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Asean Sec Gen: Individual FTAs will not halt Asean economic progress

Bernama, Malaysia

Asean Sec Gen: Individual FTAs Will Not Halt Asean Economic Progress

By M. Saraswathi

12 August 2006

KUALA LUMPUR, Aug 12 (Bernama) — Individual Free Trade Agreements (FTAs) signed or being negotiated by Asean member countries will not affect the grouping’s unity or halt its economic progress, Asean Secretary General, Ong Keng Yong said.

"If you look strictly on FTA between country A and B, then it may look like there is no focus on Asean, but that is not the reality," he said.

This is because an individual FTA is much easier to negotiate, hence, the progress seemed to be faster compared to FTAs negotiated by Asean, Ong said.

"Such a scenario makes it look like the regional agenda is being undermined," he told Bernama.

Ong said that Asean members were well aware of their commitment to the grouping in terms of trade liberalisation and investment despite the individual FTAs.

Asean as a grouping is currently negotiating FTAs with emerging economic giants such as China and India and looking forward to FTAs with Japan, South Korea, New Zealand and Australia, which will create an East Asia FTA.

Singapore, Malaysia, Thailand, Indonesia and the Philippines have worked on various bilateral FTAs.

"I am not too worried about that (individual FTAs) at this moment as the level of trade individually as a result of bilateral FTAs, is less than for instance Asean plus China," he said.

"We need to nicely fit these individual FTAs with the bigger FTAs," he said.

Ong said that trade ministers of the respective Asean countries knew this well, hence where possible "we pull things together in one direction."

Besides, there are "little problems," in trade and investment related issues that needed to be ironed out among the Asean countries, he said, pointing out that the 10-member grouping should look at harmonising and settling the rules of origin and issues relating to investment regime.

"Once we have sorted this out, we go and talk Asean+Japan or Asean+New Zealand, it would be easier. Because we (Asean) will not be quarrelling among ourselves anymore since we have settled the basic technical issues," he said.

And he noticed that lately Asean officials were working hard at this by holding more meetings at technical levels to iron out these basic issues.

However, chairman of the Asian Strategy and Leadership Institute’s Centre for Public Policy Studies, Tan Sri Ramon Navaratnam, believes that individual FTAs had somewhat prevented Asean’s economic progress as a whole.

"The progress made by Asean has more or less been inhabited by individual FTAs, which has undermined the unity, purpose and direction of Asean as a consolidated economic grouping," he said.

Navaratnam said that member countries should work together first, strengthen Asean and start negotiating FTAs as a grouping, rather than doing it individually.