TWN Info Service on Free Trade Agreements

03 February 2009

http://www.bernama.com.my/bernama/v5/news_lite.php?id=381566

Bernama | 5 January 2009

EU Expects Solid Response From ASEAN On FTA Offers

By Tengku Noor Shamsiah Tengku Abdullah

KUALA LUMPUR, Jan 5 (Bernama) — The European Union expects solid response from ASEAN countries to offers made for a possible EU-ASEAN Free Trade Agreement (FTA) at a meeting to be hosted by Malaysia in March.

"We should try to get this agreement going amid the global economic slowdown.

“Kuala Lumpur will host the next round of negotiations in March. We hope ASEAN countries will come out with solid response to EU offers," said Vincent Piket, the European Commission Ambassador and Head of Delegation in Malaysia.

Piket said ASEAN countries had confirmed to broker an agreement that was in line with what the economic and trader ministers had agreed upon in the ASEAN-EU Summit two years ago.

"With the economic slowdown creeping in, there is an urgency for concluding the EU-ASEAN FTA talks," he told Bernama in an exclusive interview.

The envoy said the negotiations have been going on for some time now, "more than one-and-a-half-year to be exact but until now we have not reach the point that we want to be."

"We are convinced this agreement will be beneficial for Asean, we have extra data to show the next Gross Domestic Product (GDP) growth for Asean is expected to be about 2.2 percent. The picture is even better for Malaysia," he said.

Piket said the agreement that covers the liberalisation of goods and services would lead Malaysia to benefit not less than 8.3 percent by 2020.

He said there were two considerations in the FTA talks.

"Firstly, Asean is not a customised union. At the end of the day, you will have to sign individual agreements between EU and individual Asean members, that is one consideration," he explained.

The diversed and heterogeneous nature of Asean economies are the other consideration, he said.

"In our negotiations, we have to make sure we accommodate what we asked for and what we agreed to give to the countries," he said.

Citing Malaysia as well-placed for strong economic potentials and has bright prospects of attaining developed country status by 2020, Piket said: " We look forward to a very ambitious approach from the Malaysia side."

He said the EU would sign the FTA under the Asean framework but "we have separate agreements because Asean countries are different in terms of economic prosperity."

"We accept the fact that we can go a little bit faster for some Asean countries," he said.

It was reported earlier that some Asean member states were ready to wrap up the agreement while countries like Laos, Myanmar and Cambodia would join the pact later.

"Hence, the FTA will be concluded in two phases as some member states are ready to go on with the negotiation process while some of them are not, but the approach will be at a regional and group level.

"It will not be separate bilaterals as it is not possible to negotiate regional FTA with individual member states," he said.

Former EU Trade Commissioner Peter Mandelson said in May last year that the EU was introducing some flexibility in the region-to-region pact framework that would take into account the different levels of development within Asean.

Asean groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

Its key position in the Asia-Pacific region, its dedication to regional peace and stability and its important economic weight have made Asean a key partner for the European Union.