The ASEAN Economic Community: How SMEs Could Exploit Local Value To Compete?

Abstract

The development of collaboration among ASEAN country members towards the ASEAN Economic Community (AEC) at the end of 2015 has an impact on various fields of business, with direct effects on ASEAN countries’ economic structure and condition. During the full development of theAEC, small and medium enterprises (SMEs), despite a number of limitations in doing business, need to accelerate their acquisition of knowledge related to various aspects of the AEC and to prepare for arriving opportunities and increasing competitiveness. This paper, therefore, aims at describing the concept of regional economic integration, clarifying the past and present status of AEC development, and analyzing local SMEs performance and their competitiveness at the regional level. Furthermore, a number of benefits and opportunities of being the AEC have been identified. In addition, a number of ways that SMEs can compete in the region by exploiting the local value have been proposed. To strengthen competitive capacity, SMEs should think big (think all of ASEAN) and exploit their local knowledge by cooperating with other members in the region while remaining competitive. As discussed, following this strategy will effectively leading them to become a successful part of the AEC.