JAKARTA – As the Association of Southeast Asian Nations reached its 45th birthday
Wednesday, it’s still struggling to get its ten members to agree on some key
issues – like what to do about tensions in the South China Sea.
But the middle-aged economic bloc
can at least celebrate what may be the first truly Asean company: AirAsia.
Asia’s largest low-cost carrier’s
fast-talking founder, Tony Fernandes, not only opened a new Asean headquarters
this week but also moved from Kuala Lumpur to Jakarta to be closer to the Asean
headquarters here.
“We started in Malaysia but now
we have become an Asean company,” he told reporters from his new office in
Jakarta Tuesday. “I hope that this will spur Asean governments into further
integration.”
While Mr. Fernandes’s photo-op
- flanked by ten models wearing the outfits
of different Southeast Asian countries – was an obvious grab for a bit of free
advertising , his claims regarding Asean are not just public relations spin.
Fifty-five of AirAsia’s 85
destinations are within Asean and most of the 10,000 people it employs are here
as well. As it boosts its fleet from around 100 planes today to more than 500,
most of those will also be flying in and out of this region.
Other companies are also trying
to regionalize, including banks like CIMB Group Holdings Bhd, and consumer
goods companies like noodle-maker PT Indofood CBP Sukses. But few can boast the
multiple stock market listings and executive teams AirAsia has in the region.
Southeast Asia is home to more
than 600 million people and has a combined gross domestic product larger than
that of India. And while the region
includes the whole spectrum of economic development – from Myanmar, one of the
poorest countries in the world, to Singapore, one of the richest – the growing
middle classes of Indonesia, Malaysia, Thailand and the Philippines are
expected by many economists to make the region the next engine of growth for
Asia.
The speed and stability of that
growth will partly be decided on how successful the ten-member countries of
Asean are at integrating their economies and financial markets – a process that
is supposed to gain momentum between now and 2015, when Asean leaders are
hoping to have some form of economic community in place. Mr. Fernandes’
industry will be an important testing ground of how far the countries are
willing to go.
Asean has plans for an open skies
policy which would allow AirAsia to streamline operations, as it would not have
to deal with different regulatory regimes in each country.
Differing rules are the reason
why AirAsia has had to create multiple joint ventures and stock listings around
Southeast Asia. The rules also force airlines to go through different
procedures to acquire landing rights and have different sets of pilots for each
country. That’s a lot of inefficiency
that a low-cost carrier would like to avoid to keep costs low.
AirAsia’s new headquarters will
be home to less than 25 employees, but there are a lot of extra desks for it to
grow as barriers to business are lowered.
In the meantime, the airline is
promoting a new Asean consciousness through a doe-eyed cartoon character named
Aseanita, whose Facebook page is dedicated to promoting Asean pride and
culture. It asks fans of the page to
figure out exactly what that means, but suggests that among things the people
of Asean should be proud of are: boxer Manny Pacquaio, durian and the Khmer
tattoo that runs down Angelina Jolie’s shoulder.
Whether Aseanita will trigger a
new Asean consciousness remains to be seen. But hopes for the middle aged
economic bloc are starting to bloom in some boardrooms.
“It is a massive market with
massive potential,” said Mr. Fernandes. “People like us will be setting the
trend.”
Eric Bellman
Business & Investment Opportunities
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