EC chief, Goh push for European-Asian summit

EC chief, Goh push for European-Asian summit

DAVOS, Switzerland (Reuter): A summit of European and Asian heads of government to discuss strengthening economic and political links is becoming more of a possibility, two key leaders from the regions said on Saturday.

Jacques Santer, newly installed president of the European Union's executive Commission, told the World Economic Forum in Davos he saw such a gathering along lines of two similar Asia- Pacific summits being held "in the near future".

Singapore Prime Minister Goh Tok Chong, also speaking at the annual meeting of world business and political leaders in the Swiss mountain resort, said a Europe-Asia summit was "now a distinct possibility" within 10 to 16 months.

But the two men offered differing approaches to the issue of cooperation between their regions.

Santer, a former prime minister of Luxembourg who took over the top EU post last week, said the Union "will continue to press for further market opening in many of the Asian-Pacific economies, some of whose markets remain impenetrably closed for financial services as well as goods.

"I believe the opening of the Asia-Pacific and South American regions, politically and economically, are an immense opportunity for the European Union to extend its influence in the world.

"I therefore welcome and will encourage deeper political and economic ties with all countries in these regions. I welcome the call for a summit between the European Union and Asian leaders in the near future," Santer added.

Goh told the Forum a dialog between the two regions "will recognize our growing interdependence in a shrinking world".

He added: "It will educate both sides to accept the limits to which we can or should try to influence each other."

Rejecting calls from Europe and the United States for a link between labor conditions in emerging economies and trade rules, Goh said Asia "cannot achieve overnight the social standards that took decades and even centuries to achieve in Europe itself.

Acceptance

"Europe must accept this," he added. "Barely a century ago, the protectionist lobby in the U.S. raised a similar cry against what it called the "pauper labor of Europe'."

Goh said Asia had no wish to see perpetuation of sweatshops and low wages.

Many U.S. and European politicians and labor leaders argue that such operations give the Asian economies an unfair trade advantage by making their goods cheaper.

But he said these conditions would continue to exist in Asian countries "as long as their supply of hungry, under-employed labor is plentiful".

Europe, he said, should engage the Asian states including China "in trade and investments that will enable them to grow rapidly, soak up their labor surpluses and provide higher value jobs."

Trade sanctions -- which some critics of last year's GATT world trade accord have suggested -- "will not raise wages and social conditions in developing countries to any artificially imposed norms, any more than they can raise their national incomes," Goh said.

But, in a gesture towards Europe, where trade union leaders have expressed concern at a further rise in unemployment as jobs switch to cheaper regions under the GATT treaty, the Singapore leader said Asia must recognize Europe had legitimate concerns.

"Asian nations must recognize that protectionism will gain increasing ground among European electorates if their governments are unable to demonstrate that more output is created by European exports and investments than jobs lost in competition with Asia," he said.