ASEAN to sign trade pact with Australia, NZ
The Associated Press | Thursday, February 26, 2009
ASEAN to sign trade pact with Australia, NZ
CHA-AM, Thailand: Southeast Asian economic ministers signed two pacts on trade and investment Thursday and plan to ink a free trade pact with Australia and New Zealand at an annual summit, where they have vowed to resist protectionism amid the global economic slump.
Leaders and top officials from the 10 member Association of Southeast Asia Nations - a region of more than 500 million people - gathered Thursday in the Thai resort town of Cha-Am, 200 kilometers (120 miles) south of the capital Bangkok, for the grouping’s 14th annual summit.
The meeting, usually dominated by human rights issues, is overshadowed this year by the global economic meltdown, which has already dragged the region’s most advanced economy - Singapore - into recession.
Thailand’s economy, also undermined by political unrest, shrank in the fourth quarter and other nations such as Malaysia and the Philippines are grappling with rapidly slowing growth amid a drop-off in export demand.
The global slump has raised the prospect of nations becoming more protectionist to safeguard homegrown industries, potentially reducing global trade even more - a particular threat to export-dependent Southeast Asia.
ASEAN has "always been open to free trade and we want more of it," Thai Foreign Minister Kasit Piromya told reporters.
"With the recent economic crisis our position is to have unhindered global trade," he said.
Pacts related to merchandise trade within ASEAN, and an investment agreement that aims to encourage the flow of capital within Southeast Asia, were signed late Thursday.
Economic ministers will also sign an agreement for a free trade zone with Australia and New Zealand.
The ASEAN goods trade agreement creates a single framework for all existing and new trade commitments as the region works to further reduce tariffs and eliminate other barriers to trade.
Negotiations for the free trade pact with New Zealand and Australia began in 2004 and the two countries announced last year that they had successfully concluded talks with ASEAN.
In 2004, it was estimated the agreement would boost the combined gross domestic product of the 12 countries by more than $48 billion by 2020.
The summit is also expected to sign a roadmap document outlining further steps for achieving ASEAN’s goal of forming a European Union-style economic community by 2015. Liberalizing of trade and investment within the region are seen as important steps toward achieving that goal.
Finance ministers from the region plus South Korea, China and Japan met at the Thai resort island of Phuket last weekend and agreed in principle to expand a proposed emergency currency fund to $120 billion from $80 billion.
Some 80 percent of the funds would be provided by China, South Korea and Japan.
Associated Press writer Ambika Ahuja contributed to this story.
