Singapore to pursue deeper ties with EU as Asean chair

Lim Hng Kiang.jpg
The time is right for Asean and the European Union (EU) to pursue greater region-to-region integration, said Minister for Trade and Industry (Trade) Lim Hng Kiang on Friday.
MARCH 03, 2018 - 6:00 AM

THE time is right for Asean and the European Union (EU) to pursue greater region-to-region integration, said Minister for Trade and Industry (Trade) Lim Hng Kiang on Friday.

In his opening remarks at the 16th Asean Economic Ministers-European Union Trade Commissioner consultations, he said that as Asean chair this year, Singapore will seek to broaden and deepen the region's engagement with external partners - even as anti-trade sentiments rise around the world and as governments come under pressure over globalisation and free trade.

"Strengthening our relationship with the EU is an important item on the agenda for Singapore and for Asean."

The EU is Asean's largest source of foreign direct investment and among Asean's top three largest trading partners.

Last year, Asean kickstarted discussions to lay out a framework for an Asean-EU free-trade agreement (FTA), almost eight years since negotiations were adjourned, he noted.

In separate remarks he made at the 6th Asean-EU Business Summit also held on Friday, he said that the journey to reach an agreement would not be an easy one.

"While Asean has made progress in its economic integration effort, our regulatory environments, in many areas, differ in sophistication. Our political realities also pose a variety of challenges," he said.

To address this, he proposed taking a pragmatic approach.

Firstly, the parties need to build confidence and trust with each other.

"I would encourage the EU to take serious action towards progressing these engagements - be it in the early ratification of concluded bilateral trade deals, or in accelerating negotiations."

Secondly, he said, all parties should "avoid placing the cart before the horse".

"We should focus on creating a framework that sets out a meaningful and pragmatic level of ambition, which will allow us to discuss issues of interest to either side, without prejudging the outcomes of our eventual negotiations," he said.

Such an approach would pave the way for the eventual resumption of negotiations for an Asean-EU FTA.

Mr Lim also noted the many positive developments that have taken place since discussions began on the framework for a future Asean-EU FTA.

Asean as a region is now better prepared to engage in deeper trade and investment liberalisation, he said.

"The region has opened up, with intra-Asean import tariffs virtually eliminated, gradual removal of services restrictions, and improved investment regimes," he said.

Trade costs have also gone down, with simplified rules of origin and more streamlined technical regulations.

The EU has concluded two FTAs with individual Asean member states, Singapore and Vietnam, and discussions with several others are ongoing.

"Our renewal of the pursuit for deeper bi-regional economic integration is therefore timely," Mr Lim said, adding that the business community has "warmly welcomed" these developments.

He also met EU Commissioner for Trade, Cecilia Malmström, who is in Singapore.

In her speech, she said that openness in trade could no longer be taken for granted, and that multilateral trading systems needed to be preserved.

"I would like to reaffirm the strong political and commercial ties between the EU and our partners in South-east Asia. These ties have existed for centuries and they have grown today into one of the most important exchanges of goods, services and investment in the world."

Following the conclusion of the 24th Asean Economic Ministers' (AEM) Retreat and related meetings held in Singapore on Thursday and Friday this week, a statement endorsed by all 10 Asean ministers was issued.

In it was a list of economic priorities for this year, including the deepening of regional connectivity for seamless economic activity and growing opportunities through advancing the implementation of the Asean Economic Community (AEC) Blueprint 2025, and positioning Asean for its next phase of growth.

In particular, these priorities are aimed at promoting innovation and e-commerce, improving trade facilitation, deepening services and investment integration, cultivating a conducive regulatory environment, and improving Asean's external relations.