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Policy Brief 07-2

Toward a Free Trade Area of the Asia Pacific

by C. Fred Bergsten, Peterson Institute for International Economics

February 2007


C. Fred Bergsten At their latest annual summit in Vietnam in November 2006, the leaders of the 21 members of the Asia Pacific Economic Cooperation (APEC) forum agreed to “seriously consider” negotiating a Free Trade Area of the Asia Pacific (FTAAP). The FTAAP initiative may well turn out to be the best, or perhaps only, way to catalyze a substantively successful Doha Round. If it cannot do that, an FTAAP can still offer a Plan B to restore the momentum of trade liberalization, prevent further proliferation of bilateral and subregional preferential trade arrangements, avoid renewed risk of “drawing a line down the middle of the Pacific,” channel the US-China economic conflict into a more constructive, less confrontational context, and revitalize APEC itself. Perhaps most important, an FTAAP could maintain US engagement in Asian, and even global, trade relations by providing a basis for congressional extension of trade promotion authority in mid-2007 and a negotiating momentum that the next US president in early 2009 will feel compelled to maintain.

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RELATED LINKS

Speech: Should APEC Focus on Trade Liberalization? May 6, 2010

Speech: The Future of APEC and Its Core Agenda December 9, 2009

Paper: Submission to the USTR in Support of a Trans-Pacific Partnership Agreement January 25, 2010

Speech: Trade and the Global Economic Crisis: "If It's Not Part of the Solution, It's Part of the Problem" July 17, 2009

Policy Brief 09-16: Pacific Asia and the Asia Pacific: The Choices for APEC July 2009