining slightly, the exchange of goods and services between the two groupings is still increasing rapidly both in terms of volume and value. ASEAN is important for EC investors as the fastest growing area of the Pacific rim. The political stability that has emerged in ASEAN is an important factor contributing to this attraction as well as an important reason why ASEAN as a grouping can expect to achieve more at the economic bargaining table than may be commensurate with the relatively low importance of ASEAN trade for the EC.
Although trade is likely to be beneficial for both sides it does not always develop automatically according to comparative advantage or investment potential. Lack of knowledge about available opportunities, methods of operation and styles of negotiation are frequent causes of missed chances. Dissemination of information, exchange of views and ideas and the analysis of potential opportunities are therefore important factors for trade expansion and consequent welfare increases. It is for this reason that research and academic exchange and co-operation have an important role to play.
ASEAN-EC Trade Relations: An Overview
- from 1 - TRADE
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- By Narongchai Akrasanee, United Nations ESCAP Bangkok
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- Book:
- ASEAN-EEC Economic Relations
- Published by:
- ISEAS–Yusof Ishak Institute
- Published online:
- 21 October 2015
- Print publication:
- 31 December 1981, pp 10-51
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Summary
This essay provides an overview and a framework within which detailed discussion on trade relations between the Association of Southeast Asian Nations (ASEAN) and the European Community (EC) may be carried out. The emphasis will be more on ASEAN's point of view of the trade relations.
The EC is ASEAN's major trading partner after Japan and the United States. The EC accounts for about 14 per cent of the total ASEAN trade on both the export and the import sides. This proportion has remained fairly constant over the last few years, implying that ASEAN's trade with the EC has been increasing in line with total ASEAN trade, which has been growing very rapidly by world standards. Since trade is a very important component of the ASEAN economies, it follows that ASEAN's trade with the EC has significantly contributed to the development of ASEAN.
On the other hand, to a very large economy like the EC, ASEAN appears insignificant. The EC's exports to and imports from ASEAN have never exceeded two per cent of its total exports and imports. However, ASEAN's exports to the EC are highly specialized and the EC relies heavily on ASEAN for such items as rubber, timber, tapioca, tin, palm oil, and cattle feed. The pattern of trade becomes even more specialized when broken down according to country. Thailand and the Philippines are the major sellers of tapioca and copra respectively to the EC. Indonesia and Malaysia are more important to the EC as importers, but they are also major suppliers of rubber, timber, tin and palm oil. Singapore exports manufactured goods and electronics to the EC. More recently ASEAN textiles have made a breakthrough in the European market with such success that the EC has set limits on textile imports from ASEAN. Other ASEAN manufactured goods are also beginning to appear in the European market.