FOCUS: APEC to shape future vision for greater economic integration, growth+

TOKYO, Oct. 29 Kyodo -
After seeing progress in its decade-long efforts to liberalize trade and
investment among Pacific Rim economies, the Asia-Pacific Economic Cooperation
forum has come to a point this year to shape its future vision for greater
economic integration and sustainable growth.
With the leaders of the 21 member economies set to gather in Yokohama on Nov.
13 to 14, the forum that accounts for more than half of the world's economic
output is expected to outline how to pursue a proposed region-wide free trade
zone and compile its first-ever regional economic growth strategy.
The meeting will also come at a time when the forum's importance may be on the
decline as its membership increasingly overlaps with another key regional
framework called the East Asia Summit, which will be joined by the United
States and Russia next year.
''The time has come for APEC to review the changes in the landscape surrounding
it and to set its next goal,'' said Hidehiko Nishiyama, this year's chair of
APEC senior officials' meetings, noting that 2010 is a target year for APEC to
assess its past efforts toward attaining its goals of freeing up regional
trade.
The so-called Bogor Goals, agreed by APEC leaders in the Indonesian city in
1994, commit developed economies to achieving free and open trade and
investment by 2010, and developing economies by 2020.
But the economic situation has changed greatly since 1994, with the region
experiencing two major economic crises -- the 1997 Asian currency crisis and
the 2008 global financial crisis.
The region has also established itself as the world's leading growth center,
while facing new challenges in areas such as the environment and energy, and
the problem of social disparities.
As APEC seeks to raise its level of activity to a higher stage through a future
vision, one of the main topics at its upcoming summit will be the long-term
goal of a region-wide free trade zone, dubbed the Free Trade Area of the
Asia-Pacific, or FTAAP.
Japan, as chair, is hoping to flesh out the concept, which a senior Foreign
Ministry official said has been ''more like a pipe dream'' until now.
But the economically diverse members have disparate approaches to its creation.
While China would prefer to build on the so-called ''ASEAN plus three''
framework grouping it, Japan, South Korea and the 10-member Association of
Southeast Asian Nations, the United States is promoting another framework,
called the Trans-Pacific Partnership agreement, as the potential core for
creating the FTAAP.
The TPP originated in a free trade agreement between Brunei, Chile, New Zealand
and Singapore, and negotiations are under way to expand it with another five
APEC countries, including major agricultural exporters such as the United
States and Australia.
''We expect participation to expand over time and we believe that the TPP is a
promising pathway to a future FTAAP,'' Marc Wall, minister counselor for
economic affairs at the U.S. Embassy in Tokyo, said at a recent gathering in
Tokyo.
Japan is also considering participating in the TPP negotiations.
Nishiyama, a senior official at the Japanese Ministry of Economy, Trade and
Industry, admitted that the views of APEC members are ''extremely diverse,''
indicating the difficulty of reaching a consensus on the specifics of how to
pursue an FTAAP.
But he added that he expects APEC will be able to set down possible pathways
for an FTAAP this year, because moves involving regional frameworks such as
ASEAN plus three and the TPP appear to have ''laid the groundwork for members
to think about the FTAAP in a realistic way to some extent.''
Against the backdrop of the 2008 financial crisis, APEC is also working to
craft a growth strategy for the following years, which is expected to seek an
improvement in the region's ''quality of growth'' through job creation,
structural reforms and other means.
The planned expansion of the 16-member East Asia Summit, however, could
undermine APEC's uniqueness as the sole framework for regional economic
cooperation in which the world's three top economic powers -- the United
States, China and Japan -- participate.
A regional forum to discuss political and economic issues, the East Asia Summit
began in 2005 with the ASEAN plus three countries joined by Australia, India
and New Zealand. All of its members apart from India and three ASEAN countries
are part of APEC.
Given that fast-growing India is a member of the East Asia Summit but not APEC,
Kazushi Shimizu, a professor specializing in Asian economy at Kyushu
University, said that an expanded East Asia Summit could increase the forum's
importance politically and economically among countries in East Asia.
But Shimizu added that APEC is likely to maintain its significance as a
framework focused on the economic sphere and because it covers issues related
to the whole Asia-Pacific region.
''I think APEC has achieved its goal of free trade and investment to a certain
extent...and further liberalization of trade and economic integration have
become even more important for the region after the financial crisis because
countries are seeking ways to ensure growth in the current global economy,''
Shimizu said.
Set up in 1989, APEC accounts for 44 percent of global trade by value and also
includes Canada, Chile, Mexico, Peru, Russia, Taiwan and seven ASEAN members.
It operates on the basis of nonbinding commitments.
Japan assumed the rotating chair of the forum this year, having last done so in
1995. A series of ministerial meetings will culminate in the annual leaders'
summit in Yokohama at which a joint declaration will be issued.
==Kyodo