ASEAN, EU Confirm Importance Of FTA Talks

When the foreign ministers of the Association of Southeast Asian Nations (ASEAN) and European Union (EU) held a meeting in Brunei on April 27, emphasis was laid on the on-going negotiation of free trade agreements (FTAs) between the two regions.

Economic and trade relations were said to have featured prominently during the meeting, with an emphasis on implementing the ASEAN-EU Trade and Investment Work Programme and on the importance of the bilateral FTA talks between individual ASEAN member states and the EU as building blocks for a region-to-region FTA.

EU and ASEAN originally started talks on a region-to-region FTA in 2007. When those negotiations were suspended in 2009, the EU member states decided, instead, to pursue negotiations towards FTAs with the individual ten countries within ASEAN.

The European Commissioner for Trade Karel De Gucht, had, earlier in the month, disclosed that the EU’s bilateral FTA negotiations with Singapore are close to conclusion, and that it is making good progress with Malaysia. FTA negotiations are also being launched with Vietnam, after a scoping exercise was concluded earlier in 2012, and he hoped that the EU could advance discussions with other ASEAN countries in the coming months.

However, German Foreign Minister Guido Westerwelle expressed the belief of others in the EU when, at the meeting in Brunei, he emphasized the particular importance of re-launching negotiations about a region-to-region FTA as soon as the talks with individual ASEAN member states reached a critical mass that would allow the EU to return to the regional process.

It was confirmed that the EU has been the number one source of foreign direct investment (FDI) to ASEAN in the past several years. The total FDI from the EU to ASEAN in 2010 stood at over USD17bn. Total ASEAN-EU trade in that year was USD208.5bn, with the EU being ASEAN’s second largest trading partner (after China).

May 1, 2012

Source: Tax News