ASEAN and the OECD launched the OECD Competition Assessment Reviews: Logistics Sector in ASEAN and the OECD Competitive Neutrality Reviews: Small-Package Delivery Services in ASEAN reports at the ASEAN Economic Ministers Meeting today.
The reports identified legislative and regulatory issues in the bloc’s logistics services sector that would hinder it from reaching its full potential. The reports provided robust, pragmatic, non-binding policy recommendations to ASEAN governments to help the industry boost overall growth and expedite its recovery from the negative economic impact of the COVID-19 pandemic.
The GDP of ASEAN has almost doubled since 2005. Its growing middle class now forms a large potential group of consumers. Yet further growth and greater prosperity are constrained by regulatory obstacles that impede competition in its logistics industry, reducing efficiency, driving up costs for businesses and not maximising consumers’ welfare, and hampering regional and international trade.
OECD’s research and analysis, supported by the UK Government’s ASEAN Economic Reform Programme, concluded that practical, low-cost policies recommended to improve the regulation of ASEAN’s logistics industry will empower existing industry participants and encourage new entrants to identify and take advantage of fresh opportunities and the resulting market efficiencies. In turn, this would benefit businesses and consumers, and ultimately accelerate growth and development across the bloc’s economies.
Engine of growth
Thanks to globalisation and free trade, ASEAN’s prosperity has grown substantially, in which its logistics sector played a major role. The sector now accounts for approximately 5% of the bloc’s GDP and employment, providing jobs for around 17 million people.
In noting the importance of the logistics services sector to the economies of the ASEAN Member States (AMS) and the wider region, the Secretary-General of ASEAN Dato Lim Jock Hoi, said in his opening remarks, "ASEAN’s commitment towards a seamlessly integrated ASEAN, remains as strong as ever. The service industries are the main driver of growth, accounting for approximately 50% of ASEAN’s GDP in 2019. The logistics sector was the second-biggest contributor to services output, accounting for approximately 24% of all such trade in ASEAN. It is therefore hard, not to overemphasize, the importance of the logistics sector to ASEAN Member States, and to the wider regional economy." |