Nov 5, 2012

ASEAN - Asean, China intend to strengthen FTA

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Agreements to be signed during summit this month

Asean and Chinese leaders will ink two agreements facilitating trade growth between the two sides under the Asean-China Free-Trade Agree-ment (FTA) at their bilateral summit this month.

The two sides' leaders are scheduled to meet on November 18 in Cambodia during a summit of the Asean leaders plus those of six partner countries.

Commerce Ministry Inspector-General Boonyarit Kalayanamit said that trade and investment between Asean and China should grow following the recent agreement of both sides to eliminate technical trade barriers.

The first agreement to be signed by Asean and China would eliminate technical trade barriers and sanitary and phytosanitary (animal and plant health) standards. The second would support free trade by giving officials more flexibility in drawing up rules to facilitate business growth between Asean and China.

China has also agreed to provide financial support for promoting closer economic ties with Asean.

After a delay in approving a budget, Boonyarit said the Chinese government has shown positive signs that it will allocate funds to support many Asean projects soon.

Thailand has asked for support on two projects. The first, known as the Asean-China Capacity Building Workshop on Rules and Regu-lations under Trade in Services, will exchange knowledge on trade rules and regulations in the service sector to improve enterprises' understanding of how to penetrate the Asean and China markets.

The second project, Best Practice on Good Agricultural Production (GAP), will increase understanding of farm production systems and promote exports of farm goods on both sides.

At the upcoming summit, the two sides will also wrap up an agreement on trade liberalisation. Certain goods on both sides remain sensitive. For these sensitive items, both sides have agreed to cut tariffs to less than 20 per cent in 2015, and will bring tariffs for most products down to zero by 2018. Sensitive goods for China include coffee, seeds, rice, nuts, garlic and onions.

China is currently the largest trading partner of both Asean and Thailand. Bilateral trade grew fivefold from US$59.6 billion (Bt1.83 trillion) to $288.39 billion from 2003 - when the FTA kicked off - and the first nine months of this year.

Petchanet Pratruangkrai



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