EU Trade Commissioner Karel De Gucht today finished a three-day visit to Da Nang (Vietnam), where he was invited to the 42nd ASEAN Economic Ministers Meeting (AEM). It’s the first time in three years that an EU representative has participated in such a meeting. The visit presents an opportunity to intensify trade and economic relations with ASEAN as a group, after the negotiations for a region-to-region Free Trade Agreement (FTA) were put on hold in 2009. Furthermore, the Commissioner had a number of useful bilateral meetings with Trade Ministers from various Asian countries.
"I came here to underline Europe’s desire for greater economic and political engagement with ASEAN“, Commissioner De Gucht said. "ASEAN as a region is becoming one of the most dynamic parts of the world. And the people in both the EU and the countries of South-East-Asia will benefit if we manage to strengthen our trade links in the coming years.“
To underline the renewed sense of engagement the Commission and ASEAN Ministers agreed to meet regularly at the annual AEM. They also announced that the first ever ASEAN-EU business summit would be held in 2011. This summit is meant to raise awareness about business and investment opportunities in the EU and ASEAN.
Background
The Association of Southeast Asian Nations (ASEAN) comprises ten countries: Indonesia, Malaysia, Singapore, Thailand, Philippines, Vietnam, Brunei, Cambodia, Laos and Myanmar. The region is the fifth biggest trading partner of the EU. In May 2007 the EU and ASEAN launched negotiations for a regional FTA, covering all but three members of ASEAN (the exceptions being Cambodia, Laos and Myanmar). Seven negotiating rounds were held, but the progress was slower than expected. In March 2009 finally, both sides agreed to a temporary suspension of the negotiations. The EU is now exploring bilateral FTAs with some ASEAN countries. Talks have started with Singapore, and we had encouraging discussions with Vietnam, Thailand, Malaysia, Indonesia and the Philippines. Bilateral FTAs should ultimately provide a stepping-stone for a future agreement in the regional context.
Already now trade between the EU and ASEAN is substantial. In 2009 bilateral merchandise trade reached 118 bn Euro, more than 5% of the total EU trade. The EU is ASEAN's 2nd biggest trading partner behind China and by far the largest investor in the region, accounting for 24.5% of total investment ahead of Japan (15%) and the US (8%).
ASEAN managed the recent crisis remarkably well. By now, all ASEAN countries have strong growth rates almost reaching pre-crisis levels. In 2010, ASEAN is poised to achieve an average economic growth rate of between 4.9 percent and 5.6 percent.
The EU finances various trade-related technical assistance projects to support ASEAN regional integration. These cover a range of topics such as intellectual property rights (ECAP II), statistical capacity building and, in the pipeline, support to FTA negotiations as well as for the development of the ASEAN Economic Community.
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