ASEAN KEY DESTINATIONS
Asean pushes for bilateral FTAs as global talks stalled
Asean is set this week to finalise a free trade agreement with India and hold talks with Australia and New Zealand, signalling the importance of regional pacts amid fading hopes for a global trading regime, reported AFP.
The Association of Southeast Asian Nations (Asean) economic ministers, meeting in Singapore from Monday to Friday, are expected to put the final touches on an Asean -India trade in goods pact agreed on by senior officials earlier this month.
The deal covering billions of dollars is expected to be signed during the Asean-India Summit in December, officials have said.
Asean economic ministers will also hold talks with their counterparts from Australia and New Zealand in an effort to have a trade agreement ready for signing by December, a Southeast Asian diplomatic source said.
Australian Foreign Minister Stephen Smith said recently Canberra hoped to conclude the talks with the 10-member Asean in Singapore, but the source said this might not be possible because certain issues still have to be resolved.
But the source added the issues, one of them concerning the rights of New Zealand's indigenous peoples, were minor.
He was confident a deal will be reached in time for the Asean Summit in Bangkok in December.
Asean has agreed to gradually tear down barriers to trade in goods and services with China and South Korea and has signed a wide-ranging economic partnership deal with Japan, which also covers investments.
Forging the trade links with India and the two Pacific nations will complete the bloc's ties with all its key Asia-Pacific trading partners, and could be a catalyst for a region-wide free-trade zone, officials said.
Asean has a combined population of about 550 million people. It is a diverse group which ranges from high-tech Singapore to poverty-stricken Myanmar, and the world's most populous Muslim nation, Indonesia.
Asean is already a free-trade area with 90 percent of goods traded having tariffs between zero and five percent.
This week the ministers are expected to discuss the impact of high oil and food prices and the escalating global economic slowdown on their economies.
But officials said the overriding focus would be on efforts to achieve a single market and manufacturing base by 2015 to raise Asean 's profile in the face of competition from China and India.
"To stay in the game, Asean must become a strong integrated region," Singapore Prime Minister Lee Hsien Loong said.
He warned that, individually, Asean states are "only tiny blips on the radar screens of investors."
Indonesian Trade Minister Mari Pangestu said Asean is likely to focus more on implementing and strengthening its free-trade agreements (FTAs) than on planning for a massive 16-nation pact including its key regional trading partners and covering about half of the global population.
But she agreed the FTAs could evolve in the future.
"What we are seeing is that Asean is at the focal point of all these trade agreements," Pangestu told AFP, noting that all the Asean deals with individual countries are similar in structure.
"Eventually, when you consolidate the FTAs, it is possible that you could end up with something like that (an Asia-wide FTA)."
Regional FTAs could gain fresh momentum after the latest attempt to end a seven-year deadlock in the so-called Doha Round of global trade talks broke down in July because of a dispute between India and the United States over agricultural tariffs.
The Asian Development Bank (ADB), in a recent study on Asian regionalism, said "substantial gains could be realised from consolidating the many FTAs into a single, region-wide one" and from adopting practices to guide future regional and sub-regional FTAs.
But while Asia is forging ahead with trade linkages, the region has a major task in integrating its financial markets which are now larger, deeper and more sophisticated than they were a decade ago, it said.
The region also has to make sure the benefits of economic progress reach a larger number of people, especially the poor, the Manila-based ADB said.
"Governments need to connect the poor to the thriving regional economy by eliminating labour market barriers, investing in workers' capabilities, and building infrastructure to connect disadvantaged regions with economic centres," said the agency, which aims to reduce poverty.
The region was on the right track, however, the ADB said.
"We are witnessing the beginnings of a strong, prosperous, outward-looking Asian economic community, regionally integrated yet connected with global markets, and with responsibility and influence to match its economic weight,"
the ADB said.