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China, Japan, Korea forge closer economic links

China, Japan, Korea forge closer economic links

China, Japan and South Korea agreed on Friday to forge closer economic links in a move towards closer integration that could lead to the establishment of a new permanent political grouping in East Asia.

The agreement came ahead of talks with 10 Southeast Asian leaders who put aside their many domestic problems for a while to thrash out ways of develop closer links of their own so they can better cope with fast changing global economic trends.

Chinese Premier Zhu Rongji said he had agreed with Japanese Prime Minister Yoshiro Mori and South Korean President Kim Dae-jung that economic organisations in the three countries would start next year to provide their governments with joint advice.

"We had very good talks on a wide range of issues including economic and trade cooperation, the exchange of personnel, cooperation in information, technology and environment, and a lot of other issues," Zhu told reporters after the breakfast meeting.

He said the three countries would also form a committee to exchange ideas on information technology.

A Japanese Foreign Ministry official said the three leaders would keep meeting regularly on the sidelines of Association of South East Asian Nations (ASEAN) gatherings and might widen the range of their discussions.

"Although this is currently confined mostly to economic issues, it could conceivably broaden after successive meetings into becoming a forum on security and political issues as well," the official told reporters.

Indeed, Zhu said he would suggest next year turning the informal group into an East Asia Forum. "It is a good idea but we didn't talk about it (today)," he said.

The talk of institution-building in East Asia reflects a desire by both Japan and China to project their economic clout onto the diplomatic stage at a time of rapid change, epitomised by the opening-up of Stalinist North Korea to the outside world.

FREE TRADE NERVES

Zhu made no mention of the idea of a free trade pact between China and ASEAN that Beijing officials floated in the run-up to the Singapore summit.

Southeast Asian governments publicly welcomed the idea on Thursday, but privately they are nervous that a flood of cheap Chinese imports would swamp their markets.

Even without tearing down trade barriers, they fear that China, which is already attracting much more foreign investment than Southeast Asia, will become a fiercer competitor once it joins the World Trade Organisation.

For several of the leaders, the informal summit is a welcome break from troubles at home.

Philippine President Joseph Estrada is facing a Senate impeachment trial on charges of taking bribes from illegal gambling syndicates.

Mori, deeply unpopular at home, won a last-minute reprieve in a no-confidence vote on Tuesday that would have cost him his job.

Indonesian President Abdurrahman Wahid is struggling with a string of crises ranging from a separatist rebellion in Aceh province to turmoil at the top of the country's central bank.

Against this dark background, leaders are grappling with how to breathe life into ASEAN, a 33-year-old institution whose cast-iron respect for the principle of non-interference hobbles its ability to act decisively.

One uncontroversial step they agreed on Friday was a so-called "e-ASEAN initiative" to link the region's various computer systems and bring all the diverse bloc's members up to speed on the information superhighway.

The task is daunting. While nearly one in three Singaporeans surfs the Internet, only one in 15,000 Cambodians logs on. In Laos, the number is so small as to be statistically negligible.

To prime the pump, private-sector giants such as Oracle, General Motors and Coca-Cola have joined companies in Thailand, Malaysia, Singapore and Brunei to develop Internet portals for sectors such as real estate, tourism and auto parts.

ASEAN comprises founding members Singapore, Malaysia, the Philippines, Thailand, Brunei and Indonesia plus newer entrants Myanmar, Laos, Cambodia and Vietnam.


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