MANILA, May 29: Southeast Asian nations should advance their 2010 deadline for dismantling all tariff barriers to cope with rising competition for investments, ASEAN secretary-general Rodolfo Severino proposed on Wednesday.

To wait for 2010 when the rest of the world is marching on might be too long, he told a media forum in Manila.

He declined to suggest a fresh deadline, saying this should be worked out by the member states but pointed out that “benchmarks” could be set to speed up a free trade area covering 500 million people in the region.

The Association of Southeast Asian Nations (ASEAN) launched a tariff cutting exercise in 1993 to forge the ASEAN Free Trade Area (AFTA).

The AFTA plan reached a milestone in January 2002 when the six older members of the group and the original signatories of AFTA Brunei, Indonesia, Malaysia, the Philippines, Singapore and Thailand dropped their tariffs on trade with one another to zero to five per cent.

The six countries account for more than 96 per cent of trade in the region. The other members of ASEAN are Cambodia, Laos, Myanmar and Vietnam.

The target of a mimimum of zero to five per cent tariffs was accelerated twice partly in reaction to a financial crisis in 1997 that dragged the region to its worst recession in history.

ASEAN leaders had decided on a 2010 deadline for total abolition of tariffs on intra-ASEAN trade by the senior members.

The target for the newer members is 2015.

But my own view on this is that this is partly slow in the face of growing competition around the world, said Severino, a strong free trade campaigner.

The current average tariff on goods traded among ASEAN members is estimated at about 3.5 per cent down from 12.76 per cent when AFTA took off in 1993.

The ASEAN free trade pact gives duty free privileges to products traded among member countries and which have at least 40 per cent local content.

Severino said ASEAN member states should impose more “benchmarks” among themselves to attain zero tariffs at a faster pace.

Aside from the 2010-2015 deadlines to totally dismantle tariffs, the only other “benchmark” now for the AFTA plan is that 60 per cent of tariff lines should attain zero tariffs by 2003, he said.

What I would like to see is for more benchmarks for the attainment of the zero per cent tariff plan, he added.

Severino said ASEAN would have to speed up efforts towards regional integration because other regions were making themselves cheaper and more attractive to lure investments.

The others are moving quickly. Even the Gulf Cooperation Council is working on a customs union. In the face of this, ASEAN countries cannot afford to go each their own way, he said.

—AFP