Largest free trade zone decade away
Plans for the world’s largest free trade zone came a step closer after leaders of the 10-nations Association of South East Nations (ASEAN) met in Bali on Tuesday.
Some association members even urged pushing a 2020 target date forward.
South Korean President Roh Moo-hyun told business leaders that if India, China, Japan and Korea sign free trade agreements with ASEAN, “the twenty first century will be the age of East Asia”.
At present, the ASEAN region has a population of 500 million and annual trade worth $720 billion.
But a new determination to grow has followed the failure of world trade talks in Cancun.
Expansion
ASEAN’s relatively small economies want more influence and access to the huge markets that dominate the region, particularly in China and India.
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Singapore’s prime minister had a |
Chinese Premier Wen Jiabao addressed the issue directly, promising that China would bring development opportunities and tangible benefits to other Asian countries, as well as increasing its investments in Asia.
By 2010 the world could see a free trade area with nearly two billion people and total gross domestic product of almost $3 trillion taking shape in Asia, Wen said.
New deadline
ASEAN is also considering bringing forward the 2020 deadline as it works on free trade agreements to be completed with China in 2010, India in 2011 and Japan in 2012, Secretary-General Ong Keng Yong said last Sunday.
Several leaders urged an earlier deadline for creating the Economic Community endorsed as part of the Bali Concord II, warning ASEAN’s economies risk being left behind.
“Seventeen years from now might be too late,” Thai Prime Minister Thaksin Shinawatra said on Monday, urging members to cut tariff and non-tariff barriers to trade in the region as soon as possible.
Criticism
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“Products have to comply with a bewildering range of standards, which vary from one ASEAN country to another. To bring a … drug to the ASEAN market, a manufacturer needs the approval of 10 health authorities” Goh Chok Tong, |
But Singapore Prime Minster Goh Chok Tong, a leading advocate of the free trade bloc, poured cold water on high expectations for quick progress by a group that has frequently adopted such plans and failed to follow through.
He has urged proper implementation, reminding members that ASEAN has long been viewed as a talking shop whose members can be reluctant or unable to follow through on agreed initiatives.
“Products have to comply with a bewildering range of standards, which vary from one ASEAN country to another. To bring a … drug to the ASEAN market, a manufacturer needs the approval of 10 health authorities,” said Tong.
No integration
A report ASEAN commissioned from the business consultant McKinsey highlighted lack of integration, non-tariff barriers and disparate policies that favour competitiveness of single nations at the expense of the group.
However, the Association is pushing for faster integration and has agreed to put 11 key sectors, including electronics, air travel and tourism on a fast-track to cut tariff and non-tariff barriers by 2010 rather than 2020.
ASEAN is at present comprised of Brunei, Cambodia, Laos, Vietnam, Indonesia, the Philippines, Singapore, Myanmar, Malaysia and Thailand.