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World
APEC to vow stimulus; tries to push climate change
2009-Nov-15 10:41:14

SINGAPORE: Asia-Pacific leaders will pledge on Sunday to keep stimulus policies in place to stop the world from sliding back into recession, wrapping up a?meeting that has been dogged by accusations of US trade protectionism.

President Barack Obama arrived in Singapore late on Saturday, missing most of the day's formal talks and speeches where several leaders suggested the world's largest economy was hampering free trade through policies such as "Buy America" campaigns.

Speaking in Tokyo before he arrived, Obama called for a new strategy to rebalance global growth, referring to the excessive consumption in the United States and the over-reliance on exports from some countries that many blame for the economic crisis.

Leaders from the Asia Pacific Economic Cooperation (APEC) forum will vow to "maintain our stimulus policies until a durable economic recovery has taken hold", according to a draft of their final statement, to be issued later on Sunday.

APEC is the last major gathering of global decision-makers before a UN climate summit in Copenhagen in three weeks meant to ramp up efforts to fight climate change.

Those negotiations have largely stalled, but a US official said Obama had backed a two-step plan by the Danish prime minister to aim for an operational agreement and to leave legally binding details until later.

The APEC draft earlier dropped a reference to emissions reductions of 50 percent by 2050, and pledged instead to "substantially" cut carbon pollution by 2050.

The statement said job creation would be at the heart of economic policy, a hot topic as unemployment has risen across the industrialised world and put pressure on governments to act.

"Looking beyond supporting the recovery, we recognise the necessity to develop a new growth paradigm for the changed post-crisis landscape, and an expanded trade agenda for enhanced regional economic integration," the draft APEC statement says.

The leaders of APEC, a 21-member grouping accounting for more than half of all global output and 40 percent of world trade, will also resolve to exert more political will to jump-start the Doha Round of global trade talks, stalled for eight years.

Beyond the rhetoric of trying to conclude the Doha Round, APEC officials have sought to instead talk up a so-called Trans-Pacific Partnership aimed at forging a regional trade deal.

Obama said Washington would work with the partnership countries, but stopped short of saying Washington would join the pact. The former U.S. administration said last year it would launch talks to join the partnership with Singapore, Chile,?Brunei and New Zealand, countries that together comprise a minor component of trade within APEC.

It is the first free trade agreement that spans both side of the Pacific and supporters are touting it as a precursor to a possible APEC-wide pact in the future.

Washington has been criticised on several fronts for its trade policies, especially toward China, which will be the most closely watched of Obama's four stops on his first Asia tour as president. He leaves for Shanghai later on Sunday.

"We're not getting big, sweeping 25 percent tariffs from the (US) Congress, but we are getting stealth US protectionism: small-scale, focused on manufactured goods and heavily concentrated on China," said Derek Scissors, a trade economist at the Heritage Foundation, a conservative think tank in Washington.

One of the major themes when Obama visits China will be its yuan currency, which has effectively been pegged against the dollar since mid-2008 to cushion its economy from the downturn.

Washington says an undervalued yuan is contributing to imbalances between the United States and the world's third-biggest economy.

The APEC statement will pledge countries to maintain "market-oriented exchange rates that reflect underlying economic fundamentals", although it makes no reference to the yuan.

China's central bank said last week it will consider major currencies in guiding the yuan, suggesting a departure from the peg.

After the APEC talks, Obama will meet with the leaders of the Association of Southeast Asian Nations (ASEAN), which will put him in the same room as the Myanmar prime minister.

Myanmar's military government is shunned by the West over its rights record, which has kept previous US presidents from meeting all 10 members of ASEAN, of which Myanmar is a part.

But the Obama administration decided in September to pursue deeper engagement with Myanmar to try to spur democratic reforms. Obama has no intention of speaking directly to Myanmar's prime minister, Lieutenant-General Thein Sein, US officials said.

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