BEIJING, Nov. 9, 2023 /PRNewswire/ — A news report from China Report ASEAN:
China’s Belt and Road Initiative is now in its tenth year. Practical experience has shown that the countries that comprise the Association of Southeast Asian Nations (ASEAN) make up a favorable region for Chinese entrepreneurs to expand their overseas endeavors, a region that has the potential to evolve into a model area for the BRI.
From a geographical perspective, China and ASEAN share adjacent maritime territories. Throughout history, from the era of Emperor Wu of the Han Dynasty to the voyages of the Ming Dynasty’s seafarer Zheng He, Chinese merchants have explored the maritime routes of Southeast Asia. Singapore, Malaysia, Indonesia, the Philippines, and Brunei all share a common time zone and their strategically advantageous geographical locations, well-developed transportation networks by sea, land, and air collectively serve as China’s southern gateway to the world. Furthermore, Vietnam, Laos, Myanmar, Thailand, and Cambodia are connected to the China’s southwest inland regions via the Pan-Asia Railway Network.
There are approximately 50 million overseas Chinese and Chinese expatriates worldwide, with approximately 78 percent residing in ASEAN countries. These individuals maintain Chinese traditions, sharing common roots and language. They have not only adapted to foreign lands for generations but have also integrated with both Western and Eastern cultures and economies. They possess in-depth knowledge of the technological, cultural, legal, and economic aspects of ASEAN countries, as well as China’s cultural, economic, and institutional landscapes. This shared heritage, customs, and linguistic affinity make them the most likely and well-versed partners for Chinese entrepreneurs venturing abroad, rendering ASEAN countries the natural choice for Chinese overseas expansion.
In terms of economic structure, China, as a developing nation, boasts a diverse industrial landscape and enormous scale. Currently, it is the world’s largest developing nation and the leading global player in merchandise trade. China’s new products, technologies, and business models have the potential to stimulate development in developing and less-developed ASEAN countries. Through the business activities promoted by the BRI, which encourage mutual engagement and collaboration, China can facilitate the partial transfer of its industries and elevate the scale of industries in ASEAN. This reflects the international division of labor and resource allocation inherent in large-scale production. The strong demand from ASEAN underscores this need. As of July 2023, China had established over 6,500 direct investment enterprises in ASEAN, with the cumulative bilateral investment exceeding $380 billion.
In terms of demand, China boasts the world’s largest and most diversified manufacturing sector, necessitating substantial production input. The ASEAN countries, on the other hand, possess abundant natural and societal resources, capable of cost-effectively supplying the raw materials and semi-finished products required by China’s manufacturing sector. By the end of 2022, bilateral trade between China and ASEAN had reached $975.34 billion, a 12-fold increase over two decades. China has maintained its position as ASEAN’s largest trading partner for 14 consecutive years, while ASEAN has been China’s top trading partner for three consecutive years. China not only offers access to a vast consumer market but also provides world-class infrastructure and digital economic development, enabling ASEAN countries to rapidly improve their infrastructure and business environments, fostering sustainable economic growth.
In terms of resources, the involvement of ASEAN’s 10 nations, along with China in international free trade agreements like ASEAN 10+1, ASEAN 10+3, and the Asia-Pacific RCEP 10+5, emphasizes the active cooperation of all these nations. This cooperation integrates resources, leverages individual strengths, addresses weaknesses, and optimizes international resource allocation. It facilitates the effective alignment of regional supply chains, industrial chains, and value chains, enabling shared development, negotiation, and collaboration. This synergy is transforming the Asia-Pacific region into the world’s most economically dynamic area. On one hand, China supports ASEAN’s development through technology, solutions, and financial aid. On the other hand, ASEAN provides support to China’s structural adjustments and supply-side reforms through high-quality resources such as raw materials.
In summary, ASEAN’s development relies on China’s economic engine, while China’s development necessitates resource alignment with ASEAN. Their harmonious integration, interaction, and mutual benefit make them a perfect match.
The article is from Dr. Albert Chen Yongquan. Dr. Albert Chen Yongquan is the president of Asia Pacific Economic Review.