TOKYO -- Japan and the Association of Southeast Asian Nations are expected later this week to reach a basic agreement on the liberalization of trade in goods, a key pillar of a bilateral free-trade agreement now under negotiation. The basic agreement is expected at a meeting of economics ministers from Japan and the 10 Asean nations scheduled for May 4 in Brunei, the day after a meeting of Asean economic ministers there. Akira Amari, Japan’s minister of economy, trade and industry, will meet with his Asean counterparts.
Under the expected agreement on free trade in goods, Japan will remove import tariffs on almost all industrial products while eliminating or cutting those on tropical fruits. Japan has specifically proposed eliminating tariffs on 92 percent of some 5,200 goods subjected to the negotiations. But rice, the most politically sensitive item in Japan, is expected to be excluded from the deal. Asean is likely to eliminate import tariffs on steel products and automobiles over 10 years.
Japan and Asean have so far held seven rounds of free-trade negotiations since 2005. The proposed trade agreement is more comprehensive than ordinary FTAs and covers the liberalization of not only trade in goods but also investment and services trade. As for the liberalization of investment and services trade, Japan and Asean are aiming to reach a basic agreement by the end of August.
The proposed free trade agreement, which is expected to take effect in 2008, will establish a trade bloc between Japan and Asean and enable Tokyo to take the initiative in steering Asia's economic integration.
According to preliminary figures released recently by Japan’s Finance Ministry, Japan-Asean trade totaled about $156 billion in fiscal 2006, which ended on March 31, making the 10-nation group Japan’s third-largest trading partner after China and the United States. The Asean countries are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
