Bangkok: It is a great honor to be with you today and celebrate ASEAN's progress and tremendous promise. With a collective GDP of over 4 trillion dollars, ASEAN already is the world's 4th largest economy and is growing 25 percent faster than the global average.
According to International Monetary Fund, despite dramatic transformations in geopolitics, trade, technology, demography, climate, and the uncertainties that they create, the world-and ASEAN-have been remarkably resilient. Growth is holding up-globally projected at 3.2 percent this year and 3.1 percent in 2026, and in ASEAN at 4.3 percent in both years. Admittedly, this falls short of historical trends, but it is better than feared in April.
The sources of this resilience include improved policy fundamentals reflecting years of hard work, private sector adaptability as evidenced by the trade frontloading, rapid supply chain reconfiguration, and surge in private investment in new technologies, particularly AI. The majority of countries are continuing to trade under Most Favored Nation rules while deepening regional and bilateral cooperation to cushion the impact of a more fragmented world.
Private sector dynamism has played a major role in generating growth and jobs in ASEAN countries. Structural reforms to eliminate red tape, improve access to finance, and enhance skills of the labor force can help lift productivity and further strengthen economic resilience.
ASEAN holds significant potential for next-generation policies to deepen trade, financial, and technological integration. Currently, regional trade within ASEAN makes up slightly over 20 percent of total trade, mostly in intermediate goods, compared to 60 percent, mostly final goods, in the EU. Removing trade barriers will help economies grow faster. Analysis shows that reducing nontariff barriers can boost ASEAN's GDP by 4.3 percent over the long run, equivalent to adding over one-third of Malaysia's current GDP to the bloc and creating some 4 million new jobs when coupled with smart labor market policies.
The call to action includes upgrading the ASEAN Trade in Goods Agreement, taking similar steps to free up trade in services, pairing this with stronger financial integration, transformative joint investments, and deeper sharing of technology, including in digital infrastructure and AI. Singapore stands out as a global leader, with Malaysia, Thailand, and Indonesia making notable progress. Knowledge sharing on AI preparedness is facilitated through peer-to-peer engagements in ASEAN and beyond.
Excited by progress in the region, together with Thai partners, safe and inclusive digital finance has been chosen as a key theme for the Annual Meetings in Bangkok next year.
The second half of the 20th century was marked by the rise of the EU, with its four freedoms-the freedom of movement of goods, services, capital, and labor. Let the first half of this century be remembered as ASEAN's time-a highly integrated, dynamic community of nations, working for the good of the region and for the good of the world.