Thailand faces ASEAN economic test

The ability to communicate in English has repeatedly been cited as the most important instrument to compete with other ASEAN member states in the AEC. That explains why the Ministry of Education was allocated more than 500 million baht to improve the proficiency of students, especially those in vocational schools, in the English language. Though government officials have also been urged to hone their English language skills, vocational students are the focus group because of the importance that small and medium-sized enterprises (SMEs) play in promoting business activities in ASEAN.

Nearly 90 percent of new business investment in the grouping is related to SMEs. And SME entrepreneurs from Singapore and Malaysia are models for the Thais especially in terms of franchised business and English proficiency.

Big Thai companies have no such problems because they are well funded and staffed to take on overseas operations. But none of them has embraced or approached ASEAN as an entity with its distinctive norms and wisdom. Malaysia's Air Asia and CIMB Bank are unique in this sense.

To be fair, Thailand has done better in fulfilling the action plans related to two AEC strategies - equitable economic development and integration with the global economy. In its report to ASEAN leaders last year, Thailand said it had fulfilled nearly 86 percent of the AEC measures compared with the ASEAN average of about 80 percent.

Upon close scrutiny, one could easily see problems with Thailand's commitment to the AEC under the single market and production base strategy, especially in the areas of service and direct investment. For example, Thailand has to do more to promote the 70 percent foreign equity ownership in the service sector and 51 percent in the logistics sector, to name but a few. Other ASEAN member states, too, face similar problems in coping with the sensitive behind-the-border measures. But the ongoing political turbulence in Thailand has made its full implementation more difficult for the country.

Sadly, the politico-security and socio-cultural pillars have not received the attention they deserve. Compared with other core ASEAN member states, Thailand has done pretty well in all areas except in conflict prevention and social justice-related issues. Indeed without continued progress on these fronts, the AEC's sustainability will suffer. As such, the much heralded ASEAN Community will remain only an inspiration.

The author is assistant group editor of Bangkok-based The Nation. Asia News Network.