EU trade caution catches Asians unaware

EU trade caution catches Asians unaware

BRUSSELS (Reuter): European officials say their Asian
counterparts, having prepared table-thumping responses to
expected criticism of their trade policy, may have been won over
by a softly-softly European Union approach.

As they made their way home yesterday, after two days of talks
here, senior Asian trade officials can be forgiven for being a
little confused.

The Asia European Meeting (ASEM) -- which groups the 15-member
EU with the seven-nation ASEAN (Association of South east Asian
Nations) plus Japan, China and South Korea -- met to plot a
common approach to the World Trade Organization summit in
Singapore later this year.

It was the highest-level gathering since ASEM heads of state
met in Bangkok earlier this year to launch a new Asia-Europe
cooperation strategy.

"There was no point in us delivering a sermon," said a senior
official of the Commission, the EU's executive. "If we want
Singapore to be a success we have to work on agreements, not
disagreements."

The Commission deliberately avoided introducing issues likely
to prove controversial, such as labor standards, political rights
and the thorny question of trade with Burma.

Instead, the meeting focused on so-called "new issues", as
well as investment, competition and development.

This was in sharp contrast to a meeting of ASEAN Foreign
Ministers in Jakarta earlier this week, where the EU was blasted
for trying to impose Western standards on its trade partners.

"It was not a confrontational meeting," said Horst Krenzler,
head of the Commission's trade department.

"They expected an argument, but I think our approach was a
more subtle way of effecting our position," said an official.

One Asian diplomat, however, said there was still a great deal
of work to be done.

On WTO issues, the Asian participants indicated they would be
prepared to put greater effort into exploring ways by which trade
and investment in Asia could be made more accessible in exchange
for an EU commitment to expanding the WTO.

Both sides agreed on the importance of expanding the WTO but,
in a reference to China, an ASEM statement after the meeting said
new members had to be judged on the basis of "appropriate rights
and obligations".

Many Western governments fear the WTO's standing could be
undermined if China joins and then withdraws the first time it is
criticized or loses a trade dispute.

There was also concern expressed that a spate of regional
trade agreements could undermine multilateral aims, and both
sides agreed to support the work of a special WTO committee
looking into this.

On bilateral relations, officials said the Asian participants
agreed to put more effort into studying ways of unifying
financial regulations.

In return, the Commission is to examine ways of promoting
European investment in ASEAN.