Client: Economic Research Institute for ASEAN and East Asia (ERIA)

In 2017, Svara Institute (formerly Presisi Indonesia) had the opportunity to work with the Economic Research Institute for ASEAN and East Asia (ERIA) to review the service schedules of the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA). AANZFTA entered into force in 2010 and so far has been generally viewed as the most comprehensive and highest quality agreement between ASEAN and its dialogue partners. This study examines the implementation rate of service schedules of commitments under AANZFTA for all ASEAN member states. The schedule would be evaluated in terms of both the commitments and the actual practice. The first part of the evaluation is the liberalization rate of the AANZFTA. It is basically converting the AANZFTA commitments into a quantifiable database. The second part of the evaluation utilizes questionnaire-based literature survey and field research to compare the commitments with the actual regulations.

On the liberalization rates of the AANZFTA, we found the average of liberalization rate among ASEAN member states rather moderate, i.e., 59.6%. There are only few member states that offer rather high liberalization through their commitments, namely Lao PDR (87.2%), Myanmar (81.7%), and Viet Nam (70.3%). However, their liberal commitments should be evaluated with care as the calculation of liberalization rate is based on the number of sectors. The number of committed sectors from these countries is rather small, except for Viet Nam. In contrast, Thailand, Cambodia, and Malaysia have rather low liberalization rates, as the number of committed sectors is higher.