Trade pacts are building blocks to global trade: APEC
Trade pacts are building blocks to global trade: APEC
BANDAR SERI BEGAWAN (AFP): Regional and bilateral trade arrangements should be viewed as "building blocks" to the multilateral free trade system, not as destabilizers, Asia- Pacific senior trade officials said here on Saturday.
The conclusion was reached after a three-day meeting of senior trade officials and diplomats of the Asia Pacific Economic Cooperation (APEC) forum aimed at fine-tuning the agenda for a summit of APEC leaders in Brunei in November.
"They stressed that bilateral and regional free trade agreements should be seen as 'building blocks' for multilateral trade and a complement to -- not a replacement for -- the global system," said Lim Jock Seng, the permanent secretary at Brunei's foreign ministry.
Lim, who chaired the meeting, noted that efforts towards bilateral and regional free trade accords have increased after negotiations for a new round of talks at the World Trade Organization (WTO) stalled.
"The WTO process is not moving," he said in a news conference.
Singapore recently concluded a free-trade arrangement with New Zealand, while other countries like Japan, South Korea and Chile, among others, have been exploring the possibility of similar agreements.
In addition, regions have agreed to establish their own free trade areas, among them the ASEAN Free Trade Area and the North American Free Trade Area.
Mitsuru Taniuchi, a deputy director-general at Japan's economic planning agency, said a preliminary report by the APEC economic committee which he heads showed the benefits from bilateral free trade arrangements far outweigh the disadvantages.
"Generally speaking, the conclusion of the report is that bilateral trade agreements can be building blocks for multilateral trade," he told AFP.
Part of the reason is that the new regional and bilateral trade arrangements go beyond the trading only of goods, which was a defect in older arrangements because they led to charges of protectionism, Taniuchi said.
Recent agreements however include provisions for market- opening reforms, greater transparency and protection of intellectual property rights -- elements required by the global trading system.
"This aspect has the potential impact of inducing more investment and creating more trade," he said.
Research have also shown that even non-members of free trade arrangements have benefited from lower tariffs and the easier flow of goods, he said.
Japan has been holding exploratory discussions with South Korea, Singapore and Chile on a free trade accord, Taniuchi said.
"I think the Japan-Singapore talk is more at an advanced stage. But in all of the cases, Japan has not agreed on any formal agreements yet," he said.