Editorial: Clark takes fuzzy attitude to Apec

A club is only as strong as the commitment of its members. That is as true of Apec as of any voluntary association. Until now, New Zealand has been one of the most strongly committed members of the Asia Pacific Economic Co-operation agreement. We invested a great deal of diplomatic effort last year in taking our turn to chair the association and host its conferences. How unfortunate that as Prime Minister, Helen Clark should talk it down.

A host country retains some influence on the Apec agenda as it hands the baton to the next host. It was disturbing to hear Helen Clark predict months ago that Apec "won't get any steam this year" because Brunei was too small to force the pace.

Last week, she looked forward to a "better balanced" resolution at Brunei. Auckland had focused too much on trade liberalisation, she said. The Brunei communique (they are largely written in advance) would see more emphasis on disparities of wealth and knowledge, skill development and social safety nets. These are important but there is not much chance of improving them without trade liberalisation.

Trade generates wealth. If the poorer states of the world are to begin to catch up to the rich, they will need easier access to rich countries for products they can produce at lower cost. Likewise, they will develop knowledge and skill only through more investment from companies based in rich countries. Their social safety nets can only be improved in step with their economies.

Poorer countries know these things and they suspect - usually quite rightly - that when trade forums start talking about changing the emphasis to disparities and social safety nets, they are hearing excuses to protect the wages of the well-off.

Again last week Helen Clark declared Apec to be, "running out of some steam." She gave that as a reason for signing a free trade agreement with Singapore yesterday and any other such deals New Zealand might do. Direct agreements, she believes, are the way trade liberalisation is more likely to progress for the time being. She may be right, but it is no reason to slacken or confuse our efforts in regional and global forums.

The drive to lower trade barriers everywhere proceeds on several fronts. When talks are struggling to make progress on the main front, at the World Trade Organisation, regional initiative can help. Apec was most effective in 1992 when the Uruguay Round was in danger or failing. Last year at Auckland Apec was content to make recommendations for a new global negotiating round that seemed likely then to be launched by the WTO at Seattle in November.

This year, Apec meets in quite different circumstances. Seattle saw a deep divide between least developed countries, which want the Uruguay agreements honoured before a new round is launched, and rich countries where protectionism is having a noisy resurgence in the name of anti-capitalism.

There is no likelihood of a WTO round for the time being, but that is no reason to soft-pedal Apec, too. Quite the contrary. Apec is essentially a club of rich countries. Some of the larger members have always been reluctant trade liberalisers but they have been kept to the principles of the club by smaller countries such as ours, which have most to gain by easier access to larger markets. If the new Government has lost sight of that goal in preparing for Brunei, it has let us down.

Herald Online feature: Apec