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Cablegate: Asean Trade Ministers Tackle Tariffs

VZCZCXRO3684
OO RUEHCHI RUEHDT RUEHHM
DE RUEHML #4984 3470945
ZNR UUUUU ZZH
O 130945Z DEC 06
FM AMEMBASSY MANILA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4256
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS IMMEDIATE
RUEHBJ/AMEMBASSY BEIJING IMMEDIATE 5933
RUCPDOC/DEPT OF COMMERCE WASHDC IMMEDIATE

UNCLAS MANILA 004984

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EAP/EP, EAP/MTS, AND EB/TP/MTA
USDOC FOR RP DESK (BERLINGUETTE)
STATE PASS USTR (KATZ)

E.O. 12958: N/A
TAGS: ETRD ECIN PREL PHUM EAID CH RP
SUBJECT: ASEAN TRADE MINISTERS TACKLE TARIFFS

REF: MANILA 4935

1. (U) Despite the postponement of the Association of
Southeast Asian Nations (ASEAN) Leaders' Summit, ASEAN trade
ministers on December 8 succeeded in signing six agreements
intended to expand economic integration in the region. Four
focus on enhancing intra-ASEAN trade and two agreements
deepen the ASEAN-China trade relationship.

2. (SBU) According to Department of Trade and Industry (DTI)
Bureau of International Trade Relations Director Ramon
Kabigting, ASEAN aspires to be a common market in 11 priority
sectors: electronics, information technology, rubber-based
products, textiles and apparel, agro-based products,
fisheries, air travel, and tourism. In their meetings in
Cebu, the trade ministers also added a twelfth priority
sector, logistics, at the behest of the Philippines, which
aims to be a East Asian hub for trans-pacific shipments.

3. (U) The four intra-ASEAN agreements include an agreement
to allow for the mutual recognition of nursing credentials,
commitments to lower barriers on the services trade, and two
additional agreements relating to the elimination of tariffs
and non-tariff barriers. According to Kabigting, the
ministers approved the fast-tracked elimination of tariffs on
a number of products in priority integration sectors
beginning January 1, 2007. This is three years ahead of the
original deadline. The "downstream electronics" sector was,
however, exempted for three years from this measure,
including appliances such as washing machines and
air-conditioners. The fourth intra-ASEAN agreement concerns
the elimination of non-tariff trade barriers, including
anti-dumping measures, countervailing duties, import
restrictions, and quotas. Brunei, Indonesia, Malaysia,
Singapore, and Thailand will eliminate non-tariff trade
barriers in stages from 2008 to 2010. The Philippines is not
required to begin eliminating non-tariff trade barriers until
2010.

4. (SBU) Two of the six agreements promote the ASEAN-China
Free Trade Area. The first is a protocol in which the
Philippines joins the "early harvest program" of tariff cuts.
The second agreement, between China and Vietnam, dealt with
trade concessions. A services trade component of the
ASEAN-China free trade deal was postponed at the request of
Chinese officials, who wanted the signing witnessed by
ASEAN's and China's heads of government. Department of
Foreign Affairs' North Asia Division Director Daniel Espiritu
confirmed that Chinese Premier Wen Jiabao had postponed his
December 14 visit to Manila and will likely reschedule for
mid-January 2007, which would allow him to participate in
the ASEAN-China Summit on January 13, the ASEAN 3 Summit on
January 14, and the East Asia Summit on January 14, if all
participants agree on these dates.
KENNEY

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