The ASEAN Economic Community (AEC) was established on December 31, 2015 with the goal of turning ASEAN into a common market and unified production base, gradually building a dynamic and competitive region. AEC focuses on measures to facilitate trade, services and investment, complete rules of origin, strengthen the development of ASEAN capital markets and freer flow of capital, and facilitate the moving natural persons. Industry and Trade Newspaper would like to introduce the article of Mr. Nguyen Hong Dien - Member of the Party Central Committee, Ministry of Industry and Trade on the ASEAN Economic Community.

Since 1992, ASEAN has promoted the process of regional economic integration through a focus on forming a free trade agreement among ASEAN countries (AFTA). AFTA is considered a very successful agreement between developing countries, making ASEAN one of the most dynamic economic development regions in the world.

(Minister Nguyen Hong Dien)

However, when intra-regional tariffs were gradually eliminated, ASEAN realized at that time that the region still had many challenges to overcome, specifically:

(i) Despite the spectacular economic development, the economies of each ASEAN country are still at a small scale, not strong enough to compete with other economic centers in the world.

(ii) The world economy has undergone many rapid changes, in which emerging is the development of the industrial revolution 4.0, the rapid development of cross-border investment and trade in services, etc. To be able to anticipate this wave of change, ASEAN needs to take strong steps in the process of economic integration in other areas such as services, investment, e-commerce, etc.

The ASEAN Economic Community (AEC) established on December 31, 2015 has met the needs of the region, is expected to help ASEAN overcome the above challenges, step by step build a more efficient region. dynamic, highly competitive in the world.

With the goal of turning ASEAN into a single market and single production base, the AEC focuses on measures to facilitate trade, services, investment, complete rules of origin, and strengthen developing ASEAN capital market and freer flow of capital, facilitation of movement of natural persons, etc., in parallel with strengthening regional production networks through promoting infrastructure connectivity. , especially in the fields of energy, transportation, information technology and telecommunications, etc. The above measures have been and are being implemented by ASEAN member countries specifically through agreements and important agreements such as ASEAN Free Trade Area (AFTA) and ASEAN Trade in Goods Agreement (ATIGA), ASEAN Framework Agreement on Services (AFAS), Framework Agreement on ASEAN Investment Area ( AIA) and ASEAN Comprehensive Investment Agreement (ACIA), Framework Agreement on Mutual Recognition Arrangement (MRA), etc., contain principles governing intra-regional trade based on c the basis of WTO regulations and a very high degree of market openness.

In order to expand integration into the global economy, ASEAN has been promoting the implementation of Free Trade Agreements (FTAs) with partner countries including the ASEAN-China FTA, the ASEAN-Japan FTA, and the FTA. ASEAN - Korea, ASEAN - India FTA, ASEAN - Australia - New Zealand FTA, ASEAN - Hong Kong (China) FTA.

ASEAN with the goal of expanding regional connectivity, after 8 years, concluded negotiations and successfully signed the Regional Comprehensive Economic Partnership (RCEP) with 5 partner countries: Japan, China, South Korea, Australia and New Zealand on November 15, 2020 on the sidelines of the 37th ASEAN Summit, chaired by Vietnam, demonstrating ASEAN's central role in the integration process more extensively in the region. The RCEP Agreement, a modern, comprehensive, high-quality and balanced agreement of interests, when implemented by 15 countries, will create the largest free trade area in the world with a size of 2.2 billion consumers, accounting for 30% of the world's population and GDP of $26.2 trillion.

Currently, ASEAN is negotiating to upgrade 03 FTAs ​​with external partners including: FTA ASEAN - China, FTA ASEAN - Korea and FTA ASEAN - Australia - New Zealand. In addition, ASEAN is also considering the possibility of negotiating the ASEAN-Canada FTA and the ASEAN-European Union (EU) FTA.

Facing the situation that the role of the multilateral trading system in international trade is being shaken, and the world economy is severely reduced due to the impact of the Covid-19 pandemic. ASEAN is facing new challenges in economic cooperation:

(i) the weakening of the World Trade Organization (WTO) has led to difficulties in developing a transparent, equitable and rules-based multilateral economic cooperation framework.

(ii) small, developing economies are under pressure from protectionism  against large countries.

(iii) the disruption of regional supply chains due to the impact of the Covid-19 pandemic shows that dependence on a single source of raw materials for a long time is an obstacle that ASEAN needs to overcome.

In this context, ASEAN needs to strengthen cooperation, strengthen links, determine the right development direction to overcome difficulties together and maintain economic growth.

Vietnam's economic achievements after joining ASEAN

Joining ASEAN is Vietnam's first international economic integration step and the basis for Vietnam to promote its policy of international economic integration over the past 26 years. In parallel with the process of joining ASEAN, our economic relationship with our partners has also been continuously expanded, creating a basis for Vietnam to integrate both economically and politically at different levels from the Regional and regional countries come bilaterally with the mark of joining new-generation free trade agreements (FTAs) with the highest standards such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) or the Trans-Pacific Partnership (CPTPP). Vietnam - EU Agreement (EVFTA).

After 26 years of joining ASEAN, Vietnam's economy has made remarkable changes in all aspects. In 1995, Vietnam's GDP per capita reached 289 USD, by 2020 this figure has reached 3,520 USD, this being an increase of more than 12 times compared to 1995. The size of the economy increased nearly 17 times from 20.8 billion USD in 1995 to about 343 billion USD in 2020, ranking fourth in ASEAN (only after Indonesia, Thailand and the Philippines). Vietnam increased from 5.2 billion USD in 1995, to 283 billion USD in 2020. Along with international economic integration and participation in regional and international organizations, foreign capital investment (FDI) ) into Vietnam increased sharply over the years, reached 29 billion USD in 2020.

In 2020, with Vietnam as the ASEAN Chair and taking on the role of promoting the formation of the ASEAN Economic Community, we and our member countries have properly promoted the spirit of "Cohesive and Proactively Responsive" to goods and services. Hundreds of meetings were successfully held online and proposed many initiatives to facilitate strengthening regional supply chains, overcoming negative consequences caused by the Covid-19 pandemic on the economy. Initiatives such as the ASEAN Master Plan on Recovery, and the Hanoi Action Plan also helped to strengthen ASEAN economic cooperation and supply chain connectivity. Vietnam also  played an active role in reconciling views in the negotiation of the RCEP Agreement in order to handle problems, thereby promoting the conclusion of negotiations and the successful signing of the RCEP Agreement in 2020. This achievement has once again confirmed Vietnam's position and role in the process of multilateral, regional and world economic integration.

Oppotunity and challenge

The ASEAN Economic Community has been creating opportunities and challenges for our economy, businesses and people.

Joining the AEC as well as participating in free trade agreements between ASEAN and partners, on the one hand helps Vietnam attract foreign direct investment, and on the other hand is also a bridge for Vietnam to access potential markets. capacity inside and outside the region. The implementation of commitments within ASEAN has been creating a foundation for Vietnam to continue to expand and strengthen its relations with non-ASEAN partners, especially major countries, thereby contributing to enhancing its role and position in the ASEAN region. international of Vietnam. It can be said that ASEAN integration has so far been considered an important "fulcrum" for Vietnam's international economic integration process.

Of course, alongside the opportunities are challenges we will also have to face and overcome. One of Vietnam's biggest challenges when participating in the AEC is the difference in development level compared to the original 06 member countries of ASEAN (ASEAN-6). However, in the past 26 years, the gap between us and the group of 6 ASEAN countries has narrowed significantly. Even in many criteria, the most important of which are the human development index (HDI) (Vietnam's HDI in 2019 is 0.704, belonging to the high human development group) and per capita income ( reaching 2,660 USD by 2020), we have therefore taken a step ahead, as compared to other ASEAN countries. Particularly in terms of export turnover and attracting foreign investment, we have even surpassed many other ASEAN-6 countries.

Orientation to participate in AEC in the near future

The Resolution of the 12th Party Congress identified the policy of "actively participating in and promoting its role in multilateral mechanisms, especially ASEAN and the United Nations". Following that, Directive No. 25-CT/TW dated August 8, 2018 of the Secretariat of the Party Central Committee on promoting and elevating multilateral external relations to 2030 also defined the motto "trying to contribute core and leading role” in international organizations of strategic importance like ASEAN. Therefore, further promoting Vietnam's integration in the AEC in the coming time is a task of great significance.

The achievements that ASEAN economic integration brings to Vietnam are very positive, but the challenges we face are not small. Therefore, in order to achieve these achievements in a sustainable way, the ASEAN economic integration in the coming time needs appropriate orientations and policies. Namely:

(i) First, we need to join ASEAN countries in affirming and promoting ASEAN's central role in coordinating economic cooperation activities in the region.

(ii) We need to accelerate the implementation of the Master Plan to build the ASEAN Economic Community to 2025, adjusting cooperation programs in ASEAN towards meeting the new situation.

(iii) We need to soon approve the RCEP Agreement to put the largest-scale Free Trade Agreement in the world in terms of population into practice, contributing to promoting regional supply chains. At the same time, we also need to coordinate with other ASEAN countries to promote the building of stable, sustainable, rules-based cooperation frameworks with foreign partners in order to expand export markets. attract investment from outside the bloc.

Maintaining the momentum from the successes of the ASEAN Chairmanship year 2020, in the coming time, Vietnam needs to show its orientation to continue considering ASEAN integration as one of the priorities in the process of international economic integration, affirming that affirming the spirit of initiative and dynamism in the implementation of initiatives to implement the ASEAN Economic Community, contributing to strengthening the close cohesion, promoting the qualities of a dynamic ASEAN economic region, and affirming the role of the ASEAN Economic Community. This is the central role in economic cooperation in the region.