Pessimists often point to the vast economic gap between ASEAN’s rich and poor nations as a barrier to its hopes of a full EU-style economic union, and this week the region’s leaders warned the gap is getting bigger. ASEAN’s secretary general Surin Pitsuwan said a union with such a gap was “not stable” and Vietnam’s Prime Minister Nguyen Tan Dung also cautioned that a widening gap would thwart hopes for a planned 600 million strong common market, especially by the 2015 target date.

Cambodia, Laos, Vietnam and Myanmar have all seen increased growth in the past few years but they remain at the bottom of ASEAN’s GDP table. To put the situation into perspective, bottom-ranked Myanmar’s annual GDP per capita is US$419, while richest member Singapore’s is $36,000. This gap, along with vast differences in administrative conditions (to put it mildly) also make the wealthier countries far more attractive investment destinations, in turn widening the gap further.

Observers are raising doubts that ASEAN has the budget, vision or ability to address the issue in a short time. The European Union, as well as perhaps having a clearer sense of common purpose, was also able to set up a fund to reduce the smaller economic gaps between its members. Much of ASEAN’s hope will depend on whether larger countries like Vietnam and Indonesia can continue to attract investment from the world’s wealthiest countries for much-needed infrastructure and transport upgrades, and ASEAN announced an in-principle agreement earlier this year to establish a fund to improve infrastructure across member countries.

source & article: AFP via Yahoo! Singapore