Business group urges U.S.-ASEAN free trade deal
Business group urges U.S.-ASEAN free trade deal
Jim Wolf, Reuters, Washington
A prominent U.S. business group urged the Bush administration
on Friday to beat China to the punch in creating a free-trade
area with the 10-member Association of Southeast Asian Nations
(ASEAN).
China is seeking to boost its economic and political clout in
Southeast Asia, possibly in a way that could freeze out U.S.
investors and undercut World Trade Organization rules, the U.S.-
ASEAN Business Council said in a series of policy
recommendations.
The challenge is to make sure that any future Chinese linkup
with Southeast Asian nations "does not undermine U.S. interests
in the region, to include those of the private sector, and ensure
it is consistent with the WTO," the council said.
To do so, U.S. officials should work toward creating a U.S.-
ASEAN free trade area in as little as five years "to beat the
Chinese," Ernest Bower, the council president, told reporters.
The council called for a "Wise Men's Group" made up of
academics, business leaders and former U.S. officials to explore
the benefits of such a deal. As appropriate, the "wise men"
should develop a road map leading to negotiations, it said.
The council said the expanded scope of ASEAN's interactions
with China, South Korea and Japan through a process dubbed ASEAN
+ 3 posed "some of the same challenges that China does."
Central to China's effort is its proposal, floated in 2000, to
form a free-trade area with ASEAN within 10 years, the group said
in a paper tied to the start of President Bush's second year in
office.
Beijing's overture is making "rapid" progress, said the
council, made up of 150 corporate members comprising the leading
U.S. investors in ASEAN.
For much of the past two decades, ASEAN's early members --
Singapore, Malaysia, Indonesia, Thailand, the Philippines and
Brunei -- functioned as a U.S.-oriented bulwark of regional
stability.
Changes began with the buckling of Asian economies in 1997 and
the rush to absorb communist-ruled Vietnam and Laos, military-
ruled Myanmar and Cambodia, recovering from decades of civil war,
revolution and more war.
A U.S. free trade zone with ASEAN would be designed to
eliminate tariffs and other trade barriers across a wide range of
industries, along the lines of a comprehensive bilateral deal the
United States is moving to wind up this year with Singapore.
"It's not a brand new idea, but an idea whose time has come,"
Bower said. He held out the hope of simultaneous progress toward
ending the political deadlock in Myanmar, formerly Burma, that
has led to U.S. economic sanctions against an ASEAN member.
The U.S. Trade Representative's Office had no immediate
comment.
The proposal for a China-ASEAN free-trade area was endorsed at
an ASEAN summit meeting in Brunei in November. It would create a
market of 1.7 billion people with a combined gross domestic
product of $2 trillion and total two-way trade of $1.2 trillion,
the council said.
U.S. exports to ASEAN members totaled $47 billion in 2000,
three times U.S. exports to China. But the U.S. economic slowdown
last year had taken a toll on the regional bloc, prompting
several ASEAN leaders to call for greater self-reliance and less
dependence on the U.S. market.
"While it is clear that there is an evolving regionalism in
Asia, it is not possible to predict whether Asian will adopt an
open or more exclusive, closed trading posture," the council
said.
Separately, the U.S. International Trade Commission called for
comments for a newly initiated investigation into the probable
economic effect of a U.S.-Singapore free trade agreement.
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