AP-ASEAN Nations Still Face Challen

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Subject: AP-ASEAN Nations Still Face Challenges

Thursday September 30, 6:08 am Eastern Time
ASEAN Nations Still Face Challenges
By JAMIE TARABAY
Associated Press Writer
SINGAPORE (AP) -- Southeast Asian countries, while recovering from the
recent financial crisis, still face huge economic and political challenges,
Singapore's prime minister said today.

Prime Minister Goh Chok Tong warned that foreign investment in most
Southeast Asian countries has remained weak, and that banks have remained
wary about extending new loans to businesses.

``Despite improvements, I would caution against any hasty conclusion that
things would only get better,'' Goh told economic ministers and officials
from the ten-member Association of Southeast Asian Nations.

He was speaking at the opening of the 31st meeting of ASEAN economic
ministers. The ministers will be discussing the region's economic and
industrial cooperation through Oct. 2.

Goh also said the region's political stability will be a crucial factor in
achieving the full recovery.

``Indonesia, the largest ASEAN member, with two-fifths of ASEAN's total
population is in political transition,'' Goh said, adding that ``investors
will be watching developments in Indonesia closely.''

Indonesia, the world's fourth most-populous nation, is facing numerous
political upheavals: The territory of East Timor recently voted for
independence and an electoral college is due to pick Indonesia's next head
of state in November.

Goh urged ASEAN countries to continue to reform and liberalize their
economies and implement various collective measures as an ASEAN group.

On Wednesday, ASEAN officials took a major step toward making the region a
free trade area by reducing tariffs to a maximum of 5 percent for various
agricultural and manufacturing products by Jan. 1 next year in six nations.

But Malaysia later urged ASEAN to postpone reducing tariffs on imported
cars, although cars are among the products on the Jan. 1 list.

ASEAN's ultimate goal is to make the region a ``zero tariff'' trade area by
2015 for the six founding members, while remaining members Laos, Vietnam,
Myanmar and Cambodia should join them by 2018, officials said in a joint
statement.

Goh urged the ministers to make a ``bold, collective effort to market ASEAN
to the world.''

``What is clear is that ASEAN should act decisively now to seize the
initiative to progress further,'' Goh said. ``This will place ASEAN in an
advantageous position as we enter the next millennium.''

The members of ASEAN are Brunei, Burma, Indonesia, Laos, Malaysia,
Philippines, Singapore, Thailand, Cambodia and Vietnam.