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44. Co-operation and Institutional Transformation in ASEAN: Insights from the AFTA Project
- ISEAS–Yusof Ishak Institute
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198 Helen E. S. Nesadurai By: ROS Size: 7.5" x 10.25" J/No: 03-14474 Fonts: New Baskerville 44. CO-OPERATION AND INSTITUTIONAL TRANSFORMATION IN ASEAN Insights from the AFTA Project HELEN E. S. NESADURAI Reprinted in abridged form from Helen E. S. Nesadurai, “Cooperation and Institutional Transformation in ASEAN: Insights from the AFTA Project”, in Non-Traditional Security Issues in Southeast Asia, edited by Andrew T. H. Tan and J. D. Kenneth Boutin (Singapore: Select Publishing and the Institute of Defence and Strategic Studies, 2001), pp. 197–226, by permission of the author and the publishers. NATURE OF THE CONSTITUTIONAL DOCUMENTS Apart from the initial agreements made among the ASEAN governments in 1992 that launched AFTA and the Summit Declarations of 1995 and 1998, all other agreements signed between the ASEAN member governments are formal and binding, requiring domestic ratification by national legislatures (Table 1).1 Table 1 shows a progressive increase in the level of institutionalisation in ASEAN/AFTA when focusing on the nature of the constitutional documents underpinning AFTA. The initial AFTA agreements of 1992, the Framework Agreement and the CEPT agreement containing ten articles provided only general guidelines on tariff reduction schedules, with few specific details. The CEPT agreement as it was originally designed allowed enormous flexibility in tariff liberalisation. Senior officials subsequently worked out implementation details during the course of 1992. These were detailed in three documents, the Operational Procedures for CEPT, Rules of Origin for CEPT, and Interpretative Notes to the Agreement on the CEPT Scheme for AFTA.2 Moreover, protocols on procedural matters were also adopted, notably on dispute settlement in 1996, on notification procedures in 1998, and on modification of CEPT concessions in 2000. The point to note is that after 1995, the constitutional documents pertaining to AFTA became formal and binding on signatories , while the level of detail provided also increased. It is clear that there has been a progressive institutionalisation of AFTA since 1992 as far as the nature of the constitutional documents is concerned. While vaguely worded initial statements of intent in the form of Framework Agreements were initially adopted, these were followed by negotiations to firm up commitments and obligations of participants. Contrary to popular perception, this approach to AFTA — cynically dubbed Agree First Talk After — is not unique. It is 044 AR Ch 44 22/9/03, 12:48 PM 198 Co-operation and Institutional Transformation in ASEAN: Insights from the AFTA Project 199 By: ROS Size: 7.5" x 10.25" J/No: 03-14474 Fonts: New Baskerville TABLE 1: Nature of the Constitutional Documents Agreements Degree of Type of Form of (signed)a Formalityb Commitmentsc Agreementd Singapore Declaration (28-1-92) Informal Not applicable Statement of Intent Bangkok Declaration (15-12-95) Informal Not applicable Statement of Intent Hanoi Declaration (16-12-98) Informal Not applicable Statement of Intent Framework Agreement on Enhancing Informal Not clearly stated Vague; Few specifics Economic Cooperation (28-1-92) Agreement on Common Effective Informal Not clearly stated Some details provided Preferential Tariff (CEPT) Scheme for AFTA (28-1-92) Protocol to Amend the Framework Formal Binding Completion period set at Agreement on Enhancing ASEAN 10 years; Allows accession Economic Cooperation (15-12-95) of new members Protocol to Amend the CEPT Scheme Formal Binding More details provided than for AFTA (15-12-95) original agreement Protocol Regarding the Implementation Formal Binding Detailed procedures provided of the CEPT Scheme Temporary on modification of Exclusion List (23-11-2000) CEPT concessions Protocol on Dispute Settlement Formal Binding Detailed procedures provided Mechanism (DSM) (26-11-96) Protocol on Notification Formal Binding Detailed procedures provided Procedures (8-10-98) Protocol on the Special Arrangement Formal Binding Substantive targets and for Sensitive and Highly Sensitive procedures outlined Products(30-9-99) ASEAN Framework Agreement on Formal Binding Statement of Intent Services (FAS) (15-12-95) Protocol to Implement the Initial Formal Binding Commitment details provided Package of Commitments under in annexes ASEAN FAS (15-12-97) Protocol to Implement the Second Formal Binding Commitment details provided Package of Commitments under in annexes the ASEAN FAS (16-12-98) Framework Agreement on the ASEAN Formal Binding Statement of Intent, Investment Area (8-10-98) providing procedures for future negotiations a Other agreements signed but excluded from this table are agreements on intellectual property rights, facilitation on goods in transit within ASEAN, industrial cooperation, customs harmonisation, electronic commerce, and mutual recognition arrangements. b Ratification is required for formal agreements; informal agreements do not require...