Nov 19, 2012

Australia - Trade issues delay launch of ASEAN Economic Community

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SOUTH-EAST Asian leaders have delayed launching their long-awaited ASEAN Economic Community by nearly a year.

The AEC will be inaugurated on December 1 2015, according to a new schedule decided by the leaders last night, rather than January 1.

ASEAN's goal for the past 20 years has been to create a unified market in the region, which now covers 600 million people with a combined GDP of $2 trillion.

However, the 10 member countries have so far only met 72 per cent of the economic blueprint for merging their economies into a single trade and investment bloc, with Singapore and Malaysia doing best.

Indonesia's Trade Minister Gita Wirjawan indicated his country, Thailand and the Philippines were struggling with cross-border trade issues.

"We will not force things; we will instead merely consolidate our achievements looking toward the end of 2015," he said.

An ASEAN official said although members had dismantled most tariff barriers, they had much work still to do on eliminating non-tariff barriers and opening services and investment.

The ASEAN leaders and their counterparts from Australia, China, India, Japan, New Zealand and South Korea are expected to commit to an even more ambitious free trade bloc, the Regional Comprehensive Economic Partnership (RCEP).

Julia Gillard was expected to arrive here about 6.30pm AEST in preparation for tomorrow's East Asia Summit.

The 16 leaders will agree tomorrow to start formal negotiations for the world's broadest trade pact, covering 16 countries, 3 billion people and $16.7 trillion combined GDP.

The US and Russia, the newest EAS members, are not engaged in the RCEP.

There are unofficial hopes the negotiation could also be finished by the end of 2015.

However Mr Gita acknowledged that given the work still ahead on AEC that would be "amazing".

PETER ALFORD



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