Asean states agree to more trade with US

A free-trade zone will be established with Australia and New Zealand as soon as possible. But the goal remains that of eliminating tariffs within the entire group to counter competition from India and China. Problems posed by the Myanmar regime have been shelved for the moment.

Kuala Lumpur (AsiaNews/Agencies) – The Association of Southeast Asian Nations (Asean) decided on 25 August to expand trade and investment with the United States, the area's leading trade partner, and to create a free-trade zone with Australia and New Zealand by next year.

The trade and investment facilitation arrangement was signed (at the end of a week-long annual meeting of Asean finance ministers) by Susan Schwab for the US and ministers from the 10 Asean member states (Cambodia, Laos, Malaysia, Myanmar, Indonesia, Singapore, Brunei, Thailand, Vietnam and the Philippines). The accord aims to boost economic ties between these states and their traditional American partner.

Schwab said Washington was committed to encouraging bilateral agreements with single states to achieve the creation of a "common custom system throughout Asean for the entry of goods" and to "intensify our trade and investment relations with the Asean region, which collectively constitutes our fourth largest trading partner". Trade between Asean and the US rose 12.4% to 152 billion US dollars last year. South-east Asia supplies agricultural and manufactured products and buys industrial goods.

Also in the pipeline is "co-operation on pharmaceutical regulatory issues aiming at speeding the delivery of innovative medicines to Asean countries". US firms have long complained about the prevalence of generic drug copies of their patented medicines. But poor countries respond by saying that patented medicines are too costly, especially more common ones or those necessary to treat fatal illnesses.

But Schwab also recalled that the "United States has very serious concerns about human rights in Myanmar", an Asean member whose political situation "is not changing".

Malaysian International Trade and Industry Minister Rafidah Aziz expressed hopes the agreement would contribute towards changes in Myanmar, but cautioned that it should not be used to pressure the country towards democracy. He made a distinction between the commitments assumed as a group towards the US and matters involving single states.

The ministers also reached agreement with Australia and New Zealand to go ahead with talks to attain a free trade, services and investments zone, with partial liberalization from June 2008. In 2005, trade between Asean and the two Oceanic countries increased by 23% to 35.6 billion US dollars.  

During the conference, moves also resumed towards a free-trade zone with India: talks broke down last year after India's refusal to reduce a list of around 1,400 products that it wanted to exclude from the agreement. India has now removed two-thirds of the merchandise from the list.

The organization has similar goals with regard to China, Japan and South Korea. China wants to liberalise exchange of services with Asean in December and to create a free-trade zone as from 2010. Thailand refuses to sign agreements with South Korea after Seoul banned the importation of Thai rice to protect domestic production. Japan has proposed the creation of a pan-Asian free-trade zone, which would include 16 states, but Asean described this idea as interesting but "premature".

For over 10 years, Asean states have pursued the setting up of a free-trade zone, based on the European Union model, but domestic problems, natural disasters, widespread poverty and economic and political differences have stood in the way of progress. However, looming competition from China and India has provided new stimulus because Asean countries know they cannot be competitive by themselves.

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