25
April
2019

Outcomes of the 25th ASEAN Economic Ministers’ Retreat (25th AEM Retreat)

25
April
2019

Outcomes of the 25th ASEAN Economic Ministers’ Retreat (25th AEM Retreat)

1,702

Outcomes of the 25th ASEAN Economic Ministers’ Retreat (25th AEM Retreat)

Thailand hosted the 25th ASEAN Economic Ministers’ Retreat (25th AEM Retreat) on 22 – 23 April 2019 at Angsana Laguna Phuket.

It was the first meeting for the ASEAN Economic Ministers in 2019 under Thailand’s ASEAN Chairmanship.

Successes from the meeting

1. Endorsed Priority Economic Deliverables under Thailand’s ASEAN Chairmanship. Under the theme of “Advancing Partnership for Sustainability”, the priority deliverables consist of 3 strategic drivers and 13 deliverables, which are:

  1. Preparing ASEAN for the Fourth Industrial Revolution (4IR) such as the action plan on ASEAN digital integration, the work plan on ASEAN Innovation, Guideline on human resources development in Response to 4IR, and the digitalisation of ASEAN micro enterprises.
  2. Enhancing connectivity including linking all 10 ASEAN Member States to the ASEAN Single Window, promoting Gastronomy tourism, and the conclusion of the RCEP negotiation.
  3. Promoting sustainable development in all dimensions, for example, sustainable fishery policies, and the cooperation on research and development on bioenergy in ASEAN

2. Acknowledged the conclusion of the ASEAN Mutual Recognition Arrangement on Type Approval for Automotive Products (AP MRA), of which ASEAN has been negotiating since 2009. It is pleasing to learn that the Senior Economic Officials’ Meeting (SEOM) was able to agree on the pending issue concerning the definition of “ASEAN Automotive Products” whereby the scope of the MRA will initially cover only products manufactured in ASEAN. The scope will then be reviewed in the 4th year after the AP MRA enters into force. Outcomes of the review and recommendations to the ASEAN Economic Ministers will be raised to the ASEAN Economic Ministers in the 5th year.
The MRA on ASEAN Automotive Products will be instrumental in helping the ASEAN businesses in the automotive sector by facilitating intra-ASEAN trade, as well as increasing business opportunities while also reduce trade barriers. These benefits are achieved through the acceptance of inspection and certification among the ASEAN test centres, meaning that products will not be subjected to re-inspection and re-certification. In turn, the associated costs including expenditures and the time required for import and export of automotive products in the region can be reduced. It is expected that the AP MRA will be signed at the 51st AEM in September 2019.

3. Signed the ASEAN Trade in Services Agreement (ATISA) that will replace the current ASEAN Framework Agreement on Services (AFAS) that has been in force since 1995. The ATISA covers a number of principles including National Treatment for services suppliers, the augmentation of internal regulations relating to services providers to be more effective, the enhancement on transparency, the promotion on the inclusion of ASEAN MSMEs, and the provision of academic assistance between the ASEAN Member States.

4. Signed the Fourth Protocol to amend the ASEAN Comprehensive Investment Agreement (ACIA), with a view to enhance the agreement by introducing additional commitments to prohibit the imposition of performance requirements (PPR) on investor, such as the prohibition of restriction on sales of goods related to the volume or value of exports and to prevent the requirement of forcing investor to supply exclusively from their territories to a specific market. Nevertheless, the agreement also provides some flexibility for the ASEAN Member States for introducing a specific measure in their reservation list. At the same time, the investors will not be able to sue the government in the country of their investment with the said reservation.

5. RCEP The meeting took note on the progress of the RCEP Negotiations as well as the outstanding issues, including AFPs positions on the issues of Trade in Goods, Trade Remedies, Rules of Origin, Investment, E-commerce, Intellectual Property, and Legal and Institutions.
The AEMs gave their guidance to ASEAN-TNC to find a common position on each of these issues as soon as possible. This will help ASEAN to steer the subsequent negotiations in a direction that will be of the most benefit to ASEAN. ASEAN aims to reach a consensus on most issues by the Fifth Intersessional RCEP TNC and Related Meetings during 23-31 May 2019 in Bangkok. This is so that ASEAN can present the unified position to our ASEAN FTA Partners during the 26th RCEP-TNC Meeting in Melbourne to drive the negotiations toward the conclusion by the end of this year, as mandated by the RCEP Leaders. The ASEAN Economic Ministers will meet again to discuss the RCEP matters just before the 34th ASEAN Summit in June 2019 in Bangkok.
The conclusion of RCEP negotiation in 2019 is one of Thailand’s Priority Economic Deliverables for this year.

6. Agreed that ASEAN will play a proactive role on the issue of WTO Reforms. To that end, ASEAN agreed on three key issues

  1. to uphold the multilateral trading system
  2. the need for WTO members to update and refresh WTO rules to adapt to the changing realities of the global economic environment and
  3. the urgency for WTO members to work on the reform of the dispute settlement mechanism, of which the appointment of the members of the Appellate Body is key. This is to ensure the continued functioning of the WTO.

7. Realised the importance of preparing ASEAN for the Fourth Industrial Revolution (4IR) and support ASEAN’s work in achieving this aim. In January, ASEAN held an important regional seminar with attendees from all the relevant sectors to learn and discuss the possible area of work to progress the 4IR agenda, as well as for the ASEAN sectoral bodies to be aware of the importance of this issue. In terms of the way forward, The ASEAN Secretariat will develop a guideline on how to progress the work under 4IR in ASEAN that cover all 3 ASEAN Communities with emphasis on sectors that ASEAN can work together. Thailand will hold another meeting to discuss this issue in July 2019 in Bangkok.

8. Agreed that the negotiation on new FTAs between ASEAN and dialogue partners are increasingly embracing new FTA issues, such as labour, environment, government procurement, digital trade, and electronic commerce. ASEAN Will assesses the new FTA issues in detail and develops a work plan on the specific issue by considering areas that ASEAN is ready. ASEAN will also consider the possibility of having a common position for the ASEAN on these issues.

9. The consultation between the ASEAN Business Advisory Council (ASEAN-BAC) on 22 April 2019

  1. ASEAN-BAC presented the 2019 priorities and initiatives of the private sector including:
    – Preparation of MSMEs and the development of human resources capacity for the digital economy
    – Promotion on trade facilitation by proposing the elimination of Non-Tariff Barriers (NTB) and reduce custom procedures to facilitate the import of low-value items under the Low-Value Shipment scheme.
    – Encourage regional trade connectivity with a proposal on harmonisation of regulations on digital trade in ASEAN, amend the rules to support digital trade in the region, and build cooperation between the public and private sector.
  2. The ASEAN Economic Ministers viewed that the effort of the ASEAN private sector aligns well with those of ASEAN in the overall picture. On the preparation micro enterprises and human resources to enter the digital economy, the ministers recognised that the important issue at this stage is to build awareness and to prepare the readiness of ASEAN through education including the development of curriculum that recognises 4IR. Meanwhile, the industrial sector also needs to develop alongside the development of human resources. On the subject of digital trade connectivity, the Ministers were of the opinion that the ASEAN Member States currently have the different capability in adjusting for digital technology. Therefore, ASEAN must reduce the digital gap before promoting connectivity.
  3. On the trade facilitation and the reduction of trade barriers proposal, the ministers encouraged the private sectors to work closely and continuously with the ASEAN sectoral bodies to ensure the effectiveness of the implementation.

ASEAN Trade Value
• ASEAN is Thailand’s most important trade partner. In 2018, Thailand’s trade value with the 9 ASEAN Member States amounted to USD 113,934 million, an increase of 13% from 2017, and accounted for 27% of Thailand’s trade. Thailand exported and imported goods from ASEAN to the value of 68,473 million USD and 45,497 million USD, respectively with a surplus of 22,940 Million USD.