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ASEAN:What is ASEAN up to?



Source:ASEAN
ASEAN MINISTERS OPEN REGION TO FOREIGN INVESTMENTS

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PHUKET, THAILAND, March 5 - The nine members of the Association of Southeast
Asian Nations (ASEAN) agreed to open their manufacturing industries to one
other's investments. According to a decision of ASEAN ministers today, each
ASEAN country would extend "national treatment" to such investments; that
is, the same treatment that it gives to investments by its own nationals. 
Services related to manufacturing, agriculture, fisheries, forestry and
mining are also to be covered by the agreement. 

Although a few industries are currently subject to certain investment
restrictions, most of those exceptions will be phased out until they are
largely eliminated by 2003. Two of the newer ASEAN members, Laos and
Vietnam, will have until 2010 to phase out the exceptions. 

Lists of such restrictions will be exchanged by April 7, after which a
review process will begin. 

Meeting as the ASEAN Investment Area Council in this resort in southern
Thailand, the ministers arrived at their decision as part of the regional
association's effort to open ASEAN to investments from within the region and
from outside of it. 

The meeting was presided over by Jose T. Pardo, Secretary of Trade and
Industry of the Philippines, and hosted by Abhisit Vejjajiva, Ministers in
the office of the Prime Ministers of Thailand. 

Others who attended were Pehin Dato Abdul Rahman Taib, Ministers of Industry
and Primary Resources of Brunei Darussalam; Sugihono Kadarisman, Deputy
Chairman of the Investment Coordinating Board of Indonesia; Bountiem
Phissamay, Minister in the office of the Prime Minister of Laos; Tan Sri
Zainal Abidin Sulong, Chairman of the Malaysian Industrial Development
Authority of Malaysia; Brigadier General Maung of Myanmar; Lee Yock Suan,
Minister for Trade and Industry of Singapore; and Nguyen Nhac, Vice-Minister
of Planning and Investment of Vietnam. 

Rodolfo Severino, ASEAN Secretary-General, also took part in the meeting.
Sok Chenda, Secretary-General of the Council for the Development of
Cambodia, attended as observer. 

At a meeting in Manila last October, the ministers had established the ASEAN
Investment Area as a comprehensive means to attract investments into the
region by cooperating to liberalize and facilitate such investment and
jointly promoting them. 


ASEAN's head of state and government, at their summit meeting in Hanoi last
December, had directed the opening of all industries to foreign investments.
They specially ordered the implementation of the ASEAN Investment Area. 

In addition, at summit, the ASEAN leaders adopted what they called "bold
measures" to entice investments into the region. Among these measures was a
wide-ranging set of incentives for investor applying to invest in ASEAN
within 1999 and 2000. 

Those investors will be exempted from corporate income taxes for at least
three years or enjoy a 30-percent investment tax allowance. Imported capital
goods required by the investment will be exempt from duties. Equity in
investing companies can be 100-percent owned by foreigners. Such companies
can use or lease industrial land for at least 30 years. They can employ
foreigners on liberal terms. On top of these, individual ASEAN members offer
their own additional incentives to investors. 

ASEAN has also been deepening and accelerating the ASEAN Free Trade Area
(AFTA), under which minimal tariffs or none at all will be levied on goods
traded within ASEAN by 2002, with most products receiving full AFTA
treatment as early as next year. 

ASEAN has completed negotiations on freeing trade in services in seven
areas-air transport, business services, construction, financial services,
maritime transport, telecommunications and tourism. It plans to begin
another round of negotiations on a wider range of services. 

At the AIA council meeting today, the ministers observed that many major
multinational corporations remained committed to investing and operating in
the region. They stated their confidence that foreign investors would be
taking advantage of the improved economic situation and the progress of
investment liberalization by locating their operations in ASEAN. 

End of Document