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The member countries of the AFTA agreement are Brunei, Indonesia, Singapore, Malaysia, Cambodia, Laos, Philippines, Vietnam, Thailand and Myanmar. It was first signed in January 1991, in Singapore. In the beginning there were only six participating countries, which later increased to a total of 10 countries.
The agreement puts these countries at an advantageous position in several ways. It increases the overall production of manufactured goods to meet the increased demand from consumers. It can also help to make these countries production capital of various goods in the world. The tariff barriers are exempted in trade between these countries. As a result the countries attract more direct foreign investment. The AFTA agreement achieves these goals with the Common Effective Preferential Tariff plan or the CEPT. The tariff rates and charges are progressively reduced with this plan which benefits all the countries participating in AFTA.
Several industries are covered under the AFTA plan like the manufacturers of cement, fertilizers, leather, textile industry, ceramic, rubber, glass, chemicals, furniture’s, vegetables, oils and copper, to name a few. All these products are being covered under the plan and exported following the AFTA guidelines. However, there are some exceptions like grains, tobacco and mineral wealth in the AFTA.
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