Myanmar in ASEAN: Regional Co-operation Experience by Mya Than

By Mya Than

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Sample text

Intra-industry linkages were facilitated by the granting of a 50 per cent margin of preference to BBC products. This BBC scheme has been relatively successful, with eight projects approved so far. However, the obvious drawback of BBC is the non-participation of Indonesia, which limits the scheme’s market and economies of scale (EAAU 1994, p. 30). The AIC/BBC was shelved because it failed to achieve its objectives. ASEAN Industrial Joint Venture (AIJV) As a result of the Basic Agreement on ASEAN Industrial Joint Ventures signed on 7 November 1983, the AIJV scheme was launched.

The PTA was appropriate for the earlier stage of ASEAN since it was a mechanism whereby intraASEAN trade could be liberalized at a pace that was acceptable to all member countries. One of the basic rules of PTA was the rule of origin. 10 This rule of origin is still valid under AFTA. From its inception, the PTA’s achievements were not impressive and it had little impact on intra-regional trade. As Mohamed Ariff correctly pointed out “This (PTA) was based on a cumbersome item-by-item approach which did not result in 02 Myanmar Ch 2 26 16/12/04, 3:36 PM MYANMAR IN ASEAN 27 any significant increase in intra-regional trade” (Ariff 2001, p.

42 and 43). A few months earlier, ASEAN economic ministers laid down the groundwork for the free trade area concept by putting the Common Effective Preferential Tariff (CEPT) scheme in place. CEPT provides a means for harmonizing internal tariff rates. This means, it took a quarter of a century for ASEAN to implement the originally envisaged 02 Myanmar Ch 2 29 16/12/04, 3:36 PM 30 ASEAN: EVOLUTION OF REGIONAL COOPERATION IN SOUTHEAST ASIA economic cooperation programme in the form of AFTA. In order to understand AFTA, a few questions need to be addressed.

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