August 26, 2006	Saturday	Sha'aban 1, 1427

KUALA LUMPUR, Aug 25: The United States on Friday signed a trade and investment pact with Southeast Asia in a bid to bolster its influence in the region which is growing closer to China.

The Trade and Investment Framework Arrangement (TIFA), seen as a precursor to a full free-trade agreement, was inked by US Trade Representative Susan Schwab and her Southeast Asian counterparts.

“The Asean region as you know is a very high priority for not just US commercial and economic ties but for the overall geo-political interest and commitments of the United States,” Schwab told reporters.

Washington has already signed TIFA pacts with key regional economies.

The new deal with the Association of Southeast Asian Nations (Asean) prepares the way for a free-trade agreement (FTA) between the bloc and the United States, its largest trading partner.

Both Schwab and Southeast Asian ministers have been reluctant to say when FTA negotiations could begin, but one Asean official told AFP that they could start in 2010 when six Asean members implement trade liberalisation programmes.

Schwab said the TIFA would boost economic ties between the US and Asean which with a population of 560 million was “one of the most rapidly growing and dynamic economies in the world”. “In a trading relationship that now constitutes $150 billion a year, Asean makes up the fourth largest trading partner with the United States... A TIFA is going to generate trade and investment,” she said.

The US-Asean Business Community hailed the landmark pact, saying the TIFA would allow “the US government to engage more directly in the economic life of the region.” The business group met the Asean economic ministers on Thursday and urged the region to boost intellectual property protection and reduce trade barriers.

It also called for standard harmonisation and steps to allow for more trade and investment.

Under the TIFA, the United States and Asean will establish a formal ministerial dialogue which is aimed at expanding trade and investment.

They have also agreed to initiate a work plan on three projects key towards starting free-trade negotiations.

They include the creation of a common Asean system for entry of goods, establishing an agreement on sanitary standards to foster agricultural trade, and harmonising standards for pharmaceutical registration.—AFP