Asian powers reach initial agreement on pan-Asia trade

Asian powers reach initial agreement on pan-Asia trade

Vijay Joshi, Associated Press/Kuala Lumpur

Diplomats preparing for the inaugural East Asia Summit reached an
eleventh-hour agreement on Thursday on a grand plan to eventually
create a cohesive economic community across the disparate region.

At issue was how deeply integrated the community should be and
how fast it should be created, and whether it should be driven by
the summit's sponsor, the 10-nation Association of Southeast
Asian Nations.

India's insistence on firm commitments to integrate in a pan-
Asian economic community had for months held up finalization of a
declaration diplomats were preparing for leaders at Wednesday's
16-nation summit.

But hectic negotiations on late Thursday resolved the
problems, both sides said.

"We're very happy everyone agreed to the Kuala Lumpur
declaration on East Asia summit including India. India is in the
process, so there is no more problem," Malaysian Foreign Minister
Syed Hamid Albar told reporters.

An Indian diplomat, speaking on condition of anonymity because
he was not authorized to speak to the media, confirmed Syed
Hamid's comments. "Everything has been sorted out. Just some
finishing touches have to be given here and there," he said.

He said India also has no objection to ASEAN being "in the
driving seat" to lead the initiative.

The East Asia Summit comprises ASEAN, Australia, China, India,
Japan, New Zealand and South Korea.

The 16 countries account for about 3 billion people, or half
the world's population, and a fifth of global trade. Any
partnership to form a trading community would rival Europe or
North America.

But large questions remain about how European-style
integration can take shape in a region ranging from communist
Laos -- one of the world's poorest economies -- to democratic
Japan -- the world's second-largest.

The Indian diplomat said that India had asked for "deepening
economic integration and community building" in East Asia, in
other words a free trade area in a European style community.

"We had articulated our views and both find reflection in the
document," he said.

Thursday's agreement is only a first step toward a regional
economic community, which could be years away. The East Asia
Summit must create a mechanism for the vision to take shape. How
that is done is something for the leaders to decide at the
summit, diplomats said.

So far, the region's free trade agreements generally are
between a single large country and a small country or a bloc of
small ones - without any comprehensive accords among heavyweights
such as China, Japan and South Korea and India.

China's enormous size and growing economy have given it
increasing influence with ASEAN and it is reluctant to share top
billing with India, which is pushing for faster integration in
part to better export its expertise in software development.

China's traditional tensions with Japan also represent a
hurdle, said Takashi Terada, an international relations expert at
the National University of Singapore.

ASEAN, which holds its own summit in Kuala Lumpur on Monday,
has come under strong pressure in recent years to get member
nation Myanmar to bring about democratic reform and release pro-
democracy leader Aung San Suu Kyi.

The country's military junta has declined, despite frustrated
pleas from its neighbors. Still, the issue was not expected to
figure prominently in this year's summit despite renewed U.S.
pressure on the issue, said Syed Hamid, the Malaysian foreign
minister.