Economy Of SE Asian States 'To Surpass Japan By 2025'

(IDEX Online News) – The combined economy of South-east Asian states will surpass that of Japan, the world's third-largest diamond market, by 2025, Singapore's United Overseas Bank (UOB) forecasts.

The bank predicts that the setting up of the Association of Southeast Asian Nations (ASEAN) economic community in 2015 and China's growing economic strength will boost the region's growth by increasing regional trade ties.

In addition, domestic factors, such as growing populations and the burgeoning middle class across South-east Asia, will also help boost the region's economic performance.

ASEAN states include Singapore, Indonesia, Thailand, the Philippines, Vietnam, Myanmar, Malaysia, Cambodia, Laos and Brunei. They have a combined nominal Gross Domestic Product (GDP) of $2.4 trillion. Japan, the third-largest economy in the world, has a nominal GDP of $4.9 trillion.

Singapore's United Overseas Bank said ASEAN states require only a growth rate of two-thirds of the pace of their expansion between 2001 and 2013 to enable them to collectively overtake Japan by 2025.

"We believe that these projections for South-east Asia are achievable going by recent developments in the region, including the opening up of Myanmar to the international community, the presidential election in Indonesia and the return of stability in Thailand after the military coup," the bank said.

"We expect that pro-business policies will continue to be pursued by various member states within ASEAN … that will help to promote free flow of goods, services, investment and skilled labor, as well as freer flow of capital, all of which would serve to make the region into an enlarged production base and a consumer market."