ASEAN agrees to eliminate nontariff trade barriers

Adianto P. Simamora, The Jakarta Post, Jakarta

Member countries of the Association of Southeast Asian Nations (ASEAN) have agreed gradually to eliminate nontariff trade barriers as part of the effort to boost intraregional trade, a top official at the Indonesian Ministry of Industry and Trade said.

The agreement was reached during the ASEAN Economics Ministers Meeting in Laos last week.

"All of the trade ministers have agreed to remove nontariff barriers before the year 2005," Pos M. Hutabarat, director general for industry and international cooperation at the trade ministry, said on Wednesday.

"The ministers have promised to identify the nontariff barriers in their respective countries and register them with the ASEAN secretary," he said.

Pos said nontariff barriers continued to hamper efforts to boost intraregional trade, although the grouping began the process of implementing the ASEAN Free Trade Area (AFTA) in 1993.

The full implementation of AFTA was completed in January this year, with import tariffs on almost all products traded in the region slashed to between 0 and 5 percent.

ASEAN members, however, still impose nontariff barriers to protect local producers against an influx of imported products.

These nontariff barriers include import licensing and quota systems for certain products.

According to data from the ASEAN Secretariat, the value of intra-ASEAN exports was US$97.8 billion in 2000, compared to $77.4 billion the previous year. Intra-ASEAN imports were valued at $77.6 billion in 2000, compared to $61 billion in 1999.

In comparison, total ASEAN exports to countries outside the regional grouping reached $423.6 billion in 2000, while imports amounted to $293.1 billion.

ASEAN, which groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, has a combined market of more than 500 million people.

Pos said removing nontariff barriers was also aimed at boosting ASEAN's competitiveness ahead of the establishment of the ASEAN Economic Union in 2010.

Under the program, ASEAN countries must further slash import tariffs on several products to zero.

ASEAN countries have established a high-level task force to help find ways to boost competitiveness in the region.

The task force members will meet in Kuala Lumpur next month.

"Aside from the problem of nontariff barriers, the task force will also discuss various issues ahead of the ASEAN Summit in Bali in October," Pos said.

One of the main items on the agenda for the ASEAN Summit is to appoint President Megawati Soekarnoputri as ASEAN chairwoman for the period of October 2003 to October 2004.