Asean Free Trade Area (AFTA)

Abstract

This article attempts to provide the basic knowledge on history and evolution of ASEAN FREE TRADE AREA (AFTA) by compiling information from several sources. Firstly the article explains the situation of ASEAN economic and political relations before the CEPT era. Then the concept and objectives of AFTA will be examined. The third part describes the Agreement on the Common Effective Preferential Tariff (CEPT) Scheme for AFTA. Finally, the latest progress of AFTA will be presented. 1. History and Evolution of ASEAN. When the founders of ASEAN from Indonesia, Malaysia, the Philippines, Singapore and Thailand established the Association of Southeast Asian Nations (ASEAN), in 1967, they held out a vision of all countries in Southeast Asia cooperating actively towards peace, stability, progress and prosperity in the region. Before 1967, there were some organizations acting the role of international cooperations in this region. In the 1950s, two countries in this region were full members of SEATO, which was initiated by the US and dominated by the western powers, and was a political-military set-up for cold war purposes. In the 1960s, the Association of East Asia (ASA) was formed by Malaya, the Philippines and Thailand. This Association, however, was short-lived and existed only from 1961 to 1967 when it had to give way to the present ASEAN. Another predecessor of ASEAN was MAPHILINDO, which was formed in 1963 by Malaya, the Philippines and Indonesia. However MAPHILINDO was dissolved soon after it was established due to the policy of Indonesia under the president Sukarno.