Blueprint for Next Era of ASEAN-Japan Economic Ties in the Works
Jakarta. A blueprint that sets the future direction of the ASEAN-Japan economic partnership for the next decades is currently in the works, according to a Japanese envoy.
ASEAN and Japan are entering their 50th year of relations this year. However, their relationship has dramatically changed over the past decades. Not to mention the common challenges that both sides face, including the Covid-19 pandemic and the food and energy security risks that ensued from the protracted Russia-Ukraine war. Today, Japan is pushing for ASEAN to “co-create” a vision that can redefine their economic ties for the coming decades.
“Simply put, Japan has always been with ASEAN to overcome challenges, and will always be,” Kiya Masahiko, the Japanese Ambassador to ASEAN, told the 2023 ASEAN Youth Economic Forum in Jakarta on Friday.
“The Japanese public and private sectors have gotten together to make a working draft to lay out the vision of our future cooperation. But this initiative can only be completed with active engagement of the ASEAN side,” Masahiko said.
An interim note of this blueprint —the ASEAN-Japan Economic Co-Creation Vision— writes that Japan had supported ASEAN's industrialization and economic development. However, Japan today is facing economic stagnation and an aging population. ASEAN, on the other hand, is flourishing into an economic growth center, and now has other countries like China and South Korea actively investing in the region.
This co-creation vision will also encompass four pillars of action, among others, promoting open innovation beyond borders.
Read More: ASEAN Seeks Single Window Expansion with Japan for Greater Trade
On the sidelines of the forum, Ryosuke Fujioka, the chief representative at the ASEAN-Japan Economic and Industrial Cooperation Committee (AMEICC), told reporters “we need a lot of inputs from the ASEAN side to think about our future together. The keyword is ‘co-creation’.”
Fujioka defined the ASEAN-Japan trade pattern as “somewhat unique”.
“Many Japanese firms are investing in ASEAN. It is true that we are trading goods, but some Japanese firms are producing the final product in this region. Collaborating with dialogue partners is important because the final market is outside ASEAN and Japan. That is the unique characteristic of the ASEAN-Japan trade and investment partnership,” Fujioka said.
According to Fujioka, the 2023 ASEAN Youth Economic Forum gives a chance for Southeast Asian youths to give their input into this vision with discussions focusing on the circular economy. The forum even had youth participants from Timor Leste, whom the group has admitted as its eleventh member in principle.
Kao Kim Hourn, the secretary-general of ASEAN, not long ago revealed that the Southeast Asian group posted $240.2 billion in trade volume with Japan in 2021, up by 17.2 percent year-on-year. Japan is also ASEAN’s fourth-largest investor. Direct investment from Japan in ASEAN rose 3.5 percent y-o-y to $12 billion in 2021.
Japan’s bilateral trade with ASEAN chair Indonesia is also on the rise.
The government reported that Indonesia-Japan trade stood at $42 billion last year, up from $32.5 billion in 2021. Japan was also the fourth largest source of investment in Indonesia in 2022, reaching $3.56 billion.
Read More: Indonesia Wants Japan to Conclude Revised IJEPA TalksTags: