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Creating the EAFTA

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Creating the EAFTA

1. Objective
Issues Involved in Creating the East Asian Free Trade Area (EAFTA)

FTA negotiations are in full swing in East Asia. As of March 2005, five FTAs-the ASEAN Free Trade Area (AFTA), the Japan-Singapore Economic Partnership Agreement (JSEPA), the Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA), China-Macao Closer Economic Partnership Arrangement (CEPA), and the ASEAN-China FTA (Trade in Goods)-became effective. There are now more than ten such agreements including those in treaty or under joint study between Japan and the Philippines, between Japan and Thailand, between Japan and Malaysia, between Japan and Korea, between Singapore and Korea, between the ASEAN and Japan, and between the ASEAN and Korea.

However, all of these agreements are bilateral or regional arrangements, such as the agreement between the ASEAN-plus-one and other nations. FTA in the East Asian region as a whole is still under contemplation or study. Undoubtedly this region lags behind the European Union, which has expanded to cover twenty-five countries, and the Americas, which has been pressing ahead with negotiations to develop the NAFTA into the FTAA, in an effort to create an integrated trade area.

Since the East Asian Vision Group (EAVG) was created in 1998 at the suggestion of Korean President Kim Dae-jung, the concept of regional integration of East Asia has been discussed by the East Asian Study Group (EASG). In November 2001, the EASG proposed creating the East Asian Free Trade Area (EAFTA) before the ASEAN Plus Three Summit. The ASEAN Plus Three Summit in Vientiane in November 2004 issued a statement welcoming the decision made by the economic ministerial meeting to create an expert group for studying the feasibility of EAFTA.

In this way, countries in this region recognize the need for an FTA in East Asia, but discussions on how to achieve this plan have yet to take place. Japan Economic Foundation (JEF) organized a symposium on the theme “FTA: JESEPA and Beyond” jointly with the Singapore Institute of International Affairs (SIIA) in March 2003. Another symposium entitled “The Future Prospects of EAFTA” was co-hosted by JEF and Thammasat University in Bangkok in January 2004. In February this year, JEF held a symposium entitled “An Integrated Roadmap to the EAFTA” in Manila jointly with the Asian Institute of Management
(AIM).

The symposium, which is to be co-organized by JEF and Korea Institute for International Economic Policy (KIEP), will discuss in detail the roadmap, focusing on issues to be addressed toward creating the EAFTA, which have been identified during the past three symposium discussions.

This international symposium entitled “Creating the East Asian Free Trade Area (EAFTA)”(tentative) aims at discussing issues involved in creating the East Asian Free Trade Area and other significant elements.


1. Subject : Creating the EAFTA
2. Date : October 27th 2005 , 09:00 ~ 20:30
3. Venue : The Westin Chosun Hotel, Orchid Room (2nd Floor)
4. information: Researcher Lee, Ji-hyun (Tel: 3460-1097, Jhlee@kiep.go.kr)





2. Program:

9:00 - 9:30 Registration

9:30 - 9:45 Opening Remarks by
Dr. Kyung Tae LEE, President, Korea Institute for International Economic Policy (KIEP)
Mr. Noboru HATAKEYAMA, Chairman and CEO, Japan Economic Foundation (JEF)

9:45 - 10:15 Keynote Address by
Dr. SUPACHAI Panitchpakdi Secretary-General, United Nations Conference on Trade and
Development (UNCTAD) (Former Director-General of World Trade Organization)
“Regional Integration”

Moderator:
Dr. Kyung Tae LEE, President, Korea Institute for International Economic Policy (KIEP)

Question and Answer

10:15 - 10:30 Coffee Break

10:30 - 11:30 sessionxx 1: Bilateral and regional FTAs in the region

i) Assessment of the FTAs already in force in the region

ii) Difficult issues for many FTAs to cope with (WTO compatibility and other issues)

Moderator:

Prof. Simon SC TAY, Chairman, Singapore Institute of International Affairs (SIIA)

Panelists: (7 minutes each)

1. Dr. Chulsu KIM, Senior Advisor, Lee International (Former Minister for Trade-Korea)

2. Mr. Nobuhiko SASAKI, Deputy Director General, Trade Policy Bureau, Ministry of Economy,
Trade and Industry (METI-Japan)

3. Dr. Djisman SIMANDJUNTAK, Chairman, Board of Trustees, Department of Economics, Center
for Strategic and International Studies (CSIS-Jakarta)

4. Prof. ZHANG Yunling, Director, Institute of Asia-Pacific Studies/ APEC
Policy Center, Chinese Academy of Social Sciences (CASS)

Question and Answer / Open Discussion


11:30 - 12:15 sessionxx 2: What is ASEAN Economic Community?

The last Symposium in Manila (Feb.2005) produced a common understanding that the EAFTA will
take shape by 2017 to 2020. On the other hand, the ASEAN Summit in 2003 agreed upon creating the
ASEAN Economic Community (AEC) by 2020 as a target year (The Bali Declaration of November
2003).What is the AEC? If the AEC is not the ASEAN economic community but simply the ASEAN
EPA, then it will constitute a part of the EAFTA, so the EAFTA will be created after an AEC is set up.
Is this scenario correct? (AFTA is intended to deal with goods alone, and does not handle services
and investments, so it should not be referred to as an EPA.)

Moderator:

Mr. Noboru HATAKEYAMA, Chairman and CEO, Japan Economic Foundation (JEF)

Panelists: (7 minutes each)

1. Dr. Thomas G. AQUINO, Undersecretary, International Trade Group (ITG) Ministry of Trade and
Industry-Philippines

2. H.E. Mr. ONG Keng Yong, Secretary-General, Association of Southeast Asian Nations (ASEAN)

Question and Answer / Open Discussion



12:15 - 13:30 Buffet Lunch (@ Lilac-Tulip-Cosmos, Second Floor The Westin Chosun, Seoul)

13:30 - 14:45 sessionxx 3: Creating the EAFTA


i) Timing of the Creation of EAFTA and an Integrated Road-map to Achieving it Regarding the route
toward achieving the EAFTA, negotiations are underway in the ASEAN-plus-one process (with
Japan setting the target year at 2012, China at 2010, and Korea at 2009), while bilateral FTA
negotiations, such as those between Japan and Korea, are also in progress. What are your views
on a combination of these negotiations and the timing? Possible paths could be as follows: (a)
Press ahead with the ASEAN-plus-one process to integrate negotiations; (b) Conduct negotiations
in the ASEAN-plus-three process; (c) Japan, China and Korea will form an EPA of Northeast Asia
and integrate this EPA with the ASEAN; or (d) Japan and Korea will first create an FTA, allow China
to join it, and then integrate it with the ASEAN. What are your views on the route to creating the
EAFTA?


ii) Members of EAFTA

In creating the EAFTA, how should we treat the China-Taiwan issue and the North Korea issue?
Should Australia, New Zealand,and India be included in the EAFTA? When should we include them?
How should we handle CLMV (Cambodia, Laos, Myanmar and Vietnam) in the context of the EAFTA?

Moderator: Dr. Chulsu KIM, Senior Advisor, Lee International (Former Minister for Trade-Korea)

Panelists: (7 minutes each)

1. Dr. Thomas G. AQUINO, Undersecretary, International Trade Group (ITG)
Ministry of Trade and Industry-Philippines

2. Mr. Noboru HATAKEYAMA, Chairman and CEO, Japan Economic Foundation (JEF)

3. Dr. Chang Jae LEE, Director, Center for Northeast Asian Economic Cooperation, Korea
Institute for International Economic Policy (KIEP)

4. Mr. Vincent C. SIEW, Chairman, Chung-Hua Institution for Economic Research (CIER)
(Former Premier of Taiwan Republic of China)

5. Prof. Simon SC TAY, Chairman, Singapore Institute of International Affairs (SIIA)

6. Prof. ZHANG Yunling, Director, Institute of Asia-Pacific Studies/APEC Policy Center,
Chinese Academy of Social Sciences (CASS)

Question and Answer / Open Discussion


14:45 - 15:30 Research Presentation “EAFTA and CMLV”

Beyond market access and the creation of free trade areas in East Asia, the next stage of regional
economic integration is critically dependent on the economic integration between less developed
economies of the region such as Cambodia, Myanmar, Laos and Vietnam (CMLV) with other ASEAN
members and with Japan, China and Korea within the ASEAN-Plus-Three framework. Skeletal as they
are, currently there are ASEAN Economic Community (AEC) and the proposed EAFTA. It would be very
useful for policy makers and researchers to make a study of the prerequisite domestic conditions for
CMLV in order to take advantage of trade and investment liberalization within AEC and EAFTA. In the
process of this investigation, we can make a comparative analysis of the different impacts on CMLV
under AEC and EAFTA and how to harmonize and standardize the possible differences under two
different regional integration frameworks.

Moderator:

Mr. Vincent C. SIEW, Chairman, Chung-Hua Institution for Economic Research(CIER)
(Former Premier of Taiwan Republic of China)

Presenter: (15 minutes )

Dr. Hank LIM, Director of Research, Singapore Institute of International Affairs(SIIA)

Commentator: (7 minutes each£ⓒ

1. Mr. HO Quang Trung, Deputy Director General, Import-Export Administration Department,
Ministry of Trade-Vietnam

2. Mr. Hiroshi TSUKAMOTO, President, Japan External Trade Organization (JETRO)

Question and Answer / Open Discussion


15:30 - 15:45 Coffee Break

15:45 - 16:45 sessionxx 4: The relation between bilateral or regional FTAs in the region and a possible
EAFTA

This sessionxx will shed light on issues that need to be addressed in order to create the EAFTA, and will
seek to find a solution to these issues. Harmonization of the Rules of Origin for Creating the EAFTA In
the process of reaching bilateral or regional FTAs, different FTAs may lay down different rules. The
creation of the EAFTA will necessitate reconciling the existing rules with rules that should be
incorporated in the EAFTA. A major issue in creating the EAFTA will be how to harmonize incompatible
rules formulated by the existing FTAs. Particular attention should be given to the rules of origin. If
different countries lay down different rules, then different procedures will apply in receiving preferential
tariff, causing unnecessary confusion or imposing a burden on companies. Likewise, if different
countries operate the same rules in a different manner, user industries will become confused and feel
the situation is unfair.To avoid this, what mechanisms must we create in order to allow countries to
operate the same rules in the same manner?

Moderator:

Dr. Djisman SIMANDJUNTAK, Chairman, Board of Trustees, Department of Economics,
Center for Strategic and International Studies (CSIS-Jakarta)

Presenter: (15 minutes £ⓒ

Prof. Norio KOMURO, Professor, Graduate School of Law, Kobe University-Japan

Commentator: (7 minutes each)

1. Mr. HO Quang Trung, Deputy Director General, Import-Export Administration Department,
Ministry of Trade-Vietnam

2. H.E. Mr. ONG Keng Yong, Secretary-General, Association of Southeast Asian Nations
(ASEAN)

3. Mr. Jae Ho PARK, Director, Fair Trade Division, Korea Customs Service

Question and Answer / Open Discussion


16:45 - 17:00 Closing Remarks by

Mr. Noboru HATAKEYAMA, Chairman and CEO, Japan Economic Foundation (JEF)

Dr. Kyung Tae LEE, President, Korea Institute for International Economic Policy (KIEP)


18:30 - 20:30 Dinner (Sitting Style) < Panelists Only>

(@ LILAC Second Floor, The Westin Chosun, Seoul)
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