BANDAR SERI BEGAWAN, Brunei – Southeast Asia’s efforts to create a single market by 2015 are in their hardest phase owing to protectionist reflexes on sensitive sectors, Philippine President Benigno Aquino said.
Despite the challenges, however, leaders of the Association of Southeast Asian Nations are working hard to meet the target, Aquino told reporters on Wednesday night, April 24, in Brunei where he is attending ASEAN’s annual summit.
“They have finished with the easy parts but the accomplishments will not be as fast as in discussing the hard parts. When you reach that point, there can be some protectionist measures taken by each economy,” Aquino said.
“But since we are focused on reaching the target, everyone who believes that one community is beneficial to everybody concerned will really try hard (to reach the goal).”
ASEAN, a region of 600 million people in 10 countries, wants to establish a common market and manufacturing base so that it can better compete as a group with giant neighbours such as China and India in terms of trade and investments.
ASEAN attracted 7.6 percent of the world’s foreign direct investment in 2011, up from 4.3 percent in 2006, Jaspal Bindra, Standard Chartered’s chief executive for Asia, wrote in a column in the Borneo Bulletin on Thursday.
Philippine Trade Secretary Gregory Domingo said ASEAN had already achieved up about three quarters of its targets relating to its single-market goal since beginning the process in 2007.
But he also emphasised there were many challenges, including a framework to open up the services sector such as banking, insurance, telecommunications and retail within ASEAN.
Another challenge is harmonising customs procedures and putting them online so that businesses can see them real-time, Domingo told a media briefing held with Aquino.
On trade in goods, agriculture is also among the most difficult sectors to fully liberalise, Domingo said.
“If their agriculture sector is large, they will protect it because there are a lot of farmers (affected),” he said.
Analysts have said that ASEAN has achieved much in cutting tariff barriers to trade in goods, but still has a lot to do before the end-of-2015 target in opening up the services sector by removing non-tariff hurdles.
“ASEAN is fully aware of that and they’re now trying to do an inventory of those non-tariff barriers so that we can eliminate them one by one,” Domingo said. – Rappler.com