US to develop closer trade ties with ASEAN at upcoming summit
By Victoria Jen, Channel NewsAsia | Posted: 03 November 2009 0050 hrs

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SINGAPORE: ASEAN economies rode out the financial storm and now are working even closer towards regional economic integration in order to reduce their trade dependence on the United States, the world's biggest economy.

But across the Pacific, the US is not sitting idly by.

President Barack Obama will be chairing the first US-ASEAN summit in Singapore, back-to-back with the APEC summit. This comes after Hillary Clinton's visit to the ASEAN Secretariat in Jakarta - the first ever by a US secretary of state.

Washington has been snuggling up to ASEAN since Mr Obama took office a year ago. The grouping is America's fifth largest trading partner. Its trade with the region has tripled in the past five years, but the growth was much slower than some of the Asian markets like China.

Deborah Kay Elms, head of Temasek Foundation Centre for Trade and Negotiations, said: "There are a number of things that the US is concerned about, especially the ASEAN plus groupings, and discussions from Japan about reviving the community idea, and Australia's discussion.

"All these are making some people in Washington nervous, that if they aren't careful, they will find themselves on the sidelines in Asia."

The region's strategic importance has also increased considerably. With US hegemony receding after the financial crisis, many in Washington believe closer ties with ASEAN is essential to counterbalance the rise of China.

However, according to some experts, this competition for influence may not be hostile.

"My sense is that the US sees its current engagement of ASEAN as a way of indirectly engaging China as well, because given the existing regional security architecture, East Asia is very much ASEAN centred, ASEAN based," said Tan See Seng, head of research for IDSS, Nanyang Technological University.

The free trade agreement between China and ASEAN will go into effect in January 2010. It is expected to boost bilateral trade growth by more than US$106 billion.

United States, on the other hand, hopes to catch up by striking a full free trade pact with ASEAN at the upcoming summit.

- CNA/sc