Services Trade Liberalization and Food Security: Exploring the links in the Association of Southeast Asian Nations (ASEAN)

This research paper examines the potential for services trade liberalization, specifically in financial and logistics sectors, to enhance food security within the Association of Southeast Asian Nations (ASEAN). The authors argue that while liberalization alone may not solve rural financial exclusion or infrastructure gaps, integrating food security objectives into services sector reform could provide a strategic rationale for deepening regional integration.

• Approximately 80 million people out of ASEAN's 550 million inhabitants are considered food insecure, with five countries—Cambodia, Indonesia, Lao PDR, the Philippines, and Timor Leste—classified as Low-Income Food-Deficit countries in 2011.
• The region faces varying levels of climate change risk, with the Philippines, Timor Leste, and Brunei Darussalam ranked 3rd, 7th, and 14th respectively among countries with the highest risk. Lao PDR is the only landlocked country in the region and is an exception to this high-risk trend.
• ASEAN has established regional food security mechanisms, including the ASEAN Integrated Food Security framework and the Strategic Plan of Action on Food Security adopted in 2009. Additionally, the ASEAN+3 Emergency Rice Reserve (APTERR) holds 787,000 tonnes of rice, supported by a US$4 billion endowment fund.
• Financial services liberalization in ASEAN has not consistently improved credit access for the poor. Foreign banks tend to focus on large firms and high net-worth individuals, and in some countries, operational restrictions persist; for example, foreign banks in Thailand have generally not been approved to open more than one branch despite a technical allowance for three.
• Rural financial markets in Southeast Asia are hindered by high transaction costs, information asymmetry, and a lack of collateral. In Indonesia, Vietnam, and the Philippines, fewer than 40 per cent of residents have access to financial services.
• Logistics quality varies significantly across the region. According to the 2012 World Bank Logistic Performance Index, Singapore ranks 1st globally, while the least developed members—Cambodia, Lao PDR, and Myanmar—rank 101st, 109th, and 129th respectively.
• Poor logistics infrastructure directly impacts food prices and security. In Indonesia, remoteness and poor infrastructure lead to price differentials; for example, consumers in West Kalimantan pay approximately US$0.014/kg more for rice than the national average.
• Regional food trade is hampered by port inefficiencies, particularly in Vietnam (exporter) and Indonesia and the Philippines (importers). Waiting times for loading, offloading, and clearance account for about 45 per cent of the total time to move grains from farmers to consumers.
• ASEAN's efforts to liberalize logistics through the Roadmap for the Integration of Logistics Services (RILS) and the AEC Blueprint are hindered by foreign ownership restrictions and a lack of enforcement via the Enhanced Dispute Settlement Mechanism (DSM), which has not been used since its 2004 establishment.

APA

Chandra, A. C., & Kinasih, H. N. (2012). Services Trade Liberalization and Food Security: Exploring the links in the Association of Southeast Asian Nations (ASEAN). International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/services_trade_liberalization_asean.pdf

Chicago

Chandra, Alexander C., and Herjuno N. Kinasih. Services Trade Liberalization and Food Security: Exploring the links in the Association of Southeast Asian Nations (ASEAN). International Institute for Sustainable Development, 2012. https://www.iisd.org/system/files/publications/services_trade_liberalization_asean.pdf.

Wikipedia

{{cite report |last1=Chandra |first1=Alexander C. |last2=Kinasih |first2=Herjuno N. |title=Services Trade Liberalization and Food Security: Exploring the links in the Association of Southeast Asian Nations (ASEAN) |publisher=International Institute for Sustainable Development |date=December 2012 |url=https://www.iisd.org/system/files/publications/services_trade_liberalization_asean.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{chandra2012services, author = {Chandra, Alexander C. and Kinasih, Herjuno N.}, title = {{Services Trade Liberalization and Food Security: Exploring the links in the Association of Southeast Asian Nations (ASEAN)}}, institution = {International Institute for Sustainable Development}, year = {2012}, month = dec, url = {https://www.iisd.org/system/files/publications/services_trade_liberalization_asean.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }