Renewed Liberalization and Speculative Drive in Bangkok
An Analysis of the APEC Leaders’ Oct. 18-20 Summit

In their statement, "Bangkok Declaration on Partnership for the Future," the heads of state of APEC countries led by U.S. President George Bush called on regional trade bloc to "take the lead" in reviving the stalled process of trade liberalization pushed by the United States in the failed World Trade Organization (WTO) Cancun Ministerial Meeting last September. As targeted in the Bangkok Declaration, financial speculative fever instead of genuine industrialization -- as what the Ramos administration offered in the Philippines from 1992 up to the 1997 financial crisis -- nonetheless remains at best a cosmetic change in the APEC economies.

By Ricco Alejandro M. Santos
Bulatlat.com

Reminiscent of the Philippines under Marcos in the 1970s, huge billboards appeared, hiding prominent Thai slums in the heat of preparations for the recent leaders’ summit of the Asia-Pacific Economic Cooperation (APEC). Then Thai police rounded up garland vendors, prostituted women, beggars and the homeless, flying them in army planes to the provinces.  Anti-globalization protesters were barred from entering the country. Finally, Prime Minister Thaksin Shinawatra warned local media people against "negative" stories about Thailand.  

These pre-conference cosmetic changes in Bangkok, Thailand in defense of the status quo and to the exclusion of the urban poor set the tone for the APEC Leaders' Meeting held there on Oct. 18-20.

The  APEC is an alliance of 10 governments of industrialized countries led by the U.S. and Japan, and of 11 third world governments, including the Philippines.   Although non-binding, its decisions have greatly spurred third world governments in the Asia-Pacific region to unilaterally open up their economies faster than the WTO timetables.

In their statement, "Bangkok Declaration on Partnership for the Future," the heads of state of the APEC countries led by U.S. President George Bush called on the regional trade bloc to "take the lead" in reviving the stalled process of trade liberalization pushed by the United States in the failed World Trade Organization (WTO) Cancun Ministerial Meeting last September.   The statement called on APEC to "reenergize the negotiating process," stressing that "flexibility" and "political will"-- compliance to U.S.-European Union demands -- are "urgently needed to move the negotiations to a successful conclusion."   They "[instructed] Ministers to take concrete steps to make APEC's trade agenda more supportive of the work of the WTO."  This thrust of the Bangkok summit reaffirmed APEC's role as key facilitator of the WTO trade liberalization agenda, a role it played in helping jumpstart talks building up to Cancun.

Primary of multilateral trading

The delegates upheld "the primacy of the multilateral trading system" of the WTO as a trade policy-making body, highlighting the Bush administration and U.S. business' continuing trust in the WTO as their main global "free trade" enforcer.  This plank followed the advice of the APEC Business Advisory Council (ABAC), a body of top corporate policymakers and executives, that negotiations on trade liberalization should not shift focus to bilateral talks but remain centered in the WTO. 

The major thrust of the Bangkok  summit was the decision to rev up the APEC machinery in support of the drive of U.S. and European Union corporate interests to push trade liberalization in agriculture and services, as outlined in the Doha Development Agenda in Qatar in 2001, as well as in investments, as advocated in the negotiations prior to the Cancun Meeting.

On top of the APEC trade liberalization agenda has been agriculture.  In an ABAC report  to the APEC heads of state, corporate heads complained that agricultural tariffs in the region were still too high, as shown in the following table prepared by ABAC:

In its report, ABAC argued for immediate reduction of agricultural tariffs, and linking this to APEC's Bogor goals of eliminating tariffs in capitalist countries by 2010 and in third world countries by 2020 :

High tariffs still apply to agricultural products in many markets.  Where these are applied by many APEC member economies -- and there are numerous examples -- their continued existence places in jeopardy the achievement of the Bogor goals.  Because of the linkages established between the various sectors covered by the Doha Round negotiations, and the narrowing timetables for completion, it will require urgent and substantial initiatives to bring the negotiations to successful conclusion.

Agricultural tariffs

The APEC leaders reiterated the Doha plank of enticing third world governments and countries to tear down agricultural tariffs by dangling in exchange the dubious promise to eliminate export subsidies and reduce local farm subsidies by the U.S., EU, Canada and Japan.   These promises made earlier sugarcoated policies of many third world countries such as the Philippines to drastically cut agricultural tariffs and let loose a flood of farm imports, causing the collapse of local farms and aggravating already severe rural joblessness.

Although trade liberalization remained the central agenda, Bush's dominating presence in Bangkok ensured that global military hegemony continued to be a major topic in the talks.  Reflecting the rising alarm over Iraqi guerrilla resistance attacks against U.S. forces in Iraq, the APEC government heads focused on the objective of seeking to prevent acquisition and use of Man-Portable Air Defense Systems (MANPADS) by anti-occupation forces.

The Bangkok Declaration also gave special attention to the drive to develop even further bond markets and derivatives -- major elements in the speculative boom and bust that marked the Asian financial meltdown in 1997.  Derivatives, which totaled $111 trillion by end-1981, are contracts that are used by corporations to minimize risk of losses caused by fluctuations in currency exchange and interest rates but which involve massive speculation by banks and hedge funds.  

This new focus sends signals that Wall Street is interested in setting off another round of speculative frenzy in Asia, as its sparkplug to artificially perk up the Asia-Pacific economies' now bogged down in stagnation and deflation.  This showcase economy gains importance as the trade liberalization advance of the WTO and APEC has resulted in rapid deterioration of the real economies of many APEC third world countries, including massive lay-offs, numerous factory closures and growing unrest. 

As targeted in the Bangkok Declaration, financial speculative fever instead of genuine industrialization -- as what the Ramos administration offered in the Philippines from 1992 up to the 1997 financial crisis -- nonetheless remains at best a cosmetic change in the APEC economies.   It will serve as nothing more than a mere billboard keeping the third world squalor behind out of public view. Bulatlat.com

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