2013 Aug 13
August 13, 2013

Asean economic integration: Where to?

0 Comment

THE effective integration of Asean economies will take place in 2015 with Cambodia, Myanmar, Laos and Vietnam, the late comers in the Asean Free Trade Agreement (Afta), completing the full implementation of their reduced tariff rates as agreed under the Common Effective Preferential Tariff (CEPT).

The CEPT only applies to goods and products originating from and circulating within Asean. There are agreed rules governing the trading of products.

Except for Philippines who sought for the delay in its reduced tariff rates to 2015 including temporary exclusion of some of its sensitive agricultural products, the original Afta members, Brunei, Indonesia, Malaysia, Philippines, Thailand, and Singapore have already completed theirs.

Afta was formed in 1992. It is a regional trade bloc patterned after the World Trade Organization. Its main goals include increase Asean’s competitive edge as a production base in the world market through the elimination, within Asean, of tariffs and non-tariff barriers; and attract more investments to Asean.

On the surface, this so called free trade agreement seems favorable to all the member countries. However a deeper scrutiny of the rules of trade, among them the goods and commodities to be traded, FOB, pricing system, and removal of tariff and other economic protections, point to a bigger advantage for the bigger economies or advanced capitalist countries or referred to by left movements as imperialists, led by United States, Germany, UK, France, Canada, Australia, and Japan.

Regional trading blocs, and the many bilateral trade agreements between countries, are all the design of World Bank, World Trade Organization (WTO) and the US treasury.

The real power behind so called Free Trade Agreements is the WTO dominated and directed by advanced capitalist countries led by United States, and other imperialist countries like Germany, France, UK, Japan, Canada, Russia, and Australia. They are also known as imperialist powers, extending the interests and control over nations around the world.

This trade bloc is integral part of the second neoliberal offensive of imperialist powers beginning the 80s to ease their overproduction thru expanding their markets by breaking other economies of smaller economies especially “third world countries” under the slogan of so called “free trade” and “free market” while keeping their own economies remain strongly protected.

The entire world capitalist system has followed the neoliberal economic policy set by the United States and United Kingdom. This is given the fancy name of “free market” globalization. It is in fact imperialist globalization, allowing the imperialist firms and banks to do their utmost and worst in exploiting poor countries and the working class therein.

With these so called trade blocs sealed by so called free trade agreements, it has become easier for the G7 countries to dampen their overproduced in these markets, demand raw materials, dictate labor orientation, handle debt payments, control revenue generation schemes, and many other one-sided deals.

Neoliberalism has carried out the flexibilization of labor or destruction of job security by replacing tenured jobs with temporary and part-time jobs; the liberalization of investment, trade and finance; the privatization of public assets; deregulation at the expense of the working class, women, children, the society at large and the environment; the denationalization of the economies of the underdeveloped countries; and the increase of overpriced contracts in war production and guarantees and subsidies for overseas investments.

The implications of this trade agreement on smaller and predominantly backward countries like the Philippines would have more negative than positive.

The zero tariff on sugar imports will endanger the lives and livelihood of sugar farmers, farm workers and planters because the country’s sugar industry will be bludgeoned by the influx of cheap imported sugar from Australia and Thailand.

I agree with Teddy Caseino’s proposal to subsidize the sugar industry to support the farmers, and for the country to develop an “alternative system,” among others, produce organic muscovado sugar for export to other markets and invest in technology research and development.

It is the government’s duty to protect the local industries and enterprises, and it is imperative that we should work for its postponement, or even scrapping although the latter requires a bigger and concerted effort of various progressive movements.

The imperialist powers and their puppet states have proven themselves futile at solving the ongoing super crisis because they cling dogmatically to the neoliberal economic policy. They wish to perpetuate this scourge to humankind. It is therefore a compelling duty of the people to fight and frustrate this trade and economic policy. –Karl G. Ombion, The Essentials