The goal of the ASEAN Economic Community is to establish ASEAN as a single market and production base that will make ASEAN more dynamic and competitive. In this context, one of the five core elements of an ASEAN single market and production base is the free flow of investments. A free and open investment regime is key to enhancing ASEAN’s competitiveness and attracting foreign direct investment (FDI) as well as intra-ASEAN investment. Sustained inflows of investments will promote and ensure the dynamic development of ASEAN.
ASEAN investment cooperation is being implemented through the Framework Agreement on the ASEAN Investment Area (AIA), 1998, while investment protection is accorded under a separate agreement i.e. the ASEAN Agreement for the Promotion and Protection of Investment, 1987 or commonly referred to as ASEAN Investment Guarantee Agreement (IGA).
Under the AIA, all industries (in the manufacturing, agriculture, fishery, forestry and mining and quarrying sectors and services incidental to these five sectors) shall be open and national treatment granted to investors both at the pre-establishment and the post-establishment stages, with some exceptions as listed in member countries’ Temporary Exclusion Lists (TEL) and Sensitive Lists (SL). The TEL is to be phased-out based on agreed timelines. Although the SL does not have a timeline for phasing-out, they will be reviewed periodically.
ASEAN Comprehensive Investment Agreement (ACIA)
Investment Agreements Superseded by ACIA