November 15, 2019

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Press Statement: EU-ASEAN Business Council and ASEAN Business Advisory Council Launch Report on Non-Tariff Barriers in ASEAN: Both Bodies Call for Faster Action on Removal of NTBS

BANGKOK, 22 June 2019 – In line with ASEAN’s 2019 theme of “Advancing Partnership for Sustainability”, the EU-ASEAN Business Council (EU-ABC) and ASEAN Business Advisory Council (ABAC) today launched a joint report “Non-Tariff Barriers (NTBs) in ASEAN and their elimination from a business perspective” which examines the prevalence of non-tariff barriers to trade in three key industrial sectors in ASEAN – Automotive, Agri-Food, and Healthcare. The aim of the report is to highlight the need for faster action in removing NTBs in the region to help ASEAN achieve its objectives as set out in the two ASEAN Economic Community Blueprints, and the subsequent targets of reducing the cost of trade by 10% by 2020 and doubling intra-ASEAN trade by 2025 as agreed by the ASEAN

Leaders in 2017.

The report sets out a number of recommendations to ASEAN, aimed at helping the region accelerate the removal of NTBs.

The Counsellor of the EU Delegation in Thailand, Mrs Isabelle De Stobbeleir, opened the event by stating that: “The European Union is a strong supporter of the ASEAN economic integration and the facilitation of regional trade. Through the Enhanced Regional EU-ASEAN Dialogue Instrument (EREADI), the EU strives to facilitate EU-ASEANpolicy dialogues across all three ASEAN pillars. Thanks to the active engagement of the ASEAN Business Advisory Council and the EU-ASEAN Business Council, business communities from the EU and ASEAN are involved in a constructive exchange. Together, we join forces to promote the economic integration of ASEAN, strengthen business cooperation and bring forth the perspectives of the private sector.”

Commenting on the report, Mr Donald Kanak, Chairman of the EU-ABC, said: “ASEAN has made excellent progress on removing tariffs for intra-ASEAN trade, but Non-tariff Measures have increased markedly despite the commitments made under the AEC to reduce them. This report by the Asian Trade Centre highlights the extent of the problem in three sectors within ASEAN. Reducing NTMs and removing NTBs will foster intra-ASEAN trade, increase innovation, and lead to lower costs for businesses and for consumers. It should also create intra-ASEAN trading opportunities for MSMEs.”

Speaking at the launch event in Bangkok, Chairman of ASEAN BAC, Mr Arin Jira, said: “As we cross over the 10th year anniversary of ATIGA, we’re very pleased to launch this joint research undertaking by ASEAN BAC and EU ABC which only affirms the private business sector’s commitment to help address NTBs. While it’s only the start of a long tedious process, we’re hopeful that with ASEAN’s support and cooperation, we now have a clear starting point in prioritizing which NTBs to address based on the results of the research as initiated on three sectors: Agri food, Healthcare and Automotive. We are now moving from talk mode to action mode.”

Executive Director of the EU-ASEAN Business Council, Chris Humphrey, added: “ASEAN is at risk of failing to fulfil its potential, unless faster and more proactive action is taken on its own economic integration programme. 2019 marks ten years since the ASEAN Trade in Goods Agreement (ATIGA) was signed but yet some elements of that Agreement have still not been implemented. ASEAN is still a long way from being the single market and production base that the AEC envisaged. Unfortunately, this means that intra-ASEAN trade remains low, and extremely unlikely to hit the goal of doubling intra-ASEAN trade by 2025 set when the Philippines was in the Chair of ASEAN in 2017. Taking faster and clearer action on the removal of NTBs is vital to both hitting those targets, and to enhancing business confidence in the AEC process.”

The report concludes that “absent a much clearer, more sustained and tighter focus on reducing the number and scope of existing NTMs and eliminating NTBs, ASEAN will not accomplish the objectives of the AEC and it will fail to meet the targets contained in the Blueprint 2025. Growth will not be as high as ASEAN Member States could have achieved and much of the promise embedded in the ASEAN exercise will have been lost.”

The report was prepared by the Asian Trade Centre, commissioned by the EU-ASEAN Business Council and by the ASEAN Business Advisory Council, and funded by the EU’s Enhanced Regional EUASEAN Dialogue Instrument (EREADI).

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Original Post from ASEAN Secretariat