EU IS LARGEST INVESTOR IN SOUTH EAST ASIA

BANGKOK, Aug 14 (Bernama) -- The European Union (EU) continues to be the
single largest investor in South East Asia, with a share of 20.6 percent or
investment which amounted to US$12.4 billion in 2008.

Japan, traditionally among the biggest investor in the region, invested
US$7.6 billion in 2008, or 12.6 percent while the United States came in third
with
US$3.2 billion, or 5.3 percent.

In a joint statement issued following the 41st Asean Economic Ministers
(AEM) meeting, the 10 Asean trade and economic ministers said they were
encouraged by the continued resiliency of FDI flows to the region in the face
of adverse global circumstances.

The ministers said the FDI flows remained high at US$60.2 billion last year,
although lower than the record US$69.5 billion in 2007.

"In particular, intra-Asean FDI flows have proven more robust than
anticipated, expanding by an exceptional 18.4 percent in 2008 to US$11.1
billion. It augurs well in terms of Asean integration efforts and the success of
trade and investment policies that promote intra-Asean liberalisation," they
said.

Foreign direct investment flows continued to predominate in the services and
manufacturing sector, accounting for 49.5 percent and 29.1 percent of the total
FDI into region or US$29.8 billion and US$17.5 billion in 2008 respectively.

The mining and quarrying sector is also becoming more important, with a
share of 7.3 percent or US$4.4 billion last year.

On trade, the ministers said that despite the global economic woes, Asean's
total trade in goods managed to grow by 6.2 percent, from US$1,610.8 billion in
2007 to US$1,710.4 billion last year.

The top five trading partners were Japan, EU, China, US and South Korea.
The ministers also noted the progress made in developing the Asean Economy
Community (AEC) Scorecard that would be submitted to Leaders at the 15th Asean
Summit in Hua Hin.

They also commended Malaysia and Thailand for their full submissions on
specific non-tariff barriers to be eliminated and urged other members to submit
their measures as soon as possible to ensure the realisation of free flow of
goods in Asean.

The ministers also welcomed efforts to develop a single regulatory framework
for the automotive, the healthcare, in particular the medical device,
traditional medicine and health supplement sectors and the agro-based products
sectors by the end of 2011.

The statement also noted the efforts made to prepare for the entry
into force of the Agreement on the Asean Harmonised Electrical and Electronic
Equipment Regulatory Regime on January 1, 2011.

On progress achieved in the negotiation over liberalisation of trade in
service, the ministers said member countries need to deepen their commitments
in various services sectors in line with the mandate of the AEC Blueprint.

Over the last 10 years, Asean FDI in services has been increasing by an
average of 10 percent per year, reaching US$29.8 billion last year.

While recognising the need for flexibility, they endorsed the proposal for
flexibility to be accorded to up to 15 percent of the total modes of supply in
each package and to be used only as a last resort.

--BERNAMA