BANDAR SERI BEGAWAN, Sept 12: Southeast Asia must restore investor confidence and cut business costs to become a significant global player, the region’s economic ministers were told here on Thursday.

The Association of Southeast Asian Nations (ASEAN) must also push ahead with deepening its economic integration and forging wider economic links with East Asian and Pacific neighbours, Brunei ruler Sultan Hassanal Bolkiah said.

“Although economies in the region are already recovering from the aftershocks of the Asian financial crisis and the September 11 attacks, we still face challenges in becoming a key global player, he said at the opening of the 34th ASEAN economic ministers meeting in Brunei’s capital.

Among others, foreign direct investments have dwindled significantly from pre-crisis levels, he said, referring to the financial storm that swept through East and Southeast Asia in 1997-1998.

Growth in intra-regional trade has yet to increase significantly, even if tariffs on most goods have been reduced to a maximum five percent in ASEAN’s six core member countries under the ASEAN Free Trade Area (AFTA), he said.

Consequently, confidence of foreign investors has to be restored and the cost of doing business in ASEAN has to be minimised, he said.

The 10-nation regional bloc has seen its share of foreign direct investments dwindle in recent years as investors flocked to its giant neighbour China a single market of 1.2 billion consumers with much cheaper labour costs.

ASEAN, which groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, has also been hurt by a flood of cheap Chinese exports to world markets.

Hassanal said while progress has been made in reducing tariff barriers and in efforts to harmonise standards and simplify customs procedures, ASEAN can do more.

He said initiatives aimed at enhancing regional economic cooperation should be reviewed for their effectiveness and modified when necessary and urged the ministers to continue to cooperate with ASEAN’s private sector.

The absolute monarch of the small but oil-rich kingdom also called on ASEAN to reach beyond its borders toward China, South Korea and Japan as well as to Australia and New Zealand.

Officials said the discussions were dominated by a proposed framework agreement for deeper economic cooperation with China which would include a free trade agreement (FTA) to cover nearly two billion people.—AFP