ASEAN members forge closer cooperation
ASEAN members forge closer cooperation
By Meidyatama Suryodiningrat
BANGKOK (JP): ASEAN senior economic officials made great strides yesterday in forging closer economic cooperation, particularly in investment, despite the hampering deadlock on Indonesia's plan to withdraw a number of items from the list of immediate tariff reductions.
The Senior Economic Officials Meeting wrapped up its discussions here yesterday after three days of talks which saw the formation of an ASEAN Industrial Cooperation (AICO) plan, replacing the two existing programs -- the ASEAN Industrial Joint Venture and the Brand to Brand Complementation -- to help boost investments to the region.
Compared to the previous two programs, AICO requires less ASEAN investment and eliminates the temporary protection previously granted.
Senior officials from the Association of Southeast Asian Nations (ASEAN) have been meeting since Wednesday as a run-up to a ministerial meeting which will begin on Monday.
The ministerial meeting will precede the fifth ASEAN Summit which starts on Thursday.
ASEAN, formed in 1967, now comprises of Brunei, Indonesia, Malaysia, Singapore, the Philippines, Thailand and Vietnam.
It is hoped that the development of AICO, which will be done together with the private sector, can help boost investments, particularly those in high-tech industries, by allowing investors to get easier access into areas already receiving preferential trading terms.
Investors under the AICO plan will be granted free trade tariffs of zero percent to 5 percent without having to wait for the deadline of the implementation of the ASEAN Free Trade Area (AFTA) agreement in 2003.
Furthermore, the required ASEAN investments have been reduced from 40 percent to 30 percent.
During their meeting, senior economic officials also got a promise from Vietnam to hand in an additional list of products to be included in the Common Effective Preferential Tariff (CEPT) program.
According to Thailand's director general for foreign economic affairs, Krirk-Krai Jirapaet, Vietnam has been overdue since November and that the number of items on the original list of 853 products was not proportional to those handed in by other ASEAN states, which average over 1,000.
Under the framework of AFTA, ASEAN has created the CEPT program, under which member states hand in lists of items for tariff reductions.
Jirapaet said that Vietnam has promised to hand in the additional list in the next few days.
"They told us that it will be available before the AFTA Council meeting," he said, referring to the ministerial meeting here tomorrow.
Economic ministers are due to meet tomorrow for the AFTA Council meeting to discuss the possible acceleration of CEPT for AFTA, among other things.
The issue of Indonesia's intention to exclude several agricultural items from a list which will not require immediate tariff reduction was still deadlocked last night.
Among the 15 items to withdrawn from the list are rice, cloves, milk, sugar, wheat flour and soybean meal.
Indonesia's intention has come under strong attack from the majority of ASEAN members.
Thailand's director general for information, Suvidhya Simaskul, tried to calm fears over worries that the reduction of tariff barriers in agricultural products would lead to a swamp of products from Thailand, which is known to be a regional leader in such commodities.
"Thailand won't be able to feed the whole region by itself," he said.
He further played down the controversy by arguing that discussions still transpired in a good atmosphere.
"We don't have any difference in terms of thinking and understanding. Maybe, we just need time to adjust," he said.