ASEAN’s initiatives for free trade in East Asia under AEC

Figures & data

Table 1. Expectation toward the deepening of AEC (Top five items)

											(%)
		ASEAN	ASEAN-6					ASEAN-4
			Indonesia	Malaysia	Philippines	Singapore	Thailand	Cambodia	Laos	Myanmar	Vietnam
Ranking	Number of valid responses	2,428	344	216	105	355	510	67	30	119	682
1	Further facilitation of customs clearance procedures	53.4	59.3	50.0	45.7	42.5	53.1	64.2	63.3	65.5	55.0
2	Elimination of non-tariff measures	32.9	36.6	31.5	25.7	31.3	33.9	37.3	46.7	35.3	31.4
3	Further harmonization of product standards and certification procedures	17.4	21.2	19.4	12.4	18.0	16.7	22.4	6.7	21.0	15.2
4	More free movement of technicians and professionals	17.0	14.2	21.3	22.9	18.0	16.3	7.5	23.3	26.9	15.1
5	More free movement of general workers, general staff, and clerks	15.5	8.4	23.1	15.2	20.3	16.5	17.9	13.3	20.2	12.5
Source: JETRO Survey on Business Conditions of Japanese Companies in Asia and Oceania (JETRO, 2018).

Table 2. Simple Average Preferential Tax Rate Trends

						(%)
	1993	2003	2008	2010	2015	2018
ASEAN-6	12.76	1.51	0.79	0.05	0.02	0.02
ASEAN-4	-	6.64	3.69	2.61	0.53	0.12
ASEAN10	-	2.99	1.95	1.06	0.21	0.06

Source: Created by the author based on ASEAN Secretariat website”Average CEPT/ATIGA Tariff Rates”

Table 3. Trends in the Usage of AFTA in Thailand’s exports to ASEAN

					(%)
	2000	2005	2010	2015	2019
ASEAN	6.4	21.5	31.6	35.9	39.2
Indonesia	20.8	45.9	61.3	66.0	67.1
Malaysia	12.7	22.4	28.6	30.8	29.7
Vietnam	6.3	41.5	53.2	64.8	61.6
Philippines	14.5	41.8	55.9	61.8	69.4
Singapore	0.2	2.7	4.9	8.3	7.5
Laos	0.0	2.8	4.3	4.4	11.8
Brunei	0.7	3.9	8.4	16.4	21.5
Myanmar	0.0	0.2	1.0	16.0	19.4
Cambodia	0.0	0.0	3.7	8.2	16.6

Source: Created by the author based on data from the Deparment of Foreign Trade, Ministry of Commerce, Thailand and Thai Customs.

Table 4. Simple Average MFN tariff rates and tariff elimination rates for ASEAN member countries

	Simple average MFN applied	MFN Duty-free share of total
		Number of items	Value of Imports
Indonesia	8.1	13.1	40.7
			(%)
Malaysia	5.6	66.3	79.9
Vietnam	9.6	35.3	54.6
Philippines	6.1	12.6	46.5
Singapore	0	100	99.9
Laos	8.6	1.7	6.0
Brunei	0.3	95.8	92.0
Myanmar	6.5	4.6	5.3
Cambodia	n.a.	n.a.	n.a.
(Reference) Thailand	10.2	36.3	57.8

Note: Figures of MFN applied and the number of items of MFN duty-free share were taken from 2019 data. Figures of the value of import were taken from 2018 data.

Source: Created by the author based on World Tariff Report (2020)

Figure 1. The nominal and real utilization rate of AFTA in Thailand’s exports

Table 5. Example of tariff rate reversal between AFTA and ASEAN+1 FTA (Vietnam)

FTA	HS code	0207.11	0407.29	0805.40	1006.20	1602.10	1701.13
	Item	Chicken	Duck Egg	Grapefruit	Home Mali Rice	Pork Homogenized preparations)	Cane sugar
MFN Tariff rate		40%	40%	40%	40%	30%	25%
AFTA	Intra-ASEAN	5%	5%	5%	5%	5%	5%
ACFTA	China/ASEAN	0%	MFN	0%	5%	5%	MFN
AKFTA	Korea/ASEAN	0%	30%	0%	0%	0%	15%
AJCEP	Japan/ASEAN	4%	8%	6%/0％	8%/0%	8%	MFN/15.9%
AIFTA	India/ASEAN	9%	MFN	0%	0%	10%	MFN
AANZFTA	AANZ/ASEAN	20%	0%	0%	0%	0%	0%

Note:If there are two tariff rates, the former is the ASEAN + 1 FTA and the latter is the minimum applicable FTA rate.

Source: Created by the author based on the Fedex”World Tariff”,ASEAN+1 FTA Agreement, the ATIGA Agreement, and the ASEAN Tariff Finder.

Figure 2. The nominal and real utilization rate of AFTA in Thailand’s exports

Table 6. Major differences between first and second SCPP and the AWSC

Key Differences	SCPP1	SCPP2	AWSC
Definition of a Certified Exporter (CE)	Both manufacturers and traders	Only manufacturers	Both manufacturers and traders
			The “trader” must have a proven track record of intra-regional exports and must present the manufacturer’s and trader’s declarations
Invoice declaration	Can be made on any of the commercial documents	Can be made only on an invoice	Can be made on the commercial invoice or other commercial documents
Information on the Invoice declaration	CE registration number, ASEAN country of origin, and origin criteria	HS code of the exported goods and More information such as: the signature over printed name of the authorized signatory of the company.	Combination of the first and second SCPP (the following information is required) (1) CE registration number, (2) export product name, (3) HS code (6 digits), (4) origin criteria (used for origin determination), (5) country of origin, (6) FOB price (value added) (3) HS code (6 digits), (4) origin standard (used for origin determination), (5) country of origin, (6) FOB price (in case of value-added standard), (7) quantity, and (8) trademark (if any). In the case of a B2B declaration of origin, the reference number of the certificate of origin in the country of first production, date of issue, country of origin, and, if applicable, the CE registration number of the company in the country of first export.
Authorized signatories	No limitation	Three (3) persons per company	10 persons per company
Exchange information	Submitted and circulated through the ASEAN Secretariat	Submitted and circulated through the ASEAN Secretariat, with more details (i.e., Authorized signatories And list of product)	Exchanged through AWSC CE database enhanced by ASEAN- USAID IGNITE (See Note)
Third Country Invoice	Allowed	Not Allowed	Allowed

Note: IGNITE – Inclusive Growth in ASEAN through Innovation, Trade and E-Commerce

Source: ASEAN Secretariat

Table 7. Seven Key Action Plans under AEC 2025 Trade Facilitation Strategic Action Plans

a)	Encourage the accelerated implementation of trade facilitation measures, which have been accepted by international institutions such as the WTO and/or the WCO, and in light of other relevant best practices
b)	Achieve competitive, efficient, and seamless movement of goods within the region in order to enhance ASEAN’s trade and production networks, better participate in global value chains, as well to establish a highly integrated and cohesive economy
c)	Put in place an effective and responsive regional approach to efficiently address the trade distorting effect of NTMs with a view to pursuing legitimate policy objectives while reducing cost and time of doing business in ASEAN
d)	Actively engage the private sector, with particular emphasis on the development and promotion of micro, small and medium enterprises (MSMEs) in the process of regional economic integration
e)	Enhance the institutional coordination among the relevant sectoral bodies of ASEAN, in order to effectively implement the trade facilitation measures under their respective purview consistently with their sectoral work-plans for 2016–2025 and AEC Blueprint 2025
f)	Work toward increasing the participation of all AMSs, especially least developed AMSs, in the process of implementation of ASEAN trade facilitation programmes
g)	Improve the monitoring mechanism for the implementation of trade facilitation measures, with a view to increasing their effectiveness and responsiveness in improving the competitiveness of ASEAN industries and businesses

Source:ASEAN Secretariat”ASEAN Economic Community 2025 Consolidated Strategic Action Plan”(http://asean.org/wp-content/uploads/2012/05/Updated-AEC-2025-CSAP-14-Aug-2018-final.pdf)

Figure 3. Trends in FTA/EPA Utilization Rates of Japanese Companies in ASEAN