Regional tensions cloud APEC trade talks

JAPAN: Asia-Pacific leaders will meet this weekend to discuss free trade, but the talks come against a sour backdrop of tensions between the world's top economies the United States, China and Japan.

While the goal of the Asia Pacific Economic Cooperation (APEC) forum meeting in Japan is to liberalise trade among its 21 members, that vision remains elusive at a time of economic uncertainty and festering disputes, analysts say.

The United States, China and other economies whose leaders will meet at the APEC talks, and at an earlier G20 summit in South Korea, have sparred over yawning trade imbalances and claims of competitive currency devaluations. Instead of seeking wider trade pacts, they have eyed bilateral deals and smaller groupings to maximise the gain and minimise the pain they would each face by removing barriers to the flow of goods across their borders.

"It was never going to be easy for APEC to aggressively promote free trade in the wake of the financial crisis," said trade expert Deborah Elms of the S. Rajaratnam School of International Studies in Singapore. "The crisis has made leaders wary of new market opening actions. The APEC members have engaged in bilateral or smaller regional deals, but most of these agreements are carefully crafted to exclude the most sensitive sectors."

A proposal that has gathered steam recently is the Trans-Pacific Partnership (TPP), which for now has just four signed-up, small members. The United States has been in talks to join the group, as have Australia, Malaysia, Peru and Vietnam, all hoping to crank up exports to trade their way out of their economic troubles. Yokohama, Tuesday, AFP