1. Negotiations to create a free trade area linking ASEAN and ANZ — the AANZ FTA — should be a symbolic centrepiece of their new relationship. The summit meeting in Vientiane between ASEAN and ANZ leaders should be the platform to launch these negotiations. The aim should be to make any agreement as comprehensive as possible so that it will stimulate trade, growth and economic integration within and between ANZ and Southeast Asia.

A final decision on whether to begin the FTA negotiations will be made by the ANZ and Southeast Asian heads of government when they meet in Laos on 30 November 2004. They are expected to accept the schedule outlined by ministers. The ASEAN and ANZ trade and economic ministers recommended in September that the FTA negotiations should start as early as January 2005 and be concluded in two years. They agreed that an FTA should be fully implemented within 10 years, though whether this will be from the start of negotions or from the date of entry into force of the agreement has yet to be decided. The aim is to move to zero tariffs on as many goods traded between the two sides as possible, liberalize trade in services, reduce non-tariff barriers to trade, and promote investment.

The aim should also be to refocus on the potential for further growth for mutual benefit. But an AANZ FTA should also ensure that products of interest to ASEAN agricultural exporters, including tropical fruit, will be able to enter the ANZ market, subject to acceptable quarantine and health standards.

Some ASEAN countries allege that Australia has misused quarantine powers to block imports of competitively priced food products from Southeast Asia. Indeed, New Zealand is challenging Australia to demonstrate, as rules of the World Trade Organization require, that there is a scientific justification for Australian quarantine bans on imports of New Zealand apples. Market access for farm products is a major issue for ASEAN agricultural exporters — one that will be a litmus test in their eyes of Australia's committment to free trade.