Asean beefs up cooperation in finance, trade

The Association of Southeast Asian Nations is beefing up various frameworks for cooperation and development within the region and with its trading partners, in preparation for regional economic integration by 2015.

Trade Secretary Gregory Domingo related that during the recent Asean Summit in Bali, Asean leaders adopted the Asean Framework for Equitable Development, which contained innovative ways to improve financial access and security in the region.

It also provided for a regional forum on best practices in the field of access to finance.

The Asean Framework for Regional Comprehensive Economic Partnership, on the other hand, aims to enhance the Asean’s relationship with its trading partners, which include China, Korea, Japan, Australia and New Zealand.

Under this framework, working groups in trade in goods, services and investments would be set up to lay down the specific principles and a template for engagement with Asean trading partners.

Also during the Bali meeting, Asean leaders inked the second package of commitments for the trade in services component of the Asean-China Free Trade Agreement.

Trade Undersecretary Adrian Cristobal Jr. said this would greatly benefit the country, as it opens opportunities for Filipino service providers to operate in China, as well as paves the way for the entry of more Chinese investments, particularly in energy and transport.

The Asean leaders also signed the second protocol to amend the agreement on trade in goods under the Asean-Korea FTA.

Cristobal said that for the Philippines this means easier access to the Korean market.

“It will be easier for Asean countries, including the Philippines and

Korea, to implement tariff commitments. With the signing, we can expect zero duties to our coconut oil exports under the Asean-Korea

Trade in Goods Agreement (AK-TIG), making our products more competitive,” he explained.

Under the current AK-TIG, coconut oil—one of the country’s key export products—is levied a tariff rate of 3 percent.

Domingo said the signing of these frameworks, agreements and amendments brought the Asean even closer to its goal of economic integration.

“We are fully committed to the Asean goal of economic integration by 2015. While we remain cautiously optimistic that this agenda can be achieved, we also want to ensure that the Asean population benefits from the integration,” he said.

The Asean last year secured $78.5 billion in investments. Regional trade also increased by 32.9 percent to more than $2 trillion.

The Philippines is expected to experience significant economic gains—in the form of higher exports and foreign direct investments—when the Asean becomes fully integrated by 2015. The National Economic and Development Authority predicts that the country’s exports will grow by as much as 45 percent after this union.