ASEAN moves towards freeing trade in services

ASEAN moves towards freeing trade in services

BANDAR SERI BEGAWAN (AFP): Members of the Association of
Southeast Asian Nations (ASEAN) took steps yesterday towards
freeing up trade in services and protecting copyrights to beef up
economic integration, officials said.

Economic ministers from the seven-nation grouping discussed a
pair of agreements on opening up the services sector and on
intellectual property protection after receiving a renewed push
to hasten their free-trade goal.

They also endorsed a proposal by senior officials to set up a
panel to examine the thorny issue of freeing up regional trade in
"sensitive" unprocessed farm commodities.

An agreement setting out the "basic principles" for opening up
the services industry is possible before ASEAN's December summit
in Bangkok, delegates said.

The accord could cover such sectors as aviation, finance and
banking, tourism and transport, communications and construction.

Members of ASEAN -- Brunei, Indonesia, Malaysia, the
Philippines, Singapore, Thailand and Vietnam -- would start
negotiations on opening each sector next year, a delegate said.

"Many things ought to be achievable within a reasonable time-
frame," he said of the sector-by-sector negotiations. "Some
sectors will be easier to negotiate than others."

On the agenda of the ministerial meeting here is a framework
agreement on services spelling out a consensus within ASEAN on
the need to open up services, officials said.

Opening up the sector would reinforce the grouping's efforts
to form an ASEAN Free Trade Area (AFTA) by cutting tariffs to a
maximum five percent by 2003, or even earlier if members decide
to advance the target year.

The accord on intellectual property protection would send a
strong signal to the outside world that ASEAN was serious about
protecting copyrights, encourage technology flows and research
and development activities, officials said.

Economic ministers also decided to set up a working group to
consider "the major concerns and reservations" of members on
opening up trade in unprocessed farm products, said Thai Deputy
Prime Minister Amnuay Viravan.

The "sensitive" products will be subject to a special
arrangement that will be decided by the working group, requiring
members to pledge tariff cuts better than their commitments in
the World Trade Organization.

Such products include rice, cocoa, palm oil, coffee, tobacco,
coconut and sugar, primary commodities of the resource-rich
countries of Malaysia, Indonesia, Thailand, the Philippines and
Vietnam.

They are viewed as "sensitive" because opening them up too
quickly could threaten the livelihood of farmers in those
countries.

The meeting opened yesterday with a renewed call by the Sultan
of Brunei to speed up AFTA's creation to 2000.

ASEAN must "be vigilant and respond to the challenges of the
world economy, " Sultan Hassanal Bolkiah said, repeating an
appeal made in July. He cited moves to expand the European Union
and open up trans-Atlantic trade.

He also said China and India were competing with ASEAN for
investments.

On Wednesday, the AFTA Council, which oversees the free-trade
plan, decided to put his proposal on ice pending further
consultations with the private sector, where strong lobbies are
resisting faster liberalization.

Despite a lack of agreement on "AFTA 2000," the council
endorsed a tariff reduction schedule including 40,960 tariff
lines whose rates will be reduced to a maximum five percent by
2003.

ASEAN is the world's fourth largest trader after the United
States, the European Union and Japan and its trade is expanding
faster than the top three.

ASEAN's total trade with the rest of the world grew by 21
percent over 1993 to US$543 billion in 1994. Intra-ASEAN trade
expanded by 24 percent to $110 billion during the same period.