EU-ASEAN FTAROADMAP
BY
Charles Santiago
Monitoring Sustainability of Globalisation (MSN)
Agenda:
EUs trade policy towards Asia; EUs demands of Asian governments; EUs Multi-prong trade approach towards
Asia.
a) Country strategy papers;
b) ASEM;
c) EU-ASEAN FTA.
PhilippinesPhilippines
Indonesia
Brunei
Myanmar
Malaysia
Thailand
VietnamLaos
Cambodia
Singapore
FTA concluded
AFTA
Japan
FTA under negotiation
US
Taiwan
FTA concluded
AFTA
Japan
FTA under negotiation
TIFA with the US
FTA concluded
AFTA
FTA concluded
AFTA
Australia
Bahrain
China
New Zealand
Japan
FTA under negotiation
US
Chile
PeruFTA concluded
AFTA
Japan
FTA under negotiation
US
Australia
New Zealand
Pakistan
Korea
India
FTA concluded
AFTA
Australia
Japan
New Zealand
US
India
Jordan
Chile
South Korea
Panama
Transpacific SEP (RTA including Brunei, Chile, New Zealand Singapore)
European Free Trade Association (EFTA)
FTA under negotiation
Canada
Sri Lanka
Peru
Iran
Egypt
Pakistan
Ukraine
Mexico
China
Golf Cooperation Council GCC (RTA including Bahrain, Kuwait, Qatar, United Arab Emirates, Oman and Saudi Arabia)
FTA concluded
AFTA
FTA under negotiation
TIFA with the US
Japan
ASEAN FTA ALREADY CONCLUDED
South Korea (2006)
AFTA
To be implemented by 2015
To be concluded by 2010
To be concluded by 2015
To be concluded by the end 2007
To be concluded by 2009
FTA UNDER NEGOTIATION WITH ASEAN
EU
MERCOSUR (Argentina, Brazil, Paraguay, Uruguay)
Korea
India
Golf Cooperation Council (Bahrain, Kuwait, Qatar, United Arab Emirates, Oman and Saudi Arabia)
CAN (Andean Community) Bolivia, Colombia, Ecuador, Peru
Central America (Guatemala, Salvador, Honduras, Nicaragua, Costa Rica, Panama)
African, Caribbean and Pacific (ACP) (78 countries)
ASEAN
EUs Trade Policy Goals in Asia.
To improve Market Access and Investment opportunities for EU MNC;
To ensure that EU corporations are not out-competed by US, Japan and Korean corp.;
To establish a pro-business environment & eliminate barriers to European trade;
To encourage changes in legislations and regulations which are barriers to European trade.
EUs Trade Policy in Asia.
EU’s ‘Towards A New Asia Strategy’ (1994) states:
“ to pursue all actions necessary to ensure open markets and a non-discriminatory business environment conducive to an expansion of European trade and investments”
How Does EU Policy Boost EU Private Sector Participation In Asia?
To demand changes to Standards and Quality Control, IPR, and Mutual Recognition Agreements (MRA);
To promote business cooperation bet. European and Asian business groupings;
To establish cooperation and links between European business and Chamber of Commerce;
To provide financial incentives for business through the European Investment Bank.
What Does EU’s Policy Demand of Asia?
Liberalisation – opening up and creating a non-discriminatory environment for European business;
Regulatory changes - towards a pro-business environment;
Convergence – Asian economies need to follow EU standards & QC, certification and custom procedures;
Integration - of Asian economies to European economies and business practices.
How are these demands played out – Asia strategy papers.
Asia (1994) - market opening; promote MNC presence and goods;
Korea (1993) - market opening; Japan (1995) - dismantle barriers to market access; China (1995) - promoting European MNC presence
(goods and investments); ASEAN (1996) – investment; and upgrading of bi-
lateral relationship; trade and investment facilitation.
ASEM
TFAP and IPAP - trade & investment liberalisation, removing trade barriers and promoting public-private partnerships.
Working groups, seminars and a reporting mechanism has been established.
Business community (AEBF) given a prominent role; Declining business interests in the economic pillar.
Towards An EU-ASEAN FTA?
ASEAN’s strategic interests to the EU: “ASEAN is not only back on its feet as one of the
world’s fastest growing regions, it is also being increasingly wooed by an array of Europe’s competitors - including the US - seeking new partnerships and alliances in the area. To secure global influence, the EU must also become part of he intense-weaving of economic ties currently underway in South East Asia”. Yale Global Project 2003
Important Agreements:
TREATI – 2003 ASEAN Integration Framework (AIF) – 2004 Inter-phasing of TREATI and AIF – 2005 Vision Group – April 2005 EU – ASEAN FTA viable - May 2006
EU’s TREATI for ASEAN (2003)
To establish a regulatory framework – on trade facilitation, market access and competition policy & investment;
Greater convergence between Europe and Asian regulatory systems;
The focus is on non-tariff barriers; Preparation for an FTA with EU
Implications for Asean
ASEAN exports need to conform to EU standards; ASEAN economies must adhere to WTO GATS
framework; ASEAN government’s must accord the highest
protection for EU MNCs IPR. ASEAN government’s must offer an open and non-
discriminatory rules for EU business and investors; ASEAN governments must open-up government
procurement to EU corporations.
ASEANs Framework on Integration of Priority Sectors (2004)
Progressive liberalisation of trade in services; Progressive elimination of restrictive
investment measures; Harmonization of product standards &
technical regulations Promote business communities in the region.
EU-ASEAN Harmonization and Integration.
In 2005, TREATI was inter-phased with ASEAN Integration of Priority Sectors
Collectively, it involves: Liberalisation of trade, investment, services; Elimination of non-tariff barriers; Elimination of technical barriers to trade; Tariff reduction; WTO + issues This Locks ASEAN into a irreversible neo-liberal
order.
EU-ASEAN FTA – Deepening & Widening liberalisation
Liberalisation – goods, services and investments – going beyond WTO commitments;
Elimination of technical barriers to trade, non-tariff barriers to trade;
Opening-up of government procurement; Protection of IPR; Implementation of Competition policy
Issues:
ASEAN nations are required to make significant economic changes for European Market Access and FDI;
Trade Rules are rewritten along neo-liberal order and works in favor of the stronger EU;
EU demand – “reorganize your economy if you want to trade with us”;
The neo-liberal order ignores existing asymmetries between the EU and ASEAN & within ASEAN.
FTA rules and regulation are not neutral.