BY EVA CHENG
If US President George Bush hadn't dominated this year's October 17-21 summit of the Asia Pacific Economic Co-operation (APEC) in Shanghai, China, with his "anti-terrorist" war drive, the peak regional body of 21 economies would have had a hard time even pretending to be relevant.
The 78-point joint statement of the APEC ministers had little to say about its achievements, or lack of them, since its last gathering. Similarly, the 30-point declaration of the APEC leaders and their Shanghai Accord also delivered little of substance.
Rather than confronting its supposed core tasks of seeking to achieve the 1994 Bogor Goals, under which developed members are to remove all trade barriers by 2010 and developing members by 2020, these official communiques were choked with diplomatic and propagandistic generalities — welcoming, endorsing or commending a range of side initiatives that have little to do with the core agenda.
Between the lines, APEC's troubles are still visible. While those documents provided no factual accounts or assessments on the progress towards its goals, there were yet more calls, as in each of the previous six annual summits, to urge members to speed up their implementation schedules.
Despite being endorsed officially, the Bogor Goals have been resisted from the start by some Third World members. This is not surprising, since the mutual reductions of import barriers between unequal economies, which is what "trade liberalisation/market opening" packages amount to, are bound to hit the weaker parties hardest, even despite "concessional" deadlines.
Such weaker economies form the bulk of the APEC membership: China, South Korea, Taiwan, Hong Kong, Singapore, Malaysia, Indonesia, Thailand, the Philippines, Papua New Guinea, Brunei, Vietnam on the Asian side, plus Chile, Peru, Mexico and Russia.
The dominant camp consists of imperialist economies headed by the US and backed by Japan, Canada, Australia and New Zealand. They set up APEC in 1989 to help break Third World resistance to the Uruguay Round of trade talks, which was at that time going nowhere.
APEC's hidden agenda
The US has only recently come clean about this hidden mission, with one State Department fact sheet implicitly admitting APEC's high-profile launch was "an alternative path to liberalising trade talks if global talks were to fail".
Since the successful conclusion to the Uruguay Round in late 1993, and the setting up of the World Trade Organisation in 1995 to police its implementation, APEC seemed to have been given a new mission — to help implement the new global trade regime.
But APEC has always been a pale shadow of the WTO — unlike its far more powerful cousin, it has no teeth.
The non-binding nature of APEC commitments is good news for the Third World countries, as a result they don't suffer as harsh or immediate consequences for not obeying the imperialist countries' dictates. The latter can still twist the arms of the poor countries through other means, but there's more breathing space.
This has contributed to a certain circus feature of APEC. The heads of every member country go along for the show: the annual summits, the national costume parades and more new promises while little real implementation happens on the ground.
To add pressure to ensure implementation of the Bogor Goals, the "Osaka action agenda" was drawn up during the 1995 summit. But Japan, struggling with a devastating recession, immediately declared it would not open up its agricultural sector, prompting China, South Korea, Taiwan and Malaysia to air their own misgivings as well.
Again to speed up implementation, "individual action plans" were pressed through the 1996 Manila summit to force individual members to spell out their market opening schedules. But little came of it before the economic crisis hit a number of Asian members, especially Thailand, Indonesia and South Korea, in the second half of 1997.
This forced the 1997 Vancouver summit to change tack, pressing for an "early voluntary sectoral liberalisation" scheme instead, to achieve opening of 15 selected sectors.
Agreement was sought at the 1998 Kuala Lumpur summit to fast-track the opening of nine of those sectors first, but Japan refused to open its forest and fish products, two of the affected sectors, dealing the scheme a major blow and prompting Mexico and Chile to also openly express their reluctance.
The 1999 Auckland summit then sought to extract agreement to open up the remaining six prioritised sectors but failed.
In a bid to save face, the summit decided to transfer its whole liberalisation agenda to the WTO ministerial meeting later that year in Seattle. However, that meeting's high-profile collapse and the associated failure to launch a new round of trade negotiations have strengthened the resolve of the poor APEC members to continue resisting liberalisation within APEC.
Little headway was made at the Brunei summit last year except for a half-hearted call for a new WTO round, which was repeated at the Shanghai summit.
Regional trade agreements
The relevance of APEC has been further called into question by the recent proliferation of bilateral or regional trade agreements (RTAs), many of which involve APEC members. RTAs, by definition, are arrangements to give selected partners special favours — which can't be anything but contradictory to the WTO (and APEC) principle of non-discrimination among trading partners.
The WTO is aware of this problem and required all members to inform it of the details of any such agreements in order to establish whether they are acceptable. Such investigations started in 1996 and 72 were still underway as of late 1999.
However, many APEC countries initiated their RTAs well after these WTO investigations started. Chile struck its deals with Canada and South Korea only in 1997 and 1998 respectively. Negotiations between New Zealand and Singapore were initiated only in 1999.
The talks commenced since 2000 include: between Singapore and Canada, Singapore and Japan (concluded this month), Singapore and Mexico, South Korea and Japan, South Korea and Thailand, South Korea and New Zealand, the US and Chile. Mexico completed a free trade deal with Israel only last year, and the US has just finalised a deal with Jordan.
APEC doesn't seem to have a strategy to deal with this rush. The Leaders' Declaration of October 21 merely took note of their existence and "reaffirmed" the wishes that they should help build multilateral liberalisation and be consistent with WTO rules and disciplines and APEC goals. But are they? Neither the APEC ministers nor the leaders would say.
However, in APEC's typically lame duck fashion, the leaders put forward yet new ways to tackle the Bogor Goals. They adopted a "pathfinder approach" in Shanghai, seeking to encourage those members who are ready to move forward to do so. They didn't clarify who can't move forward and seemed to believe that there will be enough countries volunteering to lower their trade protection measures even if they weren't reciprocated.
They also announced plans to strengthen the "peer review" of the progress on the individual action plans. As if to hedge against any more visible failure to proceed with the original Osaka action agenda program, the leaders launched the Osaka action agenda Part II, to include harmless and non-controversial efforts to broaden the applications of information and communications technology among members as well as to strengthen their market functioning.
Rather than aiming to review the progress on the implementation of the core goals, say at the summit next year, the leaders declared that a "mid-term stocktake" of the overall progress will take place only in 2005.
They won't have to wait that long to know how far the free trade agenda is going, however: the outcome of the November WTO meeting will determine whether they can be any "progress" on such an agenda at all.