S-E Asia ‘must take lead to help define world trade agenda’
Iseas conference on South-east Asia in the 21st century
SOUTH-EAST Asia’s market economies must take the initiative in helping to define the world’s trade and economic policy agenda beyond the Uruguay Round of the General Agreement on Tariffs and Trade (Gatt), a leading Australian economist urged yesterday.
Washington had lost the will to lead in world trade, having succumbed largely to the view that multilateral free trade was not viable politically, said Dr Ross Garnaut, an economics professor at the Australian National University.
But the Asia-Pacific Economic Cooperation (Apec) forum was the ideal vehicle for reconciling market economies on both sides of the Pacific, he said.
Delivering the keynote address at an international conference on South-east Asia, Dr Garnaut urged South-east Asian market economies to continue championing the superiority of a multilateral framework of free trade that engages Western Pacific powers – most crucially the United States and Japan – in an open regionalism.
The three-day conference at the Marina Mandarin Hotel, organised by the Institute of South-east Asian Studies (Iseas), is weighted heavily towards regional economic issues.
Dr Garnaut said Apec, which encompasses North American and Western Pacific economic interests, was critical in defining the international trade and economic policy agenda beyond the Gatt because the South-east Asian model of trade creation and expansion that it supported could be favourable for all countries involved.
Gatt trade negotiations had assumed that liberalisation was a concession, where member-countries gained advantage by withholding it. But in the South-east Asian trade model, countries determined that they would benefit more from keeping their borders open rather than closed.
Protectionism in North America and Europe, Dr Garnaut warned, was dangerous because it could prompt a regionalist response from the Pacific Rim.
Other speakers, including Dr Narongchai Akrasanee from Thailand’s General Finance & Securities Co agreed, warning that Apec must not be an inward-looking trade bloc, but should instead encourage further trade liberalisation among members.
Dr Narongchai said the time was ripe to pursue Apec further because Washington and Tokyo, both under new leaders, were expressing strong interest in improving economic ties with the region.
Apec was formed in 1989 as a loose consultative forum to promote free trade and economic co-operation among Pacific Rim countries. The 15-member forum groups the six Asean member-states, the United States, China, Japan, South Korea, Taiwan, Hongkong, Canada, Australia and New Zealand.
In her speech, Dr Anne Booth of the University of London’s School of Oriental and African Studies, said while South-east Asia recorded phenomenal growth, East and West Asian countries were becoming potential competitors quickly.
To stay competitive, South-east Asian economies must focus on increasing labour productivity through education and training, she said.
She said only national governments, not economic groupings, could help develop a professional and managerial middle-class with the confidence and capacity to develop new products and markets.
Meanwhile, said Dr Ismail Salleh from the Institute of Strategic and International Studies, within the region, countries could reduce inefficient competition by accelerating cross-border tariff cuts, formulating common strategies for investment and tourism, and human-resource development.
Today, the conference focuses on Indochina. Tomorrow, the agenda turns to Apec and the concept of the Pacific Century.
The conference, “South-east Asia, Challenges of the 21st Century”, marks 25 years of scholarship on the region by Iseas.
More than 300 regional business leaders, senior diplomats and top academics, including old Asia hands Dr Michael Leifer of the London School of Economics and Harvard University’s Ezra Vogel, are taking part.