BYLINE: JUN SAITO
This is the first of a two-part series on the prospects for key meetings of the Asia-Pacific Economic Cooperation forum, which got under way Tuesday with high- level working meetings in Auckland, New Zealand.
TOKYO Ministerial and summit meetings of the Asia-Pacific Economic Cooperation (APEC) forum, scheduled for Sept. 9 through Sept. 13 in Auckland, New Zealand, are expected to face a major test in terms of the organization’s political purpose and identity.
Skeptics say they doubt the regional body actually benefits its 21 members. Others say the APEC is a failure.
This year, the meetings are overshadowed by such major regional political concerns as the instability in East Timor, the missile problem with the Democratic People’s Republic of Korea (North Korea), tension between Taiwan and China, and delicate U.S.-China relations.
Voices of frustration have been heard even from within APEC participants. The Asia-Pacific trading partners are moving too slow to meet their own free-trade targets, the APEC Business Advisory Council (ABAC), a group of business leaders from APEC member economies, said in a letter sent in late last month to New Zealand Prime Minister Jenny Shipley, who will chair this year’s meetings.
”Like all processes that move by consensus and which are subject to the pressure of domestic politics, APEC has, at times, lost sight of its own goals,” ABAC Chairman Philip Burdon said.
His remarks were in sharp contrast to the enthusiasm and high expectations that embraced APEC just a few years ago. The group seemed to be at its zenith in 1994 when APEC leaders pledged, in a declaration issued in Bogor, Indonesia, to liberalize trade and investment in the region by 2010 for developed members and by 2020 for developing members.
”APEC meetings have been unable to come up with any effective measures and plans for realizing market liberalization,” a Foreign Ministry official said.
”This year’s APEC meetings will be a touchstone in terms of the question on whether it can move to meet its original market-opening goal, now that the Asian nations hit by a financial crisis in 1997 are recovering,” the official said. The financial crisis was no doubt a major reason why the APEC has lost its momentum to move toward the goal.
”The process of conflicting interests over the Early Voluntary Sectoral Liberalization (EVSL) initiative in 1998 made people label APEC as something that can do nothing,” said JiroOkamoto, researcher at APEC Study Center of Institute of Developing Economies in Tokyo.
Japan has been held responsible for the initiative’s failure because it rejected the idea of liberalizing commerce in regards to fish and forestry products two of the nine items designated for the initiative in APEC meetings in 1998.
Okamoto takes a dim view of the forthcoming APEC meetings, judging from the prevailing atmosphere at an annual international meeting of researchers and scholars from APEC nations, also in Auckland, in May.
”The atmosphere was totally different from our meeting in Tokyo in 1995,” he said. ”This year, the participants have shared the view that APEC is at a deadlock with no new ideas to reinvigorate the group.”
Helmut Sohmen, chairman of Pacific Basin Economic Council, an association of business leaders from the Pacific region based in Honolulu, was more dramatic in his assessment of the organization. At a symposium on APEC in June in Yokohama, he said, ”We should consider other options.”
Views skeptical of APEC’s raison d’etre have been expressed the loudest in the United States. For example, the Brookings Institution, a U.S. think tank, issued a report in late 1997 that proposed APEC be transformed ”from a feel-good chat forum into one where significant steps toward greater trade and investment openness become a reality.”
No discussions on such reform have ever taken place.
Japan, an APEC founding member, seems to take the organization’s current sorry situation seriously, although it does not have any grand design for the group’s future direction.
”Japan should try by all means to reinvigorate APEC as an effective regional cooperative organization,” said a senior official at the Ministry of International Trade and Industry.
However, he wrote off the notion that APEC has lost its meaning. ”It is one of the important regional bodies for Japan. It should be remembered that APEC has another important function as an economic cooperative body.”
Along this line of thinking, Japan will offer more technical cooperation and education programs to workers in developing nations, the official said.
”Most of the people who say APEC hit a deadlock are from developed nations such as the United States and Canada,” he said.
Philippine President Joseph Estrada said at a symposium on the Asian economy in June in Tokyo, ”APEC continues to be a major vehicle for expanding economic collaboration in various fields.”
The United States is apparently more interested in the trade and investment liberalization side of APEC than its role as an economic cooperation entity.
”APEC has been a sort of battlefield between developed and developing nations,” said Takahiko Tsubouchi, director of political and economic affairs at the Japan-Malaysia Association.
This is exactly why Japan is in a unique position in APEC.
Japan has two faces in APEC the world’s second-largest economy that is required to promote free and open trade and investment, and an Asian power required to play a leading role in helping create a framework for economic cooperation between APEC members.
”This two-face identity has sometimes left Japan with no choice but to be noncommittal in such key APEC matters as trade liberalization,” Tsubouchi said.
”Japan can contribute to the regional body as a nation that can bridge the different perceptions between developed and developing members,” a MITI official said.
Japan’s biggest challenge will be to translate those words into reality, observers said.