Countries in Southeast Asia are set to remain resilient to the global economic slump through 2017 as economic activity in the region will be supported more by strong domestic demand than exports, a report from the Organization for Economic Cooperation and Development (OECD) said Monday.

The OECD forecasts that ASEAN economies will expand at a strong rate of 5.5 percent in the next five years, which is in line with the the pre-crisis levels.

According to the OECD, ASEAN countries will be less reliant on net exports in the coming years than in the past. Growth will be driven mainly by the expansion of the middle class, and the resultant boost in domestic demand.

Though emerging economies like India and China have been slowing gradually due to the global uncertainty, especially the debt crisis in Eurozone, its the overall impact in Southeast Asia will be limited.

The agency, however, cautioned that in order to sustain the strong growth Southeast Asian governments should initiate prompt actions to narrow social and economic disparities between countries in the region, in particular by enhancing productivity through structural policy reforms. Disparities are at their widest in poverty and human resource development, which need greater attention.

"The common issues that many ASEAN countries face are low labor productivity, skills mismatches, large informal sectors and unequal, inequitable access to higher education. Employment policy to create more productive, better-paid jobs for a much wider section of the population will go a long way when it comes to policy reforms for narrowing development gaps," the report said.

At a regional and sub-regional level, ASEAN countries need to strengthen monitoring and enforcement mechanisms to ensure that progress stays on track.

RTTNews