ASEAN - ASEAN Braces For Regulatory Reforms

MANILA, Philippines — ASEAN is moving towards creating a template that would institutionalize regulatory reforms that would guide the region in its trade negotiations with other regional trade partners as the ten-member states fully integrate their economies by 2015.

Trade and Industry Undersecretary Adrian S. Cristobal Jr. said there have been initial discussions on this in ASEAN. As such, the Philippine government’s inter-agency committee on tariff and related matters was convened recently to start some discussions as this would impact on the country’s trade and investments.

This template would serve as ASEAN’s guiding principles when they negotiate for other regional trade deals or the so-called ASEAN + 3.

So far, ASEAN has entered into regional FTA deals including China, EU, Japan, US, Australia-New Zealand, India, among others. On top of that, individual ASEAN members also conduct their own bilateral FTAs with other trading partners. These FTAs are no longer governed by ASEAN rules.   

“How to grow our exports and continue getting fresh investments would guide us in negotiating for a possible ASEAN + 3 trade agreement,” said Cristobal.

Cristobal, however, said this guiding principle will not supplant existing ASEAN agreements but rather broaden the economic reach of ASEAN as it seeks to expand trade and investments through regional FTAs.

In July this year, the Philippines hosted the first ASEAN  Regulatory Reform Symposium for ASEAN (ARRS) integration in preparation for the ASEAN full economic integration or the ASEAN Economic Community (AEC) by 2015.

“The Philippine hosting of the ARRS will advance efforts to institutionalize regulatory reform dialogues within the ASEAN.  The symposium will help identify key challenges in policy formulation and address the gaps to achieve a more comprehensive regulatory reform program for specific sectors and industries,” Cristobal said.

The AEC envisions a single market and production base, a competitive economic region, equitable economic development, and integration into the global economy by 2015.

Through trade and investment liberalization, the ASEAN has reduced the cost of doing business through tariff reduction. At the start of the ASEAN Free Trade Area in 1993, the average tariff on intra-ASEAN trade was almost 13 per cent, and last year, in 2011, it has gone down to less that one percent.

Outside of the region, ASEAN has become a major player in the global market. According to the World Trade Organization, ASEAN  accounted for 7 per cent of global exports (totalling US$ 14,851 billion) in 2010.

According to the ASEAN Competitiveness Report 2010 prepared by the Asia Competitiveness Institute of the Lee Kuan Yew School of Public Policy, National University of Singapore, ASEAN was found to be more competitive than 57 percent of the 132 developed and developing economies in 2010.

However, the same Report also indicated that ASEAN has not advanced on the competitiveness scale in the past five years. This Symposium is a good opportunity for ASEAN to highlight current efforts in instituting several reform measures; as well as in providing support to advancing parallel advocacy efforts by the private sector to implement broad regulatory reform programs as part of the region’s overall competitiveness strategy.

Aside from reforms of regulatory regimes in supply chain and logistics, ASEAN needs to build on its previous successes and initiate a fresh wave of market-based reforms, in order to meet the challenges of globalization, as well as risks posed by a volatile global economy.

BERNIE CAHILES-MAGKILAT

http://www.mb.com.ph/

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