The international economic community may have been skeptical of ASEAN’s initiative to form a dynamic regional grouping. This is now changing. Today, world leaders, business and political, don’t need to be persuaded to be at ASEAN events such as the recent ASEAN Summit in Bali. Indeed, during the high-profile meeting, Denpasar’s Ngurah Rai airport was crammed with an impressive array of government and private jets, including the iconic Air Force One.
 
Unlike the European Union, ASEAN’s best years are ahead of it. Businessmen and political leaders are attracted by our joint commitment to forge an integrated market through the Asean Economic Community (AEC) by 2015 - bringing together a market of over 600 million consumers.
 
Malaysia, which is at the heart of ASEAN, has been at the forefront in championing this initiative. Indeed, we need to be realistic as a nation. With a population of 28 million (growing at 2% annually), our small but dynamic domestic market has proven to be an excellent base for regional expansion for Malaysian businesses.  Our hinterland, the AEC has over twenty times as many consumers and a combined GDP of USD1.85 trillion. Growth rates have been restored to pre-crisis levels and in 2010 ASEAN recorded an impressive 7.4% growth.
 
Malaysia is well-prepared for the single market. We have implemented 94% of the measures under Phase 1 (2008-2009) of the AEC, a record that we’re close to matching under Phase 2 (2010-2011). Malaysia’s average implementation rate for both phases as at October 2011 stood at 88.55%. We have completed the elimination of duties for intra-ASEAN trade, liberalised over 80 services sub-sectors, simplified Customs procedures, and ratified all the key economic agreements including the ASEAN Comprehensive Investment Agreement.  Other economic initiatives covering transport connectivity, agriculture, telecommunications, tourism and healthcare are being implemented as scheduled under the AEC Blueprint.    
 
Indeed, we see the AEC as a fundamental building block for Malaysia’s future - one of the strategies that will help us to break free from the middle-income trap.
 
Of course, the government cannot achieve these goals in isolation. The private sector - recognizing the value of our initiatives - has been immensely supportive. Still, in order to be more competitive, the government is committed to nurturing more Malaysian firms to be regional champions - companies that truly understand the importance of regionalizing their businesses.
 
We have the ASEAN Business Advisory Council (Malaysian Chapter) and the recently launched ASEAN Business Club, which complement the government’s efforts to get Malaysian companies to set their sights on ASEAN. The companies, which embraced regionalization less than a decade ago, are now beginning to reap the benefits as their profits continue to increase. 
 
This in turn has inspired many other Malaysian companies to follow suit - from banking to aviation, shipping and plantations, with companies such as Maybank, CIMB, Sime Darby Berhad, Ingress Autoventures, Sapura, Dominant Semiconductors and Air Asia leaving large regional footprints. Apart from these corporate giants, we also have many other smaller Malaysian-owned or jointly owned companies operating across ASEAN. For example, we have 400 companies in Thailand and Indonesia and over 200 in Singapore and Vietnam.
 
 
Malaysian corporate success also benefits other ASEAN member countries as it brings added investments in countries where it operates. This is especially in physical and soft infrastructure as well as creating skilled and semi-skilled jobs. In addition, technology transfer and expertise sharing brought by Malaysian companies through regionalization also help narrow the development gap among ASEAN countries. This is in line with the goals of the Equitable Economic Development (EED) framework which provides the guiding principles for inclusive and sustainable growth, as well as alleviating poverty.
 
 
However, there’s no denying that the Eurozone’s mounting crisis has dented the enthusiasm for an integrated market. Whilst Malaysians are generally supportive of ASEAN and the AEC, nationalism remains a powerful force. Used recklessly: it can derail the best intentions. Used wisely: it can enhance prosperity.
 
Still, the pace and structure of integration commitments varies across ASEAN. Policy-makers across the region have had to juggle the challenges of forming a unified structure in the face of entrenched macroeconomic imbalances.
 
Two main challenges faced by ASEAN presently are in reducing or eliminating the non-tariff barriers (NTBs) or aligning rules and regulations within the region to facilitate businesses, and improving physical and non-physical regional connectivity. In 2010, ASEAN adopted a Master Plan on Connectivity. This is fundamental to keeping the cost of doing business down.  
 
However, I believe the major test for AEC will arguably be in 2013, when the ASEAN Single Window (ASW) is implemented. The ASW, constituting a regional facility to enable a standardized routing communication of trade and customs-related information will allow businesses to benefit from the cut in transaction costs and time, alongside greater predictability in administrative customs procedures. Consumers will enjoy a more secure and timely delivery of goods at a lower cost. Hence, it will be a major step towards realizing an integrated ASEAN. A failure to execute the ASW well, may indeed jeopardise the 2015 AEC target.
 
Malaysians need to understand that economic might is a numbers game, especially when it comes to population size. With China and India having more than 1 billion population in each market, where do we fit in with less than 30 million citizens?  Indeed, it is time for us to realize that our future lies in Southeast Asia. Let’s ride this momentum created by AEC to achieve our goal of being a developed and high-income nation. Let’s make sure that the Asian Century is one with a Malaysian success story.