APEC-SOUTH KOREA: Pussyfooting On Pacific Free Trade (1)

By Suvendrini Kakuchi Reprint | | Print |

Suvendrini Kakuchi

TOKYO, Nov 11 1994 (IPS) - An eye toward expanding business ties with the fast-growing economies of South-east Asia is keeping South Korea from going all out in its support for a proposed free trade zone in the Pacific Rim.

One of the founding member-economies of the Asia-Pacific Economic Cooperation (APEC) that holds a summit next week in Bogor, Indonesia, South Korea believes it has only to gain from liberalised trade in the region.

But it is also keen not to upset the members of the Association of South-east Asian Nations (ASEAN), most of whom are wary of a plan to have a free trade zone in the APEC region by the year 2020.

ASEAN groups Brunei, Indonesia, Thailand, the Philippines, Malaysia and Singapore, all of which were taken by surprise when the proposal was made in August, just a few days after they finalised the ASEAN’s own plan to have a free trade area.

Aside from the ASEAN six, APEC includes South Korea, Japan, China, Hong Kong, Taiwan, the United States, Canada, Mexico, Papua New Guinea, Australia and New Zealand. Chile becomes a full-fledged member Saturday.

Although Singapore has eagerly supported the APEC suggestion, Malaysia has clearly said it would fight it all the way while the other ASEAN members are unhappy about having a timetable.

ASEAN is the fourth largest trading partner of South Korea after the United States and Japan. Trade between the ASEAN during the first eight months of this year was valued at 1.11 billion dollars, just slightly less than the European Union (EU).

Korean experts say trade with ASEAN will overtake that with the EU soon, and this is now making Seoul take a low profile on the current debate within APEC.

Analysts say South Korean President Kim Young Sam’s three-day state visit to the Philippines prior to the APEC summit is one indication of the importance Seoul is giving South-east Asia.

They also say Kim’s having 48 top businessmen with him during the trip in South-east Asia underscores South Korea’s determination to strengthen its presence in that region.

Observed the Korea Herald newspaper recently: “This is a departure from previous practice because Kim, unlike his predecessors, has not allowed businessmen to board the presidential airplane as part of his efforts to cut the collusive links between politics and business.”