A new milestone

A new milestone

Even before the meeting started in Bogor yesterday, one could
feel the consensus emanating from the 18 APEC leaders who were
all dressed in specially designed Indonesian batik shirts. The
press conference later in the day only confirmed that the
occasion was not just another international talk-shop.

The APEC Economic Leaders Meeting finally endorsed what is
termed the "Indonesian vision", i.e. a commitment to
liberalization towards free and open trade and investment in the
Asia-Pacific region along the principles of GATT. They also
designated a set of dates: the developed nations should implement
free and open trade and investment no later than the year 2010
and the developing economies no later than 2020.

Even though they fell short of determining an agenda on when
and how to start the whole process, the political commitment to
set specific target dates is already an enormous step and gives a
strong signal to the whole world. All the more so because it
comes at a time when the momentum for free trade is faltering
elsewhere in the world.

At the tender age of five years, the APEC grouping of 18
economies is still in a fragile stage that does not discount the
possibility of fragmentation. The diversity of its members is
such that APEC encompasses practically all of the underlying
conflicts of interest that set the East against the West, the
North against the South, the developed nations against the
developing nations.

Their per capita incomes range from US$470 in China, among the
lowest in the world, to $28,500 in Japan, among the world's
highest. Their populations range from 267,800 in Brunei to 1.2
billion in China. The socio-political spectrum varies from that
of the last bastion of communism to that of the most capitalistic
of nations.

There are at least three existing sub-regional trade
arrangements in the area, AFTA (comprising the six ASEAN
countries), ANZERTA (Australia and New Zealand) and NAFTA
(Canada, Mexico and the USA). Each of them has its own exclusive
and specific goals and targets, and each is not at ease with the
others.

Three APEC members (the USA, Japan and Canada) belong to the
world's "rich men's club", the G-7, which regularly addresses the
course of the world economy according to their own designs. On
the other hand, one member, that being Indonesia, is among the
world's poorer nations. It chairs the Non-Aligned Movement of 108
countries, frequently dubbed the "poor club". And in between you
have the newly-industrialized countries (NICs) of the world.

However, despite all that has been said, the Asia-Pacific
region is also the most dynamic region in the world. While other
parts of the world are engaged in armed conflicts, or immersed in
problems of high unemployment and its implications to economies,
the countries of the Asia-Pacific region are experiencing
economic miracles.

And for the last several years the nations of this region have
found that their economies are becoming more and more integrated,
providing the world's highest growth rate. Trade across the
Pacific has outstripped trade across the Atlantic. Investments
across borders in the region are accelerating to everyone's
delight.

The coming together of representatives of 12 economies of the
region in Canberra in 1989 did not get the attention it deserved
at first, either from the outside world, or from their own
constituents back home. The inclusion of China, Hong Kong and
Taiwan two years later -- already an undreamed of possibility
elsewhere -- still did not invoke encouraging support. Even after
the first informal leaders meeting on Blake Island last year, one
could feel a very reserved appreciation.

APEC was seen more as a talk-shop, with negligible substance;
and this is underlined by the fact that its summit meeting is
termed an "informal leaders meeting". From the outside, it has
been observed suspiciously as the creation of a new and exclusive
trading bloc. And internally there was a feeling that the concept
of free trade was not to the interests of some members like China
and Indonesia.

The Bogor meeting proves that this experiment can work and is
not to be dismissed as just another international get- together.
Its strategic importance lies not in its structure -- or lack of
it -- or in any specific schedule like the one adopted by ASEAN
or the European Union for that matter. Rather, it lies in its
contribution to regional peace and prosperity. Free trade and
investment are just two of the means to that end. They are not
ends in themselves. For the last several years the Asia-Pacific
region has distinguished itself as a region of relative peace and
prosperity. The institutionalization of APEC can only enhance
that.