Fostering Inclusive Growth in ASEAN

ASEAN has to become more inclusive to ensure the benefits of growth are more widely shared. Even Singapore, one of the best performers in ASEAN, lags significantly behind advanced economies in providing adequate social protection and income security for its citizens. Significant gaps also exist within ASEAN, most notably in terms of infrastructure, public institutions, and the provision of health, education and basic services.

The ASEAN region lags vis-à-vis other regions in several areas including providing its citizens with an adequate social safety net, formal financial services like bank accounts, a means to accumulate savings and build assets to ensure a minimum level of income security and resilience from shocks. Wage and non-wage benefits are another area where ASEAN lags compared to other economies globally. The region also must focus on providing adequate remuneration, strengthen the bargaining power of wage setting institutions, reduce informality and focus on provision of other non-wage benefits like parental and sick leave in order to improve living standards, reduce inequality and expand its middle class.

Some of the same factors required to close the competitiveness gaps within ASEAN will also be important to increase the inclusiveness of the growth process within countries and across its member states. These include improving access, quality and equity of educational systems, improving physical and digital infrastructure and tackling corruption to ensure a level playing field reinforced by sound and fair institutions.