Malaysian Prime Minister Abdullah Ahmad Badawi said in Kuala Lumpur Sunday the enlarged East Asian Free Trade Agreement (FTA) was not intended to replace the World Trade Organization (WTO) as most of the negotiations done by ASEAN are compatible with the WTO.

Prime Minister Badawi told a press conference that "What we are doing now is not inconsistent. It has no intention to replace WTO but will be blocs towards a global kind of FTA and a global WTO".

Badawi made the remarks in response to a question on whether the enlarged East Asian FTA will be a back-up in case the WTO ministerial meeting in Hong Kong next week failed.

As the negotiations are compatible with the WTO, Badawi said that ASEAN can go ahead implementing what is agreed upon as the principle is about liberalization and trade enhancement.

The Association of Southeast Asian Nations (ASEAN), established in 1967, groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

The prime minister said that a smaller grouping will be easier to talk to on the subject of liberalization as it gave some kind of familiarity on the objectives of liberalization and how beneficial it can be.

When asked on a study of the enlarged East Asian FTA, Badawi said the progress of the FTA between ASEAN and its dialogue partners -- China, Japan and South Korea -- has been good and should become a reality depending on those involved in the negotiating process.

It is natural to see this kind of FTA being expanded to friends of ASEAN like Australia, New Zealand and India in the future, he said.

In a speech to the 3rd ASEAN Business and Investment Summit held at Shangri-la hotel here Saturday, Badawi said that an integrated Asian region will not create barriers to trade with the rest of the world. He assured political and business leaders that Asia will not create barriers to trade with outside world as the future will see the emergence of a more integrated Asian region.

"Asia can not afford to adopt such a policy, as it will then limit the flow of much needed goods, services and capital. It will be detrimental to Asia's own growth. The growing economic potential of Asia will offer opportunities to all", said the Malaysian prime minister.

Badawi reiterated that "while many of these Asian countries are involved in one or more bilateral or regional trading arrangements, these countries remain open to goods, services and capital from countries which are not members of such arrangements."

Source: Xinhua