logo logo

Singapore Fast Track To EU Trade Pact

Today, Singapore


7 September 2004

Economic and trade agreement could lead to FTA

Tom Sullivan in Jakarta

SINGAPORE businesses could soon see improved access to markets in the
25-nation European Union (EU) whose 450 million consumers account for
than a quarter of world trade.

An economic and trade agreement possibly leading to a free trade
(FTA) between Singapore and the EU could be announced early next month,
according to EU Trade Commissioner Pascal Lamy.

FTAs mean lower or zero export tariffs, better investment terms and,
generally, easier access for goods and services to each other’s markets.

Speaking to Today over the weekend, Mr Lamy said the EU hopes the pre-FTA
agreement can be announced at the Asia-Europe meeting (Asem) on Oct 8 in

Mr Lamy, who was in Jakarta for the 36th Asean Economic Ministers’
meeting, is due to discuss the bilateral trade pact, as well as World
Trade Organization issues, today in Singapore with Prime Minister Lee
Hsien Loong and Trade and Industry Minister Lim Hng Kiang.

"What we are considering and are presently discussing with our member
states is to have a sort of framework agreement. The idea is not to make
it sector based but more on themes like trade facilitation, investment
rules and maybe government procurement rules," said Mr Lamy.

He described the bilateral agreement, first proposed in early 2002 by
Singapore’s then Trade and Industry Minister George Yeo, as a "precursor"
to a wider accord with Asean.

Both Singapore and Thailand have requested closer bilateral trade
agreements with the EU.

The EU has ruled out talks on an EU-Asean free trade agreement until
the conclusion of WTO negotiations, which may run until as late as 2007.

Commissioner Lamy denied suggestions that the bilateral agreements would
undermine future free trade negotiations between the two blocs.

"Variable timing is always possible," he said, adding "they are an
incentive, a preparation surrounding and shaping the environment given
desire of these countries to have some sort of bilateral relationship
not waiting for whichever free trade initiative that we take in the
to be finished."

At their meeting, Asean’s economic ministers agreed on "road maps" for
integrating common markets in 10 sectors by the year 2007 for founding
members Brunei, Indonesia, Malaysia, the Philippines, Singapore and
Thailand, and by 2012 for new members Vietnam, Cambodia, Laos, and

The EU is Asean’s second largest export market and is pushing for
cooperation between the two blocs through a Trans-Regional EU-Asean
Initiative (TREATI) launched last year.

"These bilateral framework agreements would be a sort of precursor of
we could do globally with the others," said Mr Lamy.

A row over democratic reforms in Myanmar threatened to stall high-level
Asia - EU talks but EU ministers, meeting last weekend in Brussels,
to go ahead with meetings on the condition that Myanmar sends lower
officials than other countries.

Asean is due to conclude an FTA with China by 2010, Japan by 2011 and
India by 2012.

In the last few years, Singapore has signed FTAs with New Zealand, Japan,
the European Free Trade Association (Switzerland, Iceland, Liechtenstein
and Norway), Australia, the US and Jordan.