APEC ministers to adopt FTA best practices

Asian Economic News, Nov 24, 2004

SANTIAGO, Nov. 15 Kyodo

Foreign and trade ministers from the Asia-Pacific Economic Cooperation forum are set to begin annual talks Wednesday with the adoption of ''best practices for free trade agreements'' topping the agenda.

On the first day of the two-day meeting, APEC ministers are expected to discuss trade-related issues, including the best practices for FTAs and their support for multilateral trade liberalization talks under the World Trade Organization.

Senior officials from the 21-APEC economies agreed in their two-day talks that the best practices should be nonbinding and only serve as references to better shape free trade pacts among the Pacific Rim economies.

According to Japanese officials, APEC ministers are expected to issue the best practices for FTAs in a document separate from a traditional long ministerial statement.

Senior APEC officials also agreed the envisioned best practices must have transparency and need to be in line with APEC's goal of liberalizing trade and investment as well as related rules of the WTO, the Japanese officials said.

The issue of FTA best practices is unlikely to be taken up by APEC leaders when they assemble Saturday and Sunday following the ministerial talks, they said.

FTAs or regional trade agreements are basically welcomed by the Pacific Rim economies as they lead to lower trade barriers such as tariffs, but some critics say such trade pacts could have adverse effects in terms of freeing up trade and investment on the APEC-wide basis because of their discriminatory nature.

With regard to WTO negotiations, the ministers are expected to throw full support for a framework agreement struck Aug. 1 in Geneva to give further momentum toward the conclusion of the current Doha round of negotiations that has been significantly behind the initial schedule.

The ministers are also likely to agree that APEC should contribute to helping the WTO's ongoing negotiations in trade facilitation because APEC is taking the lead in the area, the officials said, adding that APEC and the WTO will likely hold meetings on the matter in Geneva early next year.

The WTO agreed to launch formal negotiations for trade facilitation in August.

Discussions on the second day of the annual gathering by the APEC ministers are likely to be dominated by security issues.

The ministers will explore avenues for enhancing human security, which cover counterterrorism measures, preventing the proliferation of weapons of mass destruction and tightening controls on infectious diseases such as AIDS, SARS and bird flu, the officials said.

The APEC ministers are also likely to launch an initiative on energy security, according to the officials.

During a sideline lunch, the APEC ministers will discuss the feasibility of launching an APEC-wide FTA in the future -- a proposal by business leaders of the Pacific Rim economies.

The ministerial talks will be followed by a two-day summit meeting of APEC leaders on Saturday and Sunday.

APEC leaders are expected to issue a separate statement on structural reforms in addition to their regular joint statement when they wrap up two-day talks on Sunday, the officials said.

APEC, which was set up in 1989, groups Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, South Korea, the Philippines, Russia, Singapore, Taiwan, Thailand, the United States and Vietnam.

With a combined population of more than 2.5 billion, the APEC region generates a gross domestic product of $19 trillion, 47 percent of all international commerce.