Committed to PEOPLE'S RIGHT TO KNOW
Vol. 5 Num 820 Sat. September 16, 2006  
   
Business


Japan eyes leading role in regional trade


Amid growing concern that Japan could be left behind by the proliferation of regional trade agreements, the government recently floated a proposal for what it describes as a comprehensive economic partnership for East Asia.

Economy, Trade and Industry Minister Toshihiro Nikai presented the proposal, which would involve Australia, China, India, Japan, New Zealand and South Korea as well as 10 Southeast Asian nations, on Aug 24 when he met with his counterparts from these countries in Kuala Lumpur.

The proposal was followed by the conclusion on Saturday (Sept 9) of an economic partnership agreement between Japan and the Philippines, a development that is expected to give rise to further calls to create a regional free-trade system in Asia.

The proposed East Asian economic partnership agreement aims to make Asia a "high-quality economic bloc" by eliminating tariffs on manufactured goods and agricultural, forestry and marine products within the trading area.

The plan also envisages the liberalisation of investment and services and the adoption of a common set of rules to protect intellectual property rights.

Nikai and his counterparts in the Association of Southeast Asian Nations agreed to start studying the proposal in 2007.

The combined population of the 16 countries in the proposed trading area stands at 3.1 billion people, accounting for almost half of the world's total population.

Their combined economic strength is equivalent to more than USS$9 trillion in terms of nominal gross domestic product, compared with US$12.7 trillion for the European Union and US$13.3 trillion for the North American Free Trade Agreement market.

If a regionwide EPA is realised in East Asia--which is widely anticipated to be at the center of global economic growth in the 21st century--Japan could increase its GDP by 5 trillion yen (US$42.49 billion), while the 16 countries combined could see their GDP grow by 25 trillion yen, according to projections by the Economy, Trade and Industry Ministry.