APEC officials head for free trade accord

APEC officials head for free trade accord

OSAKA, Japan (AFP): Senior officials of the Asia Pacific
Economic Cooperation (APEC) forum yesterday tied up loose ends
for a last-minute accord on free trade as differences between
Beijing and Washington threatened to spill over into ministerial
talks.

The summit's success had been threatened by differences over
the treatment of sensitive sectors such as agriculture, which
some members wanted to exempt from the agreement.

A senior official said the latest draft, agreed after a one-
and-a-half day informal meeting, removes references to
"differential treatment" and "sectoral specificity," code words
among international trade negotiators for agriculture.

The official, who asked not to be named, said the new draft,
while continuing to emphasize the need for flexibility in
liberalizing trade and investment, also took into account
"diverse circumstances" among APEC members.

APEC groups Australia, Brunei, 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.

Tony Miller, director general of Hong Kong's trade department,
said the flexible approach would not undermine the spirit of the
Bogor declaration.

"We don't regard flexibility as something which is going to in
any way inhibit the comprehensive nature of this exercise,"
Miller told reporters.

"The whole liberalization process is to be conducted in
accordance with the Bogor declaration, which specifies non-
discrimination and in particular open regionalism," Miller said.

But despite broad agreement on the latest draft, dispute
emerged between China and the U.S. over the application of non-
discriminatory trade.

"There is still a wide gap between China and the United
States," Japanese trade and industry minister Ryutaro Hashimoto
told reporters, adding: "This issue will most likely have to be
dealt with by the ministers."

The dispute relates to China's Most Favored Nation (MFN)
status, annually reviewed by the U.S. as required for communist
countries by its laws.

Beijing wants the non-discriminatory rule applied to all APEC
members,, including itself.

Under an agreement reached by APEC leaders last year at a
summit in Bogor, Indonesia, industrialized members are supposed
to achieve free and open trade and investment in the region by
2010 with developing members following by 2020.

Japan and a minority of the group's 18 members including
China, South Korea and Taiwan had been seeking special treatment
for sensitive sectors such as agriculture.

Other members including Australia, Canada, Hong Kong, New
Zealand, Singapore, Thailand and the U.S. argued that any such
concession could lead to exceptions in a multitude of other
areas.

The senior official said South Korea was still unhappy with
the lack of allowances for agriculture in the draft, but
indicated Taiwan had accepted the compromise and hinted Japan was
ready to accept.

Hasmimoto, however, suggested there was still work to be done.
"We still have some troublesome problems," Hashimoto said.

"We agreed to comprehensiveness in Bogor last year, but we did
not agree to specific sectors," he said.

Japanese officials said Hashimoto had told Rizalino Navarro,
Philippines' trade and industry secretary, "there is still room
for further discussions" between members before the ministerial
meeting, which formally begins tomorrow.