APEC officials mired in tricky negotiation

APEC officials mired in tricky negotiation

KUALA LUMPUR (AFP): Official-level talks aimed at securing a APEC free trade plan dragged on into an unscheduled third session on Thursday with fish and forestry products still the main sticking point for Japan.

"In the case of forestry and fisheries products Japan is one of the economies having some difficulty," Hong Kong director- general of trade Alan Lai told reporters earlier during a break in official-level talks.

Japanese officials confirmed there had been no concrete progress but declined to go into details.

A Thai delegate emerging from the afternoon session of the closed-door talks said the delegates from the 18 members as well as new members Vietnam, Russia and Peru were desperately seeking a compromise.

"We have to... find flexibilities," he said, in a reference to a possible delayed timeframe for Japan to slash tariffs in the fisheries sector.

Another ASEAN official said southeast Asian countries would not insist that Japan open up the sector.

"The fight is really between Japan and the United States leading the pack of New Zealand, Australia etcetera," she said, adding the Americans were being "unfair".

Fisheries is one of nine products targeted under an early liberalization scheme scheduled to start next year.

Fearing a backlash from Japanese fisherman, Tokyo is reluctant to cut tariffs on fish and related products. Japan is also dragging its feet in the area of forestry products ranging from stationery to furniture.

"The APEC vision is one thing but it's quite another to put your money where your mouth is," said Malaysia's Abdul Razak Ramly, who left the meeting he was chairing to give a belated news briefing.

"There is one economy which is having political difficulties but we all have difficulties... We would focus on building the package with the end view that everyone is in," he said.

The talks continued amid accusations that Japan was engaging in checkbook diplomacy to buy support for its attempt to water down the liberalization plan, a charge Japan denied.

"We have been saying we cannot accept tariff abolition in forestry and fish products, but we have never tied it to our financial assistance," a Japanese official told AFP.

"We are not saying this issue should passed in exchange for financial assistance," he added.

While Malaysia's Razak declined to comment on details of the negotiations, he said the aim was still to come up with a credible package on trade liberalization.

"If we'd (allowed exemptions) before then we wouldn't be where we are now," he said.

Japan faces a tough fight to defend its fish and forestry industries.

Leaders of the Japanese government and ruling Liberal Democratic Party (LDP) have refused to budge on demands by the United States, Australia and other nations for early liberalization in the two sensitive sectors.

The conservative party needs to prevent the free trade drive from filtering down into more politically sensitive domestic farming sectors, including the nation's staple of rice, experts said.

"Farming and fisheries lobby groups provide a large well of votes for the LDP, which sees no reason to offend its support base," said Tokai University politics professor Fukuji Taguchi.

The party needs more sensitivity than ever to the demands of its rural supporters after suffering a staggering defeat in parliamentary elections four months ago, in which it was hit by string of losses in urban areas.