SEQC&E/V4 Theme 3 Diplomacy: ASEAN To what extent has the ASEAN Free Trade Area (AFTA) (economic integration)

) benefited the ASEAN countries economically? (helped ASEAN countries remain economically viable) EYA. The ASEAN Free Trade Area (AFTA) has brought economic benefits to the ASEAN region. AFTA was launched in 1992 to help the ASEAN region face competition from new economic powers, such as China and India. AFTA eliminates tariff barriers to integrate the ASEAN economies into a single production base and create a regional market of 500 million people. AFTA aims to remove import taxes among Southeast Asian countries. By reducing taxes, ASEAN will be able to import and export more commodities, sell and buy them at lower prices, earning more profits. The people are then able to afford those goods and increase their standard of living and thus, their quality of life. AFTA has brought economic benefits by improving the living conditions of the people in ASEAN. Educational and professional exchange amongst ASEAN countries has also benefited ASEAN. Singapore offers scholarships to students from ASEAN countries. Scholars are not subjected to any bond and are allowed to continue studying in local universities. They may then return to their homeland, after completing their studies, to work in the tertiary sector and thus contribute effectively to their countrys economic progress. Singapore has also provided technical training like information technology skills and in the English language to the people of other ASEAN countries like Laos. With this training, the Laotians will be able to further develop their economies and it helps them attract investors from foreign countries. Therefore, ASEAN has brought much sustainable economic benefits through education programmes. Economic cooperation and assistance have also benefited the ASEAN countries, allowing ASEAN countries to remain economically viable. To help narrow the economic gap between member countries such as Cambodia and Vietnam with other countries of ASEAN, the ASEAN integration (IAI) project was launched in 2000. Singapore offered a five-year aid package of over S$80 million to selected member countries between the years 2000 - 2003. This has greatly helped the economic disparity between the member countries of ASEAN, as poorer countries like Cambodia and Vietnam are able to use the money offered to help develop infrastructure and hastened economic development. This has thus allowed ASEAN countries to remain economically viable. In the short-term, AFTA is more beneficial economically as compared to education and professional exchange. In education and professional exchange, not many can be reached and it takes time to see their contributions. AFTAs beneficial impact is felt very quickly as lower import taxes lead to cheaper goods that will affect all the people in ASEAN countries. AFTA is more beneficial than economic cooperation and assistance as economic cooperation and assistance is only provided to selected member countries. Not all the ASEAN countries will benefit economically from this initiative. AFTA on the other hand contributes to tax reductions in all the ASEAN countries. Thus, AFTA has a greater impact on the ASEAN countries as compared to economic cooperation and assistance. _________________________________________________________________________________ Plausible Cause #4 International agreements such as the Asia-Europe Meeting (ASEM), East Asia-Latin America Forum (EALAF) and the Asia-Pacific Economic Cooperation (APEC) also bring about economic benefits to the ASEAN countries. These international agreements ensure that there is a broader platform for political, business and other leaders to promote better understanding, political, economic and cultural sharing as well as cooperation between countries of the various regions. These all serve as a platform for member countries to expand their international influence with other more affluent countries. Having a wider circle of influence will provide ASEAN with more leverage to continue diversifying the economy and keep pace with the rest of the globalising world.