Southeast Asian countries have no choice except to change their current model of economic development in the face of intensified competition from China, a top regional economist said yesterday.

"What choices does Asean have?" Andy Xie ( pic ), chief economist for Morgan Stanley, China asked.

"The fear is psychological but in the end, they must understand the options they have," Xie added.

According to him, Asean could either choose to retain its current model which relies on cheap labour and face the possibility of having no economic growth or find an alternative model within the framework of the proposed China-Asean Free Trade Area.

The economist who holds a doctorate in economics from the Massachusetts Institute of Technology, was speaking at a plenary session on the issues pertaining to Asean-China economic integration at the inaugural Asean-China Partnership Forum in Kuala Lumpur.

The three-day forum organised by the Malaysia-China Chamber of Commerce which brought together businessmen and corporate figures from both Malaysia and China, was officiated by the International Trade and Industry Deputy Minister Kerk Choo Ting yesterday morning.

"For Asean with more than 500 million people no growth is not a choice. Change is inevitable," Xie said.