While the Clinton administration has struggled with free-trade concepts such as NAFTA and the international GATT treaty, a special task force is urging even more ambitious steps, namely a free-trade zone covering the entire Pacific.
The plan seeks to convert the region into a free-trade zone and to eliminate all barriers and tariffs by the year 2020, with rich nations like the United States and Japan reaching that goal by 2010. Some implementation would start by the year 2000.The proposal aims for free trade between all Asia-Pacific Economic Cooperation countries across the board in goods, services, capital and investment. That would be a major leap forward in one of the world's fastest growing markets, but it won't happen without significant conflict and growing pains.
Countries involved in the APEC include Australia, Brunei, Canada, Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, China, Philippines, Singapore, South Korea, Taiwan, Thailand and the United States. Chile is expected to join later this year.
The APEC nations account for about half the global economy and 40 percent of world trade.
The free-trade idea, while enormous in scope, is not the scheme of some radical group. The 90-page plan was drafted by a task force of businessmen, economists and former government leaders from 17 countries in the region. The proposal was adopted unanimously.
The plan will be presented to the APEC nations at the group's annual meeting in November. It is being held in Indonesia this year, and President Clinton will be among those attending.
If such a free-trade zone were to become reality, it undoubtedly would mean the end of the hassles between the United States and Japan over trade barriers and closed markets. Such obstacles would largely cease to exist. That the Japanese delegate to the task force voted in favor of the plan is encouraging.
However, while the plan would open some now-difficult markets to U.S. goods, free trade also works the other way and the American market would be opened even wider to a region already known for a combination of high-tech industrial growth and low wages for workers.
The challenge would be tremendous. But in a shrinking world, free trade is the only realistic answer to success in a global economy. The sooner the United States and other in the Pacific get to work on that concept, the sooner the problems can be faced and resolved.