Asean Free Trade Area (AFTA) is a trade bloc agreement by the Association of Southeast Asian Nations supporting local manufacturing in all ASEAN countries.
The AFTA agreement was signed on 28 January 1992 in Singapore. When the AFTA agreement was originally signed, ASEAN had six members, namely, Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand. Vietnam joined in 1995, Laos and Myanmar in 1997 and Cambodia in 1999. AFTA now comprises the ten countries of ASEAN. All the four latecomers were required to sign the AFTA agreement in order to join ASEAN, but were given longer time frames in which to meet AFTA's tariff reduction obligations.
The primary goals of AFTA seek to:
- Increase ASEAN's competitive edge as a production base in the world market through the elimination, within ASEAN, of tariffs and non-tariff barriers; and
- Attract more foreign direct investment to ASEAN.
The primary mechanism for achieving the goals given above is the scheme, which established a schedule for phased initiated in 1992 with the self-described goal to increase the "region’s competitive advantage as a production base geared for the world market".
Read more about ASEAN Free Trade Area: The Common Effective Preferential Tariff (CEPT) Scheme, Rule of Origin, Administration, Dispute Resolution, Further Trade Facilitation Efforts, Membership, ASEAN Plus Three, Related Free Trade Areas
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