ASEAN Free Trade Area (AFTA)
Background In
1992, the then six ASEAN states (Association of Southeast Asean Nations) initiated the establishment of a free trade zone, which was to be implemented through an extensive program for the gradual reduction of regional tariffs and which has now also been implemented as AFTA.
AFTA is not an international organization, but this website will remain in this subject area for the time being.
Objectives
free trade and in particular the lowering of the customs barriers between the members so that the region can assert itself better on the world market, and increasing the attractiveness of the economic area for foreign investors.
Member States (10)
- Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand
(the six founding members of ASEAN) - Vietnam (2006), Laos and Myanmar (2008), Cambodia (2010)
The numbers behind the four “late” ASEAN states indicate the year in which the adoption of the AFTA regulations was completed (= full membership). Compare also graphics.
Development
The entire AFTA process was designed for the long term and should be completed in 2008. However, the program was accelerated and expanded in order, among other things, to work towards the removal of trade barriers and quantitative restrictions and to harmonize the various economic and trade standards. In fact, the goal was already achieved in 2003.
The new ASEAN member states (Vietnam 1995, Laos and Myanmar 1997, Cambodia 1999) had to sign the AFTA agreements when they joined ASEAN, but were given longer transition periods to meet the obligations to reduce tariffs. The whole process was completed in 2010.
APT (ASEAN plus Three)
According to Sciencedict, ASEAN plus Drei (ASEAN + 3) refers to the regional dialogue framework between the 10 ASEAN states and the 3 East Asian powers PR China, Japan and South Korea.
The APT forum was set up in the late 1990s in response to the Asian financial crisis at the time and operates mainly in the area of financial, economic and trade policy. The multilateral cooperation of the APT has found expression in a number of other agreements, including on environmental and health issues. In addition, ASEAN has free trade agreements with China, Japan and South Korea.
Comment
With a population of over 600 million, ASEAN is slightly larger than the European Union, but its economic output is many times (around 10: 1) lower.
Nonetheless, the long-term potential of a growing, integrated market opens up for foreign investors, which is far more attractive for larger direct investments than would be the case with a collection of relatively small, segmented individual markets. The largest trading partners are currently the USA, EU, China and South Korea.
