ASEAN’s free trade links with US gain prominence
ChannelNewsAsia, Singapore
ASEAN’s free trade links with US gain prominence
18 November 2011
SINGAPORE : President Barack Obama’s presence at the East Asia trade summit in Bali has reinforced US efforts to engage with Asia.
Free trade links with the US have gained in prominence, amid financial turmoil elsewhere.
As head of sales for "USA Incorporated", President Obama’s intention in Asia is clear, already helping to seal the biggest-ever order for US-made Boeing jets - a contract with Indonesia’s Lion Air worth US$22 billion.
For Southeast Asia, Obama’s presence gives a lift to improving trade links with the world’s biggest economy.
Professor Tommy Koh, Ambassador-At-Large at Singapore’s Ministry of Foreign Affairs, said: "It is a market of 600 million people with very low barriers, and we are transforming ourselves in the next few years into a single market with a single platform. My vision was that our bilateral FTA (free trade agreement) with America will be the the paving stone toward an eventual US-ASEAN FTA."
Singapore’s FTA with the US is hailed as proof of the benefits.
David Adelman, US Ambassador to Singapore, said: "In the 7.5 years since it went into effect, two-way trade between the US and Singapore is up more than 45 per cent and US exports to Singapore are up more than 72 per cent, it is really been phenomenal."
The US-Singapore FTA has been touted as one of the most successful FTAs thus far. With such bilateral agreements being so effective, it does call into question the relevance of regional trade agreements, which tend to take a much longer time to arrive at a consensus.
Professor Eul Soo Pang, Visiting Professorial Fellow at ISEAS, said: "I am talking here about the level of political development, economic development and social integration; it will be difficult for the US to come up with a single formula."
But an even more complex trade bloc, the nine-country Trans-Pacific Partnership (TPP), has emerged as the frontrunner, despite it not including China.
Professor Koh said: "The TPP is a mechanism to achieve free trade in the Pacific. I think it is a good thing and I welcome the intention of Japan, Canada and Mexico to join the TPP.
"But I would like to send a message to my Chinese friends. I hope China does not see the TPP as a means to isolate or marginalise China. China is a member economy of APEC, China should consider joining the TPP negotiations. "
Including China in any trade deal is a thorny issue, one that Mr Obama will not have to deal with, for now.
