Apec summit: leaders eye expanded US-Asia trade

Nearly two dozen Asia-Pacific leaders hosted by US President Barack Obama gathered Saturday for the Apec summit, buoyed by Japan's decision to enter talks on a deal that could revamp US-Asia trade. US plans to reorient on Asia after a punishing decade pursuing wars in Iraq and Afghanistan received a fillip on the eve of the summit when Japanese Prime Minister Yoshihiko Noda joined trade negotiations on Friday.
He was due to meet with Obama later Saturday. The Trans-Pacific Partnership (TPP), signed in 2005 as an obscure arrangement between just four members - Brunei, Chile, New Zealand and Singapore - has suddenly become the cornerstone of a US free trade drive.
The entrance of Japan, the world's third-largest economy, into the talks was seen as imperative if the TPP is to be transformed into a meaningful pact that will knock down trade barriers across the Pacific. "The Trans-Pacific Partnership ministers expect that the leaders of the TPP countries will be able to announce the broad outlines of a high-standard, ambitious, 21st-century trade pact," US Trade Representative Ron Kirk said.
"Of course, many of us believe that TPP can be the basis for a long-term Apec goal: a Free Trade Area of the Asia-Pacific," he told reporters after meeting trade and finance ministers ahead of Sunday's leaders' summit. Experts warned that entry into the negotiations by Japan, which has strong protections for its farming industry, would complicate a process that could now drag on for years.
"To join the negotiations, Japan must be prepared to meet the TPP's high standards for liberalising trade and to address specific issues of concern to the United States regarding barriers to agriculture, services and manufacturing trade, including non-tariff measures," Kirk said. The elephant in the room is China, the world's second-largest economy, which risks being left out in the cold if the trade zone takes off. Beijing has criticised the US ambitions as beyond the reach of developing economies in the fast-growing region.
Ten nations are now in talks for an expanded Trans-Pacific Partnership: Australia, Brunei, Chile, Japan, Malaysia, New Zealand, Peru, Singapore, the United States and Vietnam. The vision is for an initial group of economies to form the core of the grouping. Membership will remain open, with more economies added after they agree to the same commitments as existing members.
Several other countries in the Asia-Pacific Economic Co-operation forum, including Canada and Indonesia, have said they may join the TPP. Even China said it was considering it, although the United States is insisting on tough conditions that may preclude Beijing's entry.
The implications for a trans-Pacific FTA are enormous, especially with the Doha Round of global trade talks still in limbo. The 10 countries already involved in negotiations account for more than a third of global output. In Honolulu there was a tight security blanket around the hotel where Obama and wife Michelle were staying. Obama hosts the Apec summit at the start of a nine-day Pacific tour that seeks to leave the economic gloom of America and Europe behind and look towards a region that is vital to future US prosperity.