ASEAN Countries:

Analysis of
Government
Expenditure and
Economic
Growth
Julie F. Estopace

Ivy H. Jariño

Eddelyn J. Madriaga

Joella Ann S. Pura

 Asian region was the most dynamic
Background of economic region throughout the past two
the Study decades. The Association of Southeast
Asian Nations (ASEAN) is an organization
that is made up of a group of member
states.

The goal of the organization is to promote

stability and economic growth across these
nations. ASEAN has since grown to ten (10)
member states. The organization focuses
on boosting economic and trade growth,
with all member states having a free trade
agreement. (World Population Review,
2018)
 The Research Design and Methodology

The research design used secondary

data from World Bank database,
ASEAN Development Bank, and
other governmental database from
year 2008 to 2017.

In analyzing and interpreting the

data gathered, researchers used
panel data analysis with the help of
pooled ordinary least square (OLS)
with 100 observations.
 The Research Design and Methodology

Prior to the analysis and

interpretation of the data
gathered, researchers conducted
a statistical test in order to pick a
method for this study such as
Autocorrelation test, Normality test,
and Heteroskedasticity test and
found out that pooled ordinary
least square (OLS) model is the
most applicable method to use.
Statement of the
Problem
1. What is the socio-demographic
profile of the ASEAN countries in
terms of:
a. Land Area;
b. Population;
c. Political System;
d. Labor force; and
e. Public debt?
 Table 1
Socio-demographic Profile of ASEAN Countries (see pg. 51)
a. The average land area of ASEAN countries is 432,600 in which Indonesia and
Myanmar have the largest number 1,811,570 and 653,080 respectively and
Singapore has the least number of land area for 709 sq. meters.
b. South East Asian countries is one of the most populated regions in Asia and the
average population is 61,480,000 by which Indonesia and Philippines have the
largest population of 263,991,379 and 104,918,090 respectively while the lowest
of 428,697 is Brunei.
c. Republic and Monarchy are the main political systems that govern the ASEAN
countries, except for Lao PDR and Vietnam that uses communist type of
political system, while there are none for federalism.
d. Asian countries are said to be the third largest labor force in the world with an
average of 30,750,000 where majority of the ASEAN countries are increasing
from 2008 to 2017.
e. The average public debt of ASEAN countries is 45.41% wherein only the
Philippines is decreasing constantly while the other countries are all fluctuating.
Statement of the
2. What are their government
Problem expenditures based on % of GDP in
terms of:
a. Education;
b. Health;
c. Military;
d. Agriculture;
e. Infrastructure; and
f. Tourism?
 Table 2
Government Expenditure of ASEAN Countries (pg. 55)
a. The average education expenditure of ASEAN countries is 2.975%. Majority of
the ASEAN countries allocated 2.975 or 3 percent for education funding.
b. The average percentage of GDP per capita on health is 1.541%. It has the
lowest average percentage among the expenditures. It shows that majority of
the ASEAN countries does not even reach the world average spending of 6% of
GDP on healthcare.
c. The average military expenditure of ASEAN countries is 1.877%. Singapore and
Brunei is ASEAN’s big spender in terms of military expenditure ranging from
approximately 2.1 to 3.9 percent.
d. The average agriculture expenditure of ASEAN countries is 14.530%. Majority of
the ASEAN countries are agricultural country.
e. The average infrastructure expenditure of ASEAN countries is 25.550%. It has the
highest average percentage of GDP per capita among expenditures. All
ASEAN countries have a high percentage in allocating for infrastructure
ranging from approximately 13% to 39%.
f. The average tourism expenditure of ASEAN countries is 2.858%.
Statement of the
Problem

3. What is their GDP per

capita from 2008-2017?
 Table 3
GDP per capita of ASEAN countries (pg. 59)

The average GDP per capita of ASEAN countries is 11,480. Among

the ASEAN countries, Singapore and Brunei has the largest GDP per
capita with 51,407 and 36,818 respectively. While the Cambodia
and Myanmar has the lowest mean ranging from 738.23 to 1384.42
and 643.95 to 1298.88 respectively.
Statement of the
Problem

4. What is the effect of

government expenditures on the
GDP per capita as controlled by
the socio-demographics of the
ASEAN countries?
 Table 4
Effect of government expenditures on GDP per capita as controlled by socio-
demographic profile (pg.61)

a. Land area insignificantly increases GDP per capita

b. Population proves to have a significant negative effect on GDP
per capita.
c. Republic was also found to be significantly affect the GDP per
capita
d. Labor force was found to have a significant increase in GDP
per capita
e. Public debt was found to have a significant negative effect on
GDP per capita.
 Table 4
Effect of government expenditures on GDP per capita as controlled by socio-demographic
profile

f. Education expenditure insignificantly decreases GDP per capita.

g. Health expenditure also insignificantly decreases GDP per capita.
h. Military expenditure insignificantly increases the GDP per capita.
i. Agriculture expenditure significantly decreases the GDP per capita.
j. Infrastructure insignificantly increases the GDP per capita.
k. Tourism insignificantly increases the GDP per capita.
 1. a. The ASEAN countries should assess their
RECOMMENDATIONS natural resources and include this as part of
land area per square meter in order to have
a significant positive effect in the GDP per
capita.
b. The ASEAN countries should spread
awareness through educating an individual
about birth control and increase the level of
their labor force to avoid future problems of
increasing poverty level and
unemployment.
c. The ASEAN countries must maximize the
use of available resources to avoid
excessive public debt. And in case
borrowings cannot be avoided, have a
sound debt management that will
administer the proper and wise used of the
borrowed funds.
RECOMMENDATIONS 2. Effective and efficient allocation of spending.

3. The ASEAN countries, specifically Cambodia

and Myanmar, should sustain the need of every
citizen of their country by improving their GDP per
capita. Also, the ASEAN countries in order to
increase its GDP must prioritize the development
and improvement of their infrastructure,
implement a strategic debts alongside with
strong asset protection, prudent macroeconomic
policies, and their business environment should be
free from corruption, and must give importance
and attention for their human capital such as
providing complete education and full health like
what the Singapore does to have a constantly
increasing GDP.
 4. a. Land area should be utilized in housing projects
and building commercial establishments instead of
RECOMMENDATIONS using it for agriculture because infrastructure can boost
the economy as compared to spending on agriculture.
b. ASEAN countries should promote free education
not just for primary and secondary education but also
for tertiary level in order for students to avoid travelling
abroad for further studies and therefore decreasing the
outflow of labor force.
c. The ASEAN countries must build and maintain
competent labor force with professional skills and
ethical practices that meet individual and population
needs in terms of healthcare. Also, ASEAN countries
must adopt service standards for health facilities and
infrastructure. Additionally, they should strengthen
national regulatory authorities for medicines and health
technologies.
d. ASEAN countries must give attention and enforce
a more organized educational system for a high-quality
education because it can produce a highly competent
labor force.
RECOMMENDATIONS e. The ASEAN countries must improve its
project planning and preparation, as well as
strengthening its legal and regulatory
frameworks for infrastructure development.
f. ASEAN countries, except Singapore and
Brunei, should provide financial subsidies and
assistance for their farmers and implement
training programs, workshops, and seminars
on various technologies on agricultural
production that will equip farmers with new
knowledge and skills.
g. Future researchers may try to include the
natural resources of each country to the land
area and more variables and look for their
collective effect to GDP per capita of ASEAN
countries
Statement of the
Problem

5. What can be proposed

actions based on the results
of the study?
 Proposed Action Plan for
Increasing GDP per capita of
ASEAN countries
Key Areas Objectives Activities Persons Time Expected Output
Involved Frame
Socio- To assess the In terms of population, ASEAN Ten As Utilize the socio-
demograph ASEAN countries should give members of required demographic
ic profile countries’ importance for their human ASEAN profile of each
socio- capital development through organization ASEAN countries
demographic good quality education and that helps the
profiles in free health services. government in
order to have uplifting the
significant In terms of labor force, ASEAN countries’ GDP
effect on countries should implement per capita.
GDP per training programs, workshops,
capita and seminars that will equip
especially workers with new knowledge
population, and skills.
labor force
and public In terms of public debt, ASEAN
debt. countries should have a sound
debt management that will
manage the proper usage of
borrowed funds.
 Key Areas Objective Activities Persons Time Expected
s Involved Frame Output
Government To Developing a Ten As Ensure that
Expenditures efficiently strict policy, members of required each
allocate laws or rules ASEAN government
budget and regulation organization expenditure
that will oversee will contribute
the to the
implementation development
and allocation of the
of the economic
government growth of a
budget. country.
Key Areas Objectives Activities Persons Time Expected
Involved Frame Output
GDP per To Using infrastructure Ten As Increase
capita constantly to spur economic member required economic
increase growth s of growth and
GDP per Join some of the ASEAN uplift the
capita worlds’ top traders organiza standard of
(eg. USA, Japan, tion and living of every
China) other citizen of the
Relax enforcement countries ASEAN
on rules and that are member-
regulation imposed involved state.
on industry or in
business trading
Thank you!