Brunei Takes Giant Step Towards Asean Free Trade
By Azlan Othman

Bandar Seri Begawan - Brunei is among the six Association of Southeast Asian Nations (ASEAN) which has taken the major step toward a free trade zone, slashing import tariffs to under 5% for most products, Asean Secretariat said on Thursday, Kyodo news reported.

The six key Asean members, Brunei, Malaysia, Thailand, Indonesia and the Philippines have agreed to put a 5% cap on imports from within the 10 member group effective Jan 1, 2003.

According to the latest annual report issued by the Asean Secretariat in Jakarta, Brunei joined five other original Asean members in making a milestone in Asean economic cooperation in 2002.

The first six signatories to the Asean Free Trade Area (AFTA), Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand have substantially achieved the aim of reducing tariffs in the region to 0-5% on almost all of their products under the Common Effective Preferential Tariff (CEPT) scheme.

"Accounting for over 96% of all Asean trade, the first six signatories of the CEPT for the AFTA have reduced their tariffs on intra-regional trade of no more than 5% for almost all products in the inclusion list or remove them all together."

"As of 1st January 2001, 92.8% of products in the inclusion list of the six original signatories to the CEPT agreement was in the tariff range of 0-5%", the report stated.

In Brunei, there are 6,107 tariff lines (or 97.3% of products) in 2001 in the inclusion list in the tariff range of 0-5% and 157 tariff lines (or 2.5% of products) in the tariff range of no more than 5%.

The report stated the new members of Asean will maximise the number of their tariff lines in the 0-5% range by 2003 for Vietnam and 2005 for Laos and Myanmar.

Based on Vietnam's year 2001 legal enactment, it would have 64.8% of its inclusion list in the 0-5% tariff range In 2002, Vietnam will continue to move about 500 tariff lines from temporary exclusion list to inclusion list.

By the 2nd quarter of 2002, Vietnam has had nearly 5,500 tariff lines in the inclusion lists, of which 2,002 lines are in 0% and over 3,400 lines are in the 0-5% range.

By 2003, Vietnam will move all tariff lines from temporary exclusion list to inclusion list. The 2001 legal enactment of Laos and Myanmar show 61.4% and 81.3% respectively, of their inclusion list have tariffs at 0-5%.

Cambodia, which joined Asean in 1999, had 7.6% of its inclusion list with tariffs at 0-5%. Cambodia will reduce the tariffs on 91.94% of its current inclusion list to 0-5% by the year 2007.

The lowering of tariffs was accompanied by an expansion of intra-regional trade from US$ 44.2 billion in 1993, when AFTA was launched to US$97.8 billion in 2000. (Courtesy of Borneo Bulletin)

Brudirect.com