Kyodo News | 22 August 2007
APEC eyes merging trade pacts in region to create APEC-wide FTA
Pacific Rim leaders are expected at their summit next month to consider combining existing bilateral and regional free trade agreements in the region as a way of creating a Free Trade
Area of the Asia-Pacific, according to a draft report of policy recommendations to the leaders.
Senior officials from the 21 member economies of the Asia-Pacific Economic Cooperation forum will recommend that APEC leaders ’’examine possible issues to be addressed and options for docking and merging existing free trade agreements’’ during the Sept. 8-9 summit in Sydney, says the draft report, a copy of which was obtained Wednesday by Kyodo News.
As of now, there are some 30 regional and bilateral FTAs in the APEC region, including the North American Free Trade Agreement, Australia-United States Free Trade Agreement and Japan-Malaysia Economic Partnership Agreement.
The idea of the APEC-wide FTA, known as FTAAP, drew attention at the APEC leaders’ summit last year in Hanoi, with the United States a key advocate. It would cover about 60 percent of the world’s gross domestic product and half of world trade.
’’An FTAAP could make a considerable contribution to economic integration in the Asia-Pacific region,’’ says the draft report, titled, ’’Strengthening Regional Economic Integration.’’
But as the idea is little known among the public, the draft recommends that APEC leaders examine an FTAAP as ’’a long-term prospect’’ and study possible implications of an FTAAP while compiling ’’an inventory of issues that would need to be addressed as part of a preparatory process.’’
The draft calls for conducting a ’’comparative analytical study of existing bilateral and plurilateral free trade agreements in the region with the aim of increasing knowledge of their similarities and differences, as well as enabling economies to identify ways to advance the concept.’’
It also advises that as part of exploring the feasibility of an FTAAP, APEC economies develop ’’a demonstrate chapter on trade facilitation which builds on the model measures.’’
The draft requests that the APEC leaders report progress on the recommendations at their next summit in Peru in 2008.
Separately, the draft calls for intensified efforts by APEC economies to strengthen financial markets and improve financial market integration within the region.
While advising financial institutions in APEC economies to ’’achieve global standards,’’ the draft recommends the APEC economies ’’address domestic structural policies and systems that pose barriers to deepening and developing financial markets through capacity building and information sharing in a way that corresponds to member economies’ individual circumstances.’’
The draft also asks APEC leaders to examine the possibility of further liberalizing air transport market in the APEC region. It calls for increased work toward improving port efficiency.
Moreover, the draft recommends that the leaders launch an initiative to simplify patent application procedures and step up cooperation in patent screening in the region.
The envisaged initiative comes at a time when the number of patent applications in the APEC economies totals 1.25 million, accounting for 78 percent of the world’s total.
The initiative would also prompt China and Southeast Asian nations to improve their weak protection of intellectual property rights, a key to advancing free trade and investment.
APEC groups Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, South Korea, Taiwan, Thailand, the United States and Vietnam.