A few week's ago I posted some critical remarks about the Asean paper tiger. But maybe I was premature. Today the Association of South-East Asian Nations agreed in principle to speed efforts to create a single market by 2015, five years ahead of schedule, according to its secretary-general Ong Keng Yong. If that goal is achieved, it won't have proved as useless a body as many had thought. But the FT report suggests the goal will not easily be achieved:
The agreement came at the start of an annual conference of the region’s economic ministers, who will focus on achieving closer integration in response to competition from China and India.
But doubts remain over whether the goal can be achieved given the wide economic disparity and conflicting national interests among the 10 Asean members.
Even as the ministers were pledging support for a broader economic union, a dispute erupted between Malaysia and Thailand over the terms of the existing Asean Free Trade Agreement, which reduces import barriers for most manufactured goods.
Thailand said it would not cut tariffs on Malaysian cars until Malaysia ended a car import licensing system, which it has promised to phase out by 2010. Malaysia and Thailand are competing to become the region’s main car manfacturing centre.
The dispute underscored the difficulties that Asean will confront in achieving the ambitious goal of creating a common market allowing the free flow of goods, services and investment.