Kuala lumpur: Reducing non-tariff barriers could boost ASEAN’s gross domestic product (GDP) by 4.3 per cent over the long run, according to the International Monetary Fund (IMF).
According to BERNAMA News Agency, IMF managing director Kristalina Georgieva highlighted that this increase is equivalent to adding over one-third of Malaysia’s current GDP to the ASEAN bloc and has the potential to create four million new jobs when combined with effective labour market policies.
Georgieva pointed out that regional trade within ASEAN currently accounts for slightly over 20 per cent of total trade, predominantly in intermediate goods, compared to the European Union’s (EU) 60 per cent, which mainly consists of final goods. She advocated for the removal of trade barriers to accelerate economic growth within the region.
During a plenary session at the 47th ASEAN Summit, Georgieva expressed support for upgrading the ASEAN Trade in Goods Agreement and taking similar initiatives to liberalize trade in services. She also emphasized the importance of stronger financial integration and collaborative transformative investments.
Georgieva stressed the significance of deeper technology sharing, particularly in digital infrastructure and artificial intelligence (AI), noting Singapore’s global leadership in these areas and the notable progress made by Malaysia, Thailand, and Indonesia.
The IMF has projected global growth at 3.2 per cent for the current year and 3.1 per cent for 2026, with ASEAN expected to grow by 4.3 per cent in both years. Georgieva acknowledged that while these figures fall short of historical trends, they surpass previous expectations from April.
She attributed this resilience to improved policy fundamentals, private sector adaptability, and enhanced regional and bilateral cooperation. Georgieva noted that over the past decades, ASEAN members have invested in robust policy frameworks, such as independent central banks, inflation targeting, and fiscal rules, which are now yielding positive results.
The IMF offers cross-country analysis and insights from its bilateral, regional, and global economic assessments to continue supporting these efforts. Georgieva highlighted the significant role of private sector dynamism in generating growth and employment across ASEAN countries.
She concluded by emphasizing the substantial potential for next-generation policies to further deepen trade, financial, and technological integration within the bloc.