APEC wants free trade in 2020

JAKARTA (JP): A special task force of the Asia-Pacific Economic Cooperation (APEC) forum yesterday handed President Soeharto their report which calls for establishing an Asia- Pacific free trade region by the year 2020.

C. Fred Bergsten, the chairman of APEC's Eminent Persons Group (EPG), delivered the report which will serve as a proposed guideline for the forum's future outlook.

"The President emphasized that the EPG report will be used as a point of reference for the leaders," said Minister/State Secretary Moerdiono following the meeting at Soeharto's residence on Jl. Cendana, Central Jakarta.

Established during the 1992 APEC Ministerial Meeting in Bangkok, the EPG was created to provide a working framework for the forum's future.

It consists of 16 intellectuals and experts from APEC members, of whom Indonesian and Japanese representatives, Suhadi Mangkusuwondo and Ippei Yamazawa, respectively, were also present at yesterday's meeting.

Despite acknowledging the President's shared view towards an open and free trade region, Moerdiono quickly warned against premature speculation on policies, since the matter would not be decided until the Nov. 15 APEC Leaders Economic Meeting (ALEM) in Bogor.

APEC groups the United States, Mexico, Japan, Taiwan, South Korea, China, Hong Kong, Australia, Papua New Guinea, New Zealand and Canada along with the members of the Association of Southeast Asian Nations (ASEAN) -- Thailand, Singapore, Malaysia, the Philippines, Brunei and Indonesia which currently chairs the forum.

Free Trade

Bergsten also asserted that the forum must forefront a push to liberate the global trading system.

"It is essential for APEC to take the lead to begin moving forward the process of further reduction of barriers," noted Bergsten, who is also the Director of the Washington-based Institute for International Economics.

Indonesia's Suhadi Mangkusuwondo also stressed this necessity when he said, "the main thrust of our report is for APEC leaders and ministers to adopt a long term goal of free and open trade in the region."

In a 42-page report released worldwide yesterday, the EPG calls for comprehensive free and open trade by the year 2020.

The report outlines the initiative of a trade liberalization program among members beginning in the year 2000 with a completion deadline of 10 years for industrialized countries, 15 years for newly industrializing nations and 20 years for developing ones such as Indonesia.

However, as stipulated in the report and reiterated by Bergsten, the EPG seemed confident that if adopted, the liberalization process would probably accelerate before the designated target year.

Outward

Elaborating on APEC's regional free trade area, Bergsten underlined that Asia-Pacific should not become a closed inward- looking regional forum as is the tendency in many parts of the world today.

"We want to counter that risk through the APEC forum developing an outward-looking regionalism," he said.

Both Suhadi and Bergsten said that the current set of proposals, entitled Achieving the APEC Vision, is a continuation of the EPG's first report presented prior to the 1993 inaugural ALEM on Blake Island, Seattle, the U.S., last November.

They said that the second report contained more concrete guidelines for implementing the concepts presented in the Seattle meeting.

Among the items highlighted in the report are trade and investment facilitation, an APEC Dispute Mediation Service (DMS), trade liberalization and technical cooperation.

"The Dispute Mediation Service is given high priority in this year's report," said Japan's EPG representative Ippei Yamazawa.

The function of the DMS is designed to complement the rules and procedures for the settlement of disputes to be implemented by the World Trade Organization (WTO).

Yamazawa explained that the DMS would channel bilateral disputes in multilateral directions in cases which fall outside the competence of the WTO.

When queried on the initial reactions of APEC governments towards the newly published report, Bergsten remarked that it was still too early to tell since it had only been distributed two days earlier.

"We do not expect it to be accepted or rejected as a whole...that would be expecting too much," he said. (mds)