THERE is no question that the Southeast Asian region, as embodied in the Association of Southeast Asian Nations (Asean), is the bright spot of the global economy, and will remain so for years to come.
The region is moving toward more economic integration not only to enhance the individual countries of Asean, but as a buffer and protection against other regions and, of course, China.
No one knows exactly how this integration is going to play out. It will be a mostly free-trade zone, but without a common currency similar to the North American Free Trade Agreement. There may be some lifting of travel requirements to cross borders, but nothing like the Schengen area of Europe, which has abolished passports.
Investment flow will be increased between Asean members, but there will still be some restrictions and, frankly, hesitation and caution about letting full completion of many economic sectors.
However, there is little doubt that Asean members are committed to move forward as much out of necessity in the current global environment as from a desire to help each other improve.
The Asean members are a very mixed bag of economic development and progress from Cambodia and Myanmar to Singapore and Malaysia. But there are some common interests and traits which may be able to hold the Asean integration together without too many problems.
Part of the reason that Asean integration will be successful is that it has been a process, almost an informal joining over many years.
The stock exchanges in Singapore, Malaysia and Thailand launched the so-called Asean Trading Link in 2012. This platform was designed to facilitate investors being able to trade on the home stock-market listed shares of companies in the other countries. But three stock markets do not make for a regional exchange. In fact, the Asean trading link was first only Singapore and Malaysia, which makes sense since those two countries are already closely integrated with some large companies being as much Singaporean as they are Malaysian.
Philippine Stock Exchange (PSE) CEO Hans B. Sicat said this past week that the PSE intends to join the trading system as early as 2016. This would be a good move for both the Philippines and the Asean.
There are problems with integrating government rules and regulations across borders that must first be resolved, perhaps requiring some changes in Philippine securities laws. Sicat said that Filipino investors are not currently allowed to buy stocks abroad through brokerage accounts at home, which is typical of our misguided protectionist policies.
Hopefully, some in the legislature will recognize the need for the PSE joining the regional stock markets and will champion this cause. This is good for the Philippines, and it is good for Filipino investors.