The ASEAN economic community and advancement of technologies In Southeast Asia: a regional innovation system approach

Abstract

Technology and the globalisation of markets are freeing firms from their historical roots. As firms reorganise their activities globally, governments are becoming concerned about devising new technological policies to foster the production, use and diffusion of knowledge. As Southeast Asian economies are forging into an ASEAN Economic Community (AEC), they are, on one hand, taking advantage of a more integrated and globalised regional market to advance their technological levels while, on the other hand, they may have to adopt a clear vision to give focus and priority to socio- economic policy designed and implemented at the national, and increasingly the sub-national and supranational, level. The paper is to explore what extent does the creation of a more integrated economic community facilitates the exchange of tacit and codified technological knowledge, along with greater flow of goods, services and investment. Since Southeast Asia mainly comprises developing countries where small and medium enterprises (SMEs) are responsible for the largest share of employment and a significant share of value added, the paper applies the so-called "regional innovation system" approach, as the regional dimension is crucial and SMEs tend to be dependent on regional conditions and regional support. Specifically, we want to study how the formation AEC will affect industrial clusters in the regional production system which, if functions well, facilitates the knowledge and information circulation. We will take the Multimedia Super Corridor (MSC) in Malaysia as a demonstrative case in reaching tentative conclusions and suggestions.