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 28 Feb 2009

14th Asean Summit:
Trade pact signed with Australia, New Zealand
No deal on human rights body

Southeast Asian economic ministers ratified on Friday a major free trade area with Australia and New Zealand, while seeking to downplay fears of protectionism as global economic conditions worsen.

But foreign ministers from the Association of Southeast Asian Nations could not agree on a proposed human rights body for a grouping that includes military-ruled Myanmar and decided that Rohingya boat people must be sent back to Myanmar.

The free trade area encompassing the 10 member nations of the Association of Southeast Asian Nations, Australia and New Zealand, has a combined population of more 600 million people and GDP of more than $2 trillion.

"This is an extremely strong signal to the rest of the world that the Asian region remains committed to pursuing economic growth, exports and jobs to help drive the economic recovery," Australian Trade Minister Simon Crean said in a statement.

The agreement is Australia's largest free trade agreement, surpassing the free trade deal between Australia and the United States, and officials hope it will give new impetus to bilateral free trade talks with China, Malaysia and Japan.

But with countries in the region seeing a sharp fall-off in trade as the global financial crisis takes its toll on their export-dependent economies, signs of trade protectionism are emerging that could lead to a further shrinkage of world trade.

Malaysian Prime Minister Abdullah Badawi was quoted in the Bangkok Post on Friday as saying it was okay for Malaysia to implement a "Buy Malaysian" campaign as "everyone is saying it".

"First of all we have to protect our people; we are doing the same thing. If we do not create projects by Malaysia, for Malaysians, then who will buy our products?" Indonesia, Southeast Asia's largest economy, is preparing directives that also promote buying of local products.

But these kind of national "branding campaigns" are not a new form of protectionism and do not violate international trade rules, Indonesia's trade minister Mari Pangestu told Reuters on Friday.

"They're promotional campaigns," she said, adding that they are nothing more than variations on the "Buy American" clause that the U.S. Congress inserted into the $787 billion stimulus package that US President Barack Obama signed last week.

Malaysia's Foreign Minister Rais Yatim also sought to downplay his prime minister's remarks, saying it was only about "using more of Malaysian goods" "No other regime or power would be opposed to it, even in the United States they would prioritise the use and utilisation of American-made goods," he told reporters.

Consuming more Malaysian goods creates more jobs and business activity, he said. Malaysia, like a number of other countries, is working on an economic stimulus package to boost domestic demand.

Foreign ministers whose governments range from Brunei's absolute monarchy and Myanmar's junta to the young democracies of Indonesia and the Philippines could not come to any agreement on the terms of reference for a new human rights body. They decided to shelve the issue until their next meeting.

"The Terms of Reference on Human Rights is an evolving process," Thai Foreign Minister Kasit Piromyas told reporters. "The panel has four months to work and consult with stakeholders.

The next panel will be in (Kuala Lumpur)." Human rights groups say the body must have the ability to impose penalties -- including expulsion from membership -- if it it is to effectively deal with countries that have a poor human rights record.

Asean has traditionally avoided criticising fellow members. But that policy of non-interference in each other's internal affairs is being put to a test as the group creates a rules-based political and economic EU-style community over the next six years.

The foreign ministers also agreed on a mechanism to send hundreds of Rohingya boat people back to military-ruled Myanmar.

They agreed to compile and pool information and interviews on the Rohingyas, who washed up on the shores of Thailand, Indonesia and Malaysia having fled oppression in Myanmar. Those found to have originated from the former Burma, which denies the Rohingya Muslims are from its soil, would be returned, under the proposal agreed on Friday.

"They have been trying to flee Burma because of extreme persecution. They will be tragically hopeless if they are returned," said Debbie Stothard of the Alternative Asean Network on Burma.




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