ASEAN’s potential evolution is significant for Japan, which has long-standing connections with the region as an investor, trade partner, supplier of overseas development assistance and mediator in political disputes. As the new ASEAN Community takes shape, a better understanding of Japan’s role in the region will be crucial for anticipating future developments.
In the past few years the foundations for an ASEAN Economic Community have been developed around four pillars: developing a single market and production base, raising competitiveness, supporting equitable development and integrating ASEAN into the global economy. Progress has been achieved in some areas, such as reducing tariffs and streamlining customs procedures, but reforms are needed to liberalize services trade, foreign direct investment, capital markets and labour markets. Trade policy to date has emphasized the negotiation of multilateral and bilateral free-trade agreements, with some success.