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APEC business leaders hope for creation of regional free-trade zone

Mainichi Japan | October 15, 2010

APEC business leaders hope for creation of regional free-trade zone

TOKYO (Kyodo) — A business advisory body to the Asia-Pacific Economic Cooperation forum called on APEC leaders Thursday to recommit themselves to create a region-wide free trade zone, saying it is the "most practical means" to realize trade liberalization.

In a proposal submitted to Japanese Prime Minister Naoto Kan, who will chair this year’s APEC summit meeting in November, the advisory body referred to a U.S.-backed multilateral trans-Pacific free trade agreement as one of the "possible pathways" toward achieving a Free Trade Area of the Asia-Pacific.

At the summit in Yokohama, APEC is tasked with presenting the "possible pathways" to achieve an FTAAP, a vague concept envisioned by the 21-member APEC, which includes such economies as China, Peru, Russia, South Korea, Taiwan, the United States and seven ASEAN members.

Japan is considering whether to join the Trans-Pacific Partnership Agreement, a free trade accord originally reached between Brunei, Chile, New Zealand and Singapore, and now negotiated to include other APEC countries such as the United States and Australia.

"FTAAP is an aspirational but achievable vehicle for delivering free and open trade and investment within the Asia-Pacific region," the proposal by the APEC Business Advisory Council said, while stipulating the TPP and the so-called "ASEAN plus three" as among the potential key regional frameworks toward creating an FTAAP.

ASEAN plus three groups the 10-member Association of Southeast Asian Nation as well as Japan, China, South Korea.

As part of the reasons to promote an FTAAP, the proposal cited a recent analytical study which showed that tariff elimination combined with trade facilitation and other efforts could result in a 2.9 percent rise in the region’s gross domestic output.

It also said that the lack of progress in the Doha Round of global market-opening talks provides APEC with a "unique opportunity" this year to advance an FTAAP.

The APEC Business Advisory Council includes representatives from the business communities in each of APEC’s 21 member economies. Its role is to monitor APEC activities and advise APEC about priority issues for the business community.

The council’s chair Gempachiro Aihara, who held a press conference after submitting the proposal to Kan, said he told the prime minister that the Japanese business community is hoping for Japan’s participation in the TPP negotiations. Aihara is counselor of Mitsui & Co.

As the TPP agreement in principle requires members to eliminate all tariffs to zero, it is seen as quite a high bar for Japan, which has been reluctant to open up its agricultural market.

 source: Mainichi