ASEAN, Australia and NZ consider free trade area

ASEAN, Australia and NZ consider free trade area

SINGAPORE (AP): Economic ministers from Southeast Asian nations and counterparts from Australia and New Zealand said Friday they will consider establishing a free trade area for the entire region by 2010.

The ministers recognized the "significant potential" of area economies "to create synergy through strengthened trade and investment linkages," the ministers said in a joint statement.

"Each of us by ourselves is too small to carry a significant weight in the international balance," said George Yeo, Singapore's Minister of Trade and Industry. "But collectively, we will speak with the louder voice and exert a stronger influence."

The Association of Southeast Asian Nations has already taken steps towards making the region a "zero-tariff" trade area. From Jan. 1, import taxes within the six founding ASEAN countries will be reduced to a maximum of 5 percent for various agricultural and manufacturing products.

Now a special task force will be established to study whether Australia and New Zealand could be included in the region's free trade arrangements by 2010, the ministers said. The study should be completed in 12 months.

Australian trade minister Mark Vaile said the study would weigh up the benefits and impediments to the two entities working together.

"What we want this feasibility study to do is look at and identify the very clear benefits that we can see flowing to all the countries involved," he told the Associated Press.

"It's all about developing much stronger prosperity and security within the region," Vaile said.

Ministers said recent political tensions between Australia and Indonesia over the East Timor crisis would not hinder the plan.

"This is an ASEAN effort, something which all of us in ASEAN unanimously consider to be important," said Indonesia's Minister for Trade and Industry Rahardi Ramelan. "As an ASEAN member, of course we are also supportive as well."

Economic cooperation is "very important in strengthening those relationships" between Australia and Southeast Asia, Vaile said. "We also deeply value our bilateral relationship with Indonesia."

Australia is leading an international peacekeeping force in East Timor, which voted for independence from Indonesia in a U.N.-sponsored referendum Aug. 30. Indonesian politicians have accused Australia of meddling in their affairs, and bitter anti- Australian demonstrations have broken out in Indonesia.

The total trade between Southeast Asian countries and economies of Australia and New Zealand amounted to more than US$16 billion in 1998.

The ministers also noted that the region's economic prospects have improved, with countries showing "significant signs" of recovery from the recent economic crisis.

Southeast Asian ministers reiterated their commitment to further reform and to liberalize their economies.

The ministers also called for the launch of a new round of multilateral trade negotiations at the 3rd World Trade Organization conference to be held in Seattle in November this year.

Earlier this week, ASEAN ministers have pledged to open up closed or restricted industries and sectors to regional investors by 2003.

ASEAN groups Brunei, Burma, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand, Cambodia and Vietnam. The ministers will continue to discuss the region's economic and industrial cooperation with officials from Australia, New Zealand and Japan through Saturday.