China signed a trade agreement with 10 South Asian countries, reports the BBC. The deal could eventually unite a quarter of the world’s population in a free trade zone worth $2 trillion.
A landmark trade agreement between 10 South East Asian countries and China has been signed at a summit in Laos.
The deal could eventually unite a quarter of the world’s population in a free trade zone.
Participants at the Association of South East Nations (Asean) summit have also announced plans to hold another regular East Asian summit.
The new summit, like the trade agreement, would aim to strengthen economic ties in the region.
The Asean-China trade accord unites China and South East Asian countries in a single market worth $2trillion.
But the BBC’s correspondent at the summit, Kylie Morris, says analysts were warning that the agreement was more hopeful than substantial.
Asean member countries
Brunei
Burma
Cambodia
Indonesia
Laos
Malaysia
Philippines
Singapore
Thailand
Vietnam
It commits countries to lower tariffs on goods they trade by 2010, but it excludes thousands of “sensitive goods”, such as sugar, iron, steel and cars, which governments are unwilling to include in the agreement, our correspondent says.
At this stage, the deal also does not include services, nor does it tackle non-tariff barriers – impediments to trade which are normally harder to break down.
And it only encompasses South East Asia’s six biggest economies. Four poorer members – Laos, Vietnam, Cambodia and Burma – have until 2015 to comply.
Wider ambitions
But Asean leaders who have signed up to the deal with China are optimistic, our correspondent says.
They see long term benefits for the region, which is already providing significant resources and capital to fuel China’s economic growth.
Our correspondent says the agreement is also welcome for Beijing, as it boosts China’s presence in a region that traditionally has been dominated by the United States.
Ambitions for greater regional economic power are also behind plans for an East Asian Summit (EAS), which would group the 10 Asean countries with China, Japan and South Korea on a biennial basis.
The forum had been championed by Kuala Lumpur as a means of creating a trade bloc to rival the EU and the US.
Asean Secretary-General Ong Keng Yong said the EAS’ format and structure had yet to be agreed.
Its first meeting is set to take place in Malaysia next year.
The Asean summit maintained its traditions of not interfering in the internal affairs of its members.
There was no mention in the formal sessions of Burma’s slow progress on democracy, despite news on Monday that the detention of opposition leader Aung San Suu Kyi has been extended.
Thailand’s Prime Minister Thaksin Shinawatra also escaped any questioning over recent violence in his country’s Muslim-majority south.
