APEC seeks ways for sectoral liberalization
By Riyadi
MONTREAL (JP): Trade ministers in the Asia Pacific Economic Cooperation (APEC) have agreed to speed up sectoral trade liberalization and improve individual action plans.
On the first day of their two-day meeting Friday, several trade ministers identified sectors for early liberalization, but others cautioned they should first set out basic principles for the liberalization before deciding on the sectors.
Indonesia proposed textiles, apparel and footwear should be designated as a sector for early liberalization as it is significant to developing economies.
"In this way we would get easier access to the markets of industrialized economies," Indonesian Minister of Industry and Trade Tunky Ariwibowo told journalists here Friday evening.
Indonesia is apparently disappointed over the slow progress of liberalization in textiles and apparel currently pursued by the World Trade Organization (WTO).
The sector comprises 14 percent of Indonesia's exports, with value averaging about US$6 billion a year.
Indonesia's proposal gained support from New Zealand, which said textiles, clothing and leather were among sectors still protected by high tariffs and the concentration of non-tariff barriers.
New Zealand Minister of International Trade Lockwood Smith said sectoral liberalization should include both sectors which had low protection and some which were highly protected to increase the region's economic benefits and enhance the credibility of APEC's liberalization commitments.
According to a 1995 survey by the Pacific Economic Cooperation Council, highly protected sectors in the APEC region include textiles, clothing and leather; paper and paper products; food, beverages and tobacco; forestry and timber; metal products, machinery and equipment, and fishing.
But the United States and other developed member countries have their own sectoral priorities.
The U.S. proposed that chemicals and energy resources should be included among the sectors for early liberalization, Canada wanted environmental technological products and services and Japan sought investment.
Japan's state secretary for foreign affairs, Masahiko Koumura, said the APEC initiative on sectoral liberalization should not prejudge future negotiations under the WTO agreement.
Tunky agreed and said the APEC forum should serve only as a catalyst toward plurilateral sectoral agreements like that of the Information Technology Agreement (ITA), which involved only countries interested in the agreement.
APEC's agreement on information technology last November paved the way for the adoption of the ITA by 27 countries, including Indonesia, on the sidelines of the first WTO ministerial meeting in Singapore last December.
By March 26 of this year, 39 countries had agreed to the ITA. They represent over 92 percent of the $500 billion annual global trade in information technology products.
Canadian Minister of Trade Arthur Eggleton said it was too early for APEC's trade ministers to decide sectors for early liberalization at their current meeting.
Trade ministers agreed to ask senior officials to look into all sectoral liberalization possibilities before their meeting in August.
"We hope to determine this in the next few months. Certainly by the time the leaders meet in November, we would be able to discuss some possibilities," Eggleton said after the first-day session.
This trade ministerial meeting is the first of a series of ministerial meetings Canada will host to provide impetus for APEC's work in the lead up to the APEC Ministerial and Economic Leaders' Meeting in Vancouver from Nov. 22 to Nov. 25.
In this weekend meeting, trade ministers also reviewed individual actions plans of each country. Some countries pledged to improve their action plans.
Canada has undertaken a major tariff simplification initiative, with legislation proposed to the parliament in April for implementation on Jan. 1, 1998.
The proposal includes replacement of Canada's seven existing tariff schedules with one simplified customs tariff, acceleration of the implementation of scheduled tariff reductions from 1999 to 1998 for most remaining Uruguay Round commitments, manufacturing input and general preferential tariffs.
It will also remove most tariff lines with rates below 2 percent, round down other rates to the nearest half percentage point and eliminate over 300 regulations and administrative procedures.
Australian Foreign Minister Alexander Downer also presented a list of possible revisions to Australia's initial action plans. The revisions will be formally announced later this year.
The revision would cover the reduction of tariffs on information technology products, passenger motor vehicles, tinplate and aluminum canstock.
Tunky said Indonesia's action plans, based on the scheduled tariff reduction scheme, were progressing well enough and no amendments were necessary at present.