Regional Approach to Standardization and their Impacts on ASEAN one vision one identity one community Regional Approach to Standardization and their Impacts on ASEAN Regional Seminar on Standard and Standardization, Linkages to Regional Integration and Trade Promotion 17-18 December 2013, Vientiane, Lao PDR

OUTLINE TRADE and ECONOMIC PERFORMANCE ASEAN ECONOMIC COMMUNITY (AEC) Free flow of goods Trade in Goods Customs Standards & Conformance ASEAN Consultative Committee for Standards and Quality (ACCSQ) and AEC ASEAN and FREE TRADE AREA (FTA)

TRADE AND ECONOMIC PERFORMANCE

Trend: Export, Import, and Total Trade ASEAN trade increased significantly from USD 430 Billion in 1993 to USD 2.4 Trillion in 2011. Likewise, exports and imports also increased remarkably, both from USD223.3 billion and USD429.9 to USD1,243.5 billion and USD1,145 billion respectively for the same period.

Trend in ASEAN Trade Balance Since 1998 ASEAN has been recording trade surplus, peaking at USD 109 Billion in 2007, declined in 2008 (global economic crisis) and has picked up to reach the second highest recording in 2011 at USD99 billion.

Share of ASEAN Trade with Dialogue Partners Trade Partners Share of ASEAN Trade (%) 1993 2000 2011 Intra ASEAN 19.2 22.0 25.0 Australia 2.1 2.3 2.5 Canada 0.8 0.6 0.5 China 4.3 11.7 EU-27 14.7 13.5 9.8 India 0.7 1.3 2.9 Japan 20.2 15.3 11.4 Korea, Republic of 3.1 3.9 5.2 New Zealand 0.3 Pakistan 0.2 Russia 0.1 USA 17.6 16.1 8.3 Others 19.0 19.8 21.4 TOTAL 100.0

Share of ASEAN FDI with Dialogue Partners FDI Sources Share of ASEAN FDI (%) 1999 2000 2011 Intra ASEAN 16.5 3.9 23 Australia (3.4) (1.7) 1.2 Canada (0.1) (3.6) 0.9 China 0.2 (0.7) 5.3 EU-27 35.8 (1) 59.6 16.0 India 0.4 (1.6) Japan 6.2 2.5 13.2 Korea, Republic of 1.9 (0.2) New Zealand 0.3 0.0 Pakistan Russia USA 21.5 34.3 5.1 Others 30.9 34.9 TOTAL 100.0

ASEAN Economic Community (AEC)

ASEAN Economic Community 4 PILLARS OF THE AEC ASEAN Economic Community Strategic Schedule of the AEC Blueprint (2008-2015) AEC Pillar 1 Single Market & Production Base Free flow of goods Free flow of services Free flow of investment Freer flow of capital Free flow of skilled labor Priority Integration Sectors Food, agriculture and forestry AEC Pillar 2 Competitive Economic Region Competition policy Consumer protection Intellectual property rights Infrastructure development Taxation E-Commerce AEC Pillar 3 Equitable Economic Development SME development Initiative for ASEAN Integration AEC Pillar 4 Integration into the Global Economy Coherent approach towards external economic relations Enhanced participation in global supply networks HUMAN RESOURCE DEVELOPMENT RESEARC H AND DEVELOPMENT

ASEAN Economic Community 4 PILLARS OF THE AEC ASEAN Economic Community Strategic Schedule of the AEC Blueprint (2008-2015) AEC Pillar 1 Single Market & Production Base Free flow of goods Free flow of services Free flow of investment Freer flow of capital Free flow of skilled labor Priority Integration Sectors Food, agriculture and forestry AEC Pillar 2 Competitive Economic Region Competition policy Consumer protection Intellectual property rights Infrastructure development Taxation E-Commerce AEC Pillar 3 Equitable Economic Development SME development Initiative for ASEAN Integration AEC Pillar 4 Integration into the Global Economy Coherent approach towards external economic relations Enhanced participation in global supply networks Free flow of goods Trade in Goods Customs Standards & Conformance HUMAN RESOURCE DEVELOPMENT RESEARC H AND DEVELOPMENT

ASEAN Trade in Goods Agreement (ATIGA) Succeeds the Agreement on Common Effective Preferential Tariff Scheme for the ASEAN Free Trade Area (CEPT-AFTA), which mainly covered tariff liberalization. ATIGA brings into one single agreement all aspects of trade in goods and provides the legal framework to realize free flow of goods within the AEC

ASEAN Trade in Goods Agreement (ATIGA) ATIGA covers more than tariff liberalization as it includes substantive chapters on: enhanced ROO disciplines on the application of NTMs and the elimination of NTBs trade facilitation work program customs procedures Standards, Trade Regulations and Conformity Assessment Procedures (STRACAP) and Sanitary and Phyto-Sanitary Measures (SPS) Signed in February 2009, it entered into force on 17 May 2010

Trade in Goods Elimination of Duties (1 Jan 2010) ASEAN-6  99.65% tariff lines eliminated CLMV  98.86% tariff lines reduced to 0-5% Elimination of Non-tariff barriers (NTBs) Work Programme on ASEAN NTMs Matrix of actual cases NTM/trade barriers Rules of Origin: Self Certification Pilot Project Enable certified exporters to self-certify the origin of exports to enjoy preferential tariffs under ASEAN Trade in Goods Agreement. Implemented through Self-certification Pilot Project. ASEAN-wide implementation of Self-certification by 2015.

Customs ASEAN Agreement on Customs Operationalise the customs chapter of ASEAN Trade in Goods Agreement – signed on 30 April 2012 ASEAN Single Window Single point of decision for the release of cargo Implementation of the ASW Pilot Project to exchange test data initially scheduled for 2 months Extended to 31 March 2013 Extension to allow for parallel testing for interested Member States Working on the completion of the Legal Framework Agreement for the eventual live ASW implementation

Standards and Conformance Address Technical Barriers to Trade for Priority Integration Sectors (PIS) Single regulatory regime/framework agreement for PIS (cosmetics, electrical and electronic equipment and medical device, traditional medicines and health supplements.) Harmonisation of standards (agro-based products, automotive, cosmetics, electrical and electronic equipment, medical devices, rubber-based products, wood-based products) Mutual recognition arrangements for recognition and acceptance of conformity assessment results (automotive, agro-based products, electrical and electronic equipment and pharmaceuticals)

Standards and Conformance Enhancement of regional policies for standards and conformance through revision of the ASEAN Policy Guidelines for Standards and Conformance. Implementation of the ASEAN Good Regulatory Practice Guide. Engaging the business community through participation at regional meetings and organisation of Public-Private Forum

ASEAN Consultative Committee for Standards and Quality (ACCSQ) and ASEAN Economic Community (AEC)

ACCSQ Structure

ACCSQ towards AEC – Standards Harmonization of Standards and/or Technical Requirements Based on international standards and practices Without compromising health and safety of consumers and quality of the product Achieving harmonised standards and procedures for ASEAN region Priority Sectors: Agro-based products (prepared foodstuff and fisheries) Automotive Healthcare products (Cosmetics, Medical Device, Pharmaceutical, Traditional Medicines and Health Supplements) Rubber-based Electrical and Electronic Equipment Wood based products Building and Construction materials

ACCSQ towards AEC - MRAs Mutual Recognition Arrangements (MRAs) Guided by ASEAN Framework Agreement on MRAs (1998) Recognition of conformity assessment results (testing, inspection and certification) Competence criteria following international standards and practices Nomination and listing of conformity assessment bodies

ACCSQ towards AEC - MRAs Implementation of MRAs ASEAN Sectoral MRA for Electrical and Electronic Equipment (2002) ASEAN MRA of Product Registration Approval for Cosmetics (2003) (MRA is Schedule A of the ASEAN harmonised Cosmetics Regulatory Scheme) ASEAN Sectoral MRA for GMP Inspection of Manufacturers for Medicinal Products (2009) MRAs under consideration MRA on Recognition of Conformity Assessment Results for Prepared Foodstuff ASEAN MRA on Type Approval for Automotive Product

ACCSQ towards AEC – Regulatory Regimes Harmonised Regulatory Regimes Agreement on the ASEAN Harmonised Cosmetic Regulatory Scheme (2003) – ASEAN Cosmetic Directive (Schedule B) Agreement on the ASEAN harmonised Electrical and Electronic Equipment Regulatory Regime (2005) Under consideration ASEAN Medical Device Directive ASEAN Regulatory Framework for Traditional Medicines and Health Supplements

TRUST ACCSQ AEC AC 2015 Elimination of TBT to facilitate the flow of products Economic Integration and Single Market through Free Flow of Goods ASEAN Community with strong Economic Pillar

ASEAN and Free-Trade Area

ASEAN Plus FTAs ASEAN + China and ASEAN + Korea Goods, services and investment agreements signed ASEAN + Japan and ASEAN + India Goods completed; still to conclude services and investment ASEAN + Australia + New Zealand Comprehensive agreement implemented 1 January 2010 ASEAN Plus FTAs

ASEAN Plus FTAs and TBT ASEAN + China TBT MOU SPS and TBT Chapter of ASEAN-China FTA ASEAN + Japan Comprehensive Economic Partnership (AJCEP) TBT Chapter of the AJCEP on Standards, Technical Regulations and Conformity Assessment Procedures (SC-STRACAP) ASEAN + Australia + New Zealand FTA Chapter on Standards, Technical Regulations and Conformity Assessment Procedures (SC-STRACAP) ASEAN Plus FTAs and TBT

Emerging Regionalism - Economic Regional Architecture Trans Pacific Partnership? Trilateral Agreement China-Japan-Korea? Emerging Regionalism - Economic Regional Architecture ASEAN REGIONAL COMPREHENSIVE ECONOMIC PARTNERSHIP - P Source: Emerging Asian Regionalism, A Partnership for Shared Prosperity

Implication to Trade and Stakeholders Fair Trade and Free movement of goods Trade Facilitation between AMS Reducing Cost standards are also a driving force for economic growth via innovation includes technology transfer. Consequently, technology, creating new markets and increasing the productivity of these nations’ companies and economies. Stakeholder engagement is a key element of the legislative process and involve within the consultation process. Consultation may be clear and Transparency.

Regional Comprehensive Economic Partnership (RCEP) RCEP: Integrating ASEAN Plus One FTA Partners (China + Japan + Republic of Korea + Australia + New Zealand + India). ASEAN Centrality Lead country for ASEAN to spearhead the negotiations Tough and complicated Pragmatic approach Professes open regionalism – others may join once completed 31

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