AEC in the focus of ASEAN summit

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asean-brunei-summitThe ASEAN Economic Community and the South China Sea conflict were the main discussion points of ASEAN leaders who gathered for the 22nd ASEAN Summit in Brunei on April 24 and 25.

It turned out that ASEAN is still facing major obstacles in its efforts to create a single market by 2015. With the target date just 18 months away to eliminate barriers to the free movement of goods, services and workers, the bid has been bogged down by domestic political pressures and delayed by alternative trade initiatives.

So far, Asean’s richer economies — Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand — have eliminated tariffs on goods they trade with one another, aside from a handful of sensitive products like rice, sugar and alcohol. The less-developed economies of Cambodia, Laos, Myanmar and Vietnam were given until 2018 to phase out import duties.

However, non-tariff measures are proving more of a challenge. Indonesia has introduced a raft of trade restrictions in the past year as the government confronts a widening trade gap that has weakened the rupiah, burdening consumers and importing industries with higher costs.

Malaysia is lagging behind on ASEAN commitments to strengthen anti-monopoly laws allowing greater competition in protected sectors, including telecommunications and automotive,

Even Singapore, a strong early proponent of Southeast Asian economic integration, is curbing the inflow of foreign workers, who have traditionally been a strong presence in the service-oriented economy. Critics say the city state is blocking the idea of free movement of labour.

The ASEAN secretariat in a report of 2012 found that less than half the steps that were meant to be in place by 2011 to reduce trade barriers had been fully implemented.

 

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Reading Time: 2 minutes

The ASEAN Economic Community and the South China Sea conflict were the main discussion points of ASEAN leaders who gathered for the 22nd ASEAN Summit in Brunei on April 24 and 25.

Reading Time: 2 minutes

asean-brunei-summitThe ASEAN Economic Community and the South China Sea conflict were the main discussion points of ASEAN leaders who gathered for the 22nd ASEAN Summit in Brunei on April 24 and 25.

It turned out that ASEAN is still facing major obstacles in its efforts to create a single market by 2015. With the target date just 18 months away to eliminate barriers to the free movement of goods, services and workers, the bid has been bogged down by domestic political pressures and delayed by alternative trade initiatives.

So far, Asean’s richer economies — Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand — have eliminated tariffs on goods they trade with one another, aside from a handful of sensitive products like rice, sugar and alcohol. The less-developed economies of Cambodia, Laos, Myanmar and Vietnam were given until 2018 to phase out import duties.

However, non-tariff measures are proving more of a challenge. Indonesia has introduced a raft of trade restrictions in the past year as the government confronts a widening trade gap that has weakened the rupiah, burdening consumers and importing industries with higher costs.

Malaysia is lagging behind on ASEAN commitments to strengthen anti-monopoly laws allowing greater competition in protected sectors, including telecommunications and automotive,

Even Singapore, a strong early proponent of Southeast Asian economic integration, is curbing the inflow of foreign workers, who have traditionally been a strong presence in the service-oriented economy. Critics say the city state is blocking the idea of free movement of labour.

The ASEAN secretariat in a report of 2012 found that less than half the steps that were meant to be in place by 2011 to reduce trade barriers had been fully implemented.

 

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