Dream and hope of 10 nations<\/p>\n
As we all know, most of the Southeast Asian region has now
\nbecome a free trade zone.<\/p>\n
Accounting for over 96 percent of all ASEAN trade, the first
\nsix signatories of the Common Effective Preferential Tariff
\nscheme for the ASEAN Free Trade Area, or AFTA, have reduced their
\ntariffs on intra-regional trade to no more than five percent for
\nalmost all products in the Inclusion List (IL), or removed them
\naltogether.<\/p>\n
The AFTA was established in January 1992 to eliminate tariff
\nbarriers among the 10 Southeast Asian countries to integrate
\nASEAN economies into a single production base and to create a
\nregional market.<\/p>\n
The Agreement on the Common Effective Preferential Tariff
\n(CEPT) Scheme for the AFTA requires that tariff rates levied on a
\nwide range of products traded within the region are reduced to 0
\npercent to 5 percent. Quantitative restrictions and other
\nnontariff barriers are to be eliminated.<\/p>\n
Although originally scheduled to be realized by 2008, the
\ntarget of a free trade area in ASEAN was continuously moved
\nforward.<\/p>\n
The elimination of tariffs and nontariff barriers among the
\nASEAN members has served as a catalyst for greater efficiency in
\nproduction and long-term competitiveness.<\/p>\n
Moreover, the reduction of barriers to intra-regional trade is
\ngiving the ASEAN consumer a wider choice and better quality
\nconsumer products.<\/p>\n
By the beginning of this year, only 3.8 percent of products in
\nthe CEPT Inclusion List of the first six signatories, or 1,683
\nitems out of 44,060, should have had tariffs above five percent.<\/p>\n
The current average tariff on goods traded under the AFTA
\nscheme is estimated at about 3.8 percent. In the light of its
\nlater accession to the CEPT Agreement, Vietnam is expected to
\nrealize AFTA in 2006, Laos and Myanmar in 2008, and Cambodia in
\n2010.<\/p>\n
The first signatories to the CEPT scheme were Brunei
\nDarussalam, Indonesia, Malaysia, the Philippines, Singapore and
\nThailand.<\/p>\n
The free trade area covers all manufactured and agricultural
\nproducts. However, 734 tariff lines in the General Exception
\nList, representing about 1.09 percent of all tariff lines in
\nASEAN, are permanently excluded from the free trade area for
\nreasons of national security, protection of human, animal or
\nplant life and health and articles of artistic, historic and
\narchaeological value.<\/p>\n
Facilitation Initiatives: Trade facilitation activities in the
\nareas of customs and the elimination of technical barriers to
\ntrade with a view to lowering the cost of doing business in the
\nregion have also received attention.<\/p>\n
ASEAN's efforts have been directed at the simplification and
\nharmonization of customs procedures, and specifically, through
\nmeasures such as the harmonization of tariff nomenclature and the
\naccelerated implementation of the WTO Valuation Agreement. ASEAN
\nhas adopted an ASEAN Harmonized Tariff Nomenclature and will be
\nimplementing it this year.<\/p>\n
ASEAN is seeking to develop product-specific mutual
\nrecognition arrangements (MRAs) in conformity assessment so that
\nproduct-related standards and regulations do not become technical
\nbarriers to trade. A Mutual Recognition Arrangement on
\ntelecommunications equipment has already been put in place.<\/p>\n
Negotiations are proceeding in the areas of cosmetics,
\npharmaceuticals, electrical and electronic products.<\/p>\n
ASEAN has also agreed to align national standards with
\ninternational standards, such as those of the International
\nStandards Organization (ISO), the International Electrotechnical
\nCommission (IEC) and the International Telecommunications Union
\n(ITU), for 20 priority product groups by the year 2000.<\/p>\n
These 20 product groups represent some of the most widely
\ntraded products in the region, including important consumer
\ndurables such as radios, television sets, refrigerators, air
\nconditioners and telephones.<\/p>\n
In addition to the 20 product groups, ASEAN will embark on the
\nharmonization of another 72 standards for safety and 10 standards
\nfor Electromagnetic Compatibility (EMC).<\/p>\n
Rule-based Trade Arrangement: ASEAN has adopted a disputes
\nsettlement mechanism (largely patterned after the WTO disputes
\nsettlement understanding) covering all economic agreements.<\/p>\n
This establishes a mechanism for resolving any problems
\narising from the implementation of any economic agreement in
\nASEAN.<\/p>\n
The provision on emergency measures under the CEPT Agreement
\nhas been strengthened to make it consistent with the WTO
\nAgreement on Safeguarding Measures. A Protocol on Notification
\nProcedures has been established which requires advance warning of
\nactions or measures that can have an adverse effect on
\nconcessions granted under an existing ASEAN agreement.<\/p>\n
ASEAN has also agreed on a Protocol Regarding the
\nImplementation of the CEPT Scheme Temporary Exclusion List, which
\nis intended to provide some flexibility to countries facing real
\nproblems on their last tranche of manufactured TEL products.<\/p>\n
The Protocol will allow countries to temporarily delay the
\ntransfer of these TEL products or suspend concessions on those
\nTEL products already transferred into the IL. The mechanism is
\nbased on Article XXVIII (Modification of Schedules) of GATT 1994.<\/p>\n
Elimination of all Import Duties: ASEAN leaders have agreed to
\neliminate all import duties by 2010 for the six original members
\nof ASEAN and by 2015 for the new members.<\/p>\n
This move will fully create an integrated regional market of
\n500 million people.<\/p>\n
Currently, 20,701 tariff lines (representing 38 percent of the
\nIL) already have zero duties. By 2003, the first six members will
\neach have at least 60 percent of their IL with zero duties.
\nVietnam will have 35.37 percent of its IL with no tariffs in
\n2006, while Lao PDR and Myanmar will abolish import duties on
\n87.6 percent and 3.9 percent respectively of their IL by 2008.
\nCambodia will eliminate duties on 7.64 percent of its IL in 2010.<\/p>\n
Direction of ASEAN Trade: As a result of the successful
\nimplementation of the CEPT Scheme, trade among ASEAN countries
\nhas grown from US$44.2 billion in 1993 to $95.2 billion in 2000,
\nrepresenting an average annual increase of 11.6 percent. As of
\n2000, intra-regional exports made up about 23.3 percent of total
\nASEAN exports. Before the financial and economic crisis struck in
\nmid 1997, intra-ASEAN exports had been increasing by 29.6
\npercent. This is significantly higher than the rate of increase
\nof total ASEAN exports, which grew at 18.8 percent during the
\nsame period.<\/p>\n
While there has been a slight contraction of intra-ASEAN trade
\nin the year 2001, largely as a result of the global and regional
\neconomic slowdown, this is expected to pick up with the recovery
\nof the global economy expected in the latter half of 2002.<\/p>\n
The realization of the AFTA in no way lessens the importance
\nof ASEAN's other economic partners. The ASEAN leaders, at their
\nsummit in Bandar Seri Begawan from 5 November through 6 November
\n2001, resolved to promote economic linkages among East Asian
\ncountries toward integrating the ASEAN region with China, Japan,
\nand the Republic of Korea.<\/p>\n
ASEAN-China FTA: The leaders of ASEAN and China considered the
\nreport of the ASEAN-China Expert Group on Economic Cooperation,
\nset up upon the suggestion by Chinese Premier Zhu Rongji at their
\nmeeting in Singapore last year.<\/p>\n
They endorsed the proposal for a Framework on Economic
\nCooperation and agreed to establish an ASEAN-China Free Trade
\nArea within 10 years, with special and differential treatment and
\nflexibility for the newer ASEAN members.<\/p>\n
The agreement would also provide for an \"early harvest\" of
\nbenefits. With a combined market of 1.7 billion people, a free
\ntrade area between ASEAN and China would have a gross domestic
\nproduct of $2 trillion and total trade of $1.23 trillion.<\/p>\n
Discussions among officials on the scope and modality of the
\nfree trade area will commence this year.<\/p>\n
The joint experts group estimates that the establishment of an
\nASEAN-China FTA could increase ASEAN's exports to China by 48
\npercent and China's exports to ASEAN by 55 percent. An FTA is
\nalso expected to boost ASEAN's GDP by 0.9 percent and China's GDP
\nby 0.3 percent.<\/p>\n
To promote the expansion of trade and investment between ASEAN
\nand Japan, the leaders have endorsed the forging of a closer
\neconomic partnership.<\/p>\n
A group of experts from ASEAN and Japan has been established
\nto recommend measures on how to further enhance economic
\ncooperation between the two sides. The report of the experts'
\ngroup will be submitted to the next ASEAN-Japan summit in 2002.<\/p>\n
ASEAN-Japan trade reached $113.6 billion in 2000.<\/p>\n
The ASEAN leaders also proposed to explore with the Republic
\nof Korea the possibility of establishing a free trade area
\nbetween the two sides.<\/p>\n
The leaders agreed to set up an experts group to study this
\nmatter. ASEAN-ROK trade reached $28.9 billion in year 2000.<\/p>\n
In September 2001, the economic ministers of ASEAN and the
\nCloser Economic Relations of Australia and New Zealand endorsed a
\nframework to link the two groups economically through an AFTA-CER
\ncloser economic partnership.<\/p>\n
They have also approved a work program for the implementation
\nof the framework. Two-way trade between AFTA and CER amounted to
\n$18.43 billion in 2000.<\/p>\n
The realization of AFTA is not only a huge step towards
\nregional economic integration in ASEAN; it is also an important
\nbuilding bloc for economic cohesion in the larger Asia-Pacific
\nregion, bringing together the economies of Northeast Asia and CER
\nwith those of Southeast Asia.<\/p>\n
-- ASEAN Secretariat<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/dream-and-hope-of-10-nations-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }