APEC declaration means headache for Japan

APEC declaration means headache for Japan

By Keiji Urakami

JAKARTA (Kyodo): Leaders from the Asia-Pacific Economic
Cooperation (APEC) forum have charted an ambitious course toward
the goal of transforming their region into a free-trade zone by
the year 2020.

"Our goal is an ambitious one. But we are determined to
demonstrate APEC's leadership in fostering further global trade
and investment liberalization," Asia-Pacific leaders say.

The vision, set out in a declaration read out triumphantly by
Indonesian President Soeharto at the closing of an APEC leaders'
meeting at the Bogor Palace Tuesday, is more of a political
instrument for Soeharto than an actual economic scheme.

"What has come from the Bogor meeting is enhancing Soeharto's
image as a man who did it -- and a consensus to impose all the
responsibility of devising specifics on the shoulder of Japan,
the next year's APEC host," said one Japanese trade ministry
official.

Differences over whether to set a target date for trade
liberalization, the most contentious point among APEC leaders,
continued throughout the session, but the Bogor declaration
finally became a paper basically in line with a proposal made by
Soeharto, this year's host.

U.S. President Bill Clinton hailed APEC leaders' commitment in
the declaration as "historic." Australian Prime Minister Paul
Keating termed the decision a "rare achievement" that will
"change the world trading system."

Japanese Prime Minister Tomiichi Murayama said, "We set out a
grand political goal."

But nobody described how that goal will be achieved.

In a news conference broadcast live all over the world after
the Bogor meeting, Soeharto skirted the question, saying
formulation of a detailed scheme "should be left in the hands of
the ministers to make the preparations and recommendations."

His comment suggests that Japan could be left with the heavy
task of devising a framework for giving concrete shape to the
declaration before the next year's APEC leaders meeting to be
held in Osaka.

But mapping out a practical scheme that would draw unanimous
APEC support is not an easy task, with economic development
stages different from one APEC member to another.

Tetsuya Endo, Japanese ambassador in charge of APEC affairs,
said every country has "weak points."

Japan, for example, is not ready to blindly accept all of the
proposed trade liberalization measures, he said in reference to
the rice market opening mandated under Uruguay Round accords.

On this point, Prime Minister Murayama also steps back. Asked
about Japan's role in coordinating views among APEC members
toward the Osaka meeting, he said, "The scope of trade
liberalization to concretize the Bogor concept needs to be
studied fully with consideration given to positions of parties
affected."

Like Soeharto, Murayama appears reluctant to take leadership
in the task. "How to materialize it will be left to the
ministers concerned."

The Asia-Pacific free trade vision shown in the declaration is
a compromise between developed and developing nations.

Countries like the United States and Australia have been
pushing for concrete trade-opening steps as a means to exploit
free trade benefits in the booming Asian market, but less
developed nations like Malaysia have opposed the move.

During Tuesday's meeting, Malaysian Prime Minister Mahathir
Mohamad, a reluctant summit member who boycotted last year's
Seattle gathering, expressed strong reservations about setting a
deadline for trade liberalization.

The divisions left the paper void of specifics, with even the
controversial time frame issue written ambiguously.

The two-tier free trade scheme appears clear and
straightforward at first glance, setting 2020 as a deadline for
developing countries and 2010 for advanced nations.

But the deadlines appear to be conditional because the
document also states, "We agree that APEC economies that are
ready to initiate and implement a cooperative arrangement may
proceed to do so while those that are not yet ready to
participate may join a later date."

Some conference sources said they suspect Malaysia accepted
the inclusion of the year 2020 in the declaration only after
being assured the conditional clause would also be included.

But one Japanese government official denied any such political
bargaining was behind the description, saying the clause merely
reflects APEC's character as "a loose consultative body" that
runs on the basis of consensus, not on binding power.

Asked about what was to come by 2020, Soeharto said, "What is
certain is that since this is a vision, we have to see to it that
what we are going to do is for the improvement of the present
situation."

One official at Japan's trade ministry complained about the
remark, saying, "It is people like us who will be in charge of
the actual works." "It's a headache."