Within ASEAN (Association of Southeast Asian Nations), Brunei Darussalam occupies a distinct position mainly as a result of its domestic characteristics. Thus its actions towards the ASEAN Economic Community (AEC) and regional economic integration are guided in some instances, and hindered in other instances, by those special features inherent in its political, sociocultural, and economic systems (see Table 12.1).

Being one of the original six of the ASEAN grouping, Brunei has never wavered in its support for common political-security, economic, and social policies that could contribute towards ensuring a peaceful and developed region. However, the nature of its own environment does not render it a lead player, let alone an active player. Brunei is the smallest member, with an area of 5,765 square kilometres and a population of only about 400,000. In addition, its economy is dependent on the oil and gas sectors which together accounted for about 96 per cent of its total export earnings in 2009. This overreliance on the hydrocarbon contribution has had a negative impact on the general trend of economic activity in the state, and Brunei has only in the last few years taken serious steps to reduce its dependence by seeking a more diversified economic base. Non-oil exports are negligible, and thus Brunei may not be able to enjoy the full advantage of the regional economic integration. On the other hand, as a country with little agricultural and manufacturing of its own, it is able to enjoy all the benefits of a free trade area as it imports a wide variety of goods, about 51 per cent of which come from its ASEAN partners. It also stands to gain from the trade in services as local and foreign firms will be able to operate under the AEC initiative if they are located in Brunei.

Government interest in and support for the AEC have been way ahead of the economic realities of the country and at times it appears that the public enthusiasm and business participation are two different carriages running along parallel tracks. Both public and private sectors are of course committed to increasing economic activity and contributing to increased income.