Japan's Foreign Policy in the Asia-Pacific,
and the Significance of APEC
Speech Given by Minister for Foreign
Affairs Yohei Kono
at the Kansai Press Club
15 November 1995
Introduction
Thank you for this opportunity to explain some of my ideas to the Kansai media prior to the APEC Ministerial Meeting in Osaka.
The APEC Meetings in Osaka represent a historic and valuable opportunity for Japan to promote regional cooperation in the region, and it may well be said that ensuring their success is one of the most important tasks of Japanese diplomacy this year.
Even though certain factors require close attention, among them the situation on the Korean Peninsula and the future of great powers, such as China and Russia, in the region, the Asia-Pacific region today after the Cold War shows bright signs, particularly the settlement of conflict in Cambodia and Viet Nam's recent normalization of diplomatic relations with the United States and its admission to ASEAN. Against the background of the region's political and social stability, trade and investment within the region are expanding, and multilateral, interdependent relationships are developing in a dynamic fashion. In the midst of this progress, it has become even more important that we strengthen cooperative efforts in the Asia-Pacific, an integral region exhibiting remarkable growth, and that we promote even greater levels of stability in the region. This will contribute to the stability and prosperity of the entire world, and it is also important as we advance Japan's national interests over the medium to long term.
The main thrust of Japan's regional cooperation with the Asia-Pacific in the economic sphere focuses on APEC. As its very name, "Asia Pacific Economic Cooperation," indicates, the 18-member APEC is a framework whose goal is sustainable economic growth in the Asia-Pacific region achieved through mutual cooperation among all member economies, or, in more concrete terms, through the liberalization and facilitation of trade and investment and through economic and technical cooperation. Achieving a free and open market through cooperation within APEC-an extensive region holding great potential-will bring great economic benefits for all members, including Japan. Furthermore, if regional cooperation in the Asia-Pacific expands, this will establish a strong base for the enjoyment of common benefits among Japan and its major partners, particularly the United States, China, the Republic of Korea, and the countries of ASEAN, and this will enhance mutual trust and foster a sense of community within the region.
APEC: Its Special Characteristics and Significance
Next I would like to discuss APEC's special characteristics and its significance.
Firstly, APEC represents the first-ever inter-governmental framework of regional cooperation in which much of the entire region of the Asia-Pacific is joined. APEC members enjoy the greatest economic growth, and as such form a region that is the focus of world attention. I am convinced that efforts taken to further strengthen the cooperative ties among members of the region will contribute significantly to greater prosperity for the people of the region and will thus boost economic growth in the entire world.
APEC's second special characteristic is seen in the fact that it is a loose forum for consultations and cooperation. APEC is composed of members who are extremely diverse politically, economically and socially, and their levels of economic development and degrees to which trade and investment have been liberalized are widely different. For example, we have populations ranging from China's 1.2 billion to Brunei's 260,000, and we have per-capita GNP from Japan's US$31,000 to China's approximately US$500. And given this vast diversity, it would not be practical to look for a legalistic framework imposing rights and obligations on all members in a uniform fashion.
The third special feature of APEC I would like to touch upon is the fact that it has, since its inception, stood out from other types of regional frameworks, classified as customs unions and free trade areas, such as the EU and NAFTA, by embracing the ideal of "open regional cooperation." This type of cooperation proceeds on the premise of non-discrimination both within and without the region. It is not only consistent with the multilateral free trade system but is also effective in complementing and strengthening it.
Endowed with these unique characteristics, APEC has made notable advances in recent years. This is so, I believe, because Asia-Pacific countries and regions-indicative of the confidence they have developed in recent years during an era of remarkable economic growth, are now rapidly moving forward to open their markets, deregulate, privatize, and foster cutting-edge industries.
Per-capita income in Hong Kong and Singapore is now very close to that in Japan, and the economies of Chinese Taipei, the Republic of Korea, and the countries of ASEAN are growing remarkably. Asia now has many people doing business vigorously in fluent English with the countries of Europe and North America. Asian countries have indeed reached a high stage of internationalization. It is these economic realities which have made it possible for cooperative efforts within APEC to promote open regional cooperation.
One sometimes hears debate in some quarters in Japan over whether we should choose Asia or the United States; but if we consider these realities exhibited by the Asia-Pacific region, we see that such a question is completely meaningless.
Japan's Policies in the Context of the APEC Meetings in Osaka
Next I would like to discuss the significance of the upcoming Osaka meetings and Japan's policies seen in the context of the meetings.
First of all, the Economic Leaders' Declaration adopted in Bogor last year expresses the political will to achieve free and open trade and investment no later than 2010 for industrialized economies and 2020 for developing economies. The most important task of the Osaka meetings is to formulate an Action Agenda to translate this will into more operative form. In adopting the Action Agenda, APEC will move from "concept" to "action." Japan is determined to fulfill its responsibilities as Chair in the drafting of the Action Agenda. This is important not only from the viewpoint of Japan's economic development but also in terms of providing the peoples of the Asia-Pacific with concrete guidelines for cooperation and economic development over the medium to long term.
The priority in this Action Agenda is on measures that further encourage the vigorous business activities in the region, and it intends to promote, in addition to liberalization measures in the narrow sense of the term such as tariff reduction and the removal of non-tariff barriers, the simplification and harmonization of customs procedures of all members within the region, the alignment of product standards with international standards, the liberalization of investment, expediting the movement of business people, and other such facilitation measures.
Japan is not opposed to the comprehensive coverage of sectors in liberalization. However, with regard to the liberalization of certain sectors, such as Japan's agriculture, in which members may experience difficulties, we believe that it is important that a realistic and flexible approach be available, and we have been emphasizing this point.
As Chair this year, Japan is working hard to draft a substantive Action Agenda, and I am convinced that we will be able, in the end, to arrive at an Action Agenda which all APEC leaders will be proud of.
Secondly, economic and technical cooperation is important as a means to further encourage economic activities within the region by reducing economic disparities within the region and alleviating bottlenecks to economic growth. Addressing these disparities will also make it easier to achieve liberalization and facilitation of trade and investment. APEC has, since its establishment, been implementing concrete projects in the field of economic and technical cooperation, and I believe that economic and technical cooperation should continue to be recognized as one of the three pillars of APEC activities, along with trade and investment liberalization and their facilitation. In the APEC region, it has become important that assistance be provided not vertically from developed to developing economies as in the conventional sense but horizontally, with members offering each other capital, technology, and know-how, and thereby helping each other. This is why Japan is proposing a mechanism called Partners for Progress (PFP). PFP takes as its fundamental principles the mutual support among and the voluntary actions of all members, and promotes, in a more efficient manner, economic and technical cooperation within APEC. We have every expectation that PFP will be adopted formally in the upcoming Osaka meetings. For the time being, Japan is considering the use of this PFP mechanism to implement human resources development projects in sectors contributing to the liberalization and facilitation of trade and investment--especially standards and conformance, industrial property rights, and competition policies.
Thirdly, in order to demonstrate their strong determination to proceed with liberalization, each member is expected to report in Osaka on the biggest package of specific measures it can now take for liberalization and facilitation. As Chair, Japan will take the initiative in presenting its substantive Initial Actions, such as acceleration of the Uruguay Round commitments and deregulation.
Liberalization under APEC does not proceed through negotiation but is based on voluntarism. However, if actions are taken by members only in a voluntary manner, APEC's integration and orientation can become blurred. For this reason, APEC members decide upon common principles and guidelines within the Action Agenda beforehand, then follow these while pushing forward with voluntary liberalization in a concerted way and taking collective actions within APEC as a whole. This can be called the "Asia-Pacific Way." It is a unique way, and it is adopted because of what I referred to as APEC's being a loose forum and because of the diverse nature of APEC's members. This Asia-Pacific Way will bring success to liberalization efforts and, if adopted in other parts of the world, would be a great achievement for APEC.
A Message to the People of Osaka
From all of this, we can say that development in APEC has been possible in good measure because of the dynamic expansion of cross-border activities, in light of the realities created by the global activities of Asia-Pacific business people. From this we can gather that the prime movers within APEC are, together with governments, the private sector and local communities. In the same vein as the growth triangle centering on Singapore, Johore in Malaysia, and Riau in Indonesia, we can see examples where regions are joined to other regions across borders, enabling the free movement of people, goods, capital, and information and resulting in economic development. Exchanges tying regions together contribute to the feeling of integration as an Asia-Pacific community.
Turning now to Japan, the strength of the Kansai economic area is now said to equal the GDP of Canada, and the opening of the New Kansai International Airport is greatly stimulating economic exchanges with the Asia-Pacific region. Kansai has long had a history of promoting exchanges with the Asian region. The upcoming APEC Meetings in Osaka represent the first summit meetings to be held in Japan outside of Tokyo. The holding of the APEC Meetings in Osaka has symbolic significance that will translate into the further deepening of economic ties between Kansai and the Asia-Pacific region. I know that for many years it has been the custom of the Kansai economic community to let the private sector blossom as much as possible. This tradition closely matches APEC's basic concepts. I am convinced that APEC's further development will lead to greater prosperity for the Kansai economic area.
In addition, holding the meetings in Osaka will result in foreign leaders, dignitaries, and many other people coming to visit, thereby providing an opportunity for Kansai, as the center of Japanese traditional culture, and for the great metropolis of Osaka, as a center of commerce which has flourished for so long, to make a favorable impression on the rest of the world.
I would like to take this occasion to express my heartfelt gratitude to the many people, including volunteers, who have willingly given of their energy and labor to ensure the success of the upcoming APEC Meetings in Osaka. And finally, let me tell you of the deep respect and admiration I feel after seeing how the people of this region have combined forces to strive so hard to recover after the terrible tragedy caused by the Great Hanshin/Awaji Earthquake at the beginning of this year. I trust that the APEC Meetings in Osaka will provide an opportunity for reconstruction of the affected areas and for further development.
Thank you.
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