Talk of economic miracles makes easy headlines, but it does seem that something significant is happening with the economies of the ten nations that make up the Association of South East Asian Nations.

The raw numbers speak for themselves.  When the ASEAN Economic  Community (AEC) was mooted in 2003, ASEAN was a market of 542 million people then growing at a rate of 5.5 per cent, versus global growth of 4.2 per cent.

Fifteen years later, ASEAN has become a market of 642 million people, growing at a rate of 5.9 per cent, while the global economic growth rate has slowed to 3.8 per cent. And its share of global economic prosperity has also shot up; ASEAN’s contribution to global income has risen from 1.9 per cent to 3.5 per cent over these years.

Today ASEAN, which itself was founded in 1967, is a home to some of the world’s fastest growing economies of Vietnam, Indonesia and the Philippines (VIP) which are incidentally some of the world’s youngest population centres. Analysts see the correlation between the average of the population and GDP growth as strong indicator of future growth potential and value.

Against a bleak background of the Vietnam War, insurgencies and chaos, the ASEAN grouping has achieved remarkable progress. Close cooperation on regional security has led to the ASEAN Political-Security Community blueprint.

And ASEAN’s bold decision to integrate and provide economies of scale has withstood not only the effects of the Asian Financial Crisis but the Global Financial Crisis of 2009 and provide realistic growth opportunities for Western investors looking beyond the traditional targets of Latin America, China, Japan and India.

ASEAN today is one of the success stories of modern economics. In 2014, the region was the seventh-largest economic power in the world. It was also the third-largest economy in Asia, with a combined GDP of US$2.6 trillion – higher than in India. And its population makes ASEAN the world’s third largest market.

Today technology start-ups and innovators are all the buzz in the region, leading the way in FinTech, healthcare tech and the sharing economy. Regional brands like GoJek, Tokopedia of Indonesia, GRAB, Shoppee of Singapore, and Today the region is a very real and credible alternative and option to the economic powerhouses of China, Japan, Korea and India. The group co-operates and leads the way in disaster risk reduction, climate change mitigation, and energy and food security.

Given stagnant economic growth in the rest of the world, as well as looming trade wars, anxious enterprises would do well to look more closely at the ASEAN opportunity. Half the population of ASEAN is under 30 years of age, and almost 50 percent live in urban areas. 75 percent are internet users and almost all of them have a mobile phone.

With these demographics, it is no surprise that the grouping is working hard to develop its region-wide e-commerce ecosystem and digital infrastructure. What is more, ASEAN has decided to raise regional connectivity through the Smart Cities Network. This is a collaborative platform where member states work towards the common goal of smart and sustainable urban development with the use of technology.

26 pilot cities across 10 ASEAN countries have been identified as testbeds to apply technology and digital solutions to urban challenges such as traffic congestion, pollution and sustainable energy.

This is good news for ASEAN’s major economic partners. Investments in projects are open to all for financing and the sharing of best practices with respect to technology, governance and sustainable development.

With a commitment to even more comprehensive and ambitious economic integration as well as free trade agreements with multiple Asia-Pacific powers, ASEAN is set to remain a vibrant and resilient region for the foreseeable future.

 

Banner photo courtesy of REUTERS/Edgar Su