Figures from the office of the Asean Secretariat show that foreign direct investment into the region decreased sharply from US$33 billion (Bt1.14 trillion) in 1997 to $21 billion in 2004.

Foreign investors have shifted to other emerging Asian markets, such as China, India and South Korea, which have played an increasingly important role in the Asian economy over the past decade.

Commerce permanent secretary Karun Kittisataporn said Asean moved up its integration goal from 2020 to 2015 because of rising competitiveness from other parts of Asia.

The acceleration was aimed at drawing foreign investor confidence back to Asean countries.

"The rising strong position of these other countries is a key challenge to Southeast Asian nations," he said. "Asean will proceed to complete its integration by drawing up plans to promote a single market soon."

Asean leaders will meet in Cebu, the Philippines, in November to set a concrete plan to achieve integration by the target date in eight years' time.

"The [Thai] government is confident the AEC will be achieved by the deadline. Asean members will together promote a single market to preserve the region's competitiveness, in the light of proposed East Asia Community integration," Karun said.

The Japanese EAC plan includes the countries of Asean, but its proposed common market also encompasses South Korea, China, Japan and India.

The proposed AEC

consists of three "pillars": political and security cooperation, economic cooperation and sociocultural cooperation.

So far, Asean members have achieved the Asean Free-Trade Area agreement. Streamlining of tariffs and customs procedures is focused on 11 priority sectors covering nine product categories: agricultural products, fisheries, automotive products, wood products, rubber, textiles, electronics, information technology, healthcare, aviation and telecommunications.

Petchanet Pratruangkrai

The Nation