YBhg. Dato’ Mohammad Faiz Azmi
Executive Chairman, Securities Commission Malaysia 

Distinguished guests, 

Ladies and gentlemen. 

Good afternoon, everyone. It is a pleasure to be here at the ASEAN Investment Conference 2025.

First and foremost, let me extend my sincere appreciation to the Securities Commission Malaysia, as well as AFFIN Group, CGS International and RHB Banking Group for organising this conference and my opportunity to speak. It’s almost the end of Day 1 so I will try not to be too repetitive.

You will have heard a lot about ASEAN as an investment destination – indeed, it is a compelling case being: 1) home to about 700 million mainly young, hardworking, ambitious and digitally savvy people, 2) a region richly endowed with natural resources and located at the heart of Asia-Pacific commerce, 3) politically, relatively stable and 4) economically, the fastest growing region in the world backed by governments with generally sound balance sheets.

These themes inspired me during my 30-year banking career to lead CIMB into becoming a leading ASEAN bank. Driven by the 2007 vision of the ASEAN Economic Community (AEC), CIMB established a brand synonymous with ASEAN and presence in all markets to enable and catalyse intra-ASEAN flows of trade, capital and people. We moved fast because we were told that the AEC would come into being in 2015; by when ASEAN would be a single production base with free movement of goods and services, capital, investment and skilled labour.

As it turned out, ASEAN took big strides but despite the celebratory rhetoric AEC fell considerably short of its promise. Although tariffs were brought down on almost all items, non-tariff barriers rose practically in tandem. Many restrictions remained on movements of people, capital and investments and ASEAN still resembled 10 fragmented markets instead of a single production base. CIMB did not realise the expected operational synergies nor surge in revenues from exponential growth in flows of trade, people and capital. I recall being, disappointed by AEC launched at the end of 2015, and somewhat jaded by the persistent gap between ambition and rhetoric, and reality. 

However today, 10 years later, I find myself optimistic about ASEAN once more because of three main reasons. Firstly, new geopolitics and ASEAN’s strategic neutrality is attracting investors from the east and west; in 2023, FDI into the region hit a record US$230 billion (or 17.2% of global FDI) despite a 10% decline in global FDI inflows. Meanwhile, ASEAN maintains strong economic ties with all major and super economic powers. ASEAN has been adept at maintaining unity within and neutrality without. No doubt, these will be tested in the coming weeks and months, but this “Trumpian” crisis is also an opportunity to demonstrate and further cement unity and resilience of ASEAN. We are stronger together; we mustn’t be divided by cheque books or security blankets.

Another reason for my optimism is the fact that for the first time we have a new cadre of internationalist leaders; from Malaysia’s Anwar Ibrahim to Indonesia’s Prabowo, Singapore’s Lawrence Wong, Thailand’s Shinawatra, Philippines’ Marcos and Cambodia’s Hun Manet. ASEAN works best when leaders are genuinely enthusiastic about regionalism, and I don’t recall a time when we had so many at one time.

Thirdly, ASEAN has learnt hard lessons from its own past, not least about the imperative of “execution” versus rhetoric. ASEAN has better prospects today because we understand not just the possibilities, but also the limitations better than in 2007 when the AEC plan was launched. Back then, we thought we wanted to grow up to be like the European Union (EU), but we now know that we cannot and should not. When you have realistic plans, chances of success are always better. And really, it should be about achieving tangible, piecemeal progress not grandiose plans.

‘This is a pivotal time for ASEAN” sounds like a cliché, but when the world is pivoting towards an unknown, it is not. If ASEAN can’t take large integration steps forwards now, if we can’t turbo-charge economic integration workstreams now; when can we?

Ladies and gentlemen,

As Chairman of ASEAN-BAC, we have identified 12 practical and achievable initiatives for the year, anchored by the theme of “Unifying Markets for Shared Prosperity”. We are focused on how to make doing business easier for companies while also addressing challenges of financial integration, inclusivity, sustainability, digitalisation and the ASEAN identity. Let me highlight some of them here.

Our most important project is known as the ASEAN Business Entity or ABE. Whenever I reflect on those years of building CIMB as an ASEAN company, my main conclusion is always that it did not have to be so hard and the benefits of doing so should have been far greater. I think we need to admit that the AEC cannot deliver on its promise of being a single production base. Yet we want our companies and FDI to be able to realise the economies of scale of one region. How do we “square the circle”? We suggest that there be a new classification of companies known as ABE and enable feedoms at the company level. Companies that are approved as ABE’s should be allowed operational flexibilities such as free movement of people and cross-border operational outsourcing to realise ASEAN economies of scale in their business operations. 

Another interesting project that we are working on is the simple idea of availing the ASEAN IPO Prospectus as an option for companies seeking listing on their home exchanges so they can raise funds from any investor in markets that recognise the ASEAN IPO Prospectus, opening-up a wider pool of capital for IPOs. This would be a meaningful, albeit small, step forward in integrating ASEAN capital markets. An ASEAN stock exchange is a beautiful dream, but not a realistic one so let’s focus on a step forward that is within reach. This project has been aligned with our Securities Commission’s ASEAN agenda for this year.

Another project is a study on ASEAN Private Markets working together with McKinsey & Co. The problem statement is such that ASEAN private markets is underdeveloped and estimated at only 0.5% of GDP versus the average global benchmark of 1.5% of GDP. The report will show that the private markets industry is extremely important for the economy but remains too small in ASEAN. We estimate that up to $60 billion in capital should be channelled to ASEAN private equity and venture funds, but certain reforms are needed to reduce market fragmentation and improve conditions for investment monetisation. We will submit this report to ASEAN Leaders next month. 

We also have a workstream on ASEAN Carbon Markets. Several milestones have been achieved by our working group. In August last year, we launched the Malaysia Carbon Market Association intended to serve as the Malaysian platform to collaborate with regional peers through development of more carbon projects, capacity building, mutual recognition of carbon credit methodologies by ASEAN countries, and sharing of best practices. At COP29 in Baku Azerbaijan, a Memorandum of Collaboration was exchanged among carbon market associations in the region involving the Malaysian, Singaporean, Indonesian and Thai national chapters. 

As part of our effort to increase intra-ASEAN trade we have a project focused on the digitalisation of cross-border trade; and in particular, between businesses. By and large cross-border trade documentation between businesses and governments is digitally exchanged through the ASEAN Single Window so the laggard is in the digitalisation of business documentation among service providers of cross-border procedures. We are developing a new digital trade exchange platform for Malaysian companies and will work with other ASEAN-BAC chapters on interoperability with their national platforms.

These and 7 other less-financial projects will define our chairmanship year. We are now at the stage of getting the endorsements from various levels of ASEAN Governments. I don’t know how successful we will be, but ABAC Malaysia had an 18- month lead time and all the research work was done way ahead of time, unprecedentedly so.

Ladies and gentlemen,

I cannot emphasise more how ASEAN must take meaningful steps forwards at this time. Beyond ASEAN-BAC’s projects there are also many other existing and new workstreams to reduce non-tariff barriers, to create the ASEAN grid, to launch DEFA and so on. I hope that 2025, the year of Malaysia’s chairmanship, will be remembered as the one that really moved the dial on economic integration not because we said all the right things but because we made progress on workstreams that matter for businesses and investors.

In my presentation to the ASEAN Economic Ministers in Desaru, Johor a few weeks ago, I concluded by saying that ideas generation is easy, the tough part is implementation. And I pleaded for 3 things – “execution, execution & execution”.

With that, thank you.

--BERNAMA