APEC puts off consideration of region-wide free-trade deal
15 November 2006
APEC puts off consideration of region-wide free-trade deal
Associated Press
HANOI, Vietnam — A US proposal to set up a massive Pacific Rim free-trade zone will be set aside for study until a regional meeting next year in Australia, a Japanese official said Wednesday.
The United States is promoting the sprawling free-trade zone as a way of standardizing the rapid proliferation of bilateral free-trade deals in the fast-growing region.
But at a Cabinet-level meeting at the Asia-Pacific Economic Conference in Hanoi, Vietnam, some members said they needed more time to look at the proposal, and agreed to order a yearlong study of it, a Japanese official said.
"Members basically agreed to make a study ... until next year’s APEC in Australia," said Mitsuo Sakaba, spokesman for Japan’s Foreign Ministry, adding that the plan would be considered as a long-term goal.
Some of APEC’s 21 members say they prefer smaller, bilateral agreements that take into consideration the different circumstances of individual countries.
Others worry that tackling such a massive proposal at this point would distract members from the more urgent task of jump-starting stalled World Trade Organization talks.
Indonesian Foreign Minister Hassan Wirayuda said there was resistance among some APEC members toward the proposed region-wide free-trade zone as it did not fit into APEC’s nonbinding nature.
"There is a divergence of views ... I sense there is no consensus," he told reporters. "It is still controversial. We need to further study ... what are the implications if APEC expands into a free-trade area."
American officials at the APEC meeting in Hanoi, however, denied that the proposal was stalled.
"This notion of greater integration is one that is under discussion at this point," said US Trade Representative Susan Schwab. "It is likely to be discussed by the leaders, and I’ll just stop at that."
The Asia-Pacific Economic Cooperation forum’s business advisory council has urged APEC leaders to seriously consider the idea this year to consolidate a plethora of free-trade deals in the region.
A sprawling APEC-wide free-trade area, stretching from the US to China and from Australia to Chile, would envelope nearly half of global trade, 40 percent of the world’s population and 56 percent of its gross domestic product.
The APEC Business Advisory Council in a report last month said the "spaghetti bowl" of bilateral and regional free-trade agreements made doing business more complex and costly and added layers of paperwork for trade transactions.
At least 40 free-trade pacts have been signed or are being negotiated among APEC members, the council said.
