What is Asean? | CNBC Explains

Summary

Southeast Asia, home to ASEAN, has become a global economic powerhouse, attracting major powers' attention. Founded amidst Cold War tensions, ASEAN now includes 10 diverse nations, with a collective GDP on par with the UK. It boasts rapid growth rates, especially in countries like Vietnam and the Philippines, and is a key player in the digital economy, with tech giants vying for a share. However, it remains in the crosshairs of superpower rivalries, particularly over the South China Sea, where it must carefully navigate its relations with both the US and China.

Takeaways

• 🌏 Southeast Asia is recognized for its beaches, street food, and traditional architecture, but it's also an emerging economic powerhouse.
• 🎉 ASEAN, established during the Cold War, celebrated its 50th anniversary last year, highlighting its long-standing role in regional stability.
• 🔄 ASEAN was founded by five countries and later expanded to ten, creating a diverse economic and political alliance.
• 💹 ASEAN is the world's sixth-largest economy, with significant growth potential, particularly in countries like Vietnam and the Philippines.
• 📈 ASEAN's growth reached a five-year high of 5.2%, attracting global business interest and investment.
• 💼 The EU is ASEAN's largest investor, while China is its biggest trading partner, reflecting the region's importance in international trade.
• 🌐 ASEAN has the world's third-largest labor force and a youthful demographic, which is a draw for tech giants looking to expand in the digital economy.
• 📱 Southeast Asians lead the world in mobile internet usage, making the region a prime market for tech companies.
• 🚢 The South China Sea dispute is a significant geopolitical challenge for ASEAN, with China's claims affecting four member nations.
• 🔄 ASEAN nations are navigating their relationships with both China and the U.S., trying to maintain a balance amid superpower rivalry.
• 🌐 Other countries, including India, Australia, and Singapore, are seeking to deepen ties with ASEAN, indicating its growing global influence.

Q & A

What is the significance of Southeast Asia in terms of global economic growth?

Southeast Asia, particularly the ASEAN member countries, has emerged as a leader in global growth, attracting interest from major powers like the United States and China due to its economic potential and growth rates.

What was the original purpose of forming ASEAN?

ASEAN was founded during the height of the Vietnam War by five countries to promote stability and contain the influence of communism during the Cold War.

How many countries are currently members of ASEAN?

There are 10 member countries in ASEAN today, including the original five and five others that joined after the Cold War.

What is the economic disparity like within ASEAN member countries?

There is a significant economic disparity within ASEAN, with Indonesia representing nearly 40% of the region's economic output, while Singapore has the highest GDP per capita, which is 24 times higher than that of Cambodia, the lowest in the group.

What is ASEAN's position in terms of global economy?

ASEAN is the sixth largest economy in the world, comparable to the United Kingdom and ahead of France and India.

What was ASEAN's growth rate in the last reported year?

In the last reported year, ASEAN's growth reached a five-year high of 5.2%.

Who are ASEAN's major investors and trading partners?

The EU is ASEAN's biggest investor, while China is its biggest trading partner.

How does the demographic profile of ASEAN contribute to its economic potential?

More than half of ASEAN's population is below 30 years old, and they are highly engaged with mobile internet, making the region attractive for tech giants and digital economy growth.

What is the projected value of ASEAN's digital economy by 2025?

The digital economy of ASEAN is forecasted to grow to $200 billion by 2025.

How does the South China Sea dispute impact ASEAN countries?

The South China Sea dispute risks making ASEAN countries pawns in the superpower rivalry, as China claims almost all of it, while four ASEAN nations have competing claims.

How has the Philippines' stance on China changed recently?

The Philippines, which previously fought China in an international legal case, has under President Rodrigo Duterte pursued stronger ties with China, straining its relationship with the U.S.

What is the current status of talks between ASEAN and China regarding the South China Sea?

ASEAN and China have begun talks around adopting a code of conduct in the South China Sea to manage tensions and safeguard economic growth.