VIENTIANE, Laos – Southeast Asian nations and China signed an accord Monday to create the world's biggest free trade area by removing tariffs for their 2 billion people by decade's end — a key step in their vision of a trade bloc to rival Europe and North America.
Leaders in the 10-member Association of Southeast Asian Nations (search) also signed a pact to flesh out their agreement last year to create an ASEAN Community along the lines of a unified Europe by 2020. It aims to create a common market with common security goals.
The run-up to the ASEAN summit in the Laotian capital was clouded by concerns that Thailand's crackdown last month on a protest that left 85 Muslims dead could inflame regional militants, and over Myanmar's failure to deliver on pledges to go from military rule to democracy.
Some countries indicated they might call those two ASEAN members to task — in a break with the group's tradition of keeping out of domestic affairs. But both issues were kept off the table during the summit's ASEAN-only agenda Monday, Thai government spokesman Jakrapob Penkair said.
Thai Prime Minister Thaksin Shinawatra had threatened to walk out if the village crackdown was raised.
On the summit sidelines, South Korea and ASEAN member Singapore concluded negotiations on a two-way free trade agreement.
Chinese Premier Wen Jiabao signed the landmark trade accord with ASEAN leaders later Monday at a conference center built on a palm-fringed swamp in sleepy Vientiane — the first such international event ever hosted by the isolated communist nation of Laos.
Laos spruced up its tiny capital of only 133,000 people, which had no five-star hotel until one was built for the summit by a Malaysian company. Bamboo screens blocked eyesores through the city, and women were asked to wear long skirts rather than pants.
ASEAN also plans free trade areas with Japan and South Korea — and was to sign a blueprint for economic cooperation with India during the two-day summit ending Tuesday. A free trade agreement with India is still many years away.
The ASEAN's agreements with China and India reflect the group's desire to latch on to two booming economies that are drawing foreign investment away from the region.
The annual ASEAN summit consists of several, closed-door meetings among leaders: The 10 Southeast Asian countries alone, and in various permutations with summit partners China, Japan, South Korea and India.