Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(51)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

I can't help agreeing this view and admitting drawbacks of my research to some extent. In this context, I will try to allocate more time and energy in listening to various opinions of the related parties in Singapore and Indonesia to have my research upgraded. 

Needless to say, plentiful hands-on experiences to monitor real-time developments of the AEC in the two countries would provide my succeeding papers constantly looking into the relation between Singapore and Indonesia with more balanced and up-to-date insights.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(49)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Perspectives and following readiness of the two countries toward the era of the AEC, though not entirely, are necessary to keep paced with each other. Otherwise, outputs of the more sophisticated regional economic integration may be distributed in a one-sided fashion. 

If Singapore carries on being overwhelmingly outshined along with the AEC, political and diplomatic relation between the two countries may be subject to be worsened accordingly.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(46)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

The economic clout will be increasingly strengthened if the ASEAN even succeeds in fully actualizing the AEC. As a result, the influence of the ASEAN on the regional security and political issues will be also growing bigger. 

Under this circumstance, hopes are higher than ever that the beginning of the AEC will serve a drastic opportunity to create a new landscape for the 21st century in the world. In this sense, the roles of Singapore and Indonesia can't be overemphasized when the era of the AEC starts to be vigorously unfolded.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(41)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

In the meantime, there stands a possibility that Singapore's readiness on edge for the AEC powered by internationally-claimed competitiveness may impose burdens on Indonesia. Severe damages on the economic interests of Indonesia caused by Singaporean enterprises, if repeatedly happens, may spark political conflicts between the two countries. 

This is in line with my stance that Indonesia, as a whole, needs to pay attention to the inauguration of the AEC in a more desperate manner.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(38)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Besides, awareness of the importance of the AEC is not only high in the business sector but also considerably widespread among the general public in Singapore. This phenomenon may be associated with the unparalleled development career of the Singaporean economy. 

Actually, Singapore has been spotlighted to reap the biggest pie of the AEC as the United States has benefited the most in the time of the North American Free Trade Agreement (NAFTA).

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(36)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

In addition, concerns of SMEs especially in Indonesia that they may be isolated from the far-reaching age of the AEC are getting greater. 

In spite of such negative voices raised, the Singaporean and Indonesian governments have been regarded to take necessary steps to realize their commitments to the AEC as ambitiously set out in the AEC Blueprint.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(35)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

As identified above, Singapore and Indonesia may have been claimed to pour continuous efforts to deal with the era of the AEC. Both countries have concentrated on the emergence of the AEC and the impacts that the new regional economic community would bring to them. 

Nevertheless, there are yet complaints especially from the private sectors in both countries that incomplete information sharing and insufficient corporate engagement on the core agendas of the AEC has been left shortages.

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Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Indonesia is one of the few countries in ASEAN that has promulgated a competition law and has established an independent agency in charge of competition policy – the Commission for the Supervision of Business Competition. 

Larger firms tend to have better knowledge about the existing FTAs and, in general, are more optimistic than smaller ones. This is true also with regard to the AEC.

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Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Going forward, Singapore will focus on capacity building and human resource development in the ASEAN countries to help them prepare for the 2015 deadline. Results of SWOT analysis on the Singapore's perception of and response to the formation of the AEC can be diagramed as below. 

According to the papers by Hadi Soesastro and Raymond Atje (p. 72-77.) and Widdi Mugijayani and Pratiwi Kartika (p. 210-212.), Indonesia's major perception of and response to the formation of the AEC can be summarized as below.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(28)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

According to the papers by Juliana Giam (p. 280-281.) and Ong Keng Yong (p. 132-133.), Singapore’s major perception of and response to the formation of the AEC can be summarized as below. 

Singapore remains committed and continues to work closely with the other ASEAN countries to achieve the goals of the AEC as set out in the AEC blueprint. Singapore believes that a strong and competitive ASEAN is important in the face of growing challenges posed, not just to the Southeast Asian economy, but the global economy.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(24)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Though probably considered somewhat outdated, this rare publication still delivers meaningful messages by providing country-specific insights with highlights on the crucial economic roadmaps of the individual members toward the era of AEC. 

This is no exception to Singapore and Indonesia. Against this background, 4 papers of the book may function fairly useful in offering integrated views of how well Singapore and Indonesia are prepared in accomplishing the goals of the AEC. 

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(19)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

The ASEAN Secretariat report cited above illustrates two cases as evidences of commercial viability in the age of the AEC. 

They are Singapore's Super Group for brand reach and Indonesia's WIKA for corporate transformation. Business outlines of the two examples incubating potentials of the AEC go like this.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(18)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Consequently, both Singapore and Indonesia have played enormous roles in the course of the ASEAN economic integration. As a result, Singapore and Indonesia has enjoyed the benefits of the ASEAN economic integration over the years. 

Singapore has been actively expanding its business domain all over the region with its service-oriented policy initiatives. For Indonesia, fruits of strategic focuses on economy of scale have been harvested across the secondary industries.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(15)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Though all ASEAN members have been closely related with each other over the history, each country shows different interests in the nascent era of the AEC. This is mainly because 10 countries aren't in an identical economic situation. 

Components of a national economy such as natural resource reserves, labor force abundancy and industrial structure are all dissimilar, more or less. This disparity inevitably leads to an economic gap among the ASEAN members.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(11)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

The AEM agreed to develop a single and coherent plan progressing step by step to the AEC. In essence, this was undertaken by identifying the characteristics and elements of the AEC consistent with the Bali Concord II, involving clear targets and timelines for implementation. 

In January 2007, ASEAN Leaders collectively agreed to accelerate the establishment of the ASEAN Community from 2020 to 2015.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(10)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

This was in line with the ASEAN Vision 2020, which aimed to transform ASEAN into a stable, prosperous and highly-competitive region with equitable economic development, reduced poverty, and socio-economic disparities, progressing in tandem with the establishment of the ASEAN Political Security Community and the ASEAN Socio-Cultural Community. 

The AEC Blueprint 2015 was initiated at the 38th ASEAN Economic Ministers Meeting (AEM) in Kuala Lumpur.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(8)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

In this context, taking a brief look at how ASEAN economic integration has been developed and eventually led to the establishment of the AEC would be meaningful. 

A publication from the ASEAN Secretariat titled 'ASEAN Economic Community 2015: Progress and Key Achievements' describes the road towards the AEC. Summary of the report (p. 3-6.) can be introduced as below.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(2)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

At the same time, Indonesians are noticing social conflicts with controversy over the majority religious party's alleged attempt to exercise influences on the political sector. 

ASEAN members are faced with their own weighty political or diplomatic issues as partly mentioned. However, all countries are looked quite attentive to one regional watershed in common. It is the AEC (ASEAN Economic Community) which recorded the 3rd year of its ambitious inauguration 48 years after the establishment of the ASEAN back in 1967. 

Advent of the Era of the AEC and Its Impact on Singapore and Indonesia(50)

Comparative Study on the Perception and Response of Singapore and Indonesia

Expectation is unprecedentedly snowballing that physical barriers will be torn down and regional exchanges of goods and services will be fairly propelled with the extra active commitments of the Indonesian government to the AEC. 

Brisk engagement of the Singaporean government for the success of the AEC should be continued, too. In short, this is the right time for both Singapore and Indonesia to hit the AEC road to the better tomorrow of the ASEAN.

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Comparative Study on the Perception and Response of Singapore and Indonesia

However, situation would be different if joint efforts of the 10 countries to confront superpowers is designed and implemented. The countries will be surely observing their confidence built up step by step. The economic clout will be increasingly strengthened if the ASEAN succeeds in fully actualizing the AEC. 

As a result, the influence of the ASEAN on the regional security and political issues will be also fortified. Under this circumstance, hopes are higher than ever that the beginning of the AEC will serve a precious opportunity to create a new landscape for the 21^st century in the world.