APEC agrees to expand areas of cooperation

APEC agrees to expand areas of cooperation

TOKYO (AFP): The Asia-Pacific Economic Cooperation (APEC) forum wound up yesterday two weeks of preparations for next month's summit in Osaka with an agreement to expand cooperation in 13 specific areas overshadowed by a persistent deadlock over how far to extend the group's free-trade plans.

"Liberalization was the central dispute, particularly the idea of comprehensiveness," said Hiromoto Seki, the ambassador in charge of APEC affairs at the Japanese foreign ministry.

Seki, who chaired five days of talks between senior APEC officials this week following a series of committee meetings last week, said there was "no plan" to delay the action agenda which is supposed to be adopted in Osaka.

"What we have to do from now on is work out how to phrase the details," he said, downplaying the widespread opposition to Japan's reluctance to support free trade in all sectors. "I'm convinced that everybody will understand it."

Despite opposition from most of the group's 18 members, Japan, China, South Korea and Taiwan are seeking special treatment for sensitive sectors as agriculture as one of the action agenda's nine guiding principles.

The action agenda aims to implement last year's agreement by APEC leaders for industrialized members to work towards free and open trade and investment in the region by 2010 with developing members following by 2020.

The 13 areas targeted for increased cooperation were human resources, industrial technology, small and medium-sized enterprises, infrastructure, energy, telecommunications, trade promotion, transport, tourism, trade and investment data, marine resources, agriculture and fisheries.

Among the more concrete proposals to be endorsed next month is a plan to establish an Energy Research Institute, Japanese officials said.

In addition to the impasse over excluding sensitive areas from the free-trade program over the next 25 years, officials said the United States and China failed to resolve a separate dispute.

While most members agree that the benefits of free trade should the extended on a non-discriminatory basis, the United States has legal obstacles in doing so with China.

A further complication is the fact that China's application to join the World Trade Organization is still pending.

"There was no progress in the problem. Discussions are still underway with China," Seki said.

Australian Trade Minister Bob McMullan meanwhile warned that APEC was at a "critical juncture" and urged Japan to show strong political leadership.

"Since its inauguration, APEC has been an ambitious and successful undertaking which at various times has required strong leadership as it does again now," he told a news conference in Tokyo.

Speaking after talks with International Trade and Industry Minister Ryutaro Hashimoto, he warned that APEC "will lose its credibility in the eyes of both its members and the rest of the trading world" if the Osaka summit fails.

"More importantly, Japan and other APEC economies will have lost an historic opportunity to lock in the current momentum towards the implementation of free trade in goods, services and investment in the region, " he said.

"The Osaka meeting will be a real test of Japan's capability to look beyond its sectoral preoccupations and give a lead to countries in the Asia-Pacific."

Earlier Friday, Agriculture Minister Hosei Norota hinted that Japan would eventually have to back down from insisting on special treatment.

"As the host nation, I think Japan should fulfill its responsibility," Norota told reporters. "After trying different ideas, I think there will come a time when Japan will have to make a decision."

The Japanese agriculture ministry, which unsuccessfully lobbied against the partial opening of the country's rice market in the Uruguay Round of global trade talks two years ago, denied that Norota's remarks signaled a shift.

"This doesn't mean any change in the ministry's stance," a spokesman said.

APEC groups Brunei, Australia, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, the Philippines, Singapore, Taiwan, Thailand and the United States.