ASEAN agrees on scheme to boost electronics trade

ASEAN agrees on scheme to boost electronics trade

The Jakarta Post, Jakarta

Economics ministers of the Association of South East Asian
Nations (ASEAN) signed on Friday a Mutual Recognition Agreement
(MRA) for electronics and electrical equipment, which is expected
to significantly reduce the cost of intraregional trade in these
two categories of goods.

ASEAN said in a press statement that the MRA agreement would
enable member countries to recognize the testing and
certification of imported electronics and electrical equipment
conducted in another member country or the country of origin.

"With this agreement, the entry of electronics and electrical
equipment manufactured in one ASEAN country will no longer be
subject to testing and certification in the country of
importation, which can be technical barriers to trade. It will
mean lower costs for ASEAN traders

"Electrical and electronic equipment assembly plants are
expected to greatly benefit from this trade facilitation scheme,"
the statement said.

The agreement was made in Bangkok during a gathering aimed at
seeking ways of boosting intraregional trade.

Electrical and electronic equipment account for a very
significant share of intra-ASEAN trade, up from 30 percent of
intraregional exports in 1993 to almost 40 percent now.

The grouping also said that the introduction of MRA would be
accompanied by adequate consumer protection measures by ensuring
that only products that met safety requirements and were labeled
in accordance with the exporting country's regulations could be
imported.

ASEAN consists of Indonesia, Brunei Darussalam, Cambodia,
Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and
Vietnam.

Meanwhile, Reuters reported that the ASEAN ministers and U.S.
Trade Representative Robert Zoellick agreed in Bangkok to explore
closer economic cooperation, but conceded that a free trade pact
was far in the future.

The regional grouping said in a statement it had "agreed to
adopt an ambitious work program designed to expand further the
close trade and investment relationship between ASEAN and the
United States".

The statement said ministers "noted" calls for a free trade
pact between ASEAN and the United States. But Zoellick cautioned
against expecting much progress on free trade any time soon.

"We noted proposals for a free trade area," he told a news
conference. "That's a far cry from entering into negotiations."

ASEAN has pledged to create a regional free trade zone by
slashing tariffs in coming years, and is also in talks about a
trade deal with China to take advantage of that country's vast
domestic market.

But the reality of ASEAN free trade falls short of the
rhetoric. Efforts to set up the ASEAN Free Trade Area (AFTA) have
taken a blow from Malaysia's refusal to remove protective tariffs
for its auto industry.

Malaysia is widely seen as the main barrier to faster ASEAN
progress on trade liberalization.

Another problem is that the bloc's countries are at widely
different stages of development, varying from market-friendly
Singapore to military-ruled Myanmar and communist Vietnam and
Laos. Cambodia, Vietnam and Laos have yet to join the World Trade
Organization (WTO) and view trade liberalization with suspicion.