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Asian Leaders Concerned About Security, Free Trade


Leaders from 21 nations in Asia, America and the Pacific are gathering in Chile for the annual summit of APEC (Asia-Pacific Economic Cooperation Forum). This year's forum convenes amid concerns over international trade security and whether the group is on track to achieve free trade in the hemisphere by 2020.

The APEC leaders gather in Santiago, Chile, following a year of strong economic growth in Asian economies, indicating that most Asian economies have recovered from the 1997 financial crisis.

Nevertheless, many challenges remain. The executive-director of the APEC Secretariat, (Ambassador) Mario Artaza outlines some of the issues of particular concern to the Asian participants.

"Human security issues, including counter-terrorism, and infectious diseases; efficiency, stability and security of financial markets," he said.

APEC members account for more than half of global economic production (or $19 trillion per year) and nearly half of all world trade. As a result, trade security is a major concern.

The Director of the Australian APEC Center at Melbourne's Monash University, John McKay, says one concern is that terrorists might use a shipping container for a biological or chemical attack.

"There's a particular worry about the very large number of shipping containers that are moving around the world," he explained. "And currently less than two percent of all the containers going into the United States, for example, are screened in any way."

Asians are also worried about sea piracy, more than one-half of which occurs in Asian waters. To top it, there is apprehension that political disputes on the Korean Peninsula and across the Taiwan straits could interrupt trade flows.

Professor McKay notes a number of initiatives have already been launched, including a counter-terrorism task force, computerized bill-of-ladings, and clearance of cargo lists before ships leave port. But he says this is just the beginning.

"We're going to see a continuation of discussions about how these systems can be improved, not just for containers but for international airline passengers and a whole range of other things like this," he added.

It has been 10 years since APEC adopted a timetable that calls for its developed members to achieve open trade and investment by the year 2010, and developing economies to do the same by 2020.

Professor McKay says some Asian members believe that after 10 years, it is time for a progress report on what are called the Bogor Goals.

"There is a big push to have a mid-term review at what APEC has done and what it needs to do," he noted. "And part of that discussion will be a discussion of how APEC as an organization needs to be reformed."

A professor at University of the Pacific in Lima, Peru, Fernando Gonzales-Vigil, says prospects for attaining the Bogor goals are mixed.

"My impression is that for most of the small developing economies of APEC there will not be a problem to be very close to full free trade if not already in full free trade in 2020, date of Bogor Goals," he said. "At the same time it's going to be very hard for developed economies to meet the 2010 deadline."

Mr. Gonzalez says developing nations have less trade protections in place to dismantle. While developed nations have industrial forces with political influence on governments' protectionist policies.

With free trade deadlines in question, APEC members are likely to discuss whether the forum's rules need to be changed and whether the small secretariat based in Singapore needs to be enlarged.

Finally, delegates are expected to discuss the growing number of bilateral free trade agreements, which have proliferated since the Doha round of the World Trade Organization negotiations stalled last year.

Some members worry that these agreements, which often do not follow WTO rules, will further hinder global liberalization. Others fear the emergence of regional free trade zones, such as one being proposed for Asia, will weaken APEC and the WTO.

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