Membership benefits of Asia trade body limited, Australia decides

Membership benefits of Asia trade body limited, Australia decides

SYDNEY (AFP): Australia and New Zealand would receive
"positive but limited" benefits through a link with the embryonic
Association of Southeast Asian nations Free Trade Area (AFTA), a
government report said yesterday.

But the report, by the Department of Foreign Affairs and
Trade, suggests the benefits would be greater if AFTA's scope was
expanded to include commodities and services of interest to
Australia.

It also concludes that AFTA could have negative trade and
investment diversion effects on Australia, but argues these were
likely to be small and would be neutralized by improved market
access.

The 180-page report was launched here by Trade Minister Bob
McMullan, who told journalists such a link would have advantages
for both sides by creating enhanced trade opportunities.

He said it would boost the flow of foreign investment into the
region and contribute positively to efforts to advance regional
economic integration through the Asia Pacific Economic
Cooperation (APEC) group.

But he said a link could not be achieved overnight and there
would need to be extensive consultation.

Australia and New Zealand, partners in a trading arrangement
known as CER, or Closer Economic Relations, were invited to
consider membership for the CER of AFTA by Thailand's deputy
prime minister, Supachai Panitchpakdi, in Melbourne last
November.

AFTA aims to lower tariffs and other trade barriers on
manufactured goods between ASEAN members -- Indonesia, Malaysia,
Singapore, Thailand, Brunei and the Philippines.

It was relaunched last October after the ASEAN countries
agreed in early 1992 to promote closer economic co-operation in a
market of some 320 million people.

Australian Prime Minister Paul Keating said during his visit
to Thailand last month that Canberra would be exploring the
proposal.