Japan Brief / FPCJ, No. 0869
　　　　
November 28, 2008


APEC Comes out against Protectionism; Pledges to Conclude WTO Talks by Yearend

Leaders of the members of the Asia Pacific Economic Cooperation (APEC) forum, who met in Lima on November 23-24, agreed to remain firm against protectionism at a time when the world fights a deepening global recession caused by the U.S.-originated financial meltdown. To prove their stand to contain protectionism, they pledged to reach a basic conclusion in the stalled Doha round multilateral trade negotiations under the World Trade Organization.

The summit of 21 Pacific-rim nations and regions, including China, Japan, Russia and the United States, met just a week after the Group of 20 emergency summit meeting in Washington that discussed means to restore financial stability and mitigate the spreading recession. The APEC summit fully endorsed the G-20 agreement regarding the financial regulations and measures to be pushed individually and collectively by governments.

Japanese Prime Minister Taro Aso reiterated his government’s decision to do its best to work to counter the domestic and international recession by mobilizing all policy tools available, including the 27 trillion yen stimulus package. He called on countries of the region to work together toward greater regional integration, noting specifically the growth potential of Asian countries. Aso proposed the creation, in collaboration with the World Bank, of a new fund to assist banks of developing countries affected by the financial crisis, and an “Asia Pacific trade insurance network scheme” in which trade insurance operations of countries in the region will be combined to facilitate regional trade. Japan earlier offered to provide up to $100 billion out of its foreign exchange reserves to bolster the International Monetary Fund’s lending capacity.

The Japanese prime minister stressed the importance of 2010, the year in which Japan will play the role of chair at the APEC summit, as the goal of the “Bogor Declaration” of 1994, mandating its developed members to achieve full liberalization of trade and investment within the region. (For developing members, the target year is set at 2020.) Some officials expect intra-regional trade liberalization to make substantial strides in the three years from 2009 through 2011 when the APEC chair rotates from Singapore to Japan and then to the United States. To take leadership in such a prospect, Japan, observers say, will be required to advance its own liberalization in bilateral and multilateral trade.

Editorials Value Significance
Japanese media commentaries described the APEC summit as significant in that it fully endorsed the earlier G-20 summit’s commitment to fight the global economic crisis. They called on the governments concerned to flesh out and step up necessary measures.

The Nikkei noted in its editorial on November 25 “major significance of the declaration of APEC leaders’ strong resolve to achieve financial stabilization.” The newspaper took particular note that the APEC summit went one step further in stemming protectionism by pledging a framework agreement in the WTO trade talks by the yearend. It stressed the importance of “making the APEC summit’s agreement truly effective.” “Japan ought to take leadership in bridging developed and emerging economies, instead of merely staying obsessed with protection of its agricultural sector.”

The Sankei Shimbun , in its November 25 editorial, called on the APEC to further its efforts to overcome the crisis. “The agreement (against protectionism) requires as an essential condition each country’s sacrifice and concession” since “a framework WTO agreement will provide a major prop for the economy,” the newspaper argued. “The momentum should be maintained at a series of regional meetings to be held in December, such as those centering on the ASEAN and the three-way summit of Japan, China and South Korea,” it added.

The Yomiuri Shimbun wrote in its November 25 editorial that “APEC leaders must keep promises on crisis.” It argued: “At a press conference in Lima, Prime Minister Taro Aso spoke of his renewed determination to reach a basic deal in the WTO negotiations. ‘Japan also will try to get what it wants and try to protect what it needs to protect [in the talks],’ he said. Japan should play a major role in the settlement of these difficult negotiations.”

(Copyright 2008 Foreign Press Center / Japan)