Future of APEC summit doubtful after Clinton

Future of APEC summit doubtful after Clinton

By Chris Johnson

BANDAR SERI BEGAWAN (Reuters): It was Bill Clinton's Big Idea for the Pacific -- a summit of leaders of the region's top economies able to push the boundaries of free trade and build a political bridge across the world's greatest ocean.

But the Asia-Pacific Economic Cooperation (APEC) summit may not survive for long the departure of the 42nd U.S. president.

Deeply divided by economic philosophy and culture, the Pacific Rim superpowers still have no common agenda for trade despite seven years of top-level negotiations since Clinton hosted the first summit on Blake Island in Washington State.

And the political value of the APEC summit is also in doubt.

Many question the need for an annual ritual that costs tens of millions of dollars and regularly brings one of the world's capitals to a standstill as thousands of officials, politicians, non-government organizations and company executives converge.

With multilateral summits commonplace, some say there is no need for a whirlwind gathering of presidents and prime ministers who have too many people to meet and too little time to talk.

"I fully expect they will find a way to bury the summit," said Walden Bello, professor of sociology at the University of the Philippines in Manila and director of the anti-globalization pressure group Focus on the Global South.

"This may be the last hurrah of APEC as Clinton is leaving the stage," he said.

Even supporters express some reservations about APEC.

Chris Findlay, coordinating group chair for the Pacific Economic Cooperation Council pro-free trade lobby group, says APEC's agenda has become unclear.

"The value of APEC hasn't disappeared, but the focus could do with some sharpening," said Findlay, professor of economics at the Australian National University in Canberra.

APEC's sheer size is a problem. Grouping 21 economies with two-thirds of the world's population, 60 percent of global output, almost half of world trade, it has huge diversity.

Rich English-speaking and largely Christian democracies like the United States, Australia and New Zealand have little in common with the impoverished, still largely agrarian economies of communist Vietnam or Buddhist Thailand.

APEC's rationale has also changed a little over time.

Conceived as a regional forum to discuss economic collaboration, the grouping evolved under Clinton's guidance into a vehicle for the United States and others to push open the developing markets of Asia for their own products.

Through the mid 1990s, Washington and its allies tried to persuade APEC to adopt comprehensive rules to move to free trade.

That did not happen partly because Japan and several Asian countries wanted APEC to remain a consultative group, guided by the principles of consensus used in other regional blocs such as the Association of Southeast Asian Nations (ASEAN).

But APEC did become an avowedly pro-free trade grouping.

At Bogor in Indonesia in 1994, APEC declared itself committed to the goal of free and open markets within its developed members by 2010 and in developing economies by 2020.

APEC pushed the conclusion of the trade negotiations under the General Agreement on Tariffs and Trade (GATT), which developed into the World Trade Organization (WTO).

Ironically, the WTO helped take some of the guts out of APEC.

Despite the debacle of Seattle last December, when thousands of anti-capitalist protesters scuppered a WTO meeting amid rioting, most trade talk has passed to the Geneva-based body.

However, many analysts argue APEC has real value as both a non-confrontational meeting place for politicians and also as an arena for non-binding talk about trade and big economic issues.

"APEC doesn't have a rationale only as the basis of trade negotiations," Thai Deputy Prime Minister Supachai Panitchpakdi told Reuters in an interview this week.

Supachai, who is also Thai commerce minister and will take over as Director-General of the WTO in September 2002, says APEC has an important role as an agent for development, a role it has tried to stress in the wake of the backlash against globalization.

Clinton says APEC has also contributed to peace and security.

"I believe in these years APEC has made a difference," he told a conference of business leaders in Brunei on Wednesday.

"I believe these annual summits and business meetings associated with them have made a difference. I hope very much that they will continue indefinitely. I think it is very important for the leaders to meet, to work together in an informal atmosphere. It creates a much better sense of community."

This spirit of trans-Pacific community has been tested in recent years, both by the economic crisis of 1997/1998 which hit Asia hard but barely affected America, and by political rows.

A speech by Vice President Al Gore at APEC in 1998 in Kuala Lumpur, in which he praised Malaysian opponents of Prime Minister Mahathir Mohamad, has left a deep scar in Southeast Asia.

"One of the things that has killed APEC even as a multilateral forum where people can have frank discussions was what Gore did in 1998, which was to convert APEC in Kuala Lumpur into a bully pulpit against Mahathir," said Bello. "So even the political dialogue value of APEC has been tremendously eroded."

"I think what you now have is an organization that is really a shell of its former self...I expect APEC to taper off."

But Findlay argues the APEC summits will survive Clinton.

"He was a really important figure," he says. "But still the Americans will continue take a strong interest in APEC."

"I think the common interest in the United States in using APEC to pursue its own market access ambitions and the mutual interest on this side of the Pacific in maintaining access to U.S. markets will keep APEC going."

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