International Trade Daily™ Source: International Trade Daily: News Archive > 2014 > November > 11/07/2014 > News > Regional Agreements: APEC Secretariat Says Negotiations Over FTAAP Never Under Discussion Regional Agreements APEC Secretariat Says Negotiations Over FTAAP Never Under Discussion By Leslie A. Pappas Nov. 6 — Senior officials of the Asia-Pacific Economic Cooperation (APEC) forum never expected meetings in Beijing to kick off negotiations for a Free Trade Area in the Asia Pacific (FTAAP), the head of the APEC Secretariat said in a press briefing in Beijing Nov. 6. Dr. Alan Bollard, executive director of the APEC Secretariat, said APEC senior officials who met Nov. 5 and 6 agreed to promote an “information sharing mechanism” about regional trade agreements and launch a two-year study to “investigate the possibility of a free trade area for Asia and the Pacific in the future,” but that FTAAP negotiations themselves were not formally discussed. “Was there expectations on negotiating or announcing negotiating FTAAP? No, I don't believe so. I don't believe that was ever the case,” Bollard said. “And anyway, if it were to be negotiated, it wouldn't necessarily be done within APEC because APEC has no tradition of legal negotiations. That would have to be carried out along the side of APEC.” Published reports say that China was planning to use the APEC summit in Beijing to promote FTAAP and the U.S. had blocked those efforts (214 ITD, 11/5/14). BNA Snapshot Key Development: APEC Secretariat says ministers may launch two-year report on Free Trade Area of the Asia Pacific (FTAAP), adding that APEC never discussed negotiations. What's Next: APEC Ministerial Meeting in Beijing Nov 7-8. Overlapping and Fragmented The U.S. has spent two years trying to negotiate the Trans-Pacific Partnership (TPP), a 12-member free trade bloc that would exclude China. After TPP talks stumbled during meetings in Sydney in October, Japanese Economy and Finance Minister Akira Amari announced that TPP would hold a ministerial meeting in Beijing on Nov. 8 ahead of the APEC Economic Leaders' meeting Nov. 10 and 11 (211 ITD, 10/31/14). Wang Shouwen, an assistant minister with China's Ministry of Commerce, said at a press briefing Nov. 4 that the APEC meeting was not meant to be a venue for TPP negotiations. China, meanwhile, has been involved in negotiating the Regional Comprehensive Economic Partnership (RCEP), a trade pact among 12 different APEC members. China's Foreign Minister Wang Yi said on Oct. 29 that working toward FTAAP could “help consolidate” the region's various bilateral and multilateral pacts and “minimize the risks caused by overlapping and fragmented free trade arrangements.” More Detailed Study Bollard said the two-year study that APEC would undertake on the FTAAP will be “much more detailed” than what has been done in the past and would take into account developments since 2006, particularly those around TPP and RCEP. “We want to know how those are likely to converge,” Bollard said. “will [it] be in the direction of an FTAAP? Or could they set economies off in different directions? APEC would like to see them converging. And this study will help give us directions about whether that's happening or not.” China's choice to focus on FTAAP this year is a good sign for APEC potentially playing a larger, more effective FTAAP role than it has so far, according to Malcolm Cook, a senior fellow at Singapore's Institute of Southeast Asia Studies, who published a paper in October titled, “FTAAP and APEC: Wrong Goal, Wrong Institution.” “However, announcing another FTAAP feasibility or scoping study 8 years after the first of these was announced, even if this one is more detailed, shows how little has happened with the FTAAP idea since it was first promoted by the APEC Business Advisory Council in 2004,” Cook told Bloomberg BNA in an e-mail exchange Nov. 6. Many academics and economists “have already done extensive studies on the benefits of an APEC-wide FTAAP based on either the RCEP or TPP pathways so it is not so clear what another scoping report, even if it is announced by APEC leaders will add,” Cook said. Cook said it is not true that APEC has no history as a trade negotiation body. “It tried to do exactly this in the late 1990s and failed, a failure that led to a significant loss of momentum for APEC as an institution,” Cook told Bloomberg BNA.“With all recognizing that APEC will not [be] the FTAAP forum for negotiation, it may be better for APEC leaders to focus on shorter-term, more certain outcomes in the trade facilitation area.” Other Initiatives Proposed Bollard said that APEC ministers of APEC's 21 member economies “are likely to agree to some principles about what FTAAP should cover,” during their upcoming meeting Nov. 7-8. In addition to a resolution on FTAAP, APEC ministers are also likely to release a provisional “connectivity blueprint,” a brief principles document that will be accompanied by a more detailed report on improving connectivity in the Asia-Pacific region through infrastructure, institutions, and people, Bollard said. Ministers will also consider a number of initiatives, including some on the green economy and environmental issues, the “blue economy” and initiatives about the oceans, internet economy, urbanization, disaster recovery and the Beijing statement on anti-corruption. An APEC ministerial joint communique is slated for Nov. 8. To contact the reporter on this story: Leslie A. Pappas in Beijing at [email protected] To contact the editor responsible for this story: Jerome Ashton at [email protected] For More Information Malcolm Cook's paper is available at http://www.iseas.edu.sg/documents/publication/ISEAS_Perspective_2014_50.pdf. Text of Yi's speech is available in English at http://news.xinhuanet.com/english/china/201410/30/c_133754641.htm. Contact us at http://www.bna.com/contact/index.html or call 1-800-372-1033 ISSN 1533-1350 Copyright © 2014, The Bureau of National Affairs, Inc.. 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