With a young population, ASEAN has the third-largest labour force in the world, after China and India, with a fast-growing middle class given the rapidly rising affluence. By 2020, ASEAN is expected to account for more than USD2 trillion of additional consumption to the world economy. Motivation for ASEAN Integration A key factor that underpins the region’s potential is its progressive economic integration. ASEAN is one of the most diverse regions in the world – in terms of economic size, income level, resource endowment, economic structure, financial sector development, and economic systems. The region has therefore leveraged on its complementarities arising from this diversity. This is reflected in the increased cross-border production networks, and the significant increase in intra-regional trade and investment activities. Since 1990, ASEAN intraregional trade has grown from 18% to 24% of its total trade, and intra-regional investment  BIS central bankers’ speeches  1  activities have now quadrupled since 2000, from 4% to 17% of its total investment. While there has been a trend towards greater intra-regional trade and investment, financial integration in the region has not progressed as significantly. ASEAN economies have, however, now reached that stage of development whereby greater regional financial integration can further unlock our growth potential. The push for regional financial integration is to bring about a more effective intermediation of funds, bringing the excess savings from one country to be channelled into productive investments in another.

Notably, the launch of the ASEAN Banking Integration Framework (ABIF) in March 2015 and the progress made in integrating the regional capital markets and the payment and settlement systems are important milestones in this process. Partnerships for a Successful Future While the authorities and policy makers in ASEAN have entered into multilateral partnerships to achieve the common goal of a more promising future, so has the private sector, given the immense opportunities the more integrated region presents. This is also reinforced by the intrinsic predisposition of the DNA of the region and its people and institutions. The future of ASEAN needs to be built on the collective actions that are for the advancement of ASEAN. Businesses have already been proactive in harnessing the benefits arising from the diversity  2  BIS central bankers’ speeches  and complementarities in the region. To date, these efforts have culminated in the launch of the ASEAN Economic Community in 2015. In a global landscape that is constantly evolving, uncertain and complex, building effective and smart partnerships has become an imperative for the common goals that ASEAN aims to achieve. Partnerships are important because no one entity has all the solutions, answers and expertise to take full advantage of all the opportunities and synergies that are created in such partnerships. Moving forward, building successful partnerships is an important strategy to realise the true economic potential of ASEAN. As an example, effective partnerships in the financial sector have made important contributions to institutional building in our financial systems.