ENFORCING laws against illicit trade and helping dismantle criminal networks across Southeast Asia will strengthen the Philippines’s appeal to foreign investors, but the region must coordinate its response rather than compete for capital, the EU-Asean Business Council (EU-ABC) said.
Christopher Humphrey, EU-ABC executive director, told the BusinessMirror that investors increasingly view the Association of Southeast Asian Nations (Asean) as an interconnected market, making security risks in one country a concern for businesses operating across the region.
‘It is important to understand that the nature of these criminal networks is transnational, meaning that their reach extends far beyond the four epicenters highlighted,’ Humphrey told this newspaper in an email interview.
‘Businesses are increasingly looking at Asean not as 11 individual economies, but as one interconnected market to trade and invest in,’ he added.
Humphrey was responding to questions following a report by the International Institute for Strategic Studies (IISS), commissioned by the EU-ABC, which identified four criminal hubs linked to cybercrime and scam operations as major regional and international security risks.
These are the Golden Triangle, where Laos, Myanmar and Thailand meet; parts of Myawaddy township in Myanmar; Sihanoukville in Cambodia; and the area around Poipet on the Thailand-Cambodia border.
However, he noted, illicit trade and criminal networks operate across all Asean countries, and even those not identified as major criminal hubs.
For the EU-ABC chief, regional trade routes and infrastructure can also be exploited by these networks, threatening businesses that need secure conditions to manufacture, transport goods and conduct transactions.
As for the Philippines, the report points to the historical experience of the Sulu-Celebes Sea corridor linking the country with Indonesia and Malaysia, where criminal economies and terrorist groups have developed sustained connections.
‘Legislation isn’t enough’
Governments that enforce laws against illicit trade and impose penalties on criminal networks could strengthen investor confidence, the EU-ABC said.
However, this alone would not be enough to dismantle networks that can adapt and relocate after enforcement operations.
‘What is needed is appropriate enforcement action. However, illicit trade and the criminal networks involved are transnational in nature, so what is actually needed is more concerted multilateral action,’ Humphrey said.
For the business group, an Asean-wide, multi-agency task force involving customs authorities, law enforcement agencies, financial regulators and the private sector could be effective to coordinate efforts against illicit trade and related criminal activities.
In the IISS report, action against money laundering and other digitally enabled illicit financial activities were also mentioned, which helps sustain criminal operations.
The economic costs extend beyond security concerns. Citing Euromonitor data, the study indicated that illicit tobacco trade resulted in more than $13 billion in lost government revenue across the Philippines, Indonesia, Malaysia, Singapore, Thailand and Vietnam in 2024-2025.
The report also described the rapid expansion of cyber-scam and casino operations in the Philippines, as well as Cambodia, Laos and Myanmar, particularly after Chinese President Xi Jinping began cracking down on similar activities in mainland China following his assumption of office in 2012.