Singapore official urges Asean members to aim for economic and financial union

A senior minister in Singapore has urged Asean member states to work more closely together to deepen economic and financial ties and help anchor regional peace and stability in the wake of rising geopolitical tensions following the ruling on territorial rights in the South China Sea.

Modelled after the European Union’s single market initiative, the 11 members of the Association of Southeast Asian Nations have come up with the Asean Economic Community (AEC) – a roadmap and common regulatory framework for liberalising capital markets and manufacturing activities so each member state can trade freely and play to their own strengths.

Hong Kong is keen to conclude its own free-trade agreement with Asean this year that will see the city secure better trade terms and be able to tap into the common market benefits.

So far, the AEC has succeeded in implementing its own framework for bilateral banking and fund passport agreements that will give banks and investment management companies mutual access to sell into each other’s markets.

As a next step, Josephine Teo, Singapore Senior Minister of State, Prime Minister’s Office, Ministry of Foreign Affairs and Ministry of Transport,disclosed that the AEC was working on more ideas to achieve greater regional financial union.

“Asean member states will adopt a common international standard for their domestic retail payment systems,” said Teo, speaking at the OCBC Treasury, Economic and Business Forum in Singapore on Thursday.