MANILA - Southeast Asia is unlikely to hit a target of integrating its 10 economies by 2015, but the group has much potential to be a trading hub for Asia once it fully creates an economic community, the Philippines' finance chief said on Monday.
Members of the Association of Southeast Asian Nations (ASEAN) must accelerate creation of common customs procedures and harmonise its rules to further strengthen intra-regional trade, Cesar Purisima told the Reuters ASEAN Summit.
In 2010 through 2012, intra-ASEAN trade has risen by an annual average of nearly 18 percent, far faster than global commerce has grown, he said.
In 2007, ASEAN leaders set a goal of creating an ASEAN Economic Community by the end of 2015.
Purisima, in an interview at the summit in the Reuters office in Manila, said of the target: "I think it is going to be like a milestone where we should expect an acceleration of efforts to integrate."
He added that "There will be no big bang in 2015."
ASEAN, whose 10 members include wealthy Singapore and impoverished Myanmar, aims to eliminate non-tariff barriers and remove obstacles to labour flows in the region of 600 million people.
The region has shown that it can be a major market -- with a combined GDP that could rank as the seventh largest in the world, aggregate population that could be the third biggest and one of the youngest, and total tourist arrivals that top any country in the world, Purisima said.
MONEY COMING IN
Foreign direct investment in ASEAN also outpaced that of China last year, the financial secretary said.
Foreign investors "are now putting more money into the 10-member countries... This reflects the fact that they see if the integration becomes a reality, ASEAN can fulfil its vision of being the hub of intra-Asia trade," said Purisima, a certified public accountant whose debt management programmes and revenue-raising efforts helped the Philippines' credit rating change from junk status to investment grade last year.
He said the Philippines is working on its own challenges and inefficiencies, including creating a much-delayed national "single window" network that when linked with others in the region will allow faster processing of trade receipts and reduce smuggling, which depresses state revenue.
"The fight against corruption is...not going to be done overnight. It is going to be a journey, the important thing is we don't lose sight of the fundamentals," said Purisima, who late last year replaced the top management of the Customs agency.
Reforms implemented by the agency helped its revenue between November to January be 19 percent than one year earlier.