Data and Profiles - Market Profiles

ASEAN: Market Profile

29 Nov 2024

HKTDC Research

Major Economic Indicators (2023)

Land Area Population Nominal GDP Per-capita GDP Real GDP Inflation Merchandise
(sq km) (‘000) (US$ bn) (US$ ’000) growth (%) exports
(%) (US$ bn)
ASEAN 4,452,483 676,584.5 3,786.2 5.8 4.1 8.3 1,811.3
Brunei 5,765 405.5 15.1 33.5 1.4 0.4 10.8
Cambodia 181,035 17,091.5 42.0 2.5 5.0 2.1 21.7
Indonesia 1,892,410 278,696.2 1371.3 4.9 5.0 3.6 258.9
Laos 236,800 7,545.8 14.2 1.9 4.2 31.2 6.0
Malaysia 330,411 33,379.5 396.3 11.9 3.6 2.5 312.6
Myanmar 676,577 56,243.0 64.4 1.1 3.3 22.0 14.8
The Philippines 300,000 111,912.4 437.2 3.9 5.5 6.0 72.9
Singapore 734 5,917.6 501.3 84.7 1.1 4.8 475.9
Thailand 497,407 65,083.8 514.9 7.4 1.9 1.2 284.6
Vietnam 331,344 100,309.2 429.5 4.3 5.0 3.3 353.1
Sources: ASEAN Secretariat and ASEAN+3 Macroeconomic Research Office

Overview

‑
The Association of Southeast Asian Nations (ASEAN) is a fast expanding trade bloc consisting of ten member states – Brunei, Cambodia,
Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

ASEAN’s GDP grew at an average annual rate of 4.0% between 2014 and 2023. The bloc’s combined GDP was about US$3.8 trillion in 2023. Its
population numbers about 677 million. If considered as a single entity, ASEAN is the third largest economy in Asia and the fifth largest in the
world, after the US, China, Japan and Germany.

The ASEAN member states (AMSs) are, however, very diverse in terms of income levels. While the group’s overall GDP per capita was US$5,794 in
2023, its member states’ GDPs per capita range from a low of approximately US$1,100 in Myanmar to a high of US$84,700 in Singapore.1

The leading economic sector in ASEAN in 2022 was the tertiary sector, which accounted for 50.5% of the bloc’s GDP. The secondary sector made
up 29.8%, and the primary sector 16.4%.2

The ASEAN Economic Community (AEC) was officially launched on 31 December 2015 to improve regional economic integration. ASEAN’s single
market allows for easier movement of goods, services, investment, capital and people across the region. The AEC Blueprint 2025 sets out broad
directions for the economic development of the AEC until 2025, with five main goals. These are: (i) a highly integrated and cohesive economy; (ii)
‑ ‑
a competitive, innovative, and dynamic ASEAN; (iii) enhanced connectivity and sectoral co operation; (iv) a resilient, inclusive, people oriented,
‑
and people centred ASEAN; and (v) a global ASEAN.3

Current Economic Situation

The ASEAN economy expanded by 4.1% in 2023, marking a slight slowdown in growth from 5.6% in 2022. Private consumption was one of the
key growth drivers. Consumer confidence rose in most AMSs as the job market showed increasing resilience. The bloc’s unemployment rate
‑ ‑ ‑
returned to pre Covid levels, dropping from 4.2% in 2022 to 3.8% in 2023. While ASEAN’s exports of goods fell by 7.7% year on year to US$1,811
billion in 2023, its exports of services grew by 8.1% on an annual basis to US$554 billion.4

According to IMF estimates, the ASEAN-5 economy (Indonesia, Malaysia, the Philippines, Singapore and Thailand) is expected to grow by 4.5% in
both 2024 and 2025. This figure is considerably higher than that for the world’s advanced economies, which is forecast to be 1.8% for both years.
Nevertheless, geopolitical conflicts and the possible ratcheting up of protectionist policies globally may affect the bloc’s manufacturing and
export activities.5

ASEAN’s inbound tourism sector, meanwhile, is set to remain robust. The number of visitor arrivals surged from 43.6 million in 2022 to 101.9
‑
million in 2023, and this trend is expected to continue, providing additional support for retail, hospitality and other travel related sectors.6
In 2023, FDI inflows to ASEAN reached a historically high level of US$230 billion, despite an overall decline in global FDI flows. The financial and
insurance sector accounted for 40% of the total, and the manufacturing sector 22%.7 Singapore was the largest recipient of FDI among the AMSs,
with about 70% of the total, followed by Indonesia (9%) and Vietnam (8%).8

Trade in Goods and Services

ASEAN itself is the largest market for exports of goods from the trade bloc, accounting for 22.1% of total ASEAN exports in 2023, followed by
mainland China (15.9%), the US (14.9%), the EU (8.6%) and Japan (6.7%).

Major Exports of Goods (2023)

HS code Share of Total Exports of

Goods

85 Electrical machinery and equipment and parts 28.8%

27 Mineral fuels and oils 10.9%

84 Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof 10.2%

87 Vehicles and parts 3.2%

90 Optical goods 2.8%

15 Animal or vegetable fats and oils 2.7%

Natural or cultured pearls, precious or semi-precious stones; precious or semi-precious 2.7%

71
metals

39 Plastics and articles thereof 2.6%

72 Iron and steel 2.5%

40 Rubber and articles thereof 2.1%

Others 31.5%
Source: ASEAN Secretariat, ASEANstats database

Mainland China was the largest source of ASEAN imports in 2023, with 23.9% of the total, followed by ASEAN member states (20.9%), the US
(7.4%), South Korea (7.0%) and Japan (6.9%).

Major Imports of Goods (2023)

HS code Share of Total Imports of Goods

85 Electrical machinery and equipment and parts 25.2%

27 Mineral fuels and oils 17.1%

84 Nuclear reactors, boilers, machinery, mechanical appliances and parts 11.1%

39 Plastics and articles thereof 3.4%

87 Vehicles and parts 3.3%

72 Iron and steel 2.9%

71 Natural or cultured pearls, precious or semi-precious stones; precious or 2.6%

semi-precious metals

90 Optical goods 2.4%

29 Organic chemicals 1.9%

73 Iron and steel articles 1.7%

Others 28.4%
Source: ASEAN Secretariat, ASEANstats database

Travel, transport and other business services dominate ASEAN’s export and import of services. In 2023, these three segments made up 70.7% of
ASEAN’s total exports of services and 75.0% of its services imports. Singapore remains the services hub of the bloc, accounting for 60% of
ASEAN’s services exports and 56% of its services imports.

Major Items of Trade in Services (2023)

 Exports Share of Total Exports of Imports Share of Total Imports of
Services Services

Other business services 28.1% Transport 30.8%

Transport 24.0% Other business services 29.8%

Travel 18.6% Travel 14.4%

Financial services 8.6% Telecommunications, computer, and 7.7%

information services

Telecommunications, computer, and 7.6% Charges for the use of intellectual 5.9%
information services property, n.i.e
Source: ASEAN Secretariat

Trade Policy

In 1992, the ASEAN countries established the ASEAN Free Trade Area (AFTA). The aim was to try to improve the bloc’s competitive edge as a
‑ ‑
production base by reducing or eliminating tariffs and non tariff barriers on intra ASEAN trade, as well as by attracting FDI. AFTA adopted a
Common Effective Preferential Tariff (CEPT) scheme within ASEAN to reduce tariffs to between zero and 5%. The ASEAN Secretariat was given
the authority to monitor and ensure compliance with AFTA measures. There is no common external tariff on goods imported from outside the
trade bloc, with each ASEAN member applying import tariffs based on its national schedules.

On the heels of AFTA, and as part of ASEAN’s Vision 2020, ASEAN embarked on a more ambitious strategy of regional economic integration by
launching the AEC on 31 December 2015. Under the AEC framework, the more developed AMSs (Singapore, Thailand, Indonesia, Brunei, Malaysia
and the Philippines) essentially implemented a zero tariff by the end of 2015. The remaining four members (Cambodia, Laos, Myanmar and
Vietnam) (CLMV) have reduced their import duties to between 0% and 5% on 98.9% of their tariff lines.

‑
Building upon separate free trade agreements (FTAs) secured with its members’ trading partners, ASEAN has adopted a pro active stance
‑
towards extra bloc free trade and regional economic integration. One of the most important moves it has taken was to sign the Regional
‑
Comprehensive Economic Partnership (RCEP) with its five main regional trading partners China, Japan, South Korea, Australia and New
Zealand. This came into force on 1 January 2022. The RCEP has been called the world’s largest FTA, accounting as it does for about 30% of the
world’s GDP and over a quarter of global trade.

‑
The RCEP aims to support economic integration and increase trade between countries in the Asia Pacific region. It is expected to play a crucial
‑
role in promoting post pandemic economic recovery and sustainable development in the long term. Initiatives proposed within the RCEP include
‑ ‑ ‑
eliminating tariffs, reducing non tariff trade barriers, strengthening supply chains, facilitating cross border investments, business co operation
‑
and e commerce, and enhancing the protection of intellectual property rights.

In November 2017, ASEAN and Hong Kong signed an FTA and a related Investment Agreement, which became fully effective on 12 February
‑ ‑
2021. The agreements cover six main areas of co operation – trade in goods; trade in services; investment; economic and technical co operation
(ECOTECH); intellectual property rights; and dispute settlement.

In January 2024, the First Protocol to Amend the FTA between ASEAN and Hong Kong was signed. This updated the Product Specific Rules (PSR)
of origin under the FTA, increasing the coverage of the PSR from more than 200 categories of products to almost 600. This makes it easier for
‑
Hong Kong businesses to obtain Hong Kong originating status for an increased number of specified products, and thus enjoy preferential tariff
treatment when expanding into the growing ASEAN market.

The products incorporated into the FTA through the Protocol include categories such as jewellery, medicaments, food products and textile
products. The Protocol helps make these products more competitive and creates more business opportunities for Hong Kong businesses in the
ASEAN market.9

Hong Kong’s Trade and Investment with ASEAN

‑
As a trade bloc, ASEAN has been Hong Kong’s second largest trading partner since 2010, bilateral trade reach US$145 billion in 2023, accounting
for 12.8% of the Hong Kong’s total trade with the world during the year.

‑ ‑
In 2023, Hong Kong’s total exports to ASEAN dropped by 8.0% year on year to US$42.5 billion. Major items exported to ASEAN in the period
‑
included semi conductors, electronic valves and tubes (29.7% share of total exports), telecoms equipment and parts (14.0%), electrical apparatus
‑
for electrical circuits (6.6%), parts and accessories of office machines/computers (4.3%), and engines & motors, non electric & parts (3.7%).
Vietnam was the top export market for Hong Kong in ASEAN, accounting for 33.8% of total exports to ASEAN, followed by Singapore, Thailand
and Malaysia.

Hong Kong’s imports from ASEAN totalled US$102.6 billion in 2023, showing a 14.3% decrease compared with 2022. Major import items were
‑
semi conductors, electronic valves and tubes (60.4% share of total imports), telecoms equipment and parts (6.4%), parts and accessories of
office machines/computers (3.7%), petroleum oils (other than crude) (3.1%), and computers (3.0%). Singapore was Hong Kong’s largest supplier
of imports in ASEAN, accounting for 41.2% of total imports from ASEAN, followed by Malaysia, Vietnam and Thailand.
 ‑
Hong Kong is an important entrepot for merchandise trade between ASEAN and the Mainland China. Re export trade between the two economies
through Hong Kong amounted to US$65.5 billion in 2023.

Hong Kong’s Trade with ASEAN

2022 2023 2024 (Jan-Sep)

Value Change (%) Value Change (%) Value Change (%)

(US$ mn) (US$ mn) (US$ mn)

Total Exports 46,156 6.5 42,483 -8.0 36,941 18.1

Domestic Exports 1,062 -12.7 1,049 -1.3 858 15.4

Re-exports 45,094 7.1 41,434 -8.1 36,083 18.1

Imports 119,791 2.8 102,612 -14.3 83,262 12.8

(of which re-exported) 69,126 9.4 57,102 -17.4 51,802 31.5

Total Trade 165,947 3.8 145,095 -12.6 120,203 14.4

Trade Balance -73,635 - -60,129 - -46,321 -

Source: Hong Kong Census and Statistics Department

Hong Kong’s Exports to ASEAN

2022 2023 2024 (Jan-Sep)

Value (US$ Value (US$ Value (US$

Share (%) Change (%) Share (%) Change (%) Share (%) Change (%)
mn) mn) mn)

Vietnam 14,413 31.2 8.9 14,343 33.8 -0.5 13,327 36.1 25.0

Singapore 10,630 23.0 18.6 8,351 19.7 -21.4 5,949 16.1 -3.4

Thailand 7,576 16.4 3.3 8,310 19.6 9.7 7,606 20.6 27.2

Malaysia 5,570 12.1 10.9 4,744 11.2 -14.8 4,383 11.9 24.9

The Philippines 4,415 9.6 -3.9 3,642 8.6 -17.5 3,086 8.4 12.5

Indonesia 2,601 5.6 -12.3 2,272 5.3 -12.7 1,914 5.2 16.5

Cambodia 752 1.6 -21.8 674 1.6 -10.4 569 1.5 15.2

Myanmar 155 0.3 -17.1 108 0.3 -30.0 82 0.2 11.9

Brunei 27 0.1 -32.3 24 0.1 -9.8 13 * -27.2

Laos 16 * -17.4 15 * -10.6 13 * 6.2

Total 46,165 100.0 6.5 42,483 100.0 -7.96 36,941 100.0 18.1
*Insignificant
Source: Hong Kong Census and Statistics Department

Hong Kong’s Imports from ASEAN

2022 2023 2024 (Jan-Sep)

Value (US$ Value (US$ Value (US$

Share (%) Change (%) Share (%) Change (%) Share (%) Change (%)
mn) mn) mn)

Singapore 51,094 42.7 -3.7 42,251 41.2 -17.3 35,808 43.0 17.5

Malaysia 22,679 18.9 6.1 19,199 18.7 -15.4 14,791 17.8 3.7

Vietnam 18,444 15.4 22.3 17,146 16.7 -7.0 15,973 19.2 44.2

Thailand 12,009 10.0 -8.9 10,971 10.7 -8.6 7,814 9.4 -3.8

The Philippines 12,071 10.1 7.4 10,172 9.9 -15.7 6,956 8.4 -10.5

Indonesia 3,142 2.6 45.9 2,507 2.4 -20.2 1,623 1.9 -10.8

Cambodia 217 0.2 -11.9 220 0.2 1.1 214 0.3 34.0

Myanmar 113 0.1 3.4 100 0.1 -11.1 78 0.1 -2.7

Brunei 18 * -73.1 43 * 142.2 3 * -86.0

 Laos 3 * 35.0 2 * -30.6 2 * 52.6

Total 119,791 100.0 2.8 102,612 100.0 -14.3 83,262 100.0 12.8
*Insignificant
Source: Hong Kong Census and Statistics Department

Hong Kong and ASEAN are major investors in each other

In 2023, Hong Kong was ASEAN’s fifth largest investor, contributing US$15 billion of FDI to the bloc. This made up 6.5% of ASEAN’s total FDI
inflow in that year.10

Meanwhile, ASEAN’s cumulative FDI in Hong Kong totalled US$67.9 billion by the end of 2022, accounting for 3.4% of the total FDI stock in Hong
Kong. Singapore was the largest investor in Hong Kong among the AMS, with an FDI stock of US$44.7 billion as at end 2022. ‑
ASEAN’s Involvement in Hong Kong Economy

According to the Hong Kong Census and Statistics Department, there were 648 ASEAN companies in Hong Kong as of June 2023, including 52
regional headquarters, 128 regional offices and 468 local offices. They accounted for about 7.2% of the total number of foreign companies in
Hong Kong.

‑
According to the Hong Kong Tourism Board, about 2.1 million tourists from the ASEAN 6 countries – Singapore, Malaysia, Thailand, Indonesia,
Philippines and Vietnam – visited Hong Kong in the first 9 months of 2024. That was an increase from 1.3 million in the same period in 2023. It
‑
marks a return to pre pandemic visitor levels, as about 2.1 million tourists arrived in Hong Kong from these countries in the first three quarters of
11
2019.

1
ASEAN Secretariat, ASEAN Statistical Highlights 2024, October 2024

2 ASEAN Secretariat, ASEAN Key Figures 2023, December 2023

3
ASEAN Secretariat, Economic Community, January 2022

4 ASEAN Secretariat, ASEAN Statistical Highlights 2024, October 2024

5
IMF, World Economic Outlook Update, October 2024

6 ASEAN Secretariat, ASEAN Statistical Highlights 2024, October 2024

7 ASEAN Secretariat, ASEAN Investment Report 2024

8
ASEAN Secretariat, ASEANstats database, November 2024

9 Hong Kong Government: Hong Kong signs first protocol to amend ASEAN - Hong Kong, China free trade agreement, January 2024

10
ASEAN Secretariat, ASEAN Investment Report 2024

11 Hong Kong Tourism Board: Visitor Arrival Statistics

Related Topics
ASEAN INTRA-ASEAN TRADE ASEAN ECONOMY ASEAN FREE TRADE AREA AFTA ASEAN ECONOMIC COMMUNITY AEC

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