Jakarta. Chairpersons of the 24th World Economic Forum on East Asia closed the three-day event on Tuesday with a fresh sense of optimism and trust in Indonesia and the Association of Southeast Asian Nations, as Malaysia was named the next host.
“President [Joko Widodo] spoke of the optimism that he has, and this confirms the belief that through all the major global challenges the world is facing today, Indonesia has a lot to contribute,” said John Riady, executive director of the Lippo Group and one of the five co-chairs of the WEF on East Asia, during the closing session.
Joko spoke at the WEF on Monday, saying that Indonesia was an “incredible” place to invest and was ready to change to adapt to global development and to the challenges the nation faced.
“The decision of the forum to be hosted in Indonesia speaks as much as confidence in Indonesia as it is about confidence in the region,” John added.
Budi Gunadi Sadikin, chief executive of Bank Mandiri and another forum co-chair, expressed the same sentiment — highlighting the pool of opportunities available for the region’s businesses and governments through the international forum.
“The World Economic Forum is a great platform for marketing, so this was a great opportunity for Indonesia to showcase itself,” Budi said. “From the feedback that I’ve received from [the participants], they’re now a bit more positive on Indonesia.”
About 800 people participated in the forum, which began on Sunday at the Shangri-La Hotel in Jakarta, engaging in discussions on a range of topics under the theme “Anchoring Trust on East Asia’s New Regionalism.”
Other co-chairs were Boston Consulting Group chairman Hans-Paul Buerkner, International Organization for Migration director general William Lacy Swing and SM Investments Corporation vice chairwoman Teresita Sy-Coson.
Asean Economic Community
In the regional context, most participants expressed their optimism for the Asean Economic Community — set to go into full force at year-end — to contribute to the betterment of the region.
Buerkner said that with the milestone launching of the AEC, Southeast Asian nations had the opportunity to take the region to the next level of development, though there remained significant challenges ahead.
“There is an eagerness to make this work and put all the elements in action to move forward, have a level playing field, a much bigger market and grow the pie significantly in the next few years,” he said.
For her part, Sy-Coson said the discussions at the World Economic Forum on East Asia had highlighted the major challenges ahead for Asean, in particular labor mobility.
“There is now an understanding of the importance of the freer movement of human capital,” she said.
Swing agreed: “It is quite clear that, with the very exciting regional integration going on here, human mobility will be increased and expedited as a result.
“We have to look at it as both a challenge and opportunity. Migration is not a problem to solve; it is a reality to be managed.”
Earlier, in a session on the global impact of Asean, business and government leaders spoke of the opportunities and challenges arising from Asean’s regional integration.
“If you think about the notion of a more complete supply chain across the region, there are huge advantages,” said H. Raymond Bingham, chairman of the board of Flextronics International of the US.
“Many of the elements are already here in Asean, but there are barriers — boundaries, regulations, the inability to have a mobile workforce.”
“The practice of the AEC is there, but trade in services is still limited,” acknowledged Bambang Brodjonegoro, the Indonesian finance minister.
“The homework for all Asean leaders is to make sure that the Community becomes a reality.”
With Asean integration deepening, Myanmar will have to address issues such as the lack of skills and the need to improve education, said Serge Pun, chairman of the consultancy Serge Pun & Associates.
“As the youngest member of Asean, we want to have our cake and eat it,” he said. “We want all the benefits of integration, but we are also worried about competing with mature economies and companies.”
India sees significant opportunities for driving its growth in engaging the Asean, said Adi B. Godrej, chairman of India’s Godrej Industries.
“There are a lot of things that Asean countries can do to leverage each other’s strengths to further rapid growth,” he advised. “India could be a great partner to Asean.”
The AEC and regional integration of Asean are “a work in progress, but we have done a lot,” Cesar V. Purisima, the secretary of finance of the Philippines, told participants, noting that electronics was a sector where significant integration across the 10 Southeast Asian economies had already been achieved.
“We have seen the value of one market. We are working through it systematically — in the Asean way,” he added.
“It is time to take action,” Murat Sonmez, chief business officer and a member of the managing board of the World Economic Forum, told participants in remarks at the end of the closing session.
He outlined four issues that were the focus of discussions at the World Economic Forum on East Asia, including public-private cooperation on infrastructure development; financial inclusion; the need to address non-communicable diseases; and food security.
At the meeting, the WEF, in cooperation with the Asean Secretariat, launched “Grow Asia,” a new program to strengthen food security and sustainable agriculture in Asean, expected to reach 10 million farmers by 2020.
Building trust among all stakeholders and in institutions will be crucial if Asean is to succeed in reaping the full benefits of regional integration, John said.
“People have lost trust in the ability of markets and business to create wealth and to fairly allocate opportunities,” he said. “So it is important for business to reflect on its role and the role that it can play in society. But this is important not only for business."
“No matter who we are — whether in government, education, media or NGO — this is an important time to reflect on stewardship, how we can be better stewards of what we have been given, and how we can rethink what we are doing and better structure our institutions to reflect the realities of our world.”
Bank Mandiri’s Budi, added: “We can get things done faster if we have mutual trust that we have built in these meetings.”
John said the WEF had recommended concrete actions for Asean.
“We’ve put in some concrete recommendations. One is a common visa across Asean akin to the Schengen visa. That way, foreigners don’t have to reapply for each country. This would increase the number of visitors into the region,” he said.
Second, he said, is to strengthen the Asean Secretariat.
“Their annual budget is $14 million. That’s small considering that their job is hard. We want to strengthen the secretariat so that it can support policies and implement them well,” he said, adding that stakeholders were still discussing the details of the funding scheme.
“Of course, it must be funded by the Asean member states. What we suggested next is that in every embassy, there should be an Asean flag next to the country’s flags,” John said.
Mustapa Mohamed, Malaysia’s minister of international trade and industry, and Philipp Roosler, a member of the managing board of the World Economic Forum, announced that next year’s meeting would be held in Malaysia.
GlobeAsia and the Jakarta Globe are affiliated with the Lippo Group.