Indonesian businessmen warmly welcomed the signing of two subregional agreements by four Asean members during the group's summit here last Friday, The Jakarta Post reported.

The first subregional pact creates an East Asean Growth Area, covering Brunei, Indonesia's Kalimantan and North Sulawesi provinces, East Malaysia and parts of the southern Philippines.

The second agreement is called the Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT) and includes Indonesia's Riau and North Sumatra provinces, Malaysia's Johor and Penang states and southern Thailand.

"The two signings will clearly boost business activities within the region, as the agreement will require the four countries to remove barriers to doing business in the area," Riau Chamber of Commerce chairman Arsyadjuliandi Rachman told The Jakarta Post.

The IMT-GT, which covers a total population of 100 million people, is already heavily integrated, as shown by the intensive agricultural trade between Aceh and southern Thailand and the heavy flow of people and goods between Sumatra in Indonesia and Malaysia's Malacca, Johor and Penang, he added.

A special regulation also promotes integration by allowing residents in all 10 provinces on Sumatra to go to eight Malaysian states and eight Thai provinces without paying exit taxes.

"Malaysia even considers Sumatra its supplier of vegetables and fruits. We hope small and middle-scale enterprises get the most benefit from this development. The triangle can be a training ground for embracing a bigger Asean free-trade area that is soon to come," said Rachman.

Indonesian President Susilo Bambang Yudhoyono said he was glad the governors and private sectors within the IMT-GT had held a dialogue in Selangor, Malaysia, last September.

"The mutual understanding as a result of such close contact will lead to concrete action that will promote the subregion's economic dynamism," he said.

"And I look forward to the IMT-GT making full use of its natural strength. It has abundant natural resources, capacity and potential that are yet to be tapped for the welfare of our peoples. The IMT-GT should accelerate the development of its member countries and help ensure equitable distribution of the benefits of national economic growth."

In a joint statement, Yudhoyono, Malaysian Prime Minister Abdullah Ahmad Badawi and Thai Prime Minister Surayud Chulanont acknowledged the importance of the IMT-GT as a subregional growth area and agreed to adopt the accompanying draft road map.

"The road map will guide the stakeholders in the implementation of doable, practical and sustainable strategies, programmes and projects that will benefit the communities of the member countries," said the joint statement.

Bernardino Vega, chairman of the North Sulawesi Chamber of Commerce and Industry, believes the efforts of the four Asean governments to boost cooperation in the eastern Asean growth area will have a positive impact on development there.

"The expansion of air links will boost interaction and business among people in the subregion," he said. "For instance, it will cost people much less to travel from one point in the area to another in a different country. If I want to go to Davao City from Manado, I don't have to go to Jakarta. It cuts distances a lot."

Cities like Bandar Seri Begawan in Brunei, Balikpapan and Pontianak in Indonesia, Kota Kinabalu and Kuching in Malaysia and Davao and Zamboanga in the Philippines will eventually be linked by more frequent flights, because airlines will face lower operational costs, said Vega.

The Nation

Cebu, the Philippines