Asean agrees to step up efforts on world's largest free-trade pact

Foreign Minister Vivian Balakrishnan (centre) delivers his opening remarks at the 8th East Asia Summit Foreign Ministers’ Meeting, during the 51st Association of Southeast Asian Nations Ministerial Meeting in Singapore on Aug 4, 2018.
Foreign Minister Vivian Balakrishnan (centre) delivers his opening remarks at the 8th East Asia Summit Foreign Ministers’ Meeting, during the 51st Association of Southeast Asian Nations Ministerial Meeting in Singapore on Aug 4, 2018.PHOTO: AFP

Conclusion of RCEP will show political will and enhance intra-region trade, says Vivian

Amid anxiety over a trade war, Asean nations and their key partners have agreed to redouble efforts to conclude a region-wide trade pact by the end of the year.

The 16-country Regional Comprehensive Economic Partnership (RCEP) would, if concluded, be the world's largest free trade deal.

"All 10 Asean countries and our external partners acknowledge that a multilateral, rules-based trading system, which has underpinned our progress and peace for the past 70 years is under pressure, but we need to double down on this principle," said Foreign Minister Vivian Balakrishnan yesterday at the end of a week of Asean-led meetings.

Ongoing trade tensions between the US and several of its key trading partners, including China, loomed large at the discussions, traditionally dominated by security concerns.

Dr Balakrishnan said the conclusion of the RCEP will show political will, and "the acknowledgement that this is something we need to settle, and all the more so given the state of the world and the anxiety over trade wars". Asean recognises that if it cannot stop these wars externally, it can for a start try to enhance intra-Asean trade.

"We are transiting into a new age where there will be a rising middle class in Asean, and Asean will be a consumer in its own right," he said, noting that the concept for the Asean Economic Community has become all the more salient.

Most of the major world powers were in town last week, setting the stage for some friction.

 
 
 

US Secretary of State Mike Pompeo yesterday announced US$300 million (S$410 million) in funding for security cooperation in the Indo-Pacific, a move observers said was likely to further rankle China.

In response to whether Asean would end up as an arena for big power rivalry, Dr Balakrishnan said: "We will be united. We will be relevant. We will maintain centrality, and we will continue to convene these regional and extra-regional platforms... Rather than looking at this as a competitive situation where we all just become proxies, our concept of being united, being central, open and inclusive, and welcoming investments and trade with all parties is precisely the right response."

The East Asia Summit ministerial meeting and Asean Regional Forum retreat saw agreement on the need to work together on emerging issues like cyber security, and calls for the complete, verifiable and irreversible denuclearisation of North Korea - and for this to be achieved in a peaceful way.

Dr Balakrishnan noted that the joint agreement signed by US President Donald Trump and North Korean leader Kim Jong Un at the Singapore summit in June was an important first step in a long journey. There are still major issues to be resolved, but the summit did change the tone of the conversation and will hopefully help set the stage for the peaceful resolution of outstanding issues.

Asean has offered a platform for all issues to be discussed openly in a safe, constructive and comfortable forum, even among superpowers. And, said Dr Balakrishnan, it has also allowed its 10 member states to join forces, "hanging together rather than hanging separately".

"It has allowed us to integrate our economies. It has allowed us to lower trade barriers among ourselves," he said. "To fulfil that ultimate goal of creating a single zone for production and investment."

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A version of this article appeared in the print edition of The Sunday Times on August 05, 2018, with the headline 'Asean agrees to step up efforts on world's largest free-trade pact'. Print Edition | Subscribe