U.S. supports FTA deal with ASEAN<\/p>\n
JP\/ASEAN<\/p>\n
U.S. business leaders offer support for free trade deal with
\nASEAN<\/p>\n
U.S. business leaders on Wednesday offered support for a free
\ntrade agreement (FTA) with ASEAN to keep their country engaged
\nwith Southeast Asia as China's influence grows in the region.<\/p>\n
During a dialogue with economic ministers from the Association
\nof Southeast Asian Nations, they also urged the 10-member
\nalliance to ensure member states did not delay their commitments
\nto the ASEAN Free Trade Area.<\/p>\n
ASEAN-U.S. Business Council president Ernest Bower said that
\nstrategically, a U.S.-ASEAN free trade deal \"is a damn good bet\".<\/p>\n
The free-trade pact, first mooted in April, is the latest in a
\nseries of proposed free trade accords for ASEAN.<\/p>\n
Leaders of ASEAN and China in 2000 agreed to work out an FTA
\ncovering nearly two billion people within 10 years, and talks are
\nunder way for a framework agreement to be finalized.<\/p>\n
Japan earlier this year suggested a broader economic
\npartnership with ASEAN, which could also include a free trade
\npact.<\/p>\n
Singapore, a member of ASEAN, has signed free trade deals with
\nNew Zealand and Japan and may finalize one with the U.S. later
\nthis year.<\/p>\n
Bower told reporters after the U.S. business leaders met the
\neconomic ministers that free trade talks were at an exploratory
\nstage and he did not see an FTA emerging in the next two years.<\/p>\n
A U.S.-ASEAN deal would have strategic importance, given China
\nappears to have taken an increasing leadership role in the region
\nwhich has traditionally focussed on Japan and the United States.<\/p>\n
\"Bear in mind that to us, ASEAN is a very significant market,\"
\nhe said, citing the region's combined population of over 500
\nmillion.<\/p>\n
U.S. investments in ASEAN are about the same level as Japan
\nand \"we have five times as much invested in ASEAN currently as we
\ndo in China,\" he said.<\/p>\n
\"Strategically, we want to be engaged in helping to define the
\nfuture environment for trade and investment in this region. And
\nwhat we've seen happening is China has taken... a leadership role
\nin terms of reforming its image in the region,\" he said.<\/p>\n
Bower acknowledged the closure of the U.S. embassies in
\nIndonesia and Malaysia because of security threats on the Sept.11
\nanniversary could dent investor sentiment towards Southeast Asia,
\nwhere pockets of Muslim extremists operate.<\/p>\n
But he said that he and a large group of business leaders from
\nthe U.S.-ASEAN Business Council would go ahead with a trip to
\nthree Indonesian cities next week.<\/p>\n
2. Duit 3 X 20<\/p>\n
Asian currencies
\ndown late on yen,
\nrisk aversion<\/p>\n
Asian currencies down Late On Yen, Risk Aversion<\/p>\n
Dow Jones
\nSingapore<\/p>\n
A softer yen drove Asian currencies broadly lower Wednesday, with
\nthe New Taiwan dollar falling to its weakest level since late
\nMay.<\/p>\n
However, regional currencies managed to claw out of their
\nintraday troughs as profit-taking on the dollar helped trim
\nlosses.<\/p>\n
Volumes were thin as market players opted to wait out the
\nfirst anniversary of the Sept. 11 terrorist attacks in the U.S.<\/p>\n
Risk aversion was the main theme amid growing prospects of a
\nU.S.-led war on Iraq and the attendant spike in oil prices, with
\nmarket players unwilling to be caught short of dollars.<\/p>\n
\"There has been some risk aversion that has favored a strong
\ndollar. The headline risks are quite high on the fundamental
\nside. The biggest headline risk is the potential conflict in
\nIraq,\" said Vincent Low, Singapore-based head of foreign
\nexchange\/bond strategy for Asia at Merrill Lynch.<\/p>\n
Economic concerns remained a key concern as higher oil prices,
\nif sustained, will dent economic recovery in an export-dependent
\nregion, which is already trying to deal with the prospects of
\nslower growth in the U.S.<\/p>\n
A UBS Warburg report rated the Philippine peso, the Korean won
\nand the Thai baht as the most vulnerable among Asian currencies
\nto a sustained rise in oil prices<\/p>\n
With uncertainties both on the geopolitical and economic
\nfront, market players were unwilling to take strong positions,
\ntraders said.<\/p>\n
Against the New Taiwan dollar, the U.S. currency ended at
\nNT$34.395 - its highest since May 24 - from NT$34.303 Tuesday,
\nbut off an intraday high of NT$34.403.<\/p>\n
A dealer said central bank intervention helped support the
\nlocal dollar, which took its cue from the yen; the central bank
\nsold between US$150 million and $200 million to help support the
\nlocal unit.<\/p>\n
The New Taiwan dollar often tracks the yen because Taiwan and
\nJapan compete in some export categories. Taiwan also imports
\nlarge amounts of goods from Japan.<\/p>\n
Talk of central bank intervention also helped pull the dollar
\nback from intraday highs against the Indonesian rupiah, traders
\nsaid.<\/p>\n
Bank Indonesia has a policy of intervening in the market but
\nnever comments on specific actions.<\/p>\n
The dollar ended at Rp 8,890, up from Rp 8,865 the previous
\nday, but off the day's high of Rp 8,905.<\/p>\n
The rupiah didn't react to a statement from Bank Indonesia's
\nboard of governors that it hopes to keep cutting rates due to
\nbenign inflation, and a stronger rupiah, as market sentiment is
\nbarely affected by rate policy.<\/p>\n
Indonesian authorities are hoping lower rates will spur
\ngrowth. Finance Minister Boediono said the country was likely to
\nmeet its near 4 percent economic growth target this year. But
\nexperts, including the World Bank, warn Indonesia needs at least
\n6 percent growth to create enough work for new job seekers each
\nyear.<\/p>\n
In South Korea, the dollar closed at 1,202.5 won, down from
\n1,198.4 won Tuesday but off an intraday high of 1,204.0 won.<\/p>\n
Like recent sessions, importers and exporters were the main
\nmarket participants. Importers were buying dollars on dips and
\nexporters were selling them on upticks, dealers said.<\/p>\n
The dollar climbed against the Thai baht, but failed to break
\nthrough the day's high of 42.50 bath due to substantial exporter
\nselling orders around that level.<\/p>\n
The dollar finished at 42.465 baht at the Asian close, up from
\n42.41 bath Tuesday.<\/p>\n
The U.S. unit was also up against the Singapore dollar, but
\noff earlier highs as market participants took profits.<\/p>\n
Late in Asia, the dollar was quoted around S$1.7551 from
\nS$1.7527 in the previous session. The pair traded between
\nS$1.7555 and S$1.7580 in Asia.<\/p>\n
The dollar closed at 51.910 pesos on the Philippine Dealing
\nSystem from 51.960 pesos Tuesday, after moving between 51.900
\npesos and 52.080 pesos intraday.<\/p>\n
3. Sugar 2 X 28<\/p>\n
Indonesia and Philippines
\nagree to buy Thai sugar<\/p>\n
Thailand's Deputy Minister of Finance Suchart Jaovisidha said
\nWednesday Indonesia and the Philippines have agreed to enter into
\nlong-term contracts to buy Thai sugar, relieving the need for
\nThailand to push for tariff reductions for Thai sugar imported by
\nthe two countries.<\/p>\n
Thailand has been concerned about plans by Indonesia and the
\nPhilippines to delay cutting tariffs on sugar imports from the
\nAssociation of South East Asian Nations countries under the Asean
\nFree Trade Agreement.<\/p>\n
Thailand Commerce Minister Adisai Bodharamik said Monday that
\nThailand would ask the two countries to reduce their tariffs on
\nsugar from Thailand to below the level of tariffs on imports from
\nnations outside of Asean during the Asean Free Trade Area Council
\nmeeting Wednesday.<\/p>\n
However, Suchart told Dow Jones Newswires in an interview soon
\nafter the meeting that there is no need for the tariff reductions
\nas the two countries agreed Wednesday to enter into long-term
\ncontracts.<\/p>\n
\"Indonesia has agreed to enter into a long-term contract,\" he
\nsaid.<\/p>\n
\"As long as Indonesia are buying sugar from Thailand, that
\nwould be satisfactory to me.\"<\/p>\n
The Philippines had also agreed to enter into a long-term
\ncontract, relieving the need for their tariffs to be reduced, he
\nsaid.<\/p>\n
The details haven't been decided but he said the term of the
\ncontracts would likely be five to 10 years, he said.<\/p>\n
Thailand is sensitive to the fact that the two countries would
\nface revenue implications if they cut the tariffs, he said.<\/p>\n
\"They need the income from tax. We understand their problem,\"
\nhe said.<\/p>\n
Thailand is Asia's largest sugar exporter and was concerned it
\nwould lose export opportunities to the Philippines and Indonesia
\nif any reduction in sugar import tariffs is delayed.<\/p>\n
In response to requests from the Philippines and Indonesia,
\nthe Asean Free Trade Agreement Council in September 2001 allowed
\nthe Philippines to delay lowering import tariffs on sugar to 0
\npercent-5 percent in 2010 from the original schedule of 2003.<\/p>\n
Indonesia was also allowed to delay cutting sugar import
\ntariffs and the final rate, which hasn't yet been decided, will
\nbe allowed to exceed 5 percent.<\/p>\n
Indonesia imposes a tariff on sugar of 27 percent-32 percent
\nwhile the Philippines sets the sugar import tariff at 50 percent-
\n55 percent<\/p>\n
Thai government officials said early in the week that a lower
\nimport tariff on sugar from Asean countries would maintain the
\ncompetitiveness of Thai sugar exports to these two countries.<\/p>\n
Indonesia is Asia's largest sugar importer, importing around 1
\nmillion-1.5 million metric tons of sugar annually. The
\nPhilippines' sugar needs are mostly fulfilled by local
\nproduction. The Philippines has imported around 107,000 tons of
\nsugar so far this year.<\/p>",
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