Malaysia will benefit from Asia’s integration.
By Mak Kum Shi

Prime Minister Datuk Seri Mohd najib tun Razak being briefed by Executive Vice Chirman of Iskandar Waterfront holdings Tan Sri Lim Kang Hoo ( fourth from right ) at the signing ceremony for bandar Malaysia development in Kuala Lumpur. Also present are from left Datuk Wee Kar Siong, China's Ambassador Huang HuiKang , Johor MB Datuk Seri Khalid Nordin.
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Connectivity on multiple fronts will spur Asian integration and economic growth. This would lead to Malaysia reaping the benefits of this development.

Asia Pacific and Asean Economic Community’s prosperity will depend on their ability to achieve regional integration and economic growth.

According to the United Nations Economic and Social Commission for Asia and the Pacific’s (Escap) Regional Connectivity For Shared Prosperity 2014 report, connectivity is a cornerstone of regional economic cooperation and integration.

Connectivity has become a major priority for Asia Pacific countries, especially in the context of efforts to find new drivers of regional economic growth and to create additional domestic and aggregate regional demand.

To best unlock the potential of closely interlinked production networks and value chains, a broader perspective on connectivity will be key.

This kind of connectivity should not be considered sector by sector, but rather as part of an integrated whole, encompassing the development of corridors of prosperity through networks of trade, transport, ICT, energy, people and technology.

The recent economic slowdown had exposed the Asia Pacific region’s vulnerability to fluctuations in the global economy and had shifted attention to domestic and regional markets as a means of stimulating growth and raising living standards.

Cross-border and regional land transport infrastructure networks remain underutilised for international trade.

Non-physical barriers at borders also persist, increasing trade and transport costs and delaying the movement of goods and people.

By investing in intermodal facilities such as dry ports, as well as in better physical linkages between different modes, governments could increase transport options for shippers and traders.

Greater use of ICT applications for trade and transport facilitation would also improve the efficiency of freight movements and pave the way for the development of paperless trade and e-logistics.

A cohesive regional network, combining terrestrial with submarine optical fibre, would provide cost-effective broadband access on both an intraregional and intercontinental basis, as it will link Asia to Europe.

Fibre optic cables are already being laid along some national highway and railway systems. Such synergistic approaches can reduce the cost of developing a regional ICT network and facilitate maintenance of the network.

Contributing to regional economic growth
At the national level, public investment in infrastructure development, particularly in the transport, energy and telecommunications sectors, have a direct impact on GDP growth.

These critical infrastructure networks have stimulated growth by providing domestic enterprises with access to a greater pool of resources and markets, enabling them to scale up their production and reach a broader consumer base.

At the regional level, progress has been made in forging linkages between countries through the development of regional infrastructure networks. This opens up both physical and virtual access to regional and global markets.

Most countries in continental Asia are connected through the Asian Highway and Trans-Asian Railway networks, while coastal countries and small-island developing states are linked through maritime services.

These linkages have driven the region’s economic success by facilitating international trade, foreign direct investment (FDI) flows, and the establishment of global and regional production networks and global value chains.

These new systems for manufacturing, distribution and consumption have helped many countries in the region to diversify their economies.

This diversification reduces their dependence on traditional sectors such as agriculture and natural resource extraction and creates new jobs, particularly in labour-intensive sectors, such as garments and electronics.

Connectivity is also a necessary and integral aspect of regional integration. At the core of regional connectivity are a number of key regional networks, namely trade and transport, ICT, energy infrastructure, and people-to-people networks.

These regional networks reinforce each other and as such, their simultaneous development is critical in achieving effective regional connectivity and in maximising its benefits.

It is becoming evident that regional connectivity will offer best results if it enhances the effectiveness of regional networks to facilitate flows of goods, services, people and knowledge.

It is therefore necessary to look beyond traditional analyses of connectivity, which were focused on the physical dimensions of networks, to consider also their qualitative aspects.

AEC integration through transportation
The Asean Transport Strategic Plan 2016-2025 stated that transport provides great support in binding Asean economies closer together and building the Asean Economic Community (AEC) that is so vital for the future of Asean nations.

The Brunei Action Plan (BAP), adopted at the 16th Asean Transport Ministers Meeting in Nov 2010, served as the main reference guiding Asean transport cooperation and integration, as well as identified strategic actions to be implemented in the period 2011-2015.

The BAP had also supported the new priority of enhancing regional connectivity identified in the Master Plan on Asean Connectivity (MPAC).

In line with Asean’s work on post-2015 vision and the successful conclusion of BAP, Asean transport ministers agreed to formulate the transport vision for post-2015 and develop the successor of BAP, namely the Asean Transport Strategic Plan or Kuala Lumpur Transport Strategic Plan (KLTSP).

The KLTSP aims to support the realisation of the vision of the AEC 2025, which calls for a deeply integrated region that will contribute towards a highly cohesive Asean economy.

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