The AEC Logistics in ASEAN Community

What Should You Know About AEC Community

Among the major as well as the most effective memorandum of understanding between member countries in becoming a part of the AEC, ASEAN Economic Community, is the agreement based upon logistic issues. Logistics refers to connectivity, which means that the AEC will be connected to each other and thus become one. As a result of a logistics system that is well developed, the AEC enhances its competitiveness.

There are a number of logistic agreements that the ASEAN community has to follow to successfully create a sole ASEAN market. These agreements include:

  • A considerable liberalization of services in logistics

  • Growing or increasing the competitive nature of ASEAN Logistics Service Providers via logistics and trade enablement

  • Growing or increasing the ASEAN Logistic Service Providers’  competency

  • Developing the human resources

  • Growing or increasing the Multi-Modal Transport investment as well as infrastructure


ASEAN Community

Initially, the ASEAN community came to be in the year 1967 as a result of the security and height of violence issues the Vietnam War brought about. Thailand, Malaysia, Philippines, Indonesia, and Singapore, which formed the ASEAN Community, decided to come together with an aim of minimizing the casualties involved. After the war had eased up and business continued as usual during the 70’s and 80’s, the five countries thought it wise to continue with the relationship they had formed with an aim of growing their economic and trade ties. Later on, as a result of the success these countries were achieving, countries such as Brunei, Myanmar, Cambodia, Laos, and Vietnam joined the ASEAN Community.



The newly formed community of countries has been an extension that has proved to be logical in the progress ASEAN has made over the last few years proving to be quite the useful as well as the cohesive entity. A few among many of the major milestones they have made include:

  • The ASEAN Free Trade Agreement, AFTA: this agreement has made it possible to virtually eliminate all existing tariff barriers among member states, which has been a very big boost to intra-regional trade. As a result, the AEC has further extended its FTA agreements with the likes of South Korea, China, Australia, New Zealand, Japan, and India.

  • The ASEAN Framework Agreement on Services, AFAS

  • The ASEAN Investment Area, AIA

A single market accompanied by a free flow of capital, goods, investments, services, and skilled labor has been a major stronghold the AEC. The community has put together all its efforts in making the single market, among its other major strongholds, possible.

Though several places in the world right now are facing very low growth when it comes to the economy and population as a whole, the south-east part of Asia is expected to grow by an average of over a hundred million in the next few years. Due to this occurrence, the region will definitely become actively productive and thus able to extend its services to Asia and beyond, which will lead to a consumer market that is increasingly important.

Indonesia is expected to introduce new measures to stimulate GDP growth as Jokowi’s second term starts soon – which includes labour, infrastructure and tax reforms.
Due to economic slowdown and strengthening baht, Bank of Thailand had cut its benchmark interest rate to 1.5%. Thailand economy forecasts Thai GDP to grow by 3.3%.
The digital economy in ASEAN is expanding faster than predicted, with the e-commerce market value to exceed Google’s forecasted US$200 billion by 2025.
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