China has embarked on a new phase of economic development. In the future, it will no longer rely on export might for economic growth and prosperity. The mainland policymakers have started on a course to turn China into a fully-fledged economy based on domestic consumption, services and innovation. As a result, China has become one of the biggest trade and investment locations for South East Asia.
The Association of Southeast Asian Nations (ASEAN) continues to rise as an economic powerhouse with 600 million people and the combined GDP of US 2.1 trillion. As a region it will be one of world’s fastest growing consumer markets over the next two decades. The ASEAN Economic Community will come into existence at the end of 2015 effectively creating one of the world’s biggest single markets.
Chinese-ASEAN trade relations are essentially reciprocal in nature. No longer is China the same exporting competitor of past decades. China represents an important new consumer market for ASEAN, while ASEAN is growing in importance for mainland China’s manufacturing. These growing ties open up numerous opportunities for many ASEAN countries such as Indonesia, the Philippines, Vietnam and Cambodia, which have large pools of labour and make for competitive low cost production locations for mainland companies.