The AEC does not address movement o

The AEC does not address movement of low(er) skilled people within the region, despite the
fact that the majority of migrants are low-skilled (and many irregular) and greater economic
integration is likely to intensify labour flows (Huelser and Heal 2014). As the ILO/ADB
(2014: 93) study highlights, an increased demand for lower skilled workers in specific
sectors, would lead to the so-called ‘migration hump’, where countries like Malaysia,
10 Singapore, and Thailand seen as ‘migration hubs’ could benefit from freer trade by
employing more migrants. As the case of Thailand depicts, labour force is likely to shrink by
2022 and demand for medium- and lower skilled migrants to sustain production and growth
(especially in sectors like construction, fishing, food processing, garment industries and
domestic work) will rise. Thus, Thailand is developing a need for migration policies that
adequately deal with labour migration. The magnitude of the migratory phenomenon in the
region suggests that both sending and receiving countries from the region may develop an
interest for a strategy to manage migration and protect migrant workers, offering clear
migration channels, incentives for migrants to use institutionalized routes and be assured
against exploitation and trafficking. Thus far it seems that the AEC will only have a small
regulatory impact on overall flows of labour migration. And while acknowledging that there
are clear challenges and political sensitivities in liberalizing low-skilled labour, given mainly
the economic-cultural diversity within ASEAN, a regional economic community comprising
a single market and production base may constitute a valuable venue for addressing labour
flows on a systematic basis.
The agenda on labour mobility has also spread within bilateral/plurilateral trade agreements
concluded by ASEAN with third countries or separately by various member states, in
particular Singapore, Malaysia and Thailand. Below we review this external dimension of
labour mobility.

Extra-regional mobility in bilateral and plurilateral trade agreements
Sometimes more ambitious mobility commitments have been achieved in extra-regional trade
agreements, or bilaterally, in individual FTAs signed by various ASEAN members. A
prominent example is the ASEAN-Australia-New Zealand FTA. The agreement delineates
more categories of service suppliers, including CSSs and Independent Professionals (IPs),
natural persons de-linked from commercial presence. Australia even grants full working
rights to family members for those service suppliers staying on its territory from more than
12 months. Moreover, the most developed economies in the region have engaged in bilateral
FTAs, moving beyond the ASEAN status quo. Notably, Singapore has concluded trade
agreements encompassing generous mode 4 commitments with industrialized countries such
as the US, New Zealand, Korea, Japan, the EU most recently but also with developing
economies among which India and China. The far-reaching US-Singapore FTA even entails
11 visa concessions from the US side, allowing for Singaporean professionals to enter the US
under a specific visa (H1-B1) without any labour market tests, action that turned extremely
controversial in the Congress and was not replicated afterwards. Within the FTAs with Korea
and Japan, the category of CSSs and a number of professional service providers were
liberalized. Similarly, these categories de-linked from commercial presence were included in
the agreements signed by Singapore with India and China respectively. Other bilateral
agreements broadening the scope of mode 4 commitments are for instance the one concluded
by Philippine, Thailand, Malaysia with Japan (also Malaysia with New Zealand, Australia,
Korea, India, China). These agreements cover, in addition to ICTs and BVs also CSSs and
specific independent professions (e.g. cooks, instructors, care-workers, etc.). More bilateral
FTAs are currently under negotiations, including some launched by the EU with Vietnam,
Thailand and Malaysia (Interviews 7, 8). It’s worth mentioning that four members
(Singapore, Malaysia, Brunei Darussalam, and Vietnam) are also involved in the Trans-
Pacific Partnership negotiations where mobility of persons is part of the negotiations’ agenda.
These external mobility developments can of course be explained by the high differences in
economic performance of the ASEAN individual markets, with the frontrunners having
concluded broader bilateral FTAs. However, what seems intriguing is that despite a
commitment towards an integrated regional economy where free flow of skilled labour is a
key element, progress on liberalizing the movement of natural persons remains relatively low,
Members more often being inclined to offer wider deals to external trading partners than to
their ASEAN fellows (Interviews 5, 7, 8).
In sum, intra-ASEAN movement of natural persons has sought to deepen regional economic
integration and a series of reforms have been initiated to achieving this goal, notably the
developments within AFAS/MNP and conclusion of various MRAs. Nevertheless, the
commitments undertaken by members so far have been rather limited to categories related to
investment and commercial presence. Labour mobility of lower skilled workers is not
covered in the AEC. In various instances ENTs or numerical quotas restrict mobility of
professionals and domestic regulations prevail when it comes to accreditation of
qualifications. Reasons for this are often associated with regulatory heterogeneity across
countries in the region, problematic institutional capacity in some cases, and lack of
enforcement mechanism, to which adds an overall lack of trust and apprehension of member
states in taking comprehensive binding commitments (Interview 9). In contrast, ASEAN
12 states have achieved more concessions extra-regionally. Various ASEAN-third countries
agreements and bilateral FTAs signed by individual member states have broader and deeper
chapters on mobility of natural people. Movement of labour has been liberalized at different
skill levels and provisions for service providers detached from investment/commercial
establishment occur more often.
Table 2 below summarizes both internal- and external-mobility commitments undertaken by
ASEAN, and compares these provisions with those found in EU’s, NAFTA’s, and
MERCOSUR’s trade agreements. The ASEAN trade-mobility has followed closely the
WTO/GATS approach, commitments undertaken internally reflecting the similar provisions
inscribed in the GATS Treaty. In external FTAs, ASEAN states have made greater mobility
concessions. More developments within the region could take shape with the cooperation on
mobility of professionals as part of the MRAs. The case of EU internal movement of people
was one funding principle of the back then European Economic Community (1957) formed
by originally six Member States and today citizens of all 28 EU Members are entitled to
equal treatment in access to employment and working conditions. In its trade agreements
(with chapters on services) concluded with third countries, the EU has liberalized mobility of
people, covering various categories of workers, including the two categories de-linked from
commercial presence, namely contractual services suppliers and independent professionals
(Jurje and Lavenex 2014). The NAFTA model has liberalized trade (in goods and services) as
well as investment between the US, Canada and Mexico. A particularly interesting
development is the introduction of the Trade-NAFTA visa for professionals in about 70
sectors from Mexico and Canada entering the US. Finally, MERCOSUR has gradually
achieved a free movement of people internally, comparable to the EU model as least
formally, and is engaging in trade-related mobility through openings of their service markets.