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Asean to sign pact for broader investment next week

SINGAPORE: Asean economic ministers are to sign a new industrial cooperation agreement at a special meeting here next week, Singapore's Trade and Industry Ministry said on Friday.

A week-long "retreat" of trade ministers and senior officials from the seven-member Association of Southeast Asian Nations (Asian) is to start on Tuesday in Sentosa, a resort island just off Singapore.

The Asian Industrial Cooperation Scheme Agreement (Aico) to be signed by the ministers next Friday is aimed at boosting intra-Asian investment as well as investment from outside the region, a statement from the ministry said.

AICO would replace Asian industrial schemes that have generated lacklustre participation - the Asian Investment Joint Venture Programme and the Brand-to-Brand Complementation scheme, limited mainly to car assemblers. Industries approved for Aico participation would enjoy zero to five percent tariffs on products sold within the region, provided Asian companies own 30 percent of the shares and the ventures meet local-content criteria.

Details are to be announced next week.

US auto giants are reportedly interested in taking part in the AICO programme in a bid to strengthen their presence in the region, currently dominated by Japanese car manufacturers.

General Motors Corp. is choosing between the Philippines and Thailand as the site of a one-billion-dollar automotive manufacturing and assembly facility.

The Asian economic ministers' meeting is aimed at thrashing out details of the group's plan to create an Asian Free Trade Area by 2003, which has been affected by demands from some members for tariff protection for sensitive products topped by agricultural items.

Asian includes Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thiland and Vietnam. -AFP