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. y