Southeast Asian leaders have decided to begin talks on a free-trade agreement with Australia and New Zealand, after launching similar talks with Japan and South Korea. The decision came on the final day of a summit in Laos.

Leaders of the Association of Southeast Asian Nations, ASEAN, agreed to begin negotiations next year aimed at removing trade barriers with Australia and New Zealand by 2016.

Australian Prime Minister John Howard expressed satisfaction over the agreement.

"We welcome the commencement on negotiations for a free trade agreement between ASEAN and Australia and New Zealand," he said. "The warmth of the relationship was very evident in the exchanges that took place at the two-hour meeting."

He acknowledged his government did not intend to sign the ASEAN friendship treaty, but underscored that Australia had no hostile intentions against any country in the region.

Earlier, ASEAN launched free-trade talks with Japan and South Korea after signing accords Monday with China to create within the decade the world's largest free-trade area. Similar negotiations are underway with India.

At this summit, ASEAN nations also agreed to completely eliminate, by 2012, tariffs on 11 priority sectors that make up nearly one-half of their trade. And they agreed to increase cooperation on security and cultural exchanges as part of an agreement to create a regional community by 2010.

On the political front, Thailand's Prime Minister Thaksin Shinawatra met with the new leader of Burma and said Prime Minister Soe Win promised his government would carry out democratic reforms.

"He [Soe Win] said that the government will never want to [move] backward and will be moving toward democracy and is committed to the seven-step road map," he said.

The road map was announced last year by then-Prime Minister Khin Nyunt, who was dismissed in October during a power struggle that consolidated the power of hard line generals. The road map calls for a national convention to draft a constitution and organize elections. Soe Win says the convention will re-convene in February and all opposition parties will be invited.

In the lead up to the summit and to stall possible criticism, Burma released 9,000 prisoners, including several dozen members of the opposition National League for Democracy. But the government reportedly extended the house arrest of NLD leader Aung San Suu Kyi.

ASEAN believes cooperation with Burma, rather than economic sanctions, will encourage political reform. But several leaders here say the Burmese government should make progress on democratization if it is to assume the chairmanship of ASEAN in two years.