When the Asean Economic Community (AEC) comes into being at the end of this year, such growth potential is expected to accelerate in a market of more than 600 million people with a combined GDP of more than $2.4 trillion. At the World Economic Forum in Jakarta, Indonesia, earlier this year, delegates were told Asean could expect to grow around 5 per cent annually over the next decade. The European Union, on the other hand, projects growth of around 2 per cent and the United States at 3 per cent. Asean already accounts for 5 per cent of global manufacturing with dominant shares in such sectors as chemicals, food and beverage, metals and motor vehicles.

Sandra Seno-Alday, a lecturer at the University of Sydney Business School and the Sydney Southeast Asia Center, said one of the key factors that have contributed to the rise of Aseab as a manufacturing hub is wages. China has priced itself out of many sectors a long time ago, she added. Nations including Singapore, Malaysia, Thailand, Indonesia and the Philippines have developed their infrastructure to support international businesses. Such infrastructure covers export-processing zones, training and education systems and an investment-friendly regulatory climate. Singapore has been the destination of choice for the regional operating hubs of many international companies, Seno-Alday said. 

A large, youthful work force and strategic location are just some of Asean’s many advantages, which should draw more companies to establish production bases in the region, according to analysts.