Trade Liberalisation

Various significant developments took place in the field of trade liberalisation. Under the ASEAN Preferential Trading Arrangements (PTA) another 1,948 items exchanged during the Thirteenth COTT Meeting in Singapore on 28-30 October 1981 were approved by the Twelfth AEM Meeting bringing the total number of items exchanged under the PTA to 8,529 items. These additional 1,948 items have a minimum preferential margin of 20-25 percent and took effect on 16 April 1982.

With respect to across-the-board tariff cuts, the Twelfth AEM Meeting agreed that tariff concessions of 20-25 percent be extended to items with import values up to the level of US$1.0 million based on 1978 statistics with an exclusion list. With regard to the exclusion lists the Thirteenth AEM Meeting also agreed that the exclusion list should be kept as short as possible and there is a need to devise appropriate guidelines or criteria that are flexible enough to accommodate the circumstances and needs of each member country.

Noting the multiplicity of trade liberalisation instruments, the Twelfth AEM Meeting agreed to discontinue voluntary exchanges of trade preferences. To maintain the momentum of trade liberalisation, across-the-board tariff cuts would be extended to items of increasingly higher trade values.

In this regard, the Thirteenth AEM Meeting Agreed that the date of effectivity for the implementation of the 20-25 percent margin of Preference to items with import value above US$500,000 to US$1,000,000 based on 1978 statistics be implemented by 1 July 1982 and to those with import value above US$l,000,000 to US$2,500,000 based on 1978 statistics be implemented by 1 September 1982 and not later than 1 December 1982, subject to Thailand's confirmation on these two matters. Pursuant to the decision of the Eleventh AEM Meeting that COTT study how trade in the food products sector could be intensified, COTT has studied this issue and would coordinate with COFAF before submitting its recommendations to the ASEAN Economic Ministers.

To further expand intra-ASEAN trade, the Thirteenth Meeting of COTT has also proposed that preferential margins on products currently under the PTA be further increased, steps be taken towards the removal of non-tariff barriers, a more general sectoral approach to trade liberalisation be adopted, and that long term contracts of import procurement be encouraged.

Tourism

In the field of tourism, besides ongoing promotional activities, progress was made in several specific projects.

The Report on the Study of EEC Tourism Flows into the ASEAN Region, prepared by an EEC-commissioned consultant was completed and submitted for consideration by the Eighth Meeting of the Sub-Committee on Tourism (SCOT) in Puerto Azul, Philippines on 13-15 May 1981.

With regard to the lntra-ASEAN Visitor Survey, the Ninth Meeting of SCOT in Genting Highlands, Malaysia on 17-19 September 1981, agreed that it be awarded to INRA with financial contributions of US$16,000 from each member country. The Philippines was designated to coordinate with INRA and the Survey is targetted to be implemented in the last quarter of 1982 for completion by the first quarter of 1983.

On the UNDP/WTO Study on ASEAN Cooperation in Tourism Development, which COTT had accorded high priority for UNDP funding, the Ninth Meeting of SCOT recommended that 40 percent of the alloted UNDP funds for COTT projects be used for this Study in view of its importance.

In view of the importance of the Latin American and other Spanish-speaking markets, SCOT is currently in the process of producing 20,000 copies of a Spanish edition of its ASEAN Welcome Leaflet for distribution in the Latin American and Spanish markets.

With regard to the ASEAN film, SCOT is in the process of contracting out its production. Contributions from member countries will cover the cost of this film, expected to be US$75,000.

International Commodity Issues

ASEAN is one of the greatest primary commodity producing and trading regions of the world and joint ASEAN approaches to international commodity issues is an important area of ASEAN cooperation. Over the past year such cooperation has gained not only increased importance but also a greater sense of urgency as a result of the current world recession and developments in the commercial policy of developed countries.

One of the most important outcomes of UNCTAD IV in Nairobi in 1976 was the Integrated Programme for Commodities (IPC) covering 18 key commodities. To keep the momentum on commodities going, ASEAN has joined other developing countries in lobbying for the effective resumption of the North-South Dialogue where commodity issues could be taken up and progress achieved.

In the more specific area of the Common Fund, ASEAN has played an active role in negotiating its establishment as an effective and meaningful international institution in the context of the New International Economic Order. Recognising that the pillars of the Common Fund are the international commodity agreements, ASEAN has striven hard in this area and has successfully played a leading role in galvanising the support of both producers and consumers in negotiations on commodities like tin and rubber which are of interest to ASEAN. In other areas such as vegetable oils and tropical timber it is hoped that renewed efforts would make progress in the near future.

Besides joint action in negotiating commodity agreements, ASEAN also played an active role in ensuring that these are effectively enforced in the wider interest of both consumers and producers. With regard to the International Natural Rubber Agreement (INRA), for example, ASEAN hag lobbied for a revision of the buffer stock price range to reflect underlying changes in the cost of production.

A commodity issue which has generated great concern in ASEAN is the disposal of tin from the U.S. General Services Administration (GSA) Strategic Stockpile with consequent disruptive effects on an already weak international tin market. Tin producers have on many occasions called on the U.S. to suspend such disposals, particularly when the price is in the lower sector of the International Tin Council (ITC), buffer stock price range. One such call was by the Ministers of tin producing countries meeting in Kuala Lumpur in October 1981. Noting the lack of an adequate response from the U.S., the Twelfth AEM Meeting urged the U.S. to immediately stop GSA sales of tin in the world market.

In the field of export earnings. stabilisation (STABEX), the Twelfth AEM Meeting noted its importance for ASEAN countries and agreed that in spite of a lack of significant progress in this field, ASEAN should continue to press developed countries for the eventual establishment of a globalised STABEX arrangement.

For more information, please refer to the project details