Asia-Pacific tariff cut to boost tade

Asia-Pacific tariff cut to boost tade

SINGAPORE (Reuter): Removing tariff barriers between Southeast
Asia, Australia and New Zealand would boost intra-regional trade
by at least US$16 billion a year, the author of a new study told
Reuters yesterday.

"The absolute minimum that would be gained by the removal of
tariffs on goods is a $16 billion increase in real consumption,"
said Andrew Stoeckel, executive director of the Center for
International Economics in Canberra.

Stoeckel, author of what is thought to be the first cost-
benefit analysis of a free trade zone between nations of ASEAN
and Australia and New Zealand, was confident gains would be much
greater.

"It could be double that, easily. These findings are based on
very conservative assumptions," he said.

Stoeckel said it would double the value of trade between ASEAN
(the Association of Southeast Asian Nations) and Australia and
New Zealand, which stood at $16 billion in 1995.

Stoeckel was in Singapore to present his findings to a meeting
of academics, industrialists and government officials from around
the region.

Addressing the meeting earlier, Singapore Trade and Industry
Minister Lee Yock Suan said a free trade agreement could be a
long-term target for the region.

Lee said trade, transport links and developments in key
industries such as food and tourism could be enhanced between the
ASEAN Free Trade Area (AFTA) and the Closer Economic Relations
(CER) group of Australia and New Zealand.

"An AFTA-CER free trade area could be a long-term target.
Meanwhile AFTA-CER should push for the removal of non-tariff
barriers and implement other initiatives to facilitate greater
trade and investment flows," Lee said.

ASEAN, grouping Brunei, Myanmar, Indonesia, Laos, Malaysia,
the Philippines, Singapore, Thailand and Vietnam, offered a vast
market for CER, with 400 million consumers and total gross
domestic product of almost $500 billion, he added.

ASEAN is the second most important destination for Australian
exports and its fourth-largest source of imports. Two-way trade
between ASEAN and New Zealand is relatively small.

Supachai Panitchpakdi, chairman of Thailand's parliamentary
economics committee and a long-time advocate of closer ASEAN-CER
trade links, called for the relationship to be discussed at the
ministerial level.

Former New Zealand trade minister Philip Burdon, now chairman
of the Asia 2000 Foundation think-tank, told Reuters he backed
adding a higher ministerial profile to the talks.

"It's very difficult to get public attention focused on
something like this. A study showing $16 billion of benefits,
though, is exactly what will grab public and government
attention," he said.