Japan’s EPA/FTA Policy August, 2007 0 1. Overall Picture 1 1-1. Basic Principles of Promoting EPAs Mutual Prosperity with Asia Aiming to take in the growth and dynamism of Asia etc. Development of production network of Asian companies Quality, as well as speed, is important for EPAs Stable Supply of Natural Resources & Energy Strengthening relationship with countries rich In natural resources & energy Maintaining stable supply through stronger protection of rights & interests on investment Respecting the long term contracts, in times of policy change New Phase of EPA, with large markets New type of FTAs, FTAs with large market, are developing in the world In order to avoid the disadvantage, strengthening relationship with larger markets, including the U.S. and EU, is necessary for Japan Forming the model framework, in order to cope with the global corporate movements 2 1-2. Current Status of Japan’s EPA/FTA Negotiations ○EPA/FTA is the important key for Japan to activate her EPA等による Through EPA/FTA etc. ・関税コストの低減 -reduce customs cost -optimize producing locations ○Mainly with East Asia, Japan has currently concluded EPA/FTA ・生産拠点の最適化 -expand market and investment etc. ・市場や投資先の拡大 等 with 7 countries, agreed in principle with economy, and strengthen her international competitiveness 1 countries, under negotiations/preparing for negotiations with 5 countries and 2 regions, and under consideration for EPAs etc. with 1 country and 2 region India Japan-China-Korea: negotiating for trilateral investment treaty (population; 1,029 million, GDP per capita: $700) -Negotiating from Jan. ‘07 -Market with huge potential, one of the BRICs nations Singapore (population: 4 million, GDP per capita: $26,000) -Took effect in Nov. ’02 -Review treaty signed in Mar. ‘07 Malaysia (population: 260 million, GDP per capita: $5,000) South Korea(population: 48 million, GDP per capita: $14,000) -Negotiation stopped in Nov. ’04 Mexico(population: 105 million, GDP per capita: $6,500) Chile(population: 16 million, GDP Viet Nam(population: 82 million, GDP per capita: $600) Brunei(population: 350,000, GDP per capita: $17,000) -Signed in Sep. ’06. Including the agreement on the movement of natural persons -Signed on 18 June, ‘07. Important as the supplier of oil and natural gas. Thailand (population: 62 million, GDP per capita: $2,700) Indonesia(population: 217 million, GDP per capita: $1,200) -Started negotiations in Sep. ’06 -Exporting market with size of more than one trillion yen. Important in terms of security of natural resources. Investment Treaty -negotiating from Mar. ‘07 (c.f.) experts’ study on trilateral FTA is also under progress -Negotiating from Apr. ’05. In May ’07, agreed in principle on modality for trade in goods. -Aiming to build seamless business area, consistent with developing industrial network between ASEAN and Japan. Philippines (population: 83 million, GDP per capita: $1,200) GCC: Saudi Arabia, Kuwait, United Arab Emirates, Bahrain, Qatar, Oman Japan-China-Korea -took effect in Apr. ‘05 -Negotiating from Jan. ’07. -Investment from Japan is rapidly increasing. GCC(population: 35 million) strengthen strengthen International International competitiveness competitiveness ASEAN (population: 550 million, GDP per capita: $1,200) -Took effect in Jul. ’06 (eliminated tariffs on essentially all industrial products) -Signed in Apr. ‘07. activate activate economy economy -agreed in principle in Nov. ’06 Australia(population: 21 million, GDP per capita: $30,682) -Negotiation started in Apr. ‘07 -Important in terms of securing natural resources supply, economic integration in East Asia, etc. per capita: $5,839) -signed in Mar. ‘07. -important in terms of securing natural resource supply Switzerland(population: 7 million, GDP per capita: $33,678) -Negotiating from May, ‘07 East Asia as a whole -agreed to start Track-Two study, at the East Asia Summit in Jan. ’07 South Africa -considering for ways to strengthen economic relationship As of June 21st, ‘07 3 1-3. Current schedule of Japan’s EPA/FTA negotiations 2004 (As of 23 July, 2007) 2005 2006 2007 Amending protocol signed in Mar. Negotiations began in Jan.2001 Went into effect in Nov.2002 Singapore (Negotiations began in Nov.2002 ) Mexico negotiations negotiations Jan. Went into effect in Apr. 2005 Agreed in principle in May Signed in Dec. Went into effect in Jul. negotiations negotiations Feb. Agreed in principle in Nov 2004. Signed in Sep. negotiations negotiations Jun. Agreed in principle in Sep. Signed in Mar. Agreed to begin Negotiations in Nov. Joint Feb. negotiations JointStudy StudyGroup Group negotiations Feb. Agreed in principle in Sep. Signed in Apr. negotiations negotiations Jun. Agreed in principle in Dec. Signed Feb. Preparatory negotiations Preparatorymeetings meetings negotiations in June Agreed in principle in Nov. Jul. Jan. Joint JointStudy StudyGroup Group negotiations negotiations (agreed to begin May Apr. Feb. negotiations in Nov.) Agreed in principle negotiations AJCCEP negotiations AJCCEP on modality for trade in goods Agreed to begin Dec. negotiations stopped in Nov. negotiations in Oct. negotiations negotiations 2003 Sep. May preparatory negotiations preparatorymeetings meetings negotiations agreed to begin negotiations in Dec. 2003 Malaysia Philippines Chile Thailand Brunei Indonesia ASEAN Korea GCC Vietnam Feb. India Jul. Joint JointStudy StudyGroup Group Nov. Australia Switzerland Oct. Japan-China-Korea investment treaty agreed to begin consultations in Nov. May study studygroups groups Joint JointStudy Study Joint JointStudy Study Consultations Consultations Jan. negotiations negotiations Jan. negotiations negotiations Apr. negotiations negotiations May negotiations negotiations Mar. negotiations negotiations South Africa East Asia [East Asia Free Trade Area (EAFTA)] Apr. [Comprehensive Economic Partnership in East Asia (CEPEA)] Study Studyby byJoint JointExpert ExpertGroup Group May Phase PhaseIIIIStudy Study Jun. Track Track Two TwoStudy Study 4 1-4. From Bilateral EPAs to Region-wide Economic Integration -the -the deepening deepening shift shift from from bilateral bilateral economic economic partnerships partnerships to to region-wide region-wide economic economic integration integration is is taking taking place place in in East East Asia Asia -multi-layered -multi-layered style style of of integration; integration; ASEAN, ASEAN, ASEAN+1, ASEAN+1, ASEAN+3, ASEAN+3, ASEAN+6, ASEAN+6, APEC APEC ASEAN+1 ASEAN ASEAN 10 -AFTA took effect in 1992 -Original member countries will complete trade liberalization by 2010 (Thailand, Philippines, Malaysia, Indonesia, Singapore, Brunei) -New member countries will complete trade liberalization by 2015 (Cambodia, Laos, Myanmar, Vietnam) Korea-ASEAN Korea-ASEAN China-ASEAN China-ASEAN trade trade in in goods goods takes takes effect effect in in 2007 2007 trade trade in in goods goods took effect took effect in in 2005 2005 Japan-ASEAN Japan-ASEAN India-ASEAN India-ASEAN aiming aiming to to reach reach Agreement Agreement in in 2007 2007 ASEAN+3 ASEAN+6 (ASEAN, Japan, China, Korea) (ASEAN, Japan, China, Korea, India, Australia, NZ) aiming aiming to to reach reach agreement agreement in in Nov. Nov. 2007 2007 Australia, Australia, NZ-ASEAN NZ-ASEAN aiming aiming to to reach reach agreement agreement in in 2007 2007 APEC U.S. Canada Mexico Peru Chile H.K. Taiwan Russia -summer ‘06: feasibility study on EAFTA finished. Commencement of governmental study was recommended. -Jan. ‘07: continuation of expert study was decided at the summit meeting (the phase II study has started in May ‘07) Papua New Guinea -Jan. ’07: commencement of Track Two study on CEPEA was agreed at the summit meeting -Jun. ’07: the Track Two study on CEPEA was commenced Among the 10 countries of ASEAN, following countries are not APEC member: Myanmar, Cambodia, Laos -Nov. ’06: studying for FTAAP as a long term goal was agreed at the summit meeting 5 1-5. Significance of AJCEP (ASEAN-Japan Comprehensive Economic Partnership ) Examples of trade in goods without AJCEP & under AJCEP Without AJCEP Japan aE PA ys i CE P – pa n AJ M ala ys i M ala – pa n Ja A Ja EP (*)40% of the value added within the ASEAN region) nd The product doesn’t satisfy AFTA’s standard* a ail ② The component from Japan gains added value of $30, and final product worth $100 is exported to Malaysia. Th A EP Thailand P CE d AFTA AJ n ila ha AFTA’s rules of origin cannot be inapplicable Malaysia ① Export a component ($70) from Japan npa Ja ① Export a component ($70) from Japan T npa Ja aE PA Japan Under AJCEP applying AJCEP’s rules of origin Malaysia Thailand AFTA ② The component from Japan gains added value of $30, and final product worth $100 is exported to Malaysia. The product doesn’t satisfy AFTA’s standard HOWEVER The product satisfies AJCEP’s standard* (*)40% added value in the ASEAN-Japan region) MFN tariff rate is applied to the product exported to Malaysia The product is exported untaxed to Malaysia 6 1-6. “Basic Policies 2007” (decided by the Cabinet on June 19, 2007) [Provisional Translation] Regarding to EPA, “Basic Policies 2007” is addressing the issues of (1) future work plan for EPAs with countries constituting major markets and investment destinations, including U.S. and EU, (2) an EPA covering ASEAN+6 countries, (3) realization of EPAs deep in quality and wide in coverage of economic issues, (4)ideal forms of border measures, etc. Ch.2 Ch.2 Enhancing Enhancing Growth Growth Potential Potential 2. 2. Reforms Reforms Addressing Addressing Globalization Globalization (1) (1) Strengthening Strengthening Approaches Approaches on on WTO WTO and and EPA EPA 2. 2. Strengthening Strengthening Approaches Approaches on on EPA EPA Negotiations Negotiations Following Following the the EPA EPA timetable timetable (attached), (attached), work work on on EPA EPA negotiations negotiations with with positive positive attitudes. attitudes. Consequentially, Consequentially, by by the the beginning beginning of of 2009, the number of countries Japan has concluded EPAs with is expected to increase at least by three times (12 countries). 2009, the number of countries Japan has concluded EPAs with is expected to increase at least by three times (12 countries). EPA EPA negotiations negotiations are are accelerating accelerating in in worldwide worldwide scale, scale, including including the the EPAs EPAs with with large large economic economic communities. communities. Under Under this this worldwide worldwide circumstance, circumstance, EPAs EPAs with with countries countries constituting constituting major major markets markets and and investment investment destinations, destinations, including including U.S. U.S. and and EU, EU, are are to be considered as future issues for Japan, while paying attention to the factors such as the movements of other countries, to be considered as future issues for Japan, while paying attention to the factors such as the movements of other countries, status status of of economic economic relationship relationship between between the the potential potential EPA EPA partner partner and and Japan, Japan, and and size size of of the the economy. economy. Start Start preparation preparation for for EPAs EPAs from from possible possible countries/regions. countries/regions. Additionally, Additionally, propel propel study study for for region-wide region-wide economic economic partnership, partnership, including including the the proposal proposal of of economic economic partnership partnership covering covering ASEAN+6 ASEAN+6 countries. countries. 3. 3. Realization Realization of of High High Quality Quality EPAs EPAs Aim Aim to to conclude conclude EPAs EPAs with with high high quality, quality, covering covering trade trade liberalization liberalization and and various various other other fields, fields, such such as as trade trade in in service, service, investment, investment, IPR IPR etc. etc. 4. 4. Border Border Measures Measures Under Under WTO WTO and and EPA EPA negotiations, negotiations, take take initiatives initiatives for for narrowing narrowing down down the the number number of of goods goods protected protected under under border border measures, measures, and and lowering lowering tariff. tariff. Take Take considerations considerations on on the the ideal ideal form form of of differential differential tariff tariff system. system. Paying Paying attention attention to to the the progress progress of of strengthening the nation’s agriculture, forestry, and fisheries etc.. Take systematic measures, restricted on the measures useful strengthening the nation’s agriculture, forestry, and fisheries etc.. Take systematic measures, restricted on the measures useful for for structural structural reform, reform, for for the the effects effects caused caused by by EPA. EPA. 7 EPA timetable country/region Singapore Mexico (attachment to “Basic Policies 2007”) [Provisional Translation] Goals current status Taken effect. Aim to bring the amending protocol into effect 2002. Signed on the Taken effect on Nov. quickly. amending protocol on Mar. 19th, 2007. st Taken effect on Apr. 1 , 2005. A protocol on the EPA Taken effect. has taken effect on Apr. 1st, 2007. 30th, Took effect on Jul 13th, 2006. Taken effect. Approved by the National Diet on Dec. 6th, 2006. Gain approval from the Upper House of the Philippines, and bring the treaty in effect. Signed on Apr. 3rd, 2007. Aim to bring the treaty into effect as early as possible in 2007. Chile Signed on Mar. 27th, 2007. Aim to bring the treaty into effect as early as possible in 2007. Brunei Signed on Jun. 18th, 2007. Aim to bring the treaty into effect as early as possible in 2007. Agreed in principle on Nov., 2006. Aim to sign the treaty as early as possible in 2007. Malaysia Philippines Thailand Indonesia ASEAN Republic of Korea Negotiation started in Apr. 2005. Negotiation stopped since Nov. 2004. With the cooperation from ASEAN, aim to conclude the negotiation substantially as early as possible in 2007. Continue to persevere in taking approaches to the Republic of Korea for the resumption of negotiations. Aim to reach agreement in principle on major points of the negotiations as early as possible. Aim to reach agreement in principle on major points of the negotiations as early as possible. Gulf Coast Countries (GCC) Negotiation started in Sep. 2006. Vietnam Negotiation started in Jan. 2007. India Negotiation started in Jan. 2007. Aim to reach substantial agreement as early as possible, within approximately two years from the commencement of negotiation. Switzerland Negotiation started in May 2007. Aim to strengthen economic relationship, and formulate high quality rules, covering not only trade in goods but also other wide range of fields such as investment, trade in services, IPR etc. Australia Negotiation started in Apr. 2007. Aim to gain the largest merit for Japan, under the policy of “protect what has to be protected”, with thorough recognition of the importance of agriculture, forestry, and fishery. 8 1-7. (reference) Ratio of Trading Value with EPA Partners Trading status is as of July 24th, 2007 Trading values are based on Trade Statistics 2005 (MOF, Japan) Trade Ratio with EPA Partners Japan Others, 14.0 Hong Kong, 3.4 With concluded & agreed countries: 14.0% concluded, agreed in 11.3 principle, 2.7 Taiwan, 5.5 negotiating , 18.5 2.3 Mexico 0.9 Malaysia 2.4 Philippines 1.5 Chile 0.5 Thailand 3.4 Indonesia 2.7 Brunei Korea U.S.A., 17.8 6.4 Laos 0.002 Australia Export Ratio with EPA Partners Others, 15.4 Hong Kong, 6.0 concluded, 11.9 agreed in principle, 1.5 negotiating , 13.2 Taiwan, 7.3 EU, 14.7 U.S.A., 22.5 China, 13.5 Import Ratio with EPA Partners Others, Hong Kong, 12.5 0.3 Taiwan, 3.5 EU, 11.4 0.22 Cambodia 0.02 With concluded, agreed & negotiating countries/region: 32.4% EU, 13.1 China, 17.0 Singapore concluded, 10.6 3.3 Vietnam 0.7 GCC 8.0 Myanmar 0.03 India 0.6 Switzerland Trading Ratio Between U.S.A. and her FTA Partners agreed in principle, 4.0 concluded, 38.9 0.6 Trading Ratio Between South Korea and her FTA Partners concluded, 25.4 others, 14.3 negotiating, 24.5 China, 21.0 U.S.A., 12.4 With concluded & agreed countries: 13.4% With concluded & agreed countries: 14.6% With concluded, agreed & negotiating countries/region: 26.6% With concluded, agreed & negotiating countries/region: 39.2% considering, 26.6 others, 57.3 negotiating, 33.7 negotiating, 3.9 With concluded countries: 38.9% With concluded countries: 25.4% With concluded & negotiating countries: 42.7% With concluded & negotiating countries: 59.1% 9 1-8. (reference 2) EPA/FTA Negotiations of Major Countries/RegionsAs of 24th July, ‘07 countries /regions situation in effect / concluded 19 U.S. Mercosur Chile, El Salvador, Honduras, Nicaragua, Guatemala, NAFTA, Morocco, Bahrain, Jordan, Israel, Australia, Singapore, Peru, Columbia, Oman, Costa Rica, Dominican Republic, Korea, Panama under negotiations 7 Ecuador, FTAA, SACU, UAE, Malaysia, Thailand under consideration 2 ASEAN, FTAAP in effect / concluded 22 Mexico, Chile, Algeria, Tunisia, South Africa, Morocco, Egypt, overseas territories, Switzerland, Andorra, Iceland, Norway, Liechtenstein, Turkey, Faroe islands, Macedonia, Croatia, Syria, Palestine, Israel, Jordan, Lebanon under negotiations 4 ACP, GCC, Mercosur, Korea under consideration 5 ASEAN, India, Latin America region, Andean Community, Mediterranean Community EU Australia countries /regions countries /regions in effect / concluded 4 Thailand, U.S., NZ, Singapore under negotiations 5 China, ASEAN, Malaysia, GCC, Japan under consideration 3 Korea, Chile, East Asia in effect / concluded 3 SACU, India, Andean Community India China 3 GCC, Israel, FTAA under consideration 3 EU, Pakistan, Korea countries/ regions in effect / concluded 5 Singapore, Mercosur, Sri Lanka, Nepal, Bhutan under negotiations 6 Japan, ASEAN, Thailand, Egypt, Korea, GCC under consideration 7 East Asia, EU, South Africa, China, BIMSTEN, SAARC, FTAAP in effect / concluded 4 Chile, ASEAN, Hong Kong, Macao under negotiations 6 NZ, Australia, Pakistan, GCC, SACU, Singapore under consideration 7 East Asia, Iceland, India, Korea, Japan-China-Korea, FTAAP, Switzerland in effect / concluded 5 Chile, Singapore, EFTA, ASEAN, U.S. under negotiations 5 India, Mexico, Canada, Japan, EU under consideration 9 East Asia, FTAAP, China, Mercosur, NZ, South Africa, Japan-China-Korea, Australia, GCC in effect / concluded 7 Singapore, Mexico, Malaysia, Philippines, Chile, Thailand, Brunei under negotiations 8 Indonesia, India, Viet Nam, Australia, Switzerland, Korea, GCC, ASEAN under consideration 4 East Asia, FTAAP, JapanChina-Korea, South Africa Korea Japan under negotiations situation Information based on various reports and governments’ press releases. There could be information omitted in some fields. 10 2. “East Asia Initiative” 11 2-1. “East Asia Initiative” Promote Promote the the economic economic integration integration of of East East Asia Asia through; through; (1) (1) trade/investment trade/investment liberalization liberalization and and system system facilitation facilitation by by CEPEA, CEPEA, (2) (2) narrowing narrowing economic economic gap gap in in the the region region by by ERIA ERIA ERIA CEPEA (Comprehensive Economic Partnership in East Asia) (Economic Research Institute for ASEAN and East Asia) trade/investment liberalization, system facilitation cooperation, narrowing economic gap forming economic partnership by ASEAN-plus-six* countries making intellectual contribution, such as policy recommendation, for the sustainable development of East Asia (*) Japan, China, Korea, India, Australia, NZ strengthen industrial competitiveness of the region, by promoting the formation of efficient production network the Japanese style approach, which promote both (1) liberalization and system facilitation, and (2) narrowing the economic gap through cooperation keeping the complementary relationship with APEC, by placing this initiative under the multi-layered cooperation mechanisms in Asia the prosperity brought by economic integration of East Asia will connect Japan’s economy with Asia’s growth 12 2-2. What is Behind “East Asia Initiative” –Trade Structures of East Asia2-2-1. Closely Connected Economic Zone Ratio Ratio of of intra-regional intra-regional trade trade in in East East Asia Asia has has been been increasing: increasing: The The ratio ratio of of East East Asia Asia is is deeper deeper than than the the ratio ratio of of North North America America (NAFTA), (NAFTA), and and almost almost equal equal to to that that of of EU EU (15 (15 countries). countries). 70 (%) ratio of intraregional trade 65 EU regional market integration process completed EU (15 countries) EURO started 60% 60 57% ASEAN CEPT started 55 54% ASEAN+6 50 ASEAN+3 (ASEAN, Japan, China, Korea, India, Australia, NZ) (ASEAN, Japan, China, Korea) 45 45% 40 38% NAFTA came in effect NAFTA 35 30 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 (c.f.) ASEAN+6: Hong Kong and Taiwan included (reference) DOT (IMF) Trade Statistics (Board of Foreign Trade, Taiwan, Chinese Taipei) (http://eweb.trade.gov.tw/default.asp/) 2002 (year) 13 2-2-2. East Asia’s Importance as Trade Partners for Japan Japan’s trade structure, by region (2005) Middle & other South region America 2.1% 3.7% MexicoChile 0.9% 50.0% is covered by the trade with East Asia, including Australia, North America 19.4% U.S. 17.8% New Zealand and India East Asia: ASEAN, Korea, China, Hong Kong, Taiwan, Australia, India, New Zealand Europe, EU Russia 13.2% 15.4% 0.5% China, Hong Kong, Macao, Taiwan 25.9% Japan's Trade Value (import & export) GCC Australia 8.0% 3.3% East Asia Korea 50.0% 6.4% ASEAN 13.3% India Middle East N Z 0.6% 9.4% 0.4% reference: Trade Statistics of Japan (Ministry of Finance) ASEAN: Thailand, Philippines, Singapore, Malaysia, Indonesia, Brunei, Vietnam, Myanmar, Laos, Cambodia GCC: Saudi Arabia, UAE, Qatar, Kuwait, Oman, Bahrain EFTA: Switzerland, Iceland, Norway, Liechtenstein Mercosur: Brazil, Argentine, Uruguay, Paraguay SACU: South Africa, Lesotho, Botswana, Namibia 14 2-2-3. Deepening Relationships between East Asia and Other Regions In In addition addition to to rapidly rapidly increasing increasing Japan-East Japan-East Asia Asia trade, trade, East East Asia-U.S. Asia-U.S. trade trade and and East East Asia-EU Asia-EU trade trade are are also also increasing increasing sharply. sharply. The The fact fact of of Japanese Japanese companies companies making making production production in in East East Asia Asia contribute contribute aa lot lot to to this this tendency. tendency. 1994 unit: million dollar Japan -> EU 67,602 Japan unit: million dollar Japan -> EU 85,875 Japan -> U.S. 119,149 U.S. -> Japan 62,848 EU -> Japan 53,407 2004 Import & Export EU -> East Asia 129,300 EU U.S. East Asia -> Japan 90,875 96,146 East Asia -> EU 130,983 East Asia -> U.S. 146,737 East Asia* Reference: White Paper on International Economy and Trade 2006 U.S. -> Japan 62,563 Japan -> East Asia 290,753 U.S. East Asia -> Japan 196,348 EU -> East Asia 181,317 U.S. -> East Asia Japan -> U.S. 129,805 EU -> Japan 77,022 Japan -> East Asia 168,761 EU Japan East Asia -> EU 293,589 U.S. -> East Asia 108,183 East Asia -> U.S 367,863 East Asia* (*) in this page, “East Asia” stands for: ASEAN5 (Singapore, Indonesia, Philippines, Thailand, Malaysia), China, H.K., Taiwan, Korea 15 2-3. Comprehensive Economic Partnership in East Asia (CEPEA) -Aiming -Aiming to to form form an an EPA EPA among among ASEAN ASEAN plus plus six six (ASEAN (ASEAN and and its its FTA/EPA FTA/EPA partners; partners; China, China, Japan, Japan, Korea, Korea, India, India, Australia, Australia, and and New New Zealand). Zealand). CEPEA CEPEA will will contribute contribute to to achievement achievement of of further further developing developing regional regional production production network network unique unique to to this this region. region. -By -By covering covering wide wide range range of of issues issues (trade (trade in in goods, goods, trade trade in in service, service, investment, investment, intellectual intellectual property, property, etc.), etc.), CEPEA CEPEA will will contribute contribute to to build build free, free, fair fair and and rule-based rule-based market market economy. economy. India under negotiation Japan case of electronics manufacturers under negotiation India Australia, NZ CEPEA China nt s signed ne Korea took effect co China Example of regional production network Korea Korea Japan m po FTA/EPAs with ASEAN under negotiation Vietnam etc. du pro l a fin pon com ents ct Thailand etc. Australia, NZ ASEAN Schedule Jan. 2007 East Asia Summit agreed to commence track-two study (by Japan’s proposal) Jun. 2007 commencement of track-two study Nov. 2007 East Asia Summit report from tracktwo study group consider further plans 16 2-4. Plans for Regional Economic Integration in East Asia 2006 ASEAN disagreed of moving to governmental study ASEAN+6 Economic Partnership Covering ASEAN, Japan, China, Korea, India, Australia, New Zealand (c.f.) OECD-like organization in East Asia (summer ’06) Welcomed at the ASEAN Plus Three Summit Phase I Agreed at the East Asia Summit (’05 – summer ’06) NOW Korea’s proposal Economic Partnership Covering ASEAN, Japan, China, Korea feasibility study by expert group Japan’s proposal ASEAN+3 China’s proposal 2005 2007~ continuation of study by expert group (’07-) Phase II study by expert group (’07-) establishment of ERIA (‘07) 17 2-5. Economic Research Institutes for ASEAN and East Asia (ERIA) z For the sustainable economic growth in East Asia, we have to address not only Trade/Investment liberalization through FTA/EPAs but also wide range of policy issues such as Human Resources, Infrastructure Development, Economic Development Gaps, Energy Security/Environment Degradation, etc. z ERIA will make intellectual contribution to the regional efforts driven by ASEAN through policy studies and recommendations. ERIA will be developed step by step in cooperation with the countries in the region. Economic Integration in East Asia Intra ASEAN ASEAN+1 ASEAN+3 Roadmap Plan ASEAN+6 - January 2007 (ASEAN Summit / EAS) Welcome the Proposal Policy recommendation - August 2007 (AEM with Dialogue Partners) Agree on Outline Structure, etc A S E A N Driving force Strong partnership with existing institutions Making policy recommendations Providing research and analysis reports - November 2007 (ASEAN Summit / EAS) Welcome the Establishment Advice on research and analysis ¾Conducting joint research ¾Dispatching researchers etc. Such as; • Australia: ANU • Brunei: BDIPSS • Cambodia: CICP • China: CASS • India: RIS • Indonesia: CSIS • Japan: IDE/JETRO • Korea: KIEP • Laos: NERI • Malaysia: MIER • Myanmar: YIE • New Zealand: NZIER • Philippine: PIDS • Singapore: SIIA/ISEAS • Thailand: TDRI • Vietnam: CIEM • Asian Development Bank etc… Economic Research Institute for ASEAN and East Asia (ERIA) ¾ will be established in the ASEAN region ¾Contribution, etc Japan Research Institute Business Government ¾(Contribution, etc) Countries mainly in East Asia Research Institute Business Government For less Developed Countries •Capacity Building of Policy makers and Researchers etc… Example of research themes Not only Trade/Investment But also ・Human Resources ・Supporting Industry ・Small and Medium Enterprises ・Distribution, Infrastructure ・ Energy /Environment ・Intellectual property ・Standards and Conformity Assessment ・Capacity Building etc. 18 Recent and Upcoming Events on ERIA Jan., 2007 : Second East Asia Summit (Cebu, Philippines) -PM Abe made proposal of establishing ERIA -The proposal was welcomed by all the summit members of East Asia region Discussions with countries in the region, further concrete the plan Aug., 2007 : East Asia Economic Ministers Meeting Nov., 2007 : Third East Asia Summit (Singapore) -official establishment of ERIA, and the headquarter location will be decided (through ASEAN’s affirmation) -mid-term report of the Track Two study on CEPEA (Agreement on AJCEP is necessary for this) 19 2-6. The Architecture of the Asia-Pacific Region -- “ASEAN+1” “ASEAN+1” FTAs/EPAs, FTAs/EPAs, with with ASEAN ASEAN as as their their hub, hub, are are being being formulated formulated in in East East Asia. Asia. Generally, Generally, the the main main focus focus of of “ASEAN+1” “ASEAN+1” FTAs/EPAs FTAs/EPAs is is on on trade trade in in goods. goods. Works Works for for FTAs/EPAs FTAs/EPAs between between ASEAN’s ASEAN’s neighboring neighboring countries countries are are also also beginning beginning gradually. gradually. Under Under such such circumstance, circumstance, Japan Japan is is working working on on comprehensive comprehensive and and high high quality quality EPAs, EPAs, and and also also proposing proposing “CEPEA”, “CEPEA”, an an EPA EPA covering covering ASEAN+6 ASEAN+6 nations. nations. -U.S. -U.S. also also aspires aspires to to comprehensive comprehensive and and high high quality quality FTAs. FTAs. America’s FTA network is being gradually formulated America’s FTA network is being gradually formulated in in the the region, region, and and U.S. U.S. is is also also proposing proposing “FTAAP”, “FTAAP”, an free trade area of Asia-Pacific. an free trade area of Asia-Pacific. ASEAN +3/+6 Canada NAFTA China ROK ASEAN +1 ASEAN +1 ASEAN +1 Thailand Japan ASEAN Malaysia ASEAN+1 India U.S. Mexico Singapore ASEAN+1 Brunei Listing major FTAs/EPAs NZ Australia took on effect P4 Chile negotiating/preparing for negotiations has not taken effect APEC 20