Bilateral FTAs and economic blocs

At the Asia-Pacific Economic Cooperation (APEC) forum's ministerial meeting held in Santiago, Chile, last week, the attending ministers issued a statement of intent to work through expanded bilateral free trade agreements to support World Trade Organization trade liberalization negotiations. At present, the FTA vision is a part of an agenda to promote trade liberalization.

The new round of WTO talks has deepened the differences between not only the industrialized countries, but also between the ranks of the developed and developing nations. This has led to an extension of the deadline for completing negotiations, and it is also why FTAs are being hailed as a speedy means to further progress on trade.

For Japan, which has been slow to form FTAs, there is a particular sense of anxiety. Japan's FTA strategy is to expand beyond the mere curtailing or lifting of tariffs. Instead, the government is targeting comprehensive trade packages that encompass liberalization of investment, human resource training and other economic cooperation.

We would point out that such economic cooperation will bear real fruit only when tariff barriers have been removed and a free flow of goods is achieved.

For its part, while the APEC ministerial statement stressed the importance of expanding FTAs, it also noted that these accords should complement the WTO's plan. With that, the organization effectively issued a warning to avoid creating trade blocs.

We must remember that Asian FTAs will only be successful when individual accords are promoted with a clear view of the basic goal-the creation of a free trade scheme that is fully open to the world.

-- The Asahi Shimbun, Tokyo.