SINGAPORE, May 13: The European Union and Southeast Asia will launch an initiative next year that could pave the way for a wide-ranging free trade area between the two regions, German Chancellor Gerhard Schroeder said on Tuesday.

An enlarged EU plus the 10-member states of the Association of Southeast Asian Nations (ASEAN) will comprise more than one billion people and account for almost half of world trade, Mr Schroeder said at a public lecture during a day-long visit here.

In the same way that ASEAN wants to deepen ties with Europe, the EU’s biggest economy Germany wants to “achieve more with ASEAN bilaterally than we will be able to achieve together in the ongoing Doha world trade negotiations,” he said.

“We are thinking of more than just the reciprocal abolition of customs duties. We are thinking of common technical standards, the liberalization of services and the setting of clear rules for investment,” he said.

He said that “to prepare for such deepened cooperation, the EU-ASEAN trade initiative, TREATI, will be launched in 2004.”

“This is intended to pave the way for a genuine and comprehensive free trade area between the EU and ASEAN,” said Mr Schroeder.

ASEAN economic ministers and EU Trade Commissioner Pascal Lamy met in Laos last month and agreed to work towards the establishment of a framework to spur ASEAN-EU trade through the Trans-regional ASEAN-EU Initiative, or TREATI.

ASEAN, a market of more than 500 million people and which already has a free-trade zone of its own, hopes to sign free trade agreements (FTAs) with China, Japan and India within the decade.

A recently-signed FTA between Singapore and the US — the first between Washington and an Asian country — could be a model for an ASEAN-US accord, officials and analysts said.

Trade between the ASEAN and EU totalled $96.36 billion in 2001, down from $99.70 billion the previous year. As of the third quarter of 2002, trade totalled $64 billion dollars, according to the latest estimates.

Schroeder arrived here earlier Tuesday from Malaysia where he kicked of his tour of Southeast Asia on Sunday. He will depart later in the evening for Indonesia. Vietnam will be the last leg of his regional swing.

He was the first foreign leader to visit Singapore since the outbreak of the Severe Acute Respiratory Syndrome (Sars) in the region.

Mr Schroeder said after a meeting with Prime Minister Goh Chok Tong that although he had to reduce the size of his delegation due to concerns about the pneumonia-like disease, he had to push through with the trip as he wanted to send the right signal to Southeast Asia.

“The significance of these economic ties extends far beyond the exchange of goods and services,” he said in his lecture to an audience that included academics, diplomats, business leaders and students.

“The European Union is looking for strong partner organizations because there are many problems we can only solve by reaching agreements with other regional organizations,” he said.

Earlier, he told reporters that Germany sees Southeast Asia “as a very important region indeed” as Germany’s exports to the region exceeds its foreign trade with the US.

In his lecture, Mr Schroeder pledged that Germany will champion the interests of developing nations in getting concessions from the EU on the contentious issues of agricultural subsidies under the Doha round of World Trade Organization talks.

“I know that many of our partners expect additional flexibility from the European Union in particular as regards the agricultural negotiations.

“You can rest assured that Germany will, within European circles, advocate that a substantial offer be made,” he said.

Underlining the rift between the German and French alliance with the US during the war against Iraq, Mr Schroeder stressed the need for a stronger United Nations and for a “comprehensive, multilateral policy for greater security” worldwide. “No country can solve the world’s major problems on its own,” he said.—AFP