APEC stalls on trade liberalisation pact - Asia-Pacific Economic Cooperation

Business Asia, July 5, 1999

Hopes are fading of swift action on an Asia-Pacific pact to fast-track trade liberalisation after a meeting of senior officials failed to reach agreement on a key APEC package.

As Business Asia went to press, Asia-Pacific Economic Cooperation (APEC) trade ministers were meeting in New Zealand to try to forge agreements on regional trade and consider a unified agenda ahead of World Trade Organisation (WTO) talks later this year. Cracks in APEC unity emerged after senior officials disagreed on a package to speed up liberalisation in six sectors -- oilseeds, food, rubber, fertiliser, civil aircraft and the automotive sector.

Russian officials said they opposed fast-tracking the food sector. Thailand had problems with the oilseeds sector and a South Korean official suggested the entire package be referred to the WTO.

The six sectors are among 15 in an APEC package known as Early Voluntary Sectoral Liberalisation (EVSL) that the 21 member economies have been struggling to agree on since they were adopted at an APEC leaders' summit in Vancouver in 1997.

South Korean concerns revolve around food and oilseeds and the impact of competition on its domestic agriculture sector.

However, the idea of passing the liberalisation package on to the WTO without an APEC consensus did not sit well with officials from New Zealand.

Trade Minister Mr Lockwood Smith said the WTO was not the right place to negotiate wider liberalisation because trade agreements there tended to target specific items -- such as the European-US trade dispute over bananas.