EAGA free trade gets big boost
By Hendarsyah Tarmizi
MANADO, North Sulawesi (JP): Senior ministers of Indonesia, Brunei, Malaysia and the Philippines agreed at a meeting here yesterday to speed up the creation of a free trade zone in the eastern part of the Association of Southeast Asian Nations (ASEAN) region.
Indonesian Coordinating Minister for Trade and Industry Hartarto said the meeting strongly endorsed recommendations from the senior officials convening here on Monday and Tuesday to jointly develop cooperation in tourism, air linkages, transportation, shipping and fishery to stimulate trade and investment in the East ASEAN Growth Area (EAGA).
The EAGA was formed in Davao City of the Philippines early this year to create a free trade zone in areas encompassing Maluku, Sulawesi, West and East Kalimantan in the eastern part of Indonesia, Sabah and Sarawak in the eastern part of Malaysia, Brunei and the Philippines's Mindanao island.
Hartarto said priority sectors to be promoted in the EAGA will also include forestry, energy, human resource development and people mobility. The recommendations will be deferred to their respective governments for further considerations.
"For this purpose the ministers designated senior officials to undertake necessary steps," Hartarto told a joint press conference, which was also attended by other heads of delegations comprising of Brunei Minister of Industry and Primary Resources Abdul Rahman Taib, Malaysian Minister for the Coordination of Growth Triangle Project Daim Zainuddin and Philippine Secretary of Trade and Industry Rizalino S. Navarri.
Hartarto said that the progress towards the establishment of a free trade zone in the EAGA was much faster than expected due to the enthusiasm of regional business people to tap the growing business opportunities in the area.
Agreements
"A number of agreements have been signed in the private sector even though the feasibility study on the new economic cooperation forum has not been completed," the minister said, referring to the signing of 13 business deals during the first convention of the EAGA Business Convention in Davao last month and another eight projects to have coincided with yesterday's meeting.
The meeting, also attended by Indonesian Minister of Transportation Haryanto Dhanutirto, Minister of Agriculture Sjarifudin Baharsjah and State Minister for Agrarian Affairs Soni Harsono, however, did not include the timeframe for the elimination of tariff barriers despite their strong commitment to create a free trade zone in the EAGA territory.
On this question, Hartarto said that trade arrangements and investment will be dealt with under the ASEAN Free Trade Area (AFTA), which seeks the reduction of tariffs to between zero and five percent by 2003.
"This sub-regional cooperation will create a new impetus and a strong stimulus in speeding up the implementation of the AFTA," he said of the EAGA, citing that import tariffs of certain goods in the Sijori growth triangle -- involving Indonesia, Singapore and Malaysia -- have been reduced to zero percent.
Commitment
The minister said that Brunei, the Philippines and Malaysia have lowered their import tariffs to encourage trade among the EAGA members. "Indonesia has the same commitment and will do the same thing for the same purpose," he said.
Besides endorsing the senior officials' recommendations, the ministerial meeting also welcomed the establishment of the EAGA Business Council and its permanent secretariat.
Yesterday's meeting also agreed on a proposal to formalize the establishment of ad-hoc working groups as a permanent institutional mechanism for the EAGA.
"If needed, it will also be possible to establish a permanent secretariat for the EAGA," Hartarto said.
He said that the meeting also felt the importance of holding a meeting of finance ministers of ASEAN to enhance financial services in the ASEAN member countries, formation of venture capitals and cooperation in broad-based financial services, including insurance.
Other agreements include the selection of Kuching in Sarawak as the venue for the next ministerial meeting and the selection of Brunei for the 1996 meeting.
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