MANILA, Aug 25: A 10-nation Southeast Asian bloc agreed with Japan on Saturday to reduce trade barriers and said it would consider sanctions against any of its members who do not comply with free-trade agreements on time.

The Association of South East Asian Nations (Asean), which has adopted free trade as the vehicle to faster economic growth, aims to form a European Union-style economic community by 2015 and is forging free-trade deals with regional giants.

Asean’s agreement with Japan is expected to significantly boost two-way trade, currently worth more than $160 billion per year, officials said. Japan is the region’s biggest trade partner after the United States.

All the parties were able to finalise their lists for regional exchange of concessions for trade in goods, Japanese Trade Minister Akira Amari said after a meeting with Asean trade ministers in Manila, the capital of the Philippines.

This will be one step toward furthering economic integration in the East Asian region, he told reporters.

Asean already has free-trade agreements for goods in place with China and South Korea. It is negotiating similar deals with the EU, India, Australia, New Zealand and Pakistan.

Asean Secretary-General Ong Keng Yong said he had recommended to the trade ministers that the group not embark on any new agreements until these had been implemented.

He said Asean needed to remain at the centre of the group’s free trade efforts, adding some members had expressed concern that individual countries were seeking to develop their own trade relations.

Ong also said that Asean needed to ensure that its members adhered to free-trade agreements.The general perception is that Asean is prone to agree fast, act slow, he said in a report.

He said the group should set up a scorecard to track compliance by members and institute compensatory measures or denial of benefits for delay in implementation.

Japan’s Amari said the trade deal would particularly boost Japan’s investment in Southeast Asia’s electronics industries, which dominate the region’s exports.

It will help the movement of these (electronics) parts in the region and will promote even further the electronics industry in the Asean region through its liberalisation measures. The agreement will be signed at a summit in Singapore in November after officials complete work on the details.

Asean -- comprising the six richer members of Indonesia, Thailand, Malaysia, Singapore, Philippines and Brunei -- and four poorer recent members -- Vietnam, Myanmar, Cambodia and Laos -- is one of the world’s most dynamic economic regions, with a regional gross domestic product of $1.1 trillion.

But the bloc of 570 million people has made only slow progress towards its own economic integration.

Under the deal, which applies to trade in goods, not services, Japan will eliminate tariffs on 93 per cent of products imported from Southeast Asia over 10 years, and the six richer Asean countries will cut tariffs to zero on at least 90 per cent of goods they import from Japan.

The imports exempted from the deal are sensitive products, such as rice in the case of Japan, and automobile parts or textiles in the case of some of the Asean countries.—Reuters