APEC Meetings Update

Sources: CNN Bloomberg BBC

In the most recent meeting of Asian leaders in Vietnam, the leaders “vowed to revive moribund world trade talks” in a statement issued Sunday. World Trade Organization (WTO) talks ended in July after strong disagreement over subsidies. The talks ended in July over farm subsidies, but expressed willingness to compromise. The U.S. has not expressed a similar sentiment as the Americans and Europeans disagree on how to reduce agricultural farm subsidies. This is key for the Asian nations because APEC members account for half of the world’s global trade, and have claimed that “the consequences of the failure of the Doha round would be too grave for our economies and for the global multilateral trading system.” The leaders called restarting the Doha trade talks as “their top priority,” and leaders have agreed to “remain personally involved” in the effort to revive talks. European ministers are not nearly as optimistic as the APEC ministers.

Alternatively, if the talks are not restarted or otherwise fail, the APEC nations have established a potential “plan B.” This would be a “long-term APEC-wide trade deal. This idea is supported by the U.S., as the U.S. government called the APEC leaders as having “characteristic courage” in “agreeing to consider a region-wide free-trade agreement.

Another hot topic addressed at the APEC meetings regarded North Korea. President Bush had used this round of APEC talks to strengthen support for North Korea sanctions. Japanese Prime Minister Shinzo Abe and Mr. Bush agreed to pursue a joint missile defense program. President Bush also met with the South Korean President Roh Moo-hyun and “urged [him] to implement the sanctions.” Moreover, Bush met with president Hu Jintao in an effort to solidfy support. Despite President Bush’s encouragement, the text of the Sunday statement made no mention of North Korea’s nuclear program. However, South Korea released an additional statement, which “was very firm in the need for full-implementation” of the United Nations resolutions, and expressed “strong concern” of the North Korean nuclear ambitions.

QUESTION:

1) What potential ramifications may happen if APEC is unsuccessful at restarting the Doha talks? Moreover, with APEC controlling ½ of the world’s trade—who is hurt the most by a more “insular” Asian bloc?
2) What may happen to U.S. desires for a strong sanction against North Korea if China’s support for the sanctions lessens or completely wanes?