May 2, 2016 4:00 pm JST
Interview

ASEAN needs Schengen-like system: top Thai business school head

KEN KOYANAGI, Editor-at-large, Nikkei Asian Review

BANGKOK -- If Southeast Asian countries want to make their common market more effectively function as a pan-regional economy, they should accelerate the free movement of people, according to the head of the region's top business school.

In an interview with the Nikkei Asian Review in late April, Dipak Jain, director of Sasin Graduate School of Business Administration at Chulalongkorn University in Bangkok, said, "ASEAN (Association of Southeast Asian Nations) should install its own version of Schengen rules" to let people move freely within the region. Jain was referring to the European Union's arrangement that allows member states' nationals to cross each other's borders without passport checks.

ASEAN officially launched a region-wide common market, dubbed the ASEAN Economic Community, at the end of 2015, where the 10 member states have agreed to advance the free movement of goods, money and people over the coming years. While tariffs on over 95% of goods traded inside the region have been abolished, rules on human travel and relocation across borders have changed very little, keeping it difficult for companies in the region to utilize human resources of multiple nationalities in integrated and dynamic ways.

For example, if a company wants to relocate some of its employees in one country to another frequently, the destination country's rules on visas, immigration and labor often stand in the way. "Connecting people to people is the key to success for the AEC," said Jain, claiming that the current situation is not very supportive.

Jain also pointed out that Thailand is geographically better positioned than other ASEAN countries to benefit from the AEC by becoming a regional hub. "You can fly or drive directly to every part of the region from Bangkok," he said. He also noted that a lower cost of living compared to Singapore is another advantage for the kingdom. To leverage those factors and attract business investment, he said, development of both physical and soft infrastructure will be crucial.

India-born Jain is an internationally renowned marketing and business management scholar and has served as the Sasin director since 2014. Prior to the current position, he served as dean of such top business schools as INSEAD and Kellogg School for Management at Northwestern University. He also sits on the board of directors at such publicly traded companies as Northern Trust of the U.S. and Reliance Industries of India.

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