The Asean Free Trade Area Afta Is An Agreement By The Member Nations Of Asean

These two agreements have the collective influence of making ASEAN a strategic centre for global sourcing and manufacturing. With the middle class of 150 million ASEAN consumers, this market, then associated with China and India, alone represents a global consumer market of the middle class, with a total free trade of about 650 million people – today. By 2030, given Asia`s growing prosperity and dynamism, about 64% of the global middle class will be based in Asia, representing 40% of the overall consumption of global small and medium-sized enterprises. Trade liberalization in the region, through the removal of intra-regional tariffs and non-tariff barriers, has contributed to making ASEAN`s manufacturing sectors more efficient and competitive in the global market. As a result, consumers are able to source from more efficient ASEAN producers, creating robust intra-ASEAN trade. The ASEAN Economic Community (ACS) was first discussed at the Bali Summit in October 2003, when ASEAN Heads of State and Government declared that the ACS should be the goal of regional economic integration by 2020. However, at the 12th ASEAN Summit in January 2007, ASEAN Heads of State and Government reaffirmed their firm commitment to accelerate the establishment of the ACS by 2015, with the aim of transforming ASEAN into a region with free flow of goods, services, investment, skilled labour and free capital. The ASEAN region has a population of about 500 million, a total area of 4.5 million square kilometers, a combined gross domestic product of $737 billion and a total trade of $720 billion. The ASEAN Investment Zone was opened to ASEAN investors in 2003.

The liberalization of internal trade, which results from large shortcomings in the economic level of AFTA member states, has been and remains a problem for some members and the high dependence of countries on foreign markets is another AFTA topic that must be taken into account. However, benefits have been perceived, as AFTA is an integrated commercial space and market, as progress has been made in several sectors such as investment, technology and services. Creation of a legal framework to achieve the free movement of goods in the region in order to create an internal market and a production base by 2015. . . .