ASEAN moves to liberalize services

ASEAN moves to liberalize services

By Riyadi

KUALA LUMPUR (JP): The Association of Southeast Asian Nations
(ASEAN) moved forward toward realizing a free flow of services in
the region yesterday, with member countries submitting their
initial packages of service liberalization offers.

ASEAN economic ministers, who convened here for their 29th
annual meeting, endorsed the offers and would bring them to the
second ASEAN informal summit here in December.

The ministers also touched on the problem-ridden ASEAN
Industrial Cooperation scheme and on a delicate proposal by the
ASEAN Chamber of Commerce and Industry (ASEAN CCI) on capital
goods cooperation.

Malaysian Minister of International Trade and Industry
Rafidah Aziz, who chaired the meeting, said the ministers agreed
to adopt an alternative approach to negotiations in services to
achieve a free flow of services in the region by 2020.

"We are talking about sector or subsector approaches rather
than products. It is more comprehensive. This would mean that we
are looking at cross-sector negotiations on a bilateral basis,"
Rafidah said.

But she reiterated that the ministers had not yet finalized
the entire package of new approaches and instead tasked senior
officials to draw up their modalities.

At yesterday's meeting, all of ASEAN's old members -- Brunei,
Indonesia, Malaysia, the Philippines, Singapore, Thailand and
Vietnam -- submitted their initial service liberalization offers.

Brunei's offers were on air transport and tourism,
Indonesia's on maritime transport and tourism, Malaysia's on air
transport, maritime transport and tourism, the Philippines' on
business services and tourism, Thailand's on maritime transport
and tourism and Vietnam's on telecommunications and tourism.

The economic ministers said in a joint statement that new
members Laos and Myanmar had also submitted their offers.
However, it was not clear in what sectors their offers were.

Indonesian Coordinating Minister for Production and
Distribution Hartarto said Indonesia's offers on maritime
transport and tourism were "the best offers for the country's
economy".

"Although we offered the two sectors, it doesn't mean that
we'll open them up altogether, of course not. We'll still protect
our national interests," Hartarto said.

Rafidah said all offers in services involved all modes of
service, including cross-border supply, consumption abroad,
commercial presence and movement of labor.

"A significant number of offers involved opening up new
service sectors that were not previously included in the General
Agreement on Trade in Services (GATS)," she said.

The director general of foreign trade at the Indonesian
Ministry of Industry and Trade, Djoko Moeljono, said all ASEAN
member countries agreed to offer two more service sectors in
addition to their commitments in GATS.

In GATS, Indonesia had been committed to opening five
sectors; namely maritime transport, telecommunications, tourism,
construction services and financial services.

In addition to the five sectors, Indonesia was also committed
to opening two more service sectors: business services and air
transport.

Rafidah said the initial offers submitted by member countries
reflected "a move forward from having nothing to having something
to sign and implement".

All member countries must implement their commitments
contained in their initial packages of offers by no later than
March 31, 1998.

The ministers also held consultations yesterday with
executives of ASEAN CCI to obtain the views of the private sector
on how to best facilitate business interaction in the region.

ASEAN CCI chairman Aburizal Bakrie said he proposed to the
ministers that ASEAN governments provide both policy and
financial support to ASEAN CCI-initiated cooperation in the
capital goods industry.

Hartarto said ASEAN governments agreed to provide support to
initiatives through government procurement policies but not in
credit-line facilities.

Rafidah added that ASEAN CCI should create a database on ASEAN
capital goods so that each ASEAN government knew what kind of
products were available among ASEAN members.