Friday, August 29, 2008

Joint Media Statement at the Conclusion of Sixth Asean-India Consultaions

The Sixth Consultations between the ASEAN Economic Ministers (AEM) and India (6th AEM-India Consultations) was held in Singapore on 28 August 2008. The Consultations was co chaired by Mr. Lim Hng Kiang, Minister for Trade and Industry of Singapore and Mr. Kamal Nath, Minister of Commerce and Industry of India. The annual consultations provided the opportunity for Ministers to exchange views on issues and developments affecting global and regional trade, particularly those that are significant to the bilateral trade between ASEAN and India. The Ministers noted that, despite the challenges prevailing in global and regional trade, ASEAN-India bilateral trade continues to grow at impressive rates. From 2005-2007, trade in goods between ASEAN and India increased at an average annual rate of 28 percent. ASEAN exports to India during the same period grew at an annual rate of 31 percent on average , the fastest among ASEAN’s exports to major trading partners. The share of ASEAN-India trade in relation to total ASEAN trade continued to increase and India remains ASEAN’s seventh largest trading partner. On the investment side, in 2007, India’s Foreign Direct Investment to ASEAN, valued at USD 641 million, was the highest ever recorded since 2000. The other Ministers who attended the meeting were Mr Pehin Dato Lim Jock Seng, Second Minister of Foreign Affairs and Trade, Brunei Darussalam; Mr. Cham Prasidh, Senior Minister and Minister of Commerce, Cambodia; Mr Mari Elka Pangestu, Minister of Trade, Indonesia; Mr Nam Viyaketh, Minister of Industry and Commerce, Lao PDR; Mr Tan Sri Muhyiddin Yassin, Minister of International Trade and Industry, Malaysia; Mr U Soe Tha, Minister for National Planning and Economic Development, Myanmar;Mr. Peter B. Favila, Secretary of Trade and Industry, the Philippines; Mr.Pichet Tanchareon, Deputy Minister of Commerce, Thailand; (representing Mr.Chaiya Sasomsub, Minister of Commerce, Thailand); Mr. Nguyen Cam Tu, Vice Minister, Ministry of Industry and Trade, Viet Nam (representing Mr.Vu Huy Hoang, Minister of Industry and Trade, Viet Nam and Mr. Surin Pitsuwan, Secretary-General of ASEAN. 

The Ministers announced the conclusion of the ASEAN-India Free Trade Agreement (AIFTA) negotiations for trade-in-goods. The Ministers were pleased that, despite the difficult issues in the negotiations, both sides were able to reach an agreement on the modality for tariff reduction and/or elimination, which is among the key elements that will facilitate the creation of an open market in a region comprising about 1.7 billion people and with a combined gross domestic product of approximately USD 2,381 billion as of 2007. The Ministers viewed that the AIFTA could be a major avenue in harnessing the region’s vast economic potentials towards sustained progress and improved welfare not only for ASEAN and India but for the greater East Asian region as well. The Ministers agreed that officials finalise the text of the ASEAN-India Trade in Goods Agreement in time for signing during the ASEAN-India Summit in December 2008, together with the ASEAN-India Agreement on Dispute Settlement Mechanism. The Ministers agreed to target implementation of tariff reduction commitments starting 1 January 2009. The Ministers also instructed officials to commence, as soon as possible, negotiations on trade in services and investment as a single undertaking, and to work towards the conclusion of substantive discussions on these two agreements by 2009 to bring about a complete ASEAN-India Comprehensive Economic Cooperation Agreement. The Ministers also took stock of the latest developments in the Doha Round and emphasised that a stronger multilateral trading system would benefit all Members, especially the developing countries. Since the Doha Round is a Development Round, the developing countries have a special stake in its successful conclusion. The Ministers reaffirmed their commitment to active and constructive engagement in the negotiations to bring about balanced and ambitious outcomes in all areas, especially in agriculture, NAMA and services. The Ministers assured Lao PDR of their continued support in her accession to the WTO. 

The Economic Ministers of ASEAN, Australia, the People’s Republic of China, the Republic of India, Japan, the Republic of Korea and New Zealand had a productive exchange of views on the areas of cooperation within the East Asia Summit (EAS) framework. The Ministers welcomed the establishment of the Economic Research Institute for ASEAN and East Asia (ERIA) with the Inaugural Governing Board Meeting of ERIA held at the ASEAN Secretariat on 3 June 2008. The Ministers also welcomed the research activities of ERIA and looked forward to ERIA’s practical policy recommendations for deepening economic integration, narrowing development gaps and sustainable development. In particular, the Ministers noted with appreciation the ERIA East Asia Industrial Corridor Project for the region-wide comprehensive development, affirming the importance of linking the infrastructure development and industrial development planning. The Ministers also expressed interests in the ERIA Energy Outlook which demonstrates the importance of enhancing energy efficiency for sustainable development. The Ministers agreed to report the outcome of ERIA’s activities to the EAS Leaders. 

The Ministers also discussed current regional and international policy issues such as the increase in the energy and foods prices and its impact on the region. In this regard, the Ministers welcomed Japan’s proposal to host the symposium on the energy and food security in cooperation with ERIA. The Ministers noted the report of the Track Two Study Group on Comprehensive Economic Partnership in East Asia (CEPEA), which shows greater potential trade and GDP growth if enhanced integration among EAS members is achieved. Consistent with the request of Leaders, the Ministers agreed to convey the report to Leaders at the 4 th East Asia Summit (EAS). The Ministers also agreed to a Phase II Track II Study on CEPEA, detailing the pillars of economic cooperation, facilitation and liberalisation as well as institutional developments. The Ministers acknowledged that substantial progress was made during the World Trade Organisation (WTO) Mini-Ministerial in July and members came very close to agreement. However, there are still outstanding issues before modalities in Agriculture and Non-Agriculture Market Access (NAMA) can be resolved. The Ministers agreed that all economies must work together to preserve what has been achieved to date, and to show constructive and continued engagement to conclude the Round. The Ministers also agreed that a strong and equitable global rules-based trading system is necessary for continued growth. The Ministers also stressed the importance of concluding the round to achieve development objectives and to respond effectively to the global financial and food crisis. The Ministers committed to intensify efforts in the coming weeks to resume negotiations and achieve convergence in the remaining areas before the window of opportunities closes. The Ministers supported WTO DG Pascal Lamy’s efforts to bridge gaps among the key economies and his call on these economies to show political commitment and flexibility to work towards a balanced and ambitious outcome. The Ministers agreed that it is important to ensure the integrity of the multilateral trading system, and that work on the remaining areas of the single undertaking should resume in Geneva even as modalities in Agriculture and NAMA are being worked out.

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