China is an important trade partner of the Association of Southeast Asian Nations (ASEAN), and greater ASEAN-China economic cooperation could further promote peace and stability in region, Asian Development Bank (ADB) country director for Cambodia Jyotsana Varma said Wednesday.

As the global economy gets more intertwined over time, China has become a major contributor to trade and investment growth for the region, according to Varma in an interview with Xinhua.

China is also a key driving force in the Greater Mekong Subregion (GMS) with growing contribution in the creation of various hubs for regional transportation, communication and energy systems, and in fostering competitiveness to drive the economic development of this region, she added.

“Therefore, ASEAN-China economic cooperation is important to maximize the opportunities and manage the cost of this growing economic interdependence between ASEAN and China,” Varma said.

“In the future, greater ASEAN-China economic cooperation could also help promote greater peace and stability in the region. This is important as peace and stability is an important regional public good that can help promote the growth of commerce, trade and investment between ASEAN and China,” she added.

Varma’s comments came as Cambodia is hosting the 54th ASEAN Economic Ministers’ Meeting (AEM) and related meetings, including the Regional Comprehensive Economic Partnership (RCEP) ministers’ meeting, the East Asia Summit (EAS) economic ministers’ meeting and the AEM-Dialogue Partners Consultations, in the province of Siem Reap in northwest Cambodia from Sept. 14 to 18.

Varma said the full and timely implementation of the RCEP free trade agreement is the key to its contributing to ASEAN’s economic growth.

Coming into force in January 2022, the mega regional trade deal comprises 15 Asia-Pacific countries including 10 ASEAN member states, namely Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, and their five trading partners, namely China, Japan, South Korea, Australia and New Zealand.

“It would take some time before we can actually measure its actual economic impact on the region,” she said.

“The main anticipated impact of the RCEP is its ability to manage some of the challenges presented by multiple FTAs (free trade agreements) in the region and further liberalization of economic cooperation,” she added.

Varma said the RCEP has provided better access for trade in goods, and delivered other benefits in trade in services, investment and e-commerce.

She also said the ASEAN economic cooperation has been an important ingredient for the region’s economic success.

“Through its open trade and investment policy, the ASEAN region has become a key player and important hub in global trade and production network,” she said. “This has supported the region’s outward-oriented growth strategy based on exports.”

According to Varma, through the strong macroeconomic fundamentals of most ASEAN economies, supported by large foreign direct investment inflows, and with strong participation in regional trade agreements, the region has managed to position itself as one of the most competitive regions for global value chains, achieving immense development benefits.

She said most of the ASEAN economies have created stronger manufacturing and export bases, generated more and better-quality jobs, fostered innovation, technology, and knowledge diffusion, and reduced poverty rates.

“Going forward, regional cooperation in the region is becoming even more entrenched as crisis forge stronger cooperation among ASEAN economies,” she said.

“This stronger regional cooperation in the future will build the region’s resilience as it provides a buffer for the region to withstand possible global shocks in the future,” she added. 

Source: Khmer Times

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