Canada Wants FTA With ASEAN
Canada wants free trade with the ASEAN bloc, Trade Minister Jim Carr said last week, on the eve of a trip to Thailand and Singapore for "exploratory" talks. Carr is looking to promote bilateral trade and investment with Thailand and Singapore – which, along with Canada, is expected to soon ratify the Trans Pacific Partnership – and press for free trade with the Association of Southeast Asian Nations (ASEAN). A deal with the ASEAN bloc, which includes Thailand, Malaysia, Singapore, Indonesia, Philippines, Brunei, Vietnam, Laos, Burma and Cambodia, would give Canada access to 650 million consumers.
Canada is also eyeing free trade with Argentina, Brazil, Paraguay and Uruguay, which form the Mercosur bloc, and has suggested a trade deal with China is also in the works, which if successful would make Canada the first Western nation to reach a free trade deal with Beijing.
ASEAN-China to focus on free trade
In the face of global challenges, countries in the Association of Southeast Asian Nations (ASEAN) and China need to strengthen their commitment to multilateralism, open and free trade, and a rules-based international order, said Singapore's Deputy Prime Minister Teo Chee Hean. Speaking at a business forum on ASEAN and China's Belt and Road Initiative, Teo identified three key areas for ASEAN-China to work on:
Enhance interconnectivity through infrastructure and digital industries:
ASEAN will need investments of about US$ 210 billion (S$286.88 billion) every year until 2030 to meet the needs of modern infrastructure and China's Belt and Road Initiative, which includes the Kunming-Singapore rail link and the China-Singapore (Chongqing) Connectivity Initiative Southern Transport Corridor, can play a significant role by trimming travelling times, and allowing people to access new markets.
Reaffirm commitment to open and free trade:
ASEAN and China are working to upgrade the ASEAN-China Free Trade Area. The Regional Comprehensive Economic Partnership, and Comprehensive and Progressive Trans-Pacific Partnership are major trade deals ASEAN is a part of which will enhance trade and investments in the region.
Continue to uphold rules-based international order:
ASEAN is trying to harmonise the trade and investment laws of respective countries to achieve a fully-integrated ASEAN Economic Community.
China, UK to discuss free trade deal
The Chinese Commerce Ministry said it will discuss free trade possibilities with UK, post-Brexit. UK Trade Minister, Liam Fox said that Britain aims to increase its exports to 35% of GDP after leaving the EU by increasing trade ties with other world trade members. Britain is trying to set up at least some basis for the future post-Brexit trade negotiations. The trade pact with China has been up for discussion since last month.
Australia, Indonesia agree in principle on free trade deal
Australian Prime Minister Scott Morrison will make his first trip overseas less than a week after being sworn in, flying to Jakarta to announce Australia and Indonesia are on the brink of signing a free trade deal. The FTA may be signed in September or October this year. The two nations have reached an in-principle agreement on a free trade deal.
The Indonesian rupiah has been falling, and the government hopes the announcement will help boost the currency in international markets. While Australia has been pushing for a "high quality" free trade agreement, officials have been forced to narrow the ambition of the deal because of strong protectionist forces in Indonesia.
Iran-EAEU free trade zone to come into full effect by 2022
A full-fledged agreement on a free trade zone between Iran and the EAEU will be concluded by early 2022, the Russian Ministry of Industry and Trade said. The agency noted that the interim free trade zone agreement signed in May 2018, which precedes the transition to a full-fledged agreement, covers around 50% of the trade between the parties and will enter into force in early 2019. According to the deal, Iran, which is not a member of the WTO, will assume obligations stipulated by the rules of this organisation, which will make its trade with EAEU members more transparent and predictable.
"After the expiration of the three year period, plans are in store to transition to a full format agreement on a free trade zone, which will cover commodities in full. Negotiations on the transition to the new agreement should be started no later than a year after the interim agreement enters into force," the Ministry of Industry and Trade said. Trade experts are upbeat on the prospects of the free trade zone deal between the EAEU and Iran.
In their opinion, the zone will be beneficial for all parties, especially given the US sanctions against Moscow and Tehran, which are driving both to trade with each other and economic rapprochement.
"In the context of sanctions, the temporary agreement on the free trade area will partially compensate for Russia's losses in the US market. The Iranian market is an alternative for deliveries of Russian metals, especially since the territorial proximity significantly reduces the cost of transportation," Head of the Center for CIS Countries Studies Vyacheslav Kholodkov told Izvestia.
BIMSTEC FTA awaits finalisation after 13 years
A push for free trade agreement and regional connectivity is expected to dominate discussions at the fourth summit meeting of BIMSTEC (Bay of Bengal Initiative for Multi Sectoral Technical and Economic Cooperation) on August 30 and 31. The regional grouping comprises seven members – Bangladesh, Bhutan, India, Myanmar, Nepal, Thailand and Sri Lanka.
"We regard BIMSTEC as gateway to seas of littoral states as well as access for two land-locked member countries Bhutan and Nepal. For India, BIMSTEC is a natural choice to fulfill our key foreign policy priorities of neighbourhood first and act east policy," said Preeti Saran, Secretary East in MEA.
But members are unhappy with the pace of progress as far as the free trade agreement is concerned. Last week, Heads of Missions from member states expressed disappointment that 13 years after the framework agreement was finalised, BIMSTEC-FTA has still not been concluded. Calling India the engine driver in the grouping, Chutintorn Gongsakdi, Ambassador of Thailand, cautioned that trade wars affect every country in the age of inter-connected global supplies.
"We need to find a way to deal with emerging powers in Indo-Pacific and regional groupings to provide strength in numbers. So multilateralism is important. BIMSTEC and ASEAN can be part of indo-Pacific regional architecture," the envoy said.