Regional free trade pacts help global trading
Regional free trade pacts help global trading
SINGAPORE (AFP): Regional free trade pacts stabilize global trading, Japanese Minister of International Trade and Industry Takeo Hiranuma said Monday, as the world's second largest economy comes closer to signing such an agreement with Singapore.
He said the mechanism for global trade, the World Trade Organization (WTO), was lagging behind the rapid changes in the trading environment as businesses worldwide seek quick resolutions to issues they face.
"It seems ... that we have reached a point where the speed of change in the business environment is too rapid for the WTO to keep pace in creating new rules," he said in a speech to business executives here.
"Regional efforts to complement such multilateral negotiations are becoming a critical sub-system in terms of enhancing the stability of the global system," he added.
A joint study on the proposed free trade pact between the two countries was completed earlier this month, moving Singapore and Japan closer to realizing an agreement.
Hiranuma said he hopes an agreement could be signed within one year.
He said such an accord will be a "milestone in Japan's international trade policy" -- being a first for the world's second largest economy.
Japan was also consulting with South Korea and Mexico to sign off similar deals, and Malaysia has expressed interest as well, he added.
Hiranuma said the agreement with Singapore will go beyond the traditional mode of just tearing down tariff barriers.
"Investment rules, liberalization of trade in services and competition policy coordination will open the way for participation in each other's markets, with national treatment applied in principle and anti-competitive business practices kept firmly in check," he said.
"Mutual recognition agreements regarding standards and conformance will avoid inspection duplications and reduce transaction costs," he said, adding a dispute settlement mechanism will be established.
Both countries would take full advantage of information technology, starting off with a mutual recognition of each other's certification for electronic signatures and so-called "privacy marks" for private institutions, Hiranuma said.
Both sides also aim to develop cross-border, one-stop services on the Internet "whereby all the export and import data requested by the various relevant authorities ... can be submitted at the touch of a key."
The flow of business people will be facilitated under the arrangement, the Japanese minister said.
While Asian countries were still far from achieving economic integration like the European Union because of cultural and political diversities, the Internet could be used to bridge the gaps.
A new round of WTO talks has been stalled due to differences in agenda by the world's developed and developing nations.
As the WTO talks remain in limbo, nations have began establishing their own bilateral and regional free trade alliances.
Singapore and New Zealand have recently signed such a deal and plans are in foot to merge the ASEAN Free Trade Area with a zone covering Australia and New Zealand.