Economic and trade ministers from Australia, New Zealand and the 10-member Association of Southeast Asian Nations (Asean) were expected to agree to negotiating principles for a free trade agreement during the Asean Economic Ministers-Closer Economic relations meeting.

"The negotiating principles if agreed, as we would expect them to be agreed, by ministers in Jakarta will go to leaders as the formal recommendation for free trade negotiations," the trade official told a briefing.

"It would be very surprising if ministers were to revise the principles in any substantive way."

In April, Asean proposed launching free trade talks with Australia and New Zealand and a final decision on whether to begin negotiations will be made at the ASEAN leaders' summit in Laos in late November.

Asean consists of Thailand, Singapore, Indonesia, Vietnam, the Philippines, Brunei, Laos, Myanmar, Malaysia and Cambodia. Two-way trade between Australia and Asean in merchandise and services totalled more than A$40 billion ($28 billion) in 2003.

The Australian trade official said negotiations were likely to begin in 2005, take around two years to complete and be fully implemented within 10 years of the agreement's commencement.

Australia has long sought free trade with Asean but had to settle in 2001 for talks on a closer economic partnership a looser trade framework short of tariff cuts.

Australia has already signed free trade deals with Singapore, Thailand and the United States and has agreed to carry out scoping studies into the possibility of free trade agreements with Malaysia and China.