PTAs and ASEAN

Abstractss

studies on regionalism, especially the issue of the establishment of trade area is not an old debate, but the issue becomes tectonic and popular within the cooperation framework of global trade. however, this does not mean that regionalism is always an advantage for the actors of regional countries interest in the region. This paper tries to elaborate the effects of the formation of a special trade zone in the ASEAN region to the economic interests of ASEAN countries. Flexibility and restrictions on trade in the region has helped the actors in the ASEAN region to resolve the crisis and improve the efficiency of trade within the framework of a global fair trading by expanding economic linkages. Thus, it could be said that PTAs improve the multilateralism under WTO system.

Introduction

Preferential trade area (PTAs) has become a prominent feature as well as a popular tool for the global trading system in terms of regional economic enterprises. World Trade Organization (WTO) reported that there are 278 PTAs that have been notified by WTO members, half of these numbers has been enacted from 1995 to 2010. Despite the fact that the PTAs now plays an important role in the global trading system, but there are still contentious issues regarding the effects of the PTAs itself. Some people who concur with the PTAs think that PTAs could facilitate member countries to negotiate in order to achieve free trade which can also affect  traditional, sustainable partnerships or reciprocal relationship to the built environment. Therefore, PTAs may help countries to open up the possibility of what can be gained or how deeper integration can be designed and conducted.

Discussion
A. Legal Framework of PTAs

Although there was some confusion on the legal system issued by the WTO on the appropriate action from the PTAs, WTO through the General Agreement on Tariffs and Trade (GATT) under Article XXIV except pillar of the multilateral trading system under the supervision of the WTO, which contains the principle of non-discriminatory and most favored by state regulations. There are at least three ways that could be used by member countries of the WTO to join the PTAs.

First, WTO members can follow Article XXIV which includes the creation and union customary procedures and handle trade in goods in a free trade area. Second, through a clause allowing Avoked Tokyo Round Agreement in 1979 stated in paragraph 2 (c), which allows the settings for the developing countries. Third, according to Article V of the General Agreement on Trade and Services (GATS), countries either developed or developing may involve PTAs in terms of trade in services.

B. Impact of PTAs

Ordinarily, at least two effects of the PTAs, the first is the creation of trade, which means that members of the PTAs benefit gained from participation PTAs. The second is trade diversion, which can be recognized as a weakness that a PTAs member countries or third parties suffer as a result of involving PTAs. Some scholars argue that the PTAs has organized the balance between multiculturalism under the provisions of the WTO, which leads to the fragmentation of world trade. For example, if two or more countries at different levels of the participating nation's infrastructure becomes a PTAs, a country with high class infrastructure will more easily attract the industrial sector. However, other scholars strongly believe that the positive impact of PTAs outweigh the negative effects. There are at least a few points to the impact of PTAs.

First, it is believed that PTAs can stimulate member s tates to achieve the purpose of the establishment of a trade and to anticipate the possibility of barriers in trade. Secondly, it has been recognized that PTAs generally improve efficiency. This was received with obvious that PTAs can arguably provide any solution to the deadlock in the international trade arena and at least be able to improve the trading system of the WTO. Third, the PTAs can offer a solution to the difficulties of development. This is because the trade can generate economic bonds and increase prosperity, thus contributing to peace and security. A fair trade will be more accessible and can bring peace and prosperity to the world. Fourth, PTAs contain a small number of members and interests, thus dropping the cost of negotiating and making it easier to reach an agreement.

The PTAs also be said to be a "level playing field" for countries market development. In short, although it can be said that the PTAs had a negative impact, it is important to realize that the PTAs had a positive impact, which can stimulate the state to obtain the goals of the global trading system, in anticipation of trade barriers, increase efficiency, provide solutions to issues of development and level play field.

C. General Impact of PTAs on ASEAN

Since the early 1990s, ASEAN member countries have created economic intents the raison d'etre of the organization. The Interest ASEAN of entering the PTAs to profit by joining and as early access to leading a new economic sectors. Gradually, the development of trade and investment bonds between participants helped to expand the incoming and outgoing economic relations. ASEAN countries have been estimated to create functioning of the market for their own products in developing markets like China. At least three positive effects of PTAs that ASEAN has experienced, stimulating global fair trading and anticipate barriers trading, creating efficiencies and offer solutions to problems such as the development of the crisis. It can be seen from three effects when ASEAN joined the PTAs.

First, ASEAN AFTA has been established with a certain influence in APEC and global negotiations. Some studies shown that ASEAN has benefited through the integration of intra-regional cooperation with other nations. Second, ASEAN-China PTAs has strengthened during the Asian financial crisis, as China has demonstrated its commitment to help countries that are being affected by the crisis in ASEAN, this means that the PTAs offers a solution to the problem of development in ASEAN, which is the economic crisis. Third, AJCEP has affected the member countries of ASEAN to create efficiencies in trade among them. It can be seen from the figure of imports within 10 years rounded that efficiency. 90 percent of the six members of ASEAN imports to and from Japan have demonstrated efficiency in 10 years.

Conclusion

PTAs does produce many positive benefits for member countries such as providing efficiency, stimulate the global fair trade and eliminating barriers to trade, and offers solutions to development problems. As for the impact on ASEAN, it is clear that the member countries of ASEAN have experienced the benefits of AFTA, ACFTA and AJCEP. Flexibility and the selection of the partnership under the PTA coverage has helped ASEAN to overcome the crisis and improve efficiency and stimulate the main purpose of a fair global trade by expanding economic relations.