Free trade, Japan woes on APEC agenda

Free trade, Japan woes on APEC agenda

KUCHING, Malaysia (DPA): Trade liberalization and the ailing
Japanese economy are set to top the agenda when trade ministers
from 18 countries meet in Kuching on Malaysian Borneo on Monday
for their annual Asia-Pacific Economic Cooperation (APEC) forum.

The two-day meeting, which will also be attended by members-
designate Russia, Vietnam and Peru, comes at a time when APEC's
East Asian members are struggling to overcome a year-long battle
against sharp currency devaluations and economic slowdowns.

Japan, the world's second-largest economy which was once seen
as the locomotive that could pull the troubled region out of the
economic doldrums, has now proved unable to revive its own
stagnant economy, further threatening the region and the world
economy.

The United States' delegate, Trade Representative Charlene
Barshefsky, is expected to lead a push for Tokyo to carry out
promised tough economic reforms to stimulate domestic demand and
to prop up the ailing yen.

The grouping's trade ministers will also be expected to renew
their commitments to free trade despite the internal problems
posed by the financial turmoil.

At last year's Vancouver summit, APEC leaders agreed that
further trade liberalization was the best way out of Asia's
economic turmoil.

However, the crisis has worsened since then and the priorities
of some members countries may have shifted. Since the crisis
began in early July 1997, South Korea, Thailand and Indonesia
have had to accept multi-billion dollar rescue packages, while
recession now looms in Malaysia, Singapore and Japan.

Many members are now preoccupied with salvaging their troubled
economies and appeasing growing social discontent rather than
ensuring that APEC's trade liberalization goals are kept, sources
said.

Rafidah Aziz, Malaysia's International Trade and Industry
Minister and the chair of next week's APEC meeting, said recently
that the regional economic woes made it difficult for member
states to practice global liberalization.

However, APEC sources said that despite the reservations felt
by some Asian members, the meeting is expected to endorse a call
for greater "implementation and improvement" of trade
liberalization, which is a cornerstone of U.S. policy on APEC.

Australian experts are drawing up a soon-to-be completed study
on the impact of trade liberalization on APEC economies.

The study is among topics on the agenda of a three-day meeting
by APEC senior officials, which began Thursday, as a run-up to
the ministerial meeting. The study will eventually be submitted
to APEC leaders at their summit in Kuala Lumpur in November.

Noor Adlan Yahaya Uddin, the executive director of the
Singapore-based APEC secretariat, said the study was intended as
a "public affairs campaign" to counter a possible "resurgence" in
protectionist tendencies among crisis-hit members.

He said that although there were no indications of APEC
members wanting to "put the brakes" on free trade, he personally
felt that "some have read certain signs of a resurgence in
protectionism".

APEC has set a target of trade liberalization by 2010 for
developed members and 2020 for developing ones.

Nine sectors have been identified under APEC's Early Voluntary
Sectoral Liberalization (EVSL) program - telecommunications,
toys, forest products, fish products, gems and jewelry, medical
equipment and instruments, environmental goods and services,
energy and chemicals.

Six more are in the process of negotiation for possible
inclusion under the package - civil aircraft, food, natural and
synthetic products, fertilizers, automotive and oil seeds.

The trade ministers are also expected to review progress on
various APEC work programs such as on electronic commerce,
science and technology, human resource development, and on
streamlining the APEC structure by the year 2000 due to the
expanding membership.

APEC now comprises Australia, Brunei, Canada, Chile, China,
Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New
Zealand, Papua New Guinea, the Philippines, Singapore, Taiwan,
Thailand and the United States.