Many non-tariff barriers remain in Asean: report

An automotive plant in Vietnam. The region's industry is one of those hampered by non-tariff barriers, warns a new report.
An automotive plant in Vietnam. The region's industry is one of those hampered by non-tariff barriers, warns a new report.
JUNE 24, 2019 - 7:22 PM

WITHOUT a stronger focus on tackling non-tariff barriers, Asean will not accomplish the objectives of the Asean Economic Community (AEC) and will fail to meet the targets in the AEC Blueprint 2025, warns a June 22 report.

Jointly commissioned by the European Union-Asean Business Council (EU-ABC) and the Asean Business Advisory Council (Asean BAC), the report examines non-tariff barriers in the region's automotive, agri-food, and healthcare sectors. It sets out Asean-level recommendations for tackling non-tariff barriers in these sectors as well as in general.

In the automotive market, regional firms face challenges due to controls in the form of quotas and licensing; complex conformity assessment procedures; unique national standards; high taxation regimes; and discriminatory policies favouring local manufacturers.

In agri-food, three types of products were studied: alcohol, seafood, and biscuits.

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Market voices on:

  • Alcohol: A rising middle class and growth in alcohol sales and consumption mean significant opportunities for alcoholic drinks manufacturers. But these are undermined by high levels of taxation -- often associated with counterfeit trade -- as well as complex licensing procedures, increasingly burdensome labelling requirements, and marketing restrictions.
  • Seafood: Firms interviewed did not face major obstacles to trade, but did note inconsistencies during customs procedures, and strict conformity assessment and product registration procedures.
  • Biscuits: While facing relatively ligher regulation, the Asean biscuit sector still strugles with inconsistencies in customs clearance, complicated product registration processes, and national halal certification standards.

In healthcare, the fast-growing pharmaceuticals sector is hampered by an underdeveloped intellectual property regime; inconsistent, discriminatory and opaque government procurement processes; and limited access to public pharmaceuticals markets. The medical devices sector faces fewer obstacles, through these include new product registration requirements, a lack of access and transparency in public procurement procedures, and issues around halal laws.

The report sets out several Asean-level recommendations. These include:

  • Creating improved systems for collecting information on non-tariff measures and barriers, for instance through an open database system
  • Developing an institutional body or frameworks to track and tackle non-tariff barriers
  • Continued harmonisation of standards, alongside capacity-building to help member states and firms meet those standards
  • Working with the private sector to identify, eliminate, and conduct compliance reviews of non-tariff barriers