SINGAPORE – Economic ministers from Japan and the Association of the Southeast Asian Nations are looking to develop a long-term plan for strategic economic cooperation at their annual meeting in Indonesia this month, according to a copy of a statement obtained by Kyodo News.
The statement, to be issued after the meeting on Aug. 13 in Manado, Indonesia, says the ministers from Japan and the 10-member ASEAN will launch a 10-year plan for promoting strategic partnerships in such areas as trade and investment, infrastructure development, connectivity, human resources development and technology transfers.
An official ASEAN source said the proposal, floated by Japan in recent months, is being viewed as an effort to chart new directions for economic cooperation, taking into account the impact of the March earthquake and tsunami catastrophe in the Tohoku region. The resulting disruption in manufacturers’ supply chains is widely expected to push more Japanese firms to seek investment opportunities abroad.
The meeting will take place at the annual ASEAN Economic Ministers and other related meetings from Tuesday to Aug. 14 in Manado on Sulawesi. The meeting will also involve ASEAN’s major trade partners from outside the region.
“The ministers tasked the senior officials and the ASEAN Secretariat to develop a 10-year ASEAN-Japan strategic economic cooperation plan,” the draft says.
The plan is aimed at “promoting strategic partnerships in the areas of trade and investment, infrastructure development, connectivity, human resources development and technology transfer among others,” the draft says.
An official ASEAN source said the 10-year-plan signals the possibility of a new wave of Japanese investment in the region.
Japan has been a major investor in Southeast Asia for decades, but higher wages and operating costs compared with the 1970s and 1980s, combined with a growing middle class, make it necessary for Japan to redevelop its investment strategy in the region.
The draft also said the ministers aim to strike a deal in the negotiations with Japan to liberalize their trade in services and investment under a free-trade deal known as the ASEAN-Japan Comprehensive Economic Partnership Agreement by next year, suggesting there could be a further delay in wrapping up the talks.
“The ministers tasked senior officials to strive for a conclusion of these negotiations in tandem by” their next meeting or the ASEAN-Japan leaders’ summit in 2012 “as an aspirational goal,” the statement said.
Although ASEAN and Japan signed the AJCEP in 2008, key elements, such as trade in services, investment, movement of businesspeople, government procurement and intellectual property, were not ready.
Last year, the ministers hoped that a comprehensive plan for services and investment could be in place by the coming meeting. In a statement issued after their meeting in Danang, Vietnam, last August, they said they were “aiming to reach substantive outcomes by the 2011” meeting.
However, negotiations for services and investment remain tough, said the ASEAN official source. Aside from the difficulty in getting the ASEAN countries to take a common position, it has been difficult to gain access to Japan’s services sector, where rules abound.