Integration to turn Asean into 7th largest economy

MANILA, Philippines–The world is under a new wave of globalization involving new corporations based outside the G-7 roster of the wealthiest nations, and many of these firms come from Asia, including the Philippines, said the chief of Citi’s Southeast Asian business.

In particular, the upcoming integration of the members of the Association of Southeast Asian Nation (Asean) into a single market is attracting a lot of interest, said Michael Zink, head of Asean for Citi and Citi Singapore CEO.

“Citi is optimistic about growth opportunities in Asean, and we are investing for growth,” Zink told reporters late Tuesday. “Asean countries are increasingly favored by multinational companies as locations for manufacturing and service hubs to service Asia and beyond.”

The visiting Citi official noted that, in 2006, Asean was home to 49 companies belonging to the Forbes Global 2000, and the number had risen to 74 by 2013.

Zink said the Philippines, in particular, was “getting “terrific coverage across the region.”

According to Zink, he does not believe that globalization had run its course.

“We think there’s a whole new wave of globalization led by a new set of companies, and many of them are coming from this part of the world,” he said, citing the likes of Petronas (Malaysian oil and gas company), Huawei (Chinese ICT firm) and Reliance (Indian mobile service provider).

In the case of the Philippines, he noted, port operator International Container Terminal Services Inc. has since expanded to over 20 countries across the globe.

The creation of a single economic market involving the 10-nation bloc through the AEC (Asean Economic Community) will create one of the world’s largest integrated economic spheres, he said.

We are seeing a growing number of emerging market champions looking for growth opportunities beyond their home countries and the region. Once Asean becomes a single economy, it would become the seventh-largest economy in the world today, with a combined gross domestic product of $2.4 trillion in 2013, Zink said.