Malaysian Prime Minister Abdullah Ahmad Badawi has urged Southeast Asian nations to create a single market by 2015, five years earlier than planned, or face losing foreign investment.

"If we do not hasten the creation of that regional single market, Asean may run the risk of losing its position as an important investment destination," Abdullah said as he opened a meeting of Asean economic ministers today.

"We must therefore make all efforts to create the single market of an Asean economic community by 2015," he added.

Abdullah said the 10-member Association of Southeast Asian Nations (Asean), with a population of 560 million people, must protect its position as a competitive production base.

At their talks this week Southeast Asian ministers are under pressure to accelerate the creation of an economic community to combat the rise of China and India which are drawing away foreign investment from the region.

Asean is aiming to advance economic integration by five years to 2015, casting aside the tariffs and red tape which are making the unified China market more attractive to manufacturers.

Foreign direct investment (FDI) in Asean surged 48 percent to US$38 billion last year, but China remains the favourite of global investors, Malaysia's trade minister Rafidah Aziz has said.

Rafidah said investment flowing into Asean in 2005 saw it reclaim levels last seen before the 1997 Asian financial crisis, when it peaked at US$34 billion.

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The major sources of investment into Asean in 2005 were the United States, Britain, Japan, France and Finland.

Abdullah said Asean must balance national and regional interest to become a single, integrated and seamless consumer market and international production base.

"We must not allow anything to derail the progress we have made thus far in this process," he said.

The premier said Asean must continue to engage with its key trading partners to form trade blocs to allow market access for the region's products and services.

An Asean-China free-trade area in goods has been implemented while a free-trade agreement with South Korea will soon come into force, he said.

Also attending the talks in the Malaysian capital this week will be ministers from ASEAN's dialogue partners - Australia, China, India, Japan, New Zealand and South Korea.

On Friday Asean will hold trade talks with the United States, and the two sides are expected to ink a trade and investment framework pact.

The United States at present has "trade and investment framework" agreements with key individual Asean economies, which are aimed at setting the stage for fully fledged free-trade agreements.