1. The 42nd Meeting of the ASEAN Economic Ministers (AEM) was held on 24 – 25 August 2010 in Da Nang, Viet Nam. H.E. Dr. Vu Huy Hoang, Minister of Industry and Trade of Viet Nam, chaired the Meeting, which was preceded by a preparatory meeting of the Senior Economic Officials (SEOM). The AEM also had joint meetings with the 13th ASEAN Investment Area (AIA) Council and the 24th ASEAN Free Trade Area (AFTA) Council.

Economic performance

2. Ministers noted that ASEAN’s total merchandise trade remained resilient in 2009, dropping by only 19 percent, from USD 1,897.1 billion in 2008 to USD 1,536.8 billion in 2009, compared to the 22.6 percent decline in global trade in 2009. Intra-ASEAN trade was down by 20.0 percent and so was trade with the rest of the world, which contracted by 18.7 percent. ASEAN trade with its Dialogue Partners also remained strong despite the global financial/economic crisis. Even with a 9.5 percent decline in total trade, China emerged as ASEAN’s largest trading partner in 2009. The European Union and Japan came in as ASEAN’s second and third largest trading partner despite significant drops in total trade, i.e. 17.6 percent and 25.0 percent, respectively. ASEAN’s trade surplus with the rest of the world reached USD 61.2 billion in 2009, more than double the level in 2008.

Trade in Goods

3. Ministers were pleased to note the realization of the ASEAN Free Trade Area (AFTA) on 1 January 2010 as duties on 99.65 percent of all tariff lines under the Common Effective Preferential Tariff Scheme for the ASEAN Free Trade Area (CEPT-AFTA) have been eliminated. For the newer ASEAN Member States – Cambodia, Lao PDR, Myanmar and Viet Nam (CLMV), tariffs on 98.96 percent of total tariff lines are now within the 0-5 percent range. The full tariff reduction schedules of ASEAN-6 – Brunei Darussalam, Indonesia, Malaysia, Singapore, the Philippines and Thailand – have been uploaded in the ASEAN website (http://www.asean.org). The tariff reduction schedules for Cambodia, Lao PDR, Myanmar and Viet Nam will be uploaded in the website upon completion of the technical verification process. The tariff reduction schedules of ASEAN Member States form an integral part of the ATIGA.

4. Ministers were also pleased to note the entry into force of the ASEAN Trade in Goods Agreement (ATIGA) on 17 May 2010, which is an improvement over the current ASEAN Free Trade Area-Common Effective Preferential Tariff (AFTA-CEPT) Scheme. The ATIGA consolidates all ASEAN’s existing initiatives, obligations and commitments on intra-ASEAN trade-in-goods, including both tariff and non-tariff elements, into one single comprehensive document.. The list of Agreements to be superseded by the ATIGA is being finalized for subsequent annexing to the ATIGA.

5. Ministers endorsed the 6-month (180 days), from the date of entry into force of the ATIGA, transition period for the shift from the CEPT Scheme to the ATIGA. This means that Member States would continue to accept CEPT Certificates of Origin (CO) Form D until 13 November 2010 after which only the ATIGA CO Form D will be accepted. CEPT CO Form Ds issued within the transition period would remain valid for one (1) year consistent with the provisions in the ATIGA Operational Certification Procedures (OCP).

Elimination of Non-Tariff Barriers

6. Ministers noted the positive progress in the verification of ASEAN Member States’ lists of Non Tariff Measures (NTMs), which would be published in the ASEAN Secretariat website in August 2010. They also encouraged closer coordination among the various ASEAN Sectoral Bodies to ensure smooth implementation of the mechanism to monitor NTMs under the ATIGA as well as to address operational challenges.

. The Ministers re-affirmed their commitment to eliminate all forms of Non Tariff Barriers with the view to maximise the benefits from tariff reduction under the ATIGA. The Ministers noted the ongoing work in UNCTAD on a new classification of NTMs, and agreed that once this is completed, ASEAN could consider incorporating these in the AEC Scorecard.

Trade Facilitation

7. The Ministers noted the continuous work in the adoption of trade facilitating rules in ASEAN, particularly in the progress in reforming the existing certification regime to ensure free flow of ASEAN originating goods within the region. The Ministers welcomed the conclusion of the Memorandum of Understanding of the Pilot Project For the Implementation of a Regional Self-Certification System, and looked forward to the timely implementation of the ASEAN Self-Certification System by 2012.

8. The Ministers endorsed the updated ASEAN Trade Facilitation Work Program and endorsed the recommendation for each ASEAN Member States to conduct a survey of the status of trade facilitation as the first step to take stock of the current environment in ASEAN in 2010 – 2011. In this regard, the Ministers tasked the officials to finalise the common set of questionnaire for the private and public sector to be used in the trade facilitation assessment as soon as possible.

. The Ministers also re-iterated their commitment to promote trade facilitation measures for free flow of goods in the region.

ASEAN Single Window (ASW)

9. The Ministers noted the developments in the implementation of the ASEAN Single Window (ASW) and National Single Windows (NSWs) by Member States. reiterated the need to further accelerate work towards the full implementation of the ASW. Ministers noted that Brunei Darussalam, Indonesia, Malaysia, the Philippines, Singapore and Thailand have activated their National Single Windows (NSWs) as well as their efforts to expand the operational scope of their NSWs in line with the timeline set in the Agreement to Establish the ASEAN Single Window (ASW). The Ministers reaffirmed their commitment in activating the NSWs in line with the ASW Agreement and its Protocol and tasked the ASW Steering Committee to continue its work in developing and operationalising the NSWs of all Member States, and developing the ASW as an environment where all ten NSWs operate and integration. Ministers also noted the preparatory work being undertaken by CLMV to implement the NSWs. Ministers welcomed the conclusion of the Memorandum of Understanding of the ASW Pilot Project, which is expected to be signed in the second half of 2010.

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LIST OF MINISTERS

1. Dato Paduka Lim Jock Hoi, Permanent Secretary, Ministry of Foreign Affairs and Trade, Brunei Darussalam

2. H.E. Cham Prasidh, Senior Minister and Minister of Commerce, Cambodia

3. H.E. Kong Vibol, Secretary of State, Ministry of Economy and Finance, Cambodia.

4. H.E. Mari Elka Pangestu, Minister of Trade, Indonesia

5. H.E. Gita Irawan Wirjawan, Chairman of Investment Coordinating Board, Indonesia

6. H.E. Dr. Bambang Susantono, Vice Minister for Transportation, Indonesia

7. H.E. Nam Viyaketh, Minister of Industry and Commerce, Lao PDR

8. H.E. Dato’ Sri Mustapa Mohamed, Minister of International Trade and Industry, Malaysia

9. H.E. U Soe Tha, Minister for National Planning and Economic Development, Myanmar

10. H.E. Gregory L. Domingo, Secretary of Trade and Industry, the Philippines

11. H.E. Lim Hng Kiang, Minister for Trade and Industry, Singapore

12. H.E. Porntiva Nakasai, Minister of Commerce, Thailand

13. Yanyong Phuangrach, Permanent Secretary, Ministry of Commerce, Thailand

13. H.E. Buddhipongse Punnakanta, Vice Minister of Industry, Thailand

14. H.E. Dr. Vu Huy Hoang, Minister of Industry and Trade, Viet Nam

15. H.E. Nguyen Cam Tu, Vice Minister of Industry and Trade, Viet Nam

16. H.E. Vo Hong Phuc, Minister of Planning and Investment, Viet Nam

17. H.E. Surin Pitsuwan, Secretary-General of ASEAN