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Abstract
In 2004 and 2006, proposals were made at APEC summits to establish a Free Trade Area of the Asia-Pacific (FTAAP). This was an essentially a reworking of an idea first raised in the mid-1960s to create a Pacific Free Trade Area, or PAFTA. Although the PAFTA initiative never advanced, it helped lay the first organizational foundations for regional economic community building in the Asia-Pacific. The recent FTAAP proposal thus brings us full circle to the antecedent origins of APEC itself. If realized, an FTAAP would also create a free trade zone that would encircle the Pacific Rim economy and thereby subsume the region's now large number of bilateral and sub-regional free trade agreements (FTAs) into one unified agreement. Yet there are many inherent problems with establishing an FTAAP. These broadly relate to deconstructing the preferentialism of existing bilateral and sub-regional FTAs, achieving a consensus on the technical policy content and ideational principles on which an FTAAP would be based, and addressing various geopolitical issues such as reconciling the formation of a pan-regional Asia-Pacific FTA with an already fragile multilateral trading system. Growing interest in a ‘rival’ East Asia Free Trade Area project presents another geopolitical challenge. In considering these and other questions, it is concluded that many obstacles will remain in the path to realizing an FTAAP, and that this may not actually be a desirable objective to pursue for some time yet.
Christopher M. Dent is Reader in East Asia's International Political Economy, Department of East Asian Studies, University of Leeds, UK. His research interests centre on the international political economy of East Asia and the Asia-Pacific. He is more specifically interested in East Asian regionalism and regionalization; new trade policy developments in the Asia- Pacific; the foreign economic policies of Singapore, South Korea and Taiwan; East Asian developing countries, multilateralism and globalization; East Asia's economic relations with the European Union; and theories of international economic security. Published books include East Asian Regionalism (Routledge, 2008); New Free Trade Agreements in the Asia-Pacific (Basingstoke: Palgrave Macmillan, 2006); Asia-Pacific Economic and Security Co-operation (editor, Basingstoke: Palgrave Macmillan, 2003); The Foreign Economic Policies of Singapore, South Korea and Taiwan (Cheltenham: Edward Elgar, 2002); Northeast Asian Regionalism: Learning from the European Experience (co-editor, London: RoutledgeCurzon, 2002); The European Union and East Asia: An Economic Relationship (London: Routledge, 1999); The European Economy: The Global Context (London: Routledge, 1997); and Core Economics (co-editor, London: Heinemann, 1995). Christopher Dent is also author of around 50 academic articles and other papers. He has acted as a consultant advisor to the British and US governments, and European Commission on trade issues, as well an invited speaker at conferences and other events in Asia, Europe, North America, Latin America, Africa and Oceania. Christopher Dent is also an Expert (Brains Trust) member of the Evian Group.
Notes
1 Kojima's PAFTA consultation dialogue laid the foundations for the first PAFTAD held in 1968, and was also sponsored by Japan's Ministry of Foreign Affairs through the JERC (CitationRavenhill 2001). PAFTAD conferences provided an important framework for early technical discussions on enhancing regional economic co-operation, including how PAFTA could be realized. Meanwhile, PBEC was based on an existing Japan–Australia private-sector forum that was extended to include other PAFTA-based representations from the United States, New Zealand and Canada.
2 Research interviews, Canberra, August 2003. Japanese and Australian members with prior deep involvement in the PAFTAD and PECC processes especially advocated the case for open regionalism.
3 Research interview with APEC member ex-trade minister.
4 APEC 2005 Leaders' Declaration, or Busan Declaration, 18–19 November, p. 2.
5 Washington Post, 20 November 2006.
6 Malaysia Minister of International Trade and Industry press release, 11 November 2006.
7 Bangkok Post, 10 November 2006.
8 The Nation, 18 November 2006.
9 Washington Post, 20 November 2006.
10 New York Times, 14 April 2002.
11 For example, the United States reportedly wanted to incorporate a twenty-five-year period rule for enforcing drug patents in its FTA negotiations with Thailand during 2005, thus looking to extend beyond the twenty-year period norm under TRIPS. Asia Times, 14 April 2005.
12 This followed from a report published in April 2006 by Japan's Ministry of Economy, Trade and Industry entitled Japan's Global Economic Strategy that recommended the launch of an EAFTA project based on the country's ‘Economic Partnership Agreement’ model (CitationMETI 2006).
13 Financial Times, 15 November 2006.
14 Japan advocates the inclusion of Australia, New Zealand and China, whereas China is against their inclusion.
15 Bergsten believed that the FTAAP would serve as a ‘credible political jolt’ to the European Union, India and Brazil into making new offers in the Doha Round (Agence France-Presse, 11 November 2006). Similarly, Downer commented that the FTAAP would be ‘a way of reminding the Europeans that there is greater virtue in a successful conclusion to the Doha round’ (Bloomberg News, 19 November 2006).
16 For example, Australia's ABAC representative Peter Charlton stated that: ‘Although the best position is to have a successful outcome to the WTO negotiations, the primary position is that if everything else fails and the WTO fails on the Doha Round, then the FTAAP is the secondary choice’ (Business Times, 14 November 2006).
17 Agence France-Presse, 11 November 2006.
18 Japan Times, 24 November 1994.
19 An official analysis on the FTAAP's trade creation and diversion effects is likely to follow after the decision taken at the 2006 APEC summit to study the proposal further.
