ASEAN liberalizes investment rules
ASEAN liberalizes investment rules
The Jakarta Post, Jakarta
Member states of the Association of Southeast Asian Nations
(ASEAN) decided to accelerate the liberalization of their
investment regimes by broadening the scope of economic activities
in which ASEAN investors would be given national treatment.
Meeting in Jakarta last week, the ASEAN Coordinating Committee
on Investment has agreed to phase out the "temporary exclusion
list" of products in the manufacturing sectors in Brunei
Darussalam, Indonesia, Malaysia, Myanmar, the Philippines,
Singapore and Thailand.
According to a media release issued on Friday by the ASEAN
secretariat, the decision means that any ASEAN investor can now
invest in the manufacturing sector of any ASEAN country and enjoy
national investor treatment.
Since the launch of the ASEAN Investment Area in 1998,
Southeast Asian states have started opening up all industries for
investment and granted national treatment to ASEAN investors, but
with some exceptions.
The exceptions are supposed to be phased out by 2010 for ASEAN
investors.
Meanwhile, the newer member of ASEAN, namely Cambodia, Laos
and Vietnam, have until Jan.1, 2010, to phase out their temporary
exclusion list for the manufacturing sector.
The establishment of the ASEAN Investment Area is expected to
encourage investors to think increasingly in regional terms and
adopt a regional investment strategy and network operation.
The scheme aims to promote a more efficient division of labor
and industrial activities across the region, creating
opportunities for greater industrial productivity and cost
competitiveness.
The release said that ASEAN investors were defined as being
equal to national investors in terms of the equity requirements
of an ASEAN country in which the investment was made. Thus, an
ASEAN firm with a majority interest could avail itself of
national treatment and investment market access privileges.
Newly opened areas for ASEAN investors
Brunei: Manufacture of veneer sheets, plywood, laminaboard,
particle board, other panels and boards, and builders' carpentry.
Indonesia: Manufacture of pesticides.
Myanmar: Manufacture of pulp of all kinds, production and
marketing of basic construction materials, furniture, and parquet,
using teak extracted and sold by the state-owned economic enterprise.
Thailand: Production of flour from rice and field crops.
Philippines: ASEAN equity will now be allowed in cooperatives.
- More than 40 percent ASEAN equity could be allowed and export
requirement would be relaxed for domestic market enterprise with
paid-in capital of less than the equivalent of US$200,000 and
domestic market enterprises that involve advanced technology or
employ at least 50 direct employees with minimum paid-in equity
capital of less than $100,000.
- Investment incentives could be availed for companies registered
under the Omnibus Investment Code (E.O 226) with more than 40
percent ASEAN equity.