the competitiveness of asean august 2008

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The Competitiveness of ASEAN after the 1997 Asian Financial Crisis

Wong Poh KamProfessor of Lee Kuan Yew School of Public Policy and NUS Business School

[email protected]

DID: 65-65166323 Fax: 65-67756471

and

Ng Kwan KeeResearch Fellow

[email protected]: 65-65167029 Fax: 65-67756471

469C Bukit Timah Road, Level 3Singapore 259772

August 2008


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Abstract

ASEAN has been considered as one of the most successful regional groupings worldwide

since its inception to the mid 1990s. However, economic realities have dramatically

changed in the past 10 years with the onset of the Asian Financial Crisis in 1997 and the

emergence of China and India as economic powerhouse in Asia since the mid-1990s. Inthis paper, we investigate the competitiveness performance of the ASEAN region in the

decade after the onset of the Asian Financial Crisis. We found that ASEAN as a whole

has not fully recovered from the Asian Financial Crisis. ASEANs share in the world

economy has shrunk and its real GDP per capita growth performance had slowed.

Moreover, competitiveness performance had also been quite uneven among the ASEAN

member nations, and such variations appear to be related to systematic differences in the

various component determinants of competitiveness as identified by the Global

Competitiveness Report.

Keywords: ASEAN, competitiveness, GDP per capita, growth

JEL Code: O11, O53, O57

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THE COMPETITIVENESS OF ASEAN AFTER THE 1997 ASIAN FINANCIAL

CRISIS

1. IntroductionASEAN has been considered as one of the most successful regional groupings worldwide

since its inception to the mid 1990s. It experienced higher economic growth than virtually

any other region in the world during this period. However, economic realities have

dramatically changed in the past 10 years with the onset of the Asian Financial Crisis in 1997

and the emergence of China and India as economic powerhouse in Asia since the mid-1990s.

In response to growing concerns with competitiveness after the 1997 Asian Financial

Crisis, there has been increasing rhetoric by ASEAN political leaders on the need for greater

economic integration of ASEAN. At the 2003 Summit in Bali, ASEAN Leaders declared theformation of an ASEAN Economic Community (AEC) by 2020 (later brought forward to

2015). This is one of the three pillars of the collective vision of ASEAN - the ASEAN

Community 1. The aim of the AEC is to create a stable, prosperous and highly competitive

ASEAN economic region through a higher level of regional economic integration (as outlined

in the ASEAN Vision 2020) and with a final goal of being a common market in ASEAN, just

like the European Union. The AEC is envisaged to be a single market and production base

with free flow of goods, services, investments, capital and skilled labour, with equitable

economic development and reduced poverty and socio-economic disparities (McKinsey &

Company, 2003; ASEAN Secretariat, 2005; Hew & Das, 2008). The benefits, urgency and

tracking of progress towards greater ASEAN economic integration resulting in an AEC in

2015 were emphasized during the Fortieth Meeting of the ASEAN Economic Ministers

(AEM) on 25-26 August 2008, and the High-level Symposium on Asian Economic

Integration on 4 September 2008 in Singapore (Business Times Singapore, 2008; Joint Media

Statement, 2008).

In this monograph, we attempt to investigate the state of competitiveness of the ASEAN

region in the decade after the 1997 Asian Financial Crisis by examining the relative role of

ASEAN in the world economy, and the growth performance of ASEAN, both over time and

relative to the rest of the world, since 1997. We also examine variations in competitivenessperformance among the ASEAN member nations which might pose problems to regional

economic integration. In addition, key competitiveness determinants of ASEAN as derived

from the Global Competitiveness Report (GCR) in recent years are examined.

1 The other two are ASEAN Socio-Cultural Community (ASCC) and ASEAN Security Community (ASC)

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2. Conceptual Framework and Measures of Regional Competitiveness

Due to increasing global competition and growing openness of national economies, more

and more business people, policy makers and researchers have recognised the importance of

international competitiveness for enhancing economic growth and the standard of living of

regions or nations. However, defining it is not trivial.

Despite the growing literature on national & regional competitiveness over the years,

there has been little agreement on how to define it conceptually and measure it empirically.

While it is easier to define competitiveness for a firm (using performance indicators such as

sales, market share or profitability), it is more difficult to define it for an economy or region.

The factors or determinants that influence the competitiveness performance of nations and

regions are also diverse, and there has been little agreement among scholars on the relative

contributions of these determinants, and how they may vary for nations or regions at different

stages of economic development. It is interesting to note that both the World

Competitiveness Report and the Global Competitiveness Report have attempted to cover a

very wide range of measures of potential competitiveness determinants, and that their

batteries of measures have varied over time.

In this paper, we make a clear distinction between the outcome or performance of

regional competitiveness, and the determinants of such competitiveness performance. In

particular, we focus on a small number of conceptual constructs for measuring regional

competitiveness performance that relate to the notions of sustainable economic growth and

economic prosperity relative to other regions. Specifically, we note the following conceptual

definitions by OECD and Michael Porter that highlight the elements of sustainable growthand relative prosperity:

Competitiveness [should] be understood as the ability of companies, industries,

regions, nations and supranational regions to generate, while being and remaining

exposed to international competition, relatively high factor income and factor

employment levels on a sustainable basis (OECD, 1994)

Competitiveness is the underpinning of prosperity, based on productive potential of a

nations economy, which in turn is ultimately set by the productivity of its companies

determined by the sophistication of its company operations and strategy, and thequality of microeconomic business environment (Porter, Ketels, & Delgado, 2006)

Based on the above, we propose in this paper to focus on two sets of conceptual measures

of competitiveness performance: (a) measures of the relative role or weight of an economic

region in the global economy an increasing share would suggest relative improvement of

competitiveness; and (b) measures of the productivity growth rate of a region, both over time

and relative to the rest of the world or selected benchmark regions.

In terms of competitiveness determinants, this paper will use primarily the Global

Competitiveness Index (GCI)s pillars of competitiveness framework first introduced by

the Global Competitiveness Report in 2006 and subsequently refined in the 2007 and 2008

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reports. We prefer to use the GCI framework over other suggested frameworks in the

literature (e.g. the classification framework as used in the World Competitiveness Index) due

to its conceptual comprehensiveness and its broader empirical scope of coverage of ASEAN

countries, including Vietnam (which was missing from WCI).

3. Empirical Measures of ASEAN Competitiveness PerformanceTo operationalize the above conceptual constructs, we adopted the following empirical

measures to examine the competitiveness performance and competitiveness determinants of

ASEAN.

a) Competitiveness performance

In terms of empirical measures of competitiveness performance of ASEAN, we first

analyze the role of the ASEAN economy in the global economy by analyzing its shares in

world population, world GDP output, world total trade, and world total inward foreign directinvestment. We also examine the share of intra-ASEAN trade and FDI as a percentage of

total trade and FDI to gauge the degree of regional economic integration.

Secondly, we analyze the productivity level and growth of ASEAN in terms of real GDP

per capita in PPP terms. Commonly used as a measure of the rate of change in the level of

productivity or average living standards, real GDP per capita PPP growth rate per annum is a

better gauge of competitiveness performance than real GDP growth per annum, as it adjusted

for both population growth and changes in Purchasing Power Parity (PPP). Technical

Appendix 1 provides a more detailed discussion of the merit of the selected measure, and

compared the key GDP growth estimates with and without PPP adjustments to underline theimportance of doing PPP adjustments, while Technical Appendix 2 compares the growth

estimates using GDP and GDP per capita, emphasize the importance of controlling for

population growth.

A country with high real GDP growth rate may not be as well performing as it appears if

it is being matched by rising population growth. As highlighted in a recentEconomistarticle

(15 Mar 2008), while US and Canada had higher real GDP growth rate (2.8% and 2.7%) than

Japan (2.1%) over 2003-2007, in terms of real GDP per capita growth, the latter actually

outperformed the former (2.0% vs. 1.8% and 1.7%). Real GDP per capita PPP growth rate of

a region should also be benchmarked relative to the average of the World and other reference

economic groups. In addition, Angus Maddison in his book The World Economy: A

Millennial Perspective (Maddison, 2001) also noted the importance of taking into account

population growth in the measure of prosperity and welfare. He used GDP, GDP per capita

as well as population as indicators of welfare for his contour of world development.

When a regional economys shares of World real GDP (in PPP terms), trade and inward

direct foreign investments are increasing, they indicate that the regions ability to create and

compete for economic resources is expanding relative to the rest of the world. However, the

relative economic share and significance of a region in the world needs to be benchmarked

against its population share over time.

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(b) Competitiveness Determinants

To analyze the competitiveness determinants of ASEAN, we use the various component

determinants derived from the Global Competitiveness Index (GCI)s Pillars of

Competitiveness framework (Sala-I-Martin, et. al., 2007). The framework originally

identified 9 pillars, but subsequently expanded to 12 pillars in the latest (2008) edition.

Table 1 summarizes the key determinants covered under the 9/12 pillars of GCI. A 7-point

Likert scale construct is used by GCI to measure the strength of each of these determinants

for each economy.

While the GCI measures are quite comprehensive in scope, its aggregated nature and its

ordinal scale based largely on subjective measures may make it difficult to interpret the actual

level and extent of development of some of these component determinants. To supplementthe analysis using the GCI measures, we have also included analysis of a number of more

disaggregated, quantitative constructs to better interpret selected component determinants that

were found to be salient from the GCI analysis (e.g. innovation, institutions).

4. Role of ASEAN in the World EconomyASEAN (Association of Southeast Asian Nations) was formed in 1967 by five original

member countries, namely, Indonesia, Malaysia, Philippines, Singapore, and Thailand. Theywere later joined by Brunei Darussalam (January 84), Vietnam (July 95), Laos & Myanmar

(both July 97), and Cambodia (April 99). The main objectives of the formation of ASEANwere to accelerate the economic growth and to promote regional peace and stability ofSoutheast Asian nations. Since its inception to the mid 1990s, ASEAN has been consideredas one of the most successful regional economic groupings in the world.

Strategically located in Southeast Asia, ASEAN (Association of Southeast Asian Nations)countries are positioned at the crossroads of world shipping and airline routes, and Singaporeis the hub of Southeast Asian trade (Figure 1). ASEAN countries are regarded as a majorgrouping in world trade negotiations by international agencies such as the General Agreementon Trade and Tariffs (GATT, now superseded by World Trade Organisation WTO), UnitedNations Conference on Trade and Development (UNCTAD), as well as by major worldtrading economies such as the USA, the European Union (EU), and Japan. In the AsiaPacific region, ASEAN countries constitute an important sub-group of countries in the AsiaPacific Economic Cooperation (APEC).

Almost all the world's major economic powerhouses are today ASEAN's dialogue

partners. Currently, ASEAN has the following dialogue partners: Australia, Canada, China,

EU, India, Japan, New Zealand, South Korea, Russia and the United States. The United

Nations Development Program (UNDP) also has dialogue status.

As of 2006, the ASEAN region has a population of about 560 million, a total area of 4.5

million square kilometres, a combined gross domestic product of almost US$ 3 trillion (in

nominal PPP terms), and a total trade of about US$ 1.45 trillion.

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In this paper, because of the lack of data availability for some of the smaller and newer

members, several different definitions of ASEAN region will be used:

ASEAN4 refers to Indonesia, Malaysia, Philippines, and Thailand

ASEAN5 refers to Indonesia, Malaysia, Philippines, Singapore, and Thailand

ASEAN6a refers to Indonesia, Malaysia, Philippines, Singapore, Thailand and

Brunei

ASEAN6b refers to Indonesia, Malaysia, Philippines, Singapore, Thailand and

Vietnam

ASEAN10 refers to Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam,

Brunei Darussalam, Laos, Myanmar and Cambodia

In evaluating the role and the importance of ASEAN in the world economy, we will study

the ASEAN shares in world population, world GDP, world trade, and world total inward

foreign direct investment. In addition, intra-ASEAN trade, intra-ASEAN FDI, population,

GDP and trade shares among ASEAN member countries are analysed to highlight the

importance of individual member countries in the ASEAN grouping.

4.1.Share in World PopulationAs mentioned, population and population growth play a big part in determining

economic welfare of the ASEAN people. In addition, the size of the population also

indicates market size and market potential. This section highlights ASEAN total

population, its share in world population, and growth trends.

Table 2 shows that 558.1 million or 8.6% of the world population reside in ASEAN

in 2006, representing a sizeable market and market potential. However, population in

ASEAN has been increasing at a declining rate in the last 30 years. From 1980 to 2006,

share of ASEAN10 to world population has increased by about 0.6 percentage-point from

8% to 8.6%. In 2006, ASEAN6a made up of 72.2% of ASEAN10 total population, not

much change from 72.7% in 1980.

4.1.1. Growth Trends in ASEAN and World PopulationIn terms of growth trends, Figure 2 and Table 3 show that ASEAN population

grew at a faster rate than that of the world population, although growing at a declining

rate. Relative to the world, this means that ASEAN is growing in importance as a

single market but it also needs a higher economic growth rate to sustain its population

growth to achieve sustainable prosperity.

4.1.2. Population Share within ASEANIn terms of population share within ASEAN, the distribution is uneven. Over

the years, Indonesia, Philippines and Vietnam remained as top 3 most populous

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nations in ASEAN (Table 4 and Figure 3). Between 1980 and 2006, population

shares of Indonesia, Thailand, and Myanmar have declined while those of Philippines,

Malaysia and Cambodia have increased (Figure 4).

4.2.Share in World GDP

Share in world GDP indicates the relative importance of ASEAN as an economic

grouping in the world. Table 5 shows ASEAN total GDP in PPP and constant 2000

international dollar terms. Total GDP of ASEAN10 stood at $2.4 billion in 2006,

constituted 4.2% of world GDP. Total ASEAN share of world GDP expanded up to 1997

when the Asian financial crisis struck, and had still not fully recovered in 2006 from its

peak share in 1997.

Table 6 shows ASEAN GDP and share with Brunei included, in PPP and current

international dollar terms. It shows that the ASEAN GDP shares were slightly higher, but

have similar pattern over time, compared to those measured in real PPP terms.

Comparing ASEAN5 and ASEAN6b in total GDP and share in world GDP (nominal

GDP in PPP terms) shows that GDP share of Brunei is negligible.

4.2.1. Growth Trends in ASEAN and World GDPThe growth trends of ASEAN and World GDP are shown in Figure 5. ASEAN

GDP grew at a faster rate than that of the world GDP over the period from 1975 to

2006, despite the decline during the Asian Financial Crisis. This shows the

importance of ASEAN as an economic grouping is growing.

4.2.2. GDP Share within ASEANIn terms of GDP share within ASEAN, it is dominated by a selected few

countries. This is shown in Figures 6 to 9, based on the various ASEAN definitions.

In 2006, ASEAN6b made up of 97.9% of ASEAN10 total real GDP in PPP terms.

Between 1980 & 2006, share of Indonesia and Philippines in ASEAN6b declined

while others increased. Since the Asia Financial Crisis in 1997, share of Indonesias

GDP in ASEAN had been falling, while that of Thailand had been stagnant.

4.3.Share in World Total TradeASEAN Total trade and share in world total trade indicate the importance of ASEAN

as a regional trading bloc to the world. Table 7 indicates that ASEAN10 has 5.9% of the

world total trade share in 2006, up from 3.3% in 1980. However the trade share had

peaked in 1997, and despite some recovery in 2000, has generally declined over the last 6

years.

Table 8 and Figure 10 compares the ASEAN share in world total trade to selected

regional integration arrangements. ASEAN10s world total trade share of 6% in 2006 is

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still a far cry from 38% of EU-25 and 17% of NAFTA, indicating that ASEAN still has a

long way to go before becoming a major and dominating trading bloc to the world.

4.3.1. ASEAN Trade Partners and Commodity GroupsASEAN as a trading bloc is well connected to leading as well as emerging

economies of the world in terms of trade through its export markets and import

origins (Tables 9 and 10). Japan, USA, EU-25, China and South Korea are the top 5

trading partners of ASEAN, excluding ASEAN as an intra-ASEAN trading partner.

Tables 11 and 12 show ASEANs top ten trade commodity groups in 1998 and

2006. Between 1998 and 2006, parts and equipment of electric machinery, television

and sound equipment still remain the top traded commodity group in ASEAN.

Mineral fuels, oils and related products, plastics products and organic chemicals have

become important traded commodity groups in 2006.

4.3.2. Growth Trends in ASEAN and World TradeFigure 11 shows the growth trends in ASEAN and world trade from the

inception of ASEAN to 2006. Trade of ASEAN10 grew at a much slower but steady

pace as compared to world trade from 1970 till 1980. While world trade declined for

much of the 1980s, trade of ASEAN10 grew during this period, temporarily slowed

down during the 1985-86 recession but recovered to grow at a much faster rate since

1990. Singapore emerged as an importance trading nation after 1980, causing the

trade of ASEAN5 to grow faster than that of ASEAN4. The growth gap between

ASEAN5 and ASEAN4 widened after the Gulf War and throughout the period of the

Asian Financial Crisis. The growth paths of ASEAN6a, ASEAN6b and ASEAN10

were very similar throughout the period from 1967 to 2006.

4.3.3. Trade Share within ASEANTrade Share within ASEAN member countries indicates the dominating ASEAN

countries in terms of trade. Table 13 shows the shares in ASEAN total trade based on

various ASEAN definitions. Significant share of Singapore can be seen from

differences between ASEAN4 & ASEAN5. ASEAN4s trade share within ASEAN

has declined to about 57% in 2006, from about 63% in 1980 (mainly due to declining

trade shares of Indonesia and Philippines).

Figure 12 shows the trade share within ASEAN member countries in 1980 and

2006. It shows that Singapore has maintained its dominant position, with Malaysia

and Thailand became the top three ASEAN countries in terms of trade share in 2006.

4.3.4. Intra-ASEAN Trade and Free Flow of GoodsFreer flow of goods is one of the aims of the AEC. Two widely used indicators

of regional integration through trade are intra-ASEAN trade as a percentage of total

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trade and intra-ASEAN trade as a percentage of GDP. Higher percentage values

indicate a higher degree of integration. Tables 14 to 17 show the Intra-ASEAN trade

values, shares and growth rates. Intra-ASEAN trade as a percentage of total trade

measures the relative importance of intra-ASEAN trade to the total trade of all

ASEAN member countries. Share of intra-ASEAN trade to ASEAN total tradeincreased steadily over 1990-97, then dropped slightly during the Asian financial

crisis, before rising again to reach above pre-crisis levels. However, the growth of

intra-ASEAN trade has slowed in the 2000-2006 period compared to the 1990-97

period.

Comparing the growth in intra-regional trade which is a proxy for measuring the

success of economic integration initiatives, the share of intra-ASEAN trade to total

ASEAN trade reached 24.2% in 2006, still a long way compared to 65.7% of EU-25

and 41.8% of NAFTA. Pace of intra-regional trade integration had slowed down in

the 2000s compared to the 1990s (Table 16 and Figure 13).

Intra-ASEAN trade as a percentage of GDP measures the relative importance of

intra-ASEAN trade to the regions economy. In 2006, intra-ASEAN trade constituted

about one-third of total GDP of all ASEAN member countries (Table 18). This

percentage has been increasing from 15.7% since 1990.

4.3.5. Intra-ASEAN Trade Commodity Groups and Single Production BaseThe Vientiane Action Programme (VAP) adopted by the ASEAN Leaders at the

2004 Summit in Vientiane states that the acceleration of economic integration toward

a single market and production base will start with 11 priority sectors. These consist

of 7 priority goods sectors (agro-based, wood-based, rubber-based, fisheries,

electronics, textiles and garments, and automotive) and 4 services sectors (air travel,

tourism, e-ASEAN and healthcare). A high intra-industry trade index for the region

indicates that companies within the same industry have high volumes of trade,

implying a high degree of specialization that can lead to a deepening of integration

(ASEAN Secretariat, 2005).

Without intra-industry trade which could be used as an indicator to measure theextent of integration in each of the priority sectors, we used the top ten intra-ASEAN

trade commodity groups as an indicator to at least provide some clues on the top

industries with a high volume of intra-regional trade in ASEAN. This could imply the

principal types of intra-regional industrial activities and/or production networks,

products and components that are important among the ASEAN member countries.

Tables 19 and 20 show the top ten intra-ASEAN trade commodity groups in 1998

and 2006. Electric and electronics parts and equipment, nuclear appliances and parts

and mineral oil products were the top 3 intra-ASEAN trade commodity groups, as

well as the top 3 ASEAN trade commodity groups in 1998. Pearls and articles of iron

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and steel were more important in intra-ASEAN trade, compared to ASEAN to world

trade in 1998.

Compared to the list of top 10 ASEAN trade commodity groups in 2006, electric

and electronics parts and equipment, mineral oil products, and nuclear appliances and

parts were the top 3 intra-ASEAN trade commodity groups, as well as top 3 ASEAN

trade commodity groups in 2006.

Articles of iron or steel and copper and copper articles were important trade

commodity groups in intra-ASEAN trade, compared to ASEAN to world trade in

2006.

Compared to 1998s top 10 intra-ASEAN trade commodity groups, mineral fuels

and oil products have moved up to second from third; vehicles, copper and copper

articles and rubber and rubber articles have become more important in intra-ASEAN

trade in 2006.

The above findings seem to suggest that intra-regional production networks for

electronics, automotive, rubber-based industries exist among ASEAN member

countries.

4.4.Share in World Total Inward FDI FlowsShare in world total inward FDI flows of ASEAN indicates ASEANs attractiveness

as a destination for capital flows relative to the rest of the world. According to the

definition by UNCTAD, flows of FDI comprise capital provided (either directly orthrough other related enterprises) by a foreign direct investor to an enterprise, or capital

received from an investing enterprise by a foreign direct investor. FDI has three

components: equity capital, reinvested earnings and intra-company loans (United Nations

Conference on Trade and Development, 2007).

Share of ASEAN in world total inward FDI flows saw increases in the period 1980-97,

but had experienced sharp decline after the Asian financial crisis and despite some

recovery, still unable to reach the peak level in 1997. Excluding Singapore, ASEANs

share of world total inward FDI flows had fallen below its share of world GDP after the

financial crisis (Table 21).

4.4.1. Intra-ASEAN FDI Inflow and Freer Flow of CapitalWhen capital is freer to flow, more advanced economies within a regional bloc

can play a big role in increasing intra-regional FDI flows by setting up production

networks in neighbouring countries. Therefore, a good indicator of economic

integration in the area of investment is the share of investment coming from ASEAN

countries to the total inflows of foreign direct investment.

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Tables 22 to 24 show the Intra-ASEAN inward FDI flow and share in 2006,

total cumulative inward FDI to ASEAN10 and intra-ASEAN share by source and host

countries from 1995 to 2005. For the period from 1995 to 2005, intra-ASEAN share

of cumulative FDI inflows was 11.5% and for 2006, it was 11.9%. EU, USA and

Japan were the top 3 sources of cumulative FDI inflows during this period. Over thesame period, Laos, Myanmar and Malaysia had the largest intra-ASEAN share of

their respective FDI inflows received compared to other fellow ASEAN countries.

The findings suggest that the major investors in the region are still coming from

outside ASEAN.

4.4.2. Growth Trends of ASEAN and World Inward FDI FlowsFigure 14 shows the growth trends of ASEAN4, ASEAN5, ASEAN6b and the

world total inward FDI flows. ASEAN started to become attractive as a FDI

destination in the late 1980s. Similar to the growth trends of ASEAN trade, growth ofthe ASEAN (ASEAN5 and ASEAN6b) inward FDI flows started to pick up pace

during this period and grew at an increasing and faster pace than that of the world

after that. ASEAN inward FDI flows fell during the Asian Financial Crisis while

world total inward FDI flows continued to grow till 2000. ASEAN inward FDI flows

temporarily grew for a year in 1998-1999 and fell again and only started to grow

steeply after 2002, a year earlier than that of the world. Similar to the growth trends

in trade, the growth gap between ASEAN5 and ASEAN4 widened after the Gulf War

and throughout the period of the Asian Financial Crisis.

4.5.Share in World Total Inward FDI StockShare in world total inward FDI stock of ASEAN indicates ASEANs attractiveness

as a destination for capital stock relative to the rest of the world. According to the

definition by UNCTAD, FDI stock is the value of the share of their capital and reserves

(including retained profits) attributable to the parent enterprise, plus the net indebtedness

of affiliates to the parent enterprise (United Nations Conference on Trade and

Development, 2007).

The differences between shares of ASEAN4 and ASEAN5 to world total inward FDIstock showed the disproportionate importance of Singapore as a FDI location. Share of

ASEAN to world total inward FDI stock showed a trend of reaching a peak in 1997 and

declined thereafter (Table 25).

4.5.1. Growth Trends of ASEAN and World Inward FDI StockFigure 15 shows the growth trends of ASEAN4, ASEAN5, ASEAN6b and the

world total inward FDI stock. As observed in the growth trend of inward FDI inflows,

ASEAN (ASEAN5 and ASEAN6b) began to be an attractive investment destination

since 1990. Its inward FDI stock grew at a faster pace than that of the world sincethen, fell in 2000-2001 and recovered to grow at about the same pace as that of the

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world inward FDI stock. After the recession in 1986, ASEAN5 started to grow faster

than ASEAN4 in its inward FDI stock. ASEAN4 was more hard hit by the Asian

Financial Crisis than ASEAN5 which include Singapore, especially after 2000. Again,

Singapore was resilient to the impact of the crisis and still remained an attractive

investment destination in the 2000s.

4.5.2. Share of Total Inward FDI Stock within ASEANThe share of total inward FDI stock within ASEAN shows the relative

attractiveness of ASEAN member countries as an investment destination. The total

inward FDI stock for ASEAN10 in 1980 was US$18.9 billion (Figure 16), and the

top three countries with the largest share were Singapore (28.3%), Malaysia (27.3%),

and Indonesia (24.7%). The total stock in 2006 has increased to US$420 billion,

about 22 times the value in 1980. Singapore not only held on to the top spot with the

largest share but also increased its share to 50%. Thailand (16.2%) ranked secondwhile Malaysia (12.8%) was relegated to third place. Indonesia has shrunk its share

from 24.7% in 1980 to just 4.5% in 2006.

5. Productivity Growth Performance of ASEAN

5.1.Real GDP Per Capita, PPP TermsAs mentioned earlier and in the Technical Appendix 2, real GDP per capita is a better

gauge of economic performance, sustainable prosperity and welfare than real GDP.Technical Appendix 1 shows that real GDP per capita in PPP terms is the right indicator

for this purpose.

Table 26 compares the real GDP per capita (PPP) of ASEAN based on various

ASEAN definitions with selected groups of countries from 1980 to 2006. In general, real

GDP per capita of ASEAN as a whole seems to be relatively lower and grow at a slower

pace compared to lower middle income countries, East Asia and pacific countries and the

world.

The gap between ASEAN4 and ASEAN5 real GDP per Capita (PPP) widened overthe years, same for the gap between ASEAN and USA. The real GDP per capita (PPP) of

ASEAN4 and ASEAN5 were $2,256 and $2,321 in 1980 respectively. In 2006, the

numbers were $4,969 and $5,224 respectively. On the other hand, the real GDP per

capita (PPP) of USA in 1980 and 2006 were $22,568 and $38,165 respectively.

Real GDP Per Capita (PPP) of ASEAN5 ($5,224) & ASEAN6b ($4,827) were

overtaken by that of East Asia & Pacific countries ($5,862) in 2006 while real GDP Per

Capita (PPP) of ASEAN6b was overtaken by lower middle income countries since 1998.

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5.2.Growth Rate of Real GDP Per Capita, PPP Terms (CAGR, %)

Table 27 shows the compound annual growth rates of real GDP per capita of a

selected group of countries and country groupings. Real GDP Per Capita (PPP) growth of

ASEAN4, 5 & 6b were overtaken by that of lower middle income and India in recent

years (especially after the Asian Financial Crisis). For the period 1998 to 2006, the

growth rates of ASEAN4, ASEAN5 and ASEAN6b were 3.2%, 3.3% and 3.6%

respectively, slower than the growth rates of 4.2%, 6.4%, 3.1%, 8.5% and 5.3% for low

income, lower middle income, upper middle income countries, China and India. If

growth rates were computed inclusive of the period of the crisis, i.e., from 1997 to 2006,

ASEAN countries performed below the world average of 2.7%.

5.3.Progress Made by ASEAN Countries based on World Bank ClassificationThe progress made by ASEAN countries in raising their standard of living and

prosperity level can be analyzed by comparing over two time point whether thesecountries have moved to a higher real per capita income bracket. World Bank classifies

all World Bank member economies, and all other economies with populations of more

than 30,000 for operational and analytical purposes. Economies are divided among

income groups according to gross national income (GNI) per capita, calculated using the

World Bank Atlas method. We compared the income groupings of a selected group of

Asian, ASEAN, African and South American countries classified by World Bank

between 1987 and 2006 to highlight the progress made by ASEAN countries (Table 28 2).

Among ASEAN countries, Cambodia, Laos, Myanmar and Vietnam still remain in the

same category of low income group over the period 1987-2006. Malaysia moved from

lower middle income to upper middle income group, Philippines and Thailand remained

in lower middle income whereas Indonesia moved from low income to lower middle

income group. Singapore and Brunei remained in high income group over the same

period. The growth trends of these countries are shown in Figures 17 to 22.

5.4.Total Factor Productivity (TFP)To supplement the above analysis using real GDP per capita growth estimates, we

also examine the available estimates of total factor productivity (TFP) for ASEAN

countries. Table 29 and Figure 23 shows the TFP estimates of the 4 Asian NIEs, the 6

ASEAN countries, G7, selected Latin America countries, China and India, for the 16-year

period 1989-2005. In general, ASEAN countries had higher TFPs in 1989-1995

compared to Asian NIEs, but most had negative TFPs during 1995-2000, and at about the

same levels of the Asian NIEs from 2000-2005. In general, although a number of

ASEAN countries such as Indonesia, Malaysia and Thailand achieved some recovery in

their TFP growth over 2000-2005, this was not sufficient to compensate for their poor

TFP performance in the earlier period (1995-2000) that covered the Asian Financial

2 For details of the World Bank classification, see note in Table 28.

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Crisis, resulting in an overall weaker TFP growth over the entire period of 1995-2005

compared with the Asian NIEs.

It is noteworthy that China had consistently achieved the highest TFP estimates over

the entire period from 1989-2005 while India had achieved higher TFP estimates than

most ASEAN countries over the period 1995-2005.

5.5.Summary of ASEANs Competitiveness PerformanceIn summary, the first key finding is that, while ASEAN has increased its share of the

world economy from 1980 to 1997, it has suffered a severe downturn from 1997-1999,

and although there has been some recovery since, ASEANs share in the world economy

in 2006 was generally lower than in 1997 (Table 30).

The second related key finding is that ASEAN growth performance had slowed over

the last 10 years, both absolutely & relatively.

Growth of real GDP Per Capita (PPP) of ASEAN6 had been below that of not

only the East Asia & Pacific region, the Asian NIEs and China and India in the

last decade, but also that of low, lower middle income, and upper middle

income countries (Table 31 & 32). In fact, although growth of real GDP per

capita (PPP) of ASEAN4, 5 and 6 was slightly above world average over

1998-2006, if the period of Asian Financial Crisis is taken into account (1997-

2006), ASEAN countries performed below the world average as well (Table

32)

ASEAN countries performed relatively better on GDP growth than GDP per

capita growth when compared to the more advanced countries, because of the

relatively higher population growth in the region, as compared to the advanced

economies (Table 32)

China and India (combined) rose particularly strongly over the last 10 years

the period when ASEAN performance improvement slowed (Table 30 &

Tables 31). Indeed, by 2000, Chinas per capita real GDP PPP has already

exceeded the average of ASEAN. As pointed out by some scholars, the global

trading system is not a zero-sum game, in that the decline in the market shareof ASEAN exports of finished products to developed countries can being

compensated by the increase in the exports of ASEAN components to China

as it emerged to become the global production base for a wide range of

manufactured goods (Ravenhill, 2006; Liu & Luo, 2004). Indeed, the growing

importance of China to ASEAN can be seen from the fact that ASEAN has

become the 5th largest export markets for China and 4th largest import

suppliers of China in 2006 (Table 33). Moreover, China was ranked by

Indonesia, Malaysia, Singapore and Thailand as one of their top 5 export

markets and import source countries in 2006 (Table 34). The above

observations notwithstanding, it remains true that the rapid rise of China and

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India in the last decade has certainly reduced the relative share of ASEAN in

the world economy; in particular, the declining share of ASEAN in global

inward FDI has been largely due to the rapid rise of China (and more recently

India) as a FDI destination.

The third key finding is that ASEAN member nations not only remain quite diverse in

terms of income level (according to World Banks classification using 2006 Gross

National Income per capita, see Table 28), but their GDP per capita growth performance

had also been very diverse. Indeed, diversity in performance had been observed even

among member countries within the same income group. For example, Vietnam has

performed much better than Indonesia in recent years, while Malaysia and Thailand had

continued to perform better than Philippines since 2000, despite suffering more severe

downturns in 1997-99 than the latter. Overall, Indonesia seems to be the laggard in

ASEAN in terms of growth of real GDP per capita in the last decade, although

Philippines grew the least over the last 3 decades.

6. Competitiveness Determinants of ASEAN6.1.Summary of Competitiveness Determinants of ASEAN

Figures 24 to 29 show the selected competitiveness determinants of ASEAN using

the dimensions of determinants as reported by Global Competitiveness Index (GCI) (9

pillars in 2006-2007; 12 pillars in 2007-2008 normalised to 9 pillars), which were

introduced by the Global Competitiveness Report since 2006. The following key findings

can be highlighted:

From 2005-2007, ASEAN countries did not make much progress in improving the

fundamentals vital for their competitiveness, in fact, there was a decline in the health

and primary education category (consists of indicators such as business impact of

malaria, tuberculosis, HIV/AIDS, incidence/prevalence of these 3 diseases, infant

mortality, life expectancy, quality of primary education, primary enrolment and

education expenditure)

On average, ASEAN as a whole was particularly lagging behind in institutions,

infrastructure, higher education & training, technology readiness and innovationcompared to high income countries

Overall, there seems to be a close correlation between the level of GDP per capita and

the scores of most competitiveness determinants. High income ASEAN country

Singapore has higher determinant levels than the middle and lower income countries

in virtually all dimensions, but particularly so in terms of infrastructures,

technological readiness, institutions and innovations. Middle income countries score

better than lower income countries in most dimensions, particularly infrastructure,

institutions, and technological readiness.

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Of the three middle income ASEAN countries, Thailand and Malaysia seem to have

higher scores on most dimensions compared to selected reference countries in the

same income group (Brazil, Mexico, South Africa), but Philippines seem to have

levels comparable to Indonesia and Vietnam in the lower income group

For lower income ASEAN countries (Vietnam and Indonesia), the level of

infrastructure, macroeconomic stability and business sophistication seem to be below

those of selected reference countries in the same income group (China, India)

While the GCI 9 (12) competitiveness pillars framework represents a comprehensive

conceptual model for categorizing the various factors that influence competitive performance,

it does suffered from a lack of comparable data in earlier years before 2005, making it

difficult to examine how ASEAN competitiveness determinants have changed over the last

decade. Moreover, many of the actual measures for the various GCI sub-indices used were

not based on objective measures, or were not sufficiently comprehensive in their coverage.

In view of this, future research may need to examine other sources of data to identify

more objective and more refined measures for some of the relatively weak measures currently

used in GCI framework. For example, the GCI indices for market efficiency and institution

could be supplemented with more detailed information from World Banks annual Cost of

Doing Business survey, which provides much more disaggregated measures of the various

dimensions of market transaction costs and regulatory costs. As can be seen from Tables 35

and 36; Figures 30 and 31, there appears to be much greater variations in cost of doing

business among the ASEAN countries based on the World Banks Cost of Doing Business

ranking of countries than is suggested by the GCR scores of market efficiency and institutionpillars; in particular, while there are little variations between Vietnam, Philippines and

Indonesia in the score of market efficiency and institution pillars of GCR, World Banks Cost

of Doing Business data suggest that Vietnam scores much higher than Philippines and

Indonesia in ease of doing business (Tables 35 and 36; Figures 30 and 31). Similarly,

while the GCR score for innovation capacity does show some differences between the middle

and lower income ASEAN countries versus Singapore, an analysis of S&T performance

using more objective indicators like scientific publications and patent outputs shows much

higher disparity in performance between the high, middle and lower income ASEAN

countries (Table 37), and even higher disparity when comparing the middle and lower

ASEAN countries with the Asian NIEs of Taiwan, Korea and Hong Kong.

7. ConclusionsASEAN has been considered one of the most successful regional groupings in the world

since its inception in 1967 to the mid 1990s. Over the period 1980-97, ASEAN achieved

higher economic growth than virtually any other region in the world. However, economic

realities have dramatically changed in the past 10 years with the onset of the Asian Financial

Crisis in 1997 and the emergence of China and India as economic powerhouse in Asia since

the mid-1990s. After experiencing a sharp decline in economic performance over 1997-98 as

a result of the Asian Financial Crisis, ASEAN as a group did rebound somewhat in the

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ensuing period, but had never quite recovered its former competitiveness position in the

world economy. Not only had ASEANs share of world GDP, trade and inward direct

foreign investment (FDI) declined between 1997 and 2006, ASEANs productivity growth,

as measured by the growth of real GDP PPP per capita in the 1997-2006 period had declined

both absolutely (when compared to the earlier period of 1980-97) and relatively (whencompared to the average for all low and middle-income economies). In particular, ASEANs

declining competitiveness performance in the decade after the 1997 Asian financial crisis

stands in strong contrast with the rapid increase in world market share and growth in

productivity of China and India.

Significant variations are also found among the individual ASEAN member countries in

terms of competitiveness performance. In particular, among the low income countries,

Vietnam had achieved significant catching up in the last decade, while Indonesia had

performed less well. Despite being already a high-income country, Singapore had

outperformed Thailand and Malaysia in the last decade. The variations in competitivenessperformance among the ASEAN member countries appear to correlate with systematic

variations in the underlying determinants of competitiveness as captured by the GCI nine-

pillar framework as well as by other data sources.

As Asia entered the 21st century, the global media had rightly highlighted the last decade

of the 20th century as the lost decade for the largest economy in Asia Japan. Although

less obvious, it may well be that future economic historians will refer to the decade after the

1997 Financial Crisis as the lost decade for ASEAN. Yes, ASEAN did recover from the

financial crisis and achieved moderate economic growth during that decade. And yes, the

rise of the two Asian mega-economies -- China and India -- has contributed significantly tothe relative decline of ASEAN in the expanding global economic pie. But virtually all

economists would agree that the slow pace of economic integration and liberalization among

the ASEAN member states has been an important contributing factor in the above observed

erosion of the competitive positioning of ASEAN in the world economy. Throughout the

last decade, intra-ASEAN trade had been at or below one-quarter of total ASEAN trade,

much less than in the case of the European Union (about two-thirds among EU25) and

NAFTA (over 40%). As global competition continues to intensify, we can only hope that

ASEAN will make up for lost time by speeding up the economic integration process in the

next decade.

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References

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Edition, 2005. Retrieved from ASEAN Secretariat web site:

http://www.aseansec.org/18177.htm

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Maddison, A. (2001). The World Economy: A Millennial Perspective. Paris: Development

Centre, OECD.

McKinsey & Company. (2003). ASEAN Competitiveness Study. McKinsey & Company.

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Porter, M. (2006). Building The Microeconomic Foundations of Prosperity. In A. Lopez-

Claros, M. Porter, X. Sala-i-Martin, & K. Schwab, The Global Competitiveness Report 2006-

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Martin, & K. Schwab, The Global Competitiveness Report 2006-2007. World EconomicForum.

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TABLES

Table 1 - Dimensions of Determinants of Competitiveness by GCI

Overall GCI for 2005/06, 2006/07 versions: Overall GCI for 2007/08 version:

Basic Requirements subindex (pillars 1 to 4) Basic Requirements subindex (pillars 1 to 4)

1st pillar: Institutions 1st pillar: Institutions

2nd pillar: Infrastructure 2nd pillar: Infrastructure

3rd pillar: Macroeconomy 3rd pillar: Macroeconomic stability

4th pillar: Health and primary education 4th pillar: Health and primary education

Efficiency Enhancers subindex (pillars 5 to 7) Efficiency Enhancers subindex (pillars 5 to 10)

5th pillar: Higher education and training 5th pillar: Higher education and training6th pillar: Market efficiency 6th pillar: Goods Market efficiency

7th pillar: Technological readiness 7th pillar: Labour Market efficiency

Innovation Factors subindex (pillars 8 to 9) 8th pillar: Financial market sophistication

8th pillar: Business sophistication 9th pillar: Technological readiness

9th pillar: Innovation 10th pillar: Market size

Innovation and Sophistication subindex (pillars 11 to12)

11th pillar: Business sophistication

12th pillar: Innovation

Source: Global Competitiveness Report 2006, 2007 & 2008

Table 2 ASEAN Total Population and Share in World Population

Total Population (millions) 1980 1990 1997 1998 2000 2006

ASEAN4 256.5 311.8 350.6 355.9 366.5 398.1

ASEAN5 258.9 314.9 354.4 359.8 370.5 402.5

ASEAN6a 259.1 315.1 354.7 360.1 370.8 402.9

ASEAN6b 312.6 381.1 429.8 436.3 448.1 486.6

ASEAN10 356.2 435.9 492.9 500.4 514.1 558.1Share in World Population (%)

ASEAN4 5.8% 5.9% 6.0% 6.0% 6.0% 6.1%

ASEAN5 5.8% 6.0% 6.1% 6.1% 6.1% 6.2%

ASEAN6a 5.9% 6.0% 6.1% 6.1% 6.1% 6.2%

ASEAN6b 7.1% 7.3% 7.4% 7.4% 7.4% 7.5%

ASEAN10 8.0% 8.3% 8.5% 8.5% 8.5% 8.6%

Source: World Bank World Development Indicators Online

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Table 3 - Compound Annual Growth Rate of Total Population, %ASEAN10 World

1980-2006 1.7 1.5

1980-1990 2.0 1.7

1990-1997 1.8 1.5

1997-1998 1.5 1.5

1998-2006 1.4 1.2

Note: ASEAN4, 5, 6a & 6b grew at the same rates as ASEAN10 in all the periods except 1990-1997 in which all grew at 1.7%Source: World Bank World Development Indicators Online

Table 4 - Population Share in ASEAN Countries, Various YearsCountry Name 1980 1990 1997 1998 2000 2006

Brunei Darussalam 0.05% 0.06% 0.06% 0.06% 0.06% 0.07%

Cambodia 1.86% 2.23% 2.42% 2.44% 2.48% 2.57%

Indonesia 41.64% 40.89% 40.21% 40.14% 40.12% 39.97%

Lao PDR 0.87% 0.94% 1.00% 1.00% 1.02% 1.03%

Malaysia 3.86% 4.09% 4.35% 4.39% 4.47% 4.62%

Myanmar 9.46% 9.35% 9.30% 9.29% 9.28% 9.13%

Philippines 13.50% 14.02% 14.48% 14.55% 14.74% 15.16%

Singapore 0.68% 0.70% 0.77% 0.78% 0.78% 0.79%

Thailand 13.01% 12.53% 12.10% 12.04% 11.95% 11.60%

Vietnam 15.08% 15.19% 15.31% 15.29% 15.10% 15.07%


Table 5 ASEAN Total GDP and Share in PPP and Constant 2000 International $

Terms

Total GDP ($million) 1980 1990 1997 1998 2000 2006

ASEAN4 578,559 973,044 1,513,617 1,371,127 1,490,307 1,978,451

ASEAN5 600,876 1,018,707 1,595,081 1,451,470 1,585,101 2,102,803

ASEAN6b - 1,095,006 1,728,916 1,593,020 1,743,474 2,348,806

ASEAN10 600,876 1,099,331 1,752,874 1,618,099 1,773,485 2,398,137Share in World GDP (%)

ASEAN4 2.4% 2.9% 3.7% 3.3% 3.3% 3.4%

ASEAN5 2.5% 3.1% 3.9% 3.5% 3.5% 3.6%

ASEAN6b - 3.3% 4.2% 3.8% 3.8% 4.1%

ASEAN10 2.5% 3.3% 4.3% 3.9% 3.9% 4.2%

* GDP figures are in PPP terms at constant 2000 international $, million; no data for Brunei


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Table 6 ASEAN Total GDP and Share in PPP and Current International $ Terms

Total GDP ($ million) 1980 1990 1997 1998 2000 2006

ASEAN4 332,419 818,802 1,472,173 1,347,639 1,520,733 2,354,107

ASEAN5 344,722 856,804 1,551,457 1,426,698 1,617,425 2,501,962

ASEAN6a - 861,488 1,557,942 1,433,219 1,624,589 2,511,691

ASEAN6b 368,008 919,020 1,678,960 1,563,046 1,775,558 2,788,352

ASEAN10 382,323 959,350 1,748,288 1,636,510 1,868,547 2,989,544

Share in World GDP (%)

ASEAN4 2.8% 3.3% 3.8% 3.4% 3.4% 3.5%

ASEAN5 2.9% 3.4% 4.0% 3.6% 3.6% 3.7%

ASEAN6a - 3.5% 4.0% 3.6% 3.6% 3.7%

ASEAN6b 3.1% 3.7% 4.3% 3.9% 3.9% 4.1%

ASEAN10 3.2% 3.9% 4.5% 4.1% 4.1% 4.4%

* GDP figures are in PPP (current international $, million)

Source: International Monetary Fund World Economic Outlook Database, October 2007

Table 7 ASEAN Total Trade and Share in World Trade

Total Trade (US$ billion) 1980 1990 1997 1998 2000 2006

ASEAN4 86.3 183.5 449.1 375.6 497.0 833.6

ASEAN5 129.7 297.0 706.5 587.2 769.3 1,344.1

ASEAN6a 134.8 300.2 711.2 590.8 774.3 1,353.5

ASEAN6b 131.3 302.2 727.3 608.1 799.5 1,428.1

ASEAN10 137.6 306.5 737.8 618.4 812.7 1,454.8

Share in World Trade (%)

ASEAN4 2.1% 2.6% 4.0% 3.4% 3.8% 3.4%

ASEAN5 3.2% 4.2% 6.2% 5.3% 5.8% 5.5%

ASEAN6a 3.3% 4.3% 6.3% 5.3% 5.9% 5.5%

ASEAN6b 3.2% 4.3% 6.4% 5.4% 6.1% 5.8%

ASEAN10 3.3% 4.4% 6.5% 5.5% 6.2% 5.9%

Source: World Trade Organisation

Table 8 - Share in World Total Trade by Regional Integration Arrangement (%)

1980 1990 1997 1998 2000 2006

ASEAN (Association of South East Asian Nations) 3.3 4.4 6.5 5.5 6.2 5.9

European Union (15) 77.9 43.8 37.3 39.8 35.8 -

European Union (25) - - - - 37.9 37.9

MERCOSUR (Southern Common Market) 1.6 1.1 1.6 1.6 1.3 1.3

NAFTA (North American Free Trade Agreement) 15.9 17.6 19.6 20.4 22.0 17.2

Notes:(1) Data for European Union (15) is from 1990-2003; data for European Union (25) is from 1999-2006

(2) EU-25 includes Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary,

Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal,Slovakia, Slovenia, Spain, Sweden, and

United Kingdom.

EU-15 refers to the 15 countries in the European Union before the expansion on 1 May 2004. They are: Austria, Belgium,

Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, and United

Kingdom.

(3) NAFTA (North American Free Trade Agreement) includes USA, Canada and Mexico.

(4) MERCOSUR (Southern Common Market) includes Argentina, Brazil, Paraguay and Uruguay.

(5) Data for ASEAN includes data of all 10 member countries for all years


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Table 9 Top Ten ASEAN Trade Partner, 2006

value in US$ million;share in percent

Value Share to total ASEAN tradeTrade partner country/region1/

Exports Imports Total trade Exports Imports Total trade

ASEAN 189,176.8 163,594.5 352,771.4 25.2 25.0 25.1

Japan 81,284.9 80,495.6 161,780.5 10.8 12.3 11.5USA 96,943.5 64,252.5 161,196.0 12.9 9.8 11.5European Union-25 94,471.8 66,118.1 160,589.9 12.6 10.1 11.4China 65,010.3 74,950.9 139,961.2 8.7 11.5 10.0Republic of Korea 25,670.0 26,849.7 52,519.6 3.4 4.1 3.7Australia 23,148.5 13,262.8 36,411.4 3.1 2.0 2.6India 18,928.1 9,774.6 28,702.7 2.5 1.5 2.0Taiwan 9,032.0 12,876.9 21,908.9 1.2 2.0 1.6Hong Kong, SAR 13,784.0 6,409.0 20,193.0 1.8 1.0 1.4

Total top ten trade partnercountries 617,449.9 518,584.6 1,136,034.6 82.2 79.3 80.9

Others2/ 133,257.9 135,513.2 268,771.1 17.8 20.7 19.1

Total 750,707.8 654,097.8 1,404,805.7 100.0 100.0 100.0

Source: ASEAN Trade Database (compiled from data submission and/or websites of ASEAN Member Countries' national statisticaloffices and other relevant government agencies)

Notes- not available as of publication timex not available/not compiledSome figures may not sum up to totals due to rounding off errors.

1/ includes Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy,Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and United Kingdom

2/ includes trade of all other countries and those that could not be attributed to specific countries

Table 10 Top Ten Export Markets and Import Origins, 2006

value in US$ million; share in percent

Export market Import origin

Country of destination1/Value ofexports

Share tototal

Country of origin1/ Value of Imports Share to total

ASEAN 189,176.8 25.2 ASEAN 163,594.5 25.0USA 96,943.5 12.9 Japan 80,495.6 12.3European Union-25 94,471.8 12.6 China 74,950.9 11.5Japan 81,284.9 10.8 European Union-25 66,118.1 10.1China 65,010.3 8.7 USA 64,252.5 9.8Republic of Korea 25,670.0 3.4 Republic of Korea 26,849.7 4.1Australia 23,148.5 3.1 Australia 13,262.8 2.0India 18,928.1 2.5 Taiwan 12,876.9 2.0Hong Kong, SAR 13,784.0 1.8 India 9,774.6 1.5United Arab Emirates 11,889.2 1.6 Saudi Arabia 8,600.4 1.3

Total top ten destinationcountries 620,307.1 82.6 Total top ten origin countries 520,776.0 79.6

Others2/ 130,400.7 17.4 Others2/ 133,321.8 20.4

Total 750,707.8 100.0 Total 654,097.8 100.0Source: ASEAN Trade Database (compiled from data submission and/or websites of ASEAN Member Countries' national statisticaloffices and other relevant government agencies)

Notes1/ identified/ranked based on share of total ASEAN exports/imports

2/ includes trade of all other countries and those that could not be attributed to specific countries

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Table 11 - Top Ten ASEAN Trade Commodity Groups, 1998


Commodity group1/ Value Share to total ASEAN trade

2-digit HScode Description Exports Imports Total trade Exports Imports Total trade

85 Electric machinery, equipment andparts; sound equipment; televisionequipment

66,020.8 60,518.8 126,539.6 28.5 32.4 30.2

84 Nuclear reactors, boilers, machineryand mechanical appliances; partsthereof

51,130.8 37,643.0 88,773.9 22.0 20.1 21.2

27 Mineral fuels, mineral oils & productsof their distillation; bituminsubstances; mineral wax

22,155.5 12,649.1 34,804.6 9.5 6.8 8.3

90 Optical, photographic,cinematographic, measuring,checking, precision, medical orsurgical instruments/apparatus; parts& accessories

3,832.4 4,970.8 8,803.2 1.7 2.7 2.1

39 Plastics and articles thereof 4,012.1 4,263.9 8,276.0 1.7 2.3 2.029 Organic chemicals 3,887.4 4,164.5 8,051.9 1.7 2.2 1.915 Animal/veg fats & oils & their

cleavage products; prepared ediblefats; animal or vegetable waxes

6,783.6 589.5 7,373.1 2.9 0.3 1.8

71 Natural or cultured pearls, precious orsemiprecious stones, precious metalsand metals clad therewith and articlesthereof; imitation jewelry; coin

5,191.8 1,929.8 7,121.7 2.2 1.0 1.7

44 Wood and articles of wood; woodcharcoal

6,077.0 527.0 6,604.0 2.6 0.3 1.6

88 Aircraft, spacecraft, and parts thereof 1,781.3 4,575.3 6,356.6 0.8 2.4 1.5

Total top ten commodity groups 170,872.7 131,831.8 302,704.5 73.6 70.6 72.3

Others 61,134.0 54,996.0 116,130.0 26.4 29.4 27.7

Total 232,006.7 186,827.8 418,834.5 100.0 100.0 100.0

Source: The World Integrated Trade Solution (WITS), The World Bank

Note: 1/ identified based on the share of the 2-digit classification (section) of the Harmonized System (HS) to total trade in 1998

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Table 12 Top Ten ASEAN Trade Commodity Groups, 2006

value in US$ million;share in percent

Commodity group1/ Value Share to total ASEAN trade

2-digit HS code Description Exports Imports Total trade Exports ImportsTotaltrade


206,841.9 180,657.7 387,499.727.6 27.6 27.6

27 Mineral fuels, mineral oils & productsof their distillation; bituminsubstances; mineral wax

107,023.4 117,054.4 224,077.714.3 17.9 16.0


117,666.8 94,076.9 211,743.7 15.7 14.4 15.1

39 Plastics and articles thereof20,611.6 17,709.3

38,320.9 2.7 2.7 2.7

29 Organic chemicals20,942.0 15,185.9

36,127.9 2.8 2.3 2.6

87 Vehicles, (not railway, tramway,rolling stock); parts and accessories 17,045.6 16,235.3

33,280.9 2.3 2.5 2.4

90 Optical, photographic,

cinematographic, measuring,checking, precision, medical orsurgical instruments/apparatus; parts& accessories

14,319.3 15,873.4

30,192.7 1.9 2.4 2.1

72 Iron and steel6,199.3 20,141.2

26,340.6 0.8 3.1 1.9

40 Rubber and articles thereof21,194.7 5,125.4

26,320.1 2.8 0.8 1.9

71 Natural or cultured pearls, precious orsemiprecious stones, precious metalsand metals clad therewith and articlesthereof; imitation jewelry; coin

9,566.5 10,266.319,832.8 1.3 1.6 1.4

Total top ten commodity groups 541,411.1 492,325.8 1,033,737.072.1 75.3 73.6

Others2/ 209,296.7 161,772.0 371,068.727.9 24.7 26.4

Total 750,707.8 654,097.8 1,404,805.7 100.0 100.0 100.0Source: ASEAN Trade Database (compiled from data submission and/or websites of ASEAN Member Countries' national statistical

offices and other relevant government agencies)Notes

- not available as of publication timex not available/not compiled

Some figures may not sum up to totals due to rounding off errors.1/ identified based on the share of the 2-digit classification (section) of the Harmonized System (HS) to total trade in 2006

2/ include products with unspecified codes and/or products that could not be explicitly classified according to the current HS

Table 13 - Share in ASEAN total trade

1980 1990 1997 1998 2000 2006

ASEAN4 62.7 59.9 60.9 60.7 61.2 57.3

ASEAN5 94.2 96.9 95.8 95.0 94.7 92.4

ASEAN6a 98.0 98.0 96.4 95.5 95.3 93.0

ASEAN6b 95.4 98.6 98.6 98.3 98.4 98.2


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Table 14 Intra-ASEAN Import, Export and Trade Statistics (US$ million)

Value (US$ million)

1990 1997 1998 2000 2006

Intra-ASEAN export 28,954 88,189 72,592 103,548 193,385

Intra-ASEAN import 26,309 76,253 64,464 89,488 158,192

Intra-ASEAN trade 55,263 164,442 137,056 193,036 351,577

ASEAN total export 144,149 355,900 331,106 432,027 769,991

ASEAN total import 162,328 381,869 287,264 380,674 684,855

ASEAN total trade 306,477 737,769 618,370 812,701 1,454,846

Note: ASEAN data includes all 10 ASEAN member countries for all years; For 2006, ASEAN total trade figure of US$1,454.8 billion

from World Trade Organisation (WTO) differs from the ASEAN Trade Database figure shown in Table 12 of US$1,404.8 billion. The

WTO ASEAN trade figures will be used in Tables 15, 16, 17 & 18 for aggregate-level comparisons of trade performance.

Sources: World Trade Organisation

Table 15 Intra-ASEAN Import, Export and Trade Share Statistics (%)

Share (%)1990 1997 1998 2000 2006

Share of Intra-ASEAN export toASEAN total export

20.1 24.8 21.9 24.0 25.1

Share of Intra-ASEAN import toASEAN total import

16.2 20.0 22.4 23.5 23.1

Share of Intra-ASEAN trade toASEAN total trade

18.0 22.3 22.2 23.8 24.2

Share of Intra-ASEAN trade toextra-ASEAN trade

22.0 28.7 28.5 31.2 31.9

Note: ASEAN data includes all 10 ASEAN member countries for all years


Table 16 - Intra-Regional Trade as a Percentage of Total Trade by Regional Integration

Arrangement (%)

1990 1997 1998 2000 2006

ASEAN (Association of South East AsianNations)

18.0 22.3 22.2 23.8 24.2

European Union (15) 63.9 62.6 63.6 61.4 -

European Union (25) - - - 65.7 65.7

MERCOSUR (Southern Common Market) 11.1 22.6 22.9 20.3 15.8

NAFTA (North American Free Trade Agreement) 38.2 43.9 45.1 46.4 41.8

Notes:(1) Data for European Union (15) is from 1990-2003; data for European Union (25) is from 1999-2006

(2) EU-25 includes Austria, Belgium, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary,

Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal,Slovakia, Slovenia, Spain, Sweden, and

United Kingdom.

EU-15 refers to the 15 countries in the European Union before the expansion on 1 May 2004. They are: Austria, Belgium,

Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Sweden, and United

Kingdom.

(3) NAFTA (North American Free Trade Agreement) includes USA, Canada and Mexico.

(4) MERCOSUR (Southern Common Market) includes Argentina, Brazil, Paraguay and Uruguay.

(5) Data for ASEAN includes data of all 10 member countries for all years

(6) McKinsey report (McKinsey & Company, 2003) showed that although total ASEAN trade has grown, intra-ASEAN trade as a

percentage of total ASEAN trade has declined from 26% to 21% from 1994 to 2001. They were referring to ASEAN5 of

Singapore, Malaysia, Thailand, Indonesia and Philippines, and not ASEAN10 as a whole.


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Table 17 Intra-ASEAN Import, Export and Trade Share Growth Rates (%)

Compound Annual Growth Rate (%)

1990-1997 1997-1998 1998-2000 2000-2006

Share of Intra-ASEAN export to ASEAN

total export

3.0 -11.5 4.6 0.8

Share of Intra-ASEAN import to ASEANtotal import

3.0 12.4 2.3 -0.3

Share of Intra-ASEAN trade to ASEANtotal trade

3.1 -0.6 3.5 0.3

Share of Intra-ASEAN trade to extra-ASEAN trade

3.9 -0.7 4.6 0.4

Intra-ASEAN trade 16.9 -16.7 18.7 10.5Note: ASEAN data includes all 10 ASEAN member countries for all years


Table 18 Share of Intra-ASEAN trade to ASEAN total GDP (%)

1990 1997 1998 2000 2006Intra-ASEAN trade (US$ mil) 55,263 164,442 137,056 193,036 351,577

ASEAN Total GDP (US$ mil) 350,944 710,890 480,541 598,685 1,065,627

Intra-ASEAN trade to ASEANtotal GDP (%)

15.7 23.1 28.5 32.2 33.0

Note: ASEAN data includes all 10 ASEAN member countries for all years


Table 19 - Top 10 Intra-ASEAN Trade Commodity Groups, 1998


Commodity group Value Share to total Intra-ASEAN trade

2-digit HS

code

Description Exports Imports Total trade Exports Imports Total trade


19,786.5 16,655.9 36,442.4 37.0 40.1 38.4


8,702.0 8,158.8 16,860.7 16.3 19.7 17.7

27 Mineral fuels, mineral oils &products of their distillation;bitumin substances; mineral wax

4,335.7 3,817.1 8,152.8 8.1 9.2 8.6

71 Natural or cultured pearls, preciousor semiprecious stones, preciousmetals and metals clad therewithand articles thereof; imitationjewelry; coin

2,049.3 425.9 2,475.2 3.8 1.0 2.6

39 Plastics and articles thereof 1,416.6 867.8 2,284.4 2.6 2.1 2.4

29 Organic chemicals 967.7 605.6 1,573.3 1.8 1.5 1.773 Articles of iron or steel. 767.0 503.6 1,270.6 1.4 1.2 1.390 Optical, photographic,

cinematographic, measuring,checking, precision, medical orsurgical instruments/apparatus; parts& accessories

798.7 408.0 1,206.7 1.5 1.0 1.3

15 Animal/veg fats & oils & theircleavage products; prepared ediblefats; animal or vegetable waxes

827.9 375.7 1,203.6 1.5 0.9 1.3

10 Cereals 63.9 1,000.4 1,064.2 0.1 2.4 1.1


Others 13,806.0 8,669.4 22,475.4 25.8 20.9 23.7

Total 53,521.4 41,488.2 95,009.5 100.0 100.0 100.0


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Table 20 - Top 10 Intra-ASEAN Trade Commodity Groups, 2006


Commodity group Value Share to total Intra-ASEAN trade

2-digit HScode

Description Exports Imports Total trade Exports Imports Total trade


54,323.1 42,697.6 97,020.7 29.9 28.7 29.4

27 Mineral fuels, mineral oils &products of their distillation; bituminsubstances; mineral wax

31,744.5 35,539.5 67,284.0 17.5 23.9 20.4


28,902.8 20,140.1 49,042.9 15.9 13.6 14.9

39 Plastics and articles thereof 6,287.8 4,393.4 10,681.3 3.5 3.0 3.229 Organic chemicals 5,137.8 4,377.1 9,514.9 2.8 2.9 2.987 Vehicles other than railway,tramway,

roll-stock; parts and accessories4,954.9 4,013.3 8,968.2 2.7 2.7 2.7

73 Articles of iron or steel. 3,685.8 1,968.8 5,654.5 2.0 1.3 1.790 Optical, photographic,

cinematographic, measuring,checking, precision, medical or

surgical instruments/apparatus; parts& accessories

3,548.0 2,044.5 5,592.5 2.0 1.4 1.7

74 Copper and articles thereof 2,635.9 2,530.3 5,166.1 1.5 1.7 1.640 Rubber and articles thereof 2,869.3 1,715.9 4,585.2 1.6 1.2 1.4


Others 37,457.0 29,145.4 66,602.3 20.6 19.6 20.2

Total 181,546.8 148,565.9 330,112.8 100.0 100.0 100.0


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Table 21 ASEAN Total Inward FDI Flows and Share of World Total

Total Inward FDI flows (US$ mil) 1980 1990 1997 1998 2000 2006

ASEAN4 1,537 6,828 16,132 11,717 4,827 23,711

ASEAN5 2,773 12,403 29,885 19,031 21,311 47,918

ASEAN6a 2,753 12,410 30,586 19,604 21,860 48,352

ASEAN6b 2,774 12,583 32,472 20,731 22,600 50,233

ASEAN10 2,756 12,821 34,307 22,276 23,540 51,480

Share of World Total Inward FDI flows (%)

ASEAN4 2.8% 3.4% 3.3% 1.7% 0.3% 1.8%

ASEAN5 5.0% 6.2% 6.1% 2.7% 1.5% 3.7%

ASEAN6a 5.0% 6.2% 6.3% 2.8% 1.5% 3.7%

ASEAN6b 5.0% 6.2% 6.6% 2.9% 1.6% 3.8%

ASEAN10 5.0% 6.4% 7.0% 3.1% 1.7% 3.9%

Source: UNCTAD World Investment Report, 2007

Table 22 Intra-ASEAN FDI Net Inflow, 2006

2006

Intra-ASEAN FDI net inflow 6,242

Extra-ASEAN FDI netinflow

46,137

Total net inflow of ASEAN 52,380

Intra-ASEAN FDI share to

total net inflow of ASEAN

11.9%

Note: value in US$million; share in %

Source: ASEAN Foreign Direct Investments Database, ASEAN Secretariat

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Table 23 - Top Sources of ASEAN Foreign Direct Investments Cumulative Inflow, 1995

- 2005 (US$ million)

Total Cumulative Inward FDIto ASEAN10 by Source

Country, 1995-2005SOURCE

COUNTRYValue (US$ mil) % of Total

European Union 79,052.66 27.8%

USA 48,963.65 17.2%

Japan 34,384.17 12.1%

ASEAN 32,757.97 11.5%

Singapore 19,585.93 6.9%

Malaysia 6,356.37 2.2%

Indonesia 3,921.78 1.4%

Thailand1,725.05 0.6%

Philippines 497.98 0.2%

Brunei Darussalam 472.96 0.2%

Viet Nam 101.37 0.0%

Myanmar 62.03 0.0%

Cambodia 22.41 0.0%

Lao PDR 12.08 0.0%

ANIEs 20,230.59 7.1%

Republic of Korea 4,176.03 1.5%

Taiwan (ROC) 8,352.36 2.9%

Hong Kong 7,702.19 2.7%China 2,046.14 0.7%

India 1,122.78 0.4%

OTHERS 65,680.20 23.1%

TOTAL 284,238.16 100.0%Source: ASEAN Secretariat - ASEAN FDI Database, 2006

Table 24 - Intra-ASEAN Share of foreign Direct Investments Inflows Received by Each

ASEAN10 Host Country, 1995-2005 (%)

HOST COUNTRY

BruneiDarussalam

Cambodia IndonesiaLaoPDR

Malaysia Myanmar Philippines Singapore ThailandVietNam

SOURCE

Intra-ASEAN 15.8% 10.7% 17.4% 50.3% 19.2% 26.3% 9.6% 5.8% 17.4% 17.0%

Extra-ASEAN 84.2% 89.3% 82.6% 49.7% 80.8% 73.7% 90.4% 94.2% 82.6% 83.0%

TOTAL 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Source: ASEAN Secretariat - ASEAN FDI Database, 2006

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Table 25 ASEAN Total Inward FDI Stocks and Share of World Total

Total Inward FDI stocks (US$ mil) 1980 1990 1997 1998 2000 2006

ASEAN4 12,110 30,683 95,539 111,045 120,252 157,808

ASEAN5 17,460 61,151 170,308 197,885 232,885 367,897

ASEAN6a 17,479 61,184 172,306 200,456 236,753 377,758

ASEAN6b 18,876 62,800 183,589 213,532 253,480 401,349

ASEAN10 18,936 63,165 189,638 221,126 263,349 420,025

Share of World Total Inward FDI stocks (%)

ASEAN4 2.2% 1.7% 2.7% 2.7% 2.1% 1.3%

ASEAN5 3.2% 3.4% 4.8% 4.7% 4.0% 3.1%

ASEAN6a 3.2% 3.4% 4.9% 4.8% 4.1% 3.1%

ASEAN6b 3.4% 3.5% 5.2% 5.1% 4.4% 3.3%

ASEAN10 3.4% 3.6% 5.4% 5.3% 4.5% 3.5%

Source: UNCTAD World Investment Report, 2007

Table 26 Real GDP Per Capita, PPP Terms

1980 1990 1997 1998 2000 2006

ASEAN4 2,256 3,121 4,318 3,853 4,067 4,969

ASEAN5 2,321 3,235 4,501 4,034 4,278 5,224

ASEAN6b - 2,874 4,022 3,651 3,891 4,827

USA 22,568 28,263 31,716 32,671 34,599 38,165

Low income countries 1,124 1,402 1,645 1,694 1,794 2,359

Lower middle income countries 1,753 2,542 3,607 3,683 4,050 6,066

Upper middle income countries 7,784 7,833 7,611 7,524 7,911 9,625

High income countries 17,921 22,456 25,167 25,623 27,127 29,911

East Asia & Pacific countries 1,045 1,857 3,273 3,336 3,750 5,862

World 5,443 6,324 6,994 7,071 7,474 8,862

*GDP per capita were expressed in PPP and constant 2000 international $ terms; no data for Brunei

Note:

World Bank classifies all World Bank member economies, and all other economies with populations of more than 30,000. For operational

and analytical purposes, economies are divided among income groups according to 2006 gross national income (GNI) per capita, calculated

using the World Bank Atlas method. The groups are: low income, $905 or less; lower middle income, $9063,595; upper middle income,

$3,59611,115; and high income, $11,116 or more. Other analytical groups based on geographic regions are also used. Income

classifications are in effect until 1 July 2008. Taiwan data is not available.

Because GNI per capita changes over time, the country composition of income groups may change from one edition of World DevelopmentIndicators to the next. Once the classification is fixed for an edition, based on GNI per capita in the most recent year for which data are

available (2006 in this edition), all historical data presented are based on the same country grouping.

According to World Bank, in ASEAN, low income countries include Cambodia, Laos, Myanmar, Vietnam; lower middle income countries

include Indonesia, Philippines and Thailand; Malaysia is being classified as a upper middle income country; High income countries include

Singapore and Brunei.

China is being classified as a lower middle income country whereas India is being classified as a low income country.

All the ASEAN countries are classified as East Asia & Pacific countries except Singapore and Brunei which are unclassified by Region.

China is being classified as an East Asia & Pacific country whereas India is being classified as a South Asia country. OECD countries are

being classified as high income countries.


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Table 27 - Growth Rate of Real GDP per capita, PPP Terms (CAGR, %)

Compound AnnualGrowth Rates of RealGDP per capita (PPP)

1980-1990 1990-1997 1997-1998 1998-2006 1997-2006

ASEAN4 3.3 4.7 -10.8 3.2 1.6

ASEAN5 3.4 4.8 -10.4 3.3 1.7ASEAN6b - 4.9 -9.2 3.6 2.0

Low income 2.2 2.3 3.0 4.2 4.1

Lower middle income 3.8 5.1 2.1 6.4 5.9

Upper middle income 0.1 -0.4 -1.1 3.1 2.6

High income 2.3 1.6 1.8 2.0 1.9

East Asia & Pacific 5.9 8.4 1.9 7.3 6.7

OECD 2.4 1.7 1.9 2.0 2.0

World 1.5 1.5 1.1 2.9 2.7

Japan 3.4 1.3 -2.0 1.4 1.0

Hong Kong, China 5.1 3.4 -5.8 4.3 3.2

Singapore 4.9 5.3 -4.6 4.1 3.1

S Korea 7.5 6.2 -7.5 5.1 3.6China 7.7 10.2 6.8 8.5 8.4

India 3.6 3.5 4.2 5.3 5.1

United States 2.3 1.7 3.0 2.0 2.1*GDP per capita were expressed in PPP and constant 2000 international $ terms; no data for Brunei

See notes under Table 26 for country composition of income groups and region.


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Table 28 Classification of Economies based on World Bank Analytical Classifications,

1987 and 2006

World Bank Analytical Classifications(presented in World Development Indicators)

Gross National Income per capita in US$ (Atlas methodology)1987 2006

Low income (L) 11,115

ASEAN (ex-Singapore)

Brunei Darussalam H H

Malaysia LM UM

Thailand LM LM

Philippines LM LM

Indonesia L LM

Cambodia L L

Lao PDR L L

Myanmar L L

Vietnam L L

ASIAN NIEs

Hong Kong, China H H

Singapore H H

Taiwan H H

South Korea UM H

Other Asia

Japan H HChina L LM

India L L

Other Emerging Economies

Brazil UM UM

Mexico LM UM

South Africa LM UM

Egypt, Arab Rep. LM LM

Note:

World Bank classifies all World Bank member economies, and all other economies with populations of more than 30,000. For operational

and analytical purposes, economies are divided among income groups according to gross national income (GNI) per capita, calculated using

the World Bank Atlas method.

The Atlas methodology is used to reduce the impact of exchange rate fluctuations in the cross-country comparison of national incomes. The

Atlas conversion factor for any year is the average of a country's exchange rate for that year and its exchange rates for the two preceding

years, adjusted for the differences between the rate of inflation in the country and that in Japan, the United Kingdom, the United States, and

the Euro area). A country's inflation rate is measured by the change in its GDP deflator. The inflation rate for the above countries,

representing international inflation, is measured by the changes in the SDR deflator. (Special drawing rights, or SDRs, are the IMF's unit of

account.)


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Table 29 Total Factor Productivity (TFP) Estimates of Asian Countries, 1989-2005

1989-1995 1995-2000 2000-2005 1995-2005

Asian NIEs

Hong Kong, China 1.65 -0.35 2.05 0.85

Singapore 3.52 0.17 1.72 0.95

South Korea 1.88 0.75 1.04 0.90

Taiwan 2.39 1.86 0.20 1.03

ASEAN Countries (exclude Singapore)

Cambodia 2.09 1.72 2.70 2.21

Indonesia 3.84 -3.23 1.74 -0.75

Malaysia 3.13 -1.01 1.03 0.01

Philippines -0.93 1.16 0.63 0.90

Thailand 4.29 -1.66 2.49 0.42

Vietnam 3.75 1.03 1.26 1.15

Emerging Asia

China 4.56 3.37 3.85 3.61

India 2.10 1.69 2.68 2.19

G7

United States 0.25 0.87 1.01 0.94

Canada 0.05 1.07 -0.50 0.28

France 0.31 0.88 0.27 0.58

Germany 1.49 0.71 0.15 0.43

Italy 0.85 0.04 -0.74 -0.35

Japan 0.04 -0.08 0.83 0.38

United Kingdom 0.70 0.30 0.11 0.20

Latin America

Brazil 0.09 0.11 -0.05 0.03

Mexico -1.09 1.50 -1.14 0.18

Source: Jorgenson, Dale and Khuong Vu. 2006. "Information Technology and the World Economy", in The Network Society From

Knowledge to Policy, ed. Gustavo Cardoso and Manuel Castells, eds., Center For Transatlantic Relations and Johns Hopkins University Sais

2006. pp. 71-124

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Tabl

the competitiveness of asean august 2008

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