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Vaile floats idea of Asian FTA

AAP - August 3, 2006

Vaile floats idea of Asian FTA

Australia could join an Asia-wide free trade bloc or create its own deal with other free-trading nations across the globe.

Trade Minister Mark Vaile has floated at least two options for Australia if the current round of World Trade Organisation (WTO) negotiations collapse.

The talks have been put on hold indefinitely following the failure of six key nations - including Australia - to agree on how best to slash farm protection, open up industrial markets and cut agricultural subsidies.

Next month, representatives from countries such as the United States will join with the Cairns group of agricultural free nations in talks in Queensland aimed at breathing life into the WTO talks.

But Mr Vaile signalled he is already thinking ahead of next month’s meeting, outlining other options for Australia if the WTO negotiations collapse altogether.

He said one option was for like-minded countries to strike their own deal, and then extend that to other nations that agree to slash their protection levels.

Another option being floated is a free trade agreement (FTA) between Australia, New Zealand, India, South Korea, Japan, China and the ASEAN group of nations.

"Our test for whether we enter negotiations will remain as it is today - any agreement should obtain tangible benefits for Australian business," he told the Institute for International Trade.

"We won’t do an FTA unless it will open markets."

Asia-Pacific businesses backed a similar proposal two years ago but it has so far failed to win political support.

Mr Vaile said he still believed the WTO talks could be salvaged, although he admitted they were hanging by a thread.

He said next month’s meeting would specifically address how countries like the US and Japan could become more flexible in addressing "stumbling blocks" to the talks.

"The round is not dead, it’s hanging on by a thread," Mr Vaile told reporters in Adelaide.

"Every now and then you need an event like this to shake a few people up to get focused on what we’re trying to achieve and the objectives we’re trying to achieve."

Mr Vaile, backed up by his Malaysian counterpart Rafidah Aziz, said until the talks agreed on the early issue of a formula for tariff cuts, there was no need for the active input of leaders such as Prime Minister John Howard.

"The prime minister has indicated that he’s prepared to contact other leaders at a particular stage of the process but there’s still quite a bit of detailed work ... that needs to be done before we get to that stage," he said.

Ms Rafidah, Malaysia’s Trade Minister, said Australia and Malaysia were frustrated by the failure of other countries - which she refused to name - to move the talks forward.

"Individual countries have failed to be proactive in showing flexibility to the degree that they should ... much to the disappointment to the rest of the world," she said.

"Some countries are so unreasonable.

"If they’re really serious about the Doha round, and they really mean what they say about having a predictable regime that benefits everybody: the so-called win-win situation, then they had better come on board and agree to modalities to which the majority of us already agree."

 source: The Age