11 Oct 2009

US to lay groundwork for free trade talks with Asia

7:21 am on 11 October 2009

The United States is laying the initial groundwork for talks to forge a free trade agreement with Southeast Asia, ahead of President Barack Obama's maiden trip to the region.

A senior US senator will propose a resolution on Tuesday encouraging Obama administration officials to initiate the negotiations, warning about competition from China and other powers who have already sealed pacts with the Association of Southeast Asian Nations.

"The United States should proceed to develop a comprehensive strategy toward engaging ASEAN in serious FTA discussions," said Senator Dick Lugar, the Republican party leader in the powerful Senate foreign relations committee.

Senator Dick Lugar admitted that the free trade endeavour would be "complex and have possible challenges to negotiation given the varying levels of economic development and open markets among ASEAN countries".

He pointed out that "China, India, Australia, New Zealand and South Korea have already finalised FTAs with ASEAN and are sharpening a competitive edge over the US in Southeast Asia".

President Obama will hold his first-ever official summit between a US president and leaders of the 10 ASEAN member states when he is in Singapore for the Asia Pacific Economic Cooperation forum in mid-November.