Jakarta. ASEAN-6, the sub-grouping of the Southeast Asian bloc, will see its nominal gross domestic product top $4 trillion by 2025, according to a study by the DBS Group Research.

The ASEAN-6 encompasses the bloc’s chair Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. The DBS Group Research forecasted that the ASEAN-6 could see a growth of between 5 and 5.5 percent over the next five years. Data show that ASEAN-6’s nominal GDP totaled $2.9 trillion in 2020. 

“With strong economic expansion, ASEAN-6's prominence has increased over the past two decades. Its nominal GDP is set to exceed $4 trillion by 2025. This would make it the fifth largest [as a bloc] globally, just behind the US, China, Japan, India, and Germany, and fourth within Asia,” the DBS report reads.

Continued regional integration with Asia, among others thanks to the Regional Comprehensive Economic Partnership (RCEP), will likely drive up trade and investment inflows to the ASEAN-6 region, according to the study. 

The RCEP’s signatories comprise the 10 ASEAN member states, China, Japan, South Korea, Australia, and New Zealand, thus making it the world’s largest free trade area. The trade pact is projected to eliminate 90 percent of the tariffs on goods traded between its signatories within 20 years of coming into force.

More companies are also avoiding investing solely in China and going for other alternative investment destinations, particularly amidst China’s growing tension with the US.

“Individual Southeast Asian economies would be unable to replace China as a manufacturing base. Yet, as a bloc, it can rival China in attracting foreign direct investment [FDI],” the DBS report reads, while adding that Indonesia has commodities to offer to the investors.

The ASEAN-6 accounted for around 11 percent of the world’s FDI inflows in 2020. China represented 12 percent of the global total FDI inflows in the same year, according to the DBS report. 

Indonesia’s economy rose 5.3 percent in 2022 — the highest in the ASEAN region. Close neighbor Singapore posted a 3.65 percent growth, whereas Thailand’s economy increased by 2.59 percent.

“Indonesia's main strategies [as the bloc’s chair] is to boost ASEAN’s economic integration and competitiveness in a bid to make ASEAN an epicenter of economic growth,” Chief Economic Minister Airlangga Hartarto said recently.