By Michael Ha
Staff Reporter
President Lee Myung-bak continued to tout the virtues of free markets and free trade during his overseas trip. In his address at the closing of the Asia-Pacific Economic Cooperation (APEC) forum in Peru, Sunday, Lee proposed that APEC member nations adopt wide-ranging free trade agreements (FTA).
Specifically, President Lee urged APEC nations to jointly conduct a study on benefits of adopting free trade deals covering their economies. The arrangement could function as a collective regional FTA at the APEC level.
Tentatively called ``Free Trade Area of the Asia-Pacific Region'' (FTAAP), it could have a major impact on the global economy. APEC member nations currently account for more than half of the world economy and almost half of world trade.
The President said it's time for APEC members to seriously explore the possibility of multiple FTAs. ``Sets of bilateral and multilateral FTAs will help accelerate the WTO bid for global trade and investment liberalization,'' Lee said.
At an APEC session, President Lee also told world leaders that global cooperation is a key in overcoming the financial crisis. He urged developed economies to increase aid to emerging markets. Lee also told APEC leaders that more government spending and more tax cuts will be needed to lift up the slowing economies around the world.
Also on the sidelines of the summit, Lee held meetings with several heads of state. He discussed with the presidents of Colombia and Chile the prospects of free trade agreements between Korea and the two South American nations.
Meanwhile, world leaders at the APEC summit were on the same page with President Lee when it came to the issue of free trade. Heads of state said in a joint statement that their countries would avoid protectionism. Specifically, the leaders pledged to refrain from erecting new trade barriers in the coming year.
``There is a risk that slower world growth could lead to calls for protectionist measures which would only exacerbate the current economic situation,'' according to the joint statement.
``In this regard, we…will refrain within the next 12 months from raising new barriers to investment or to trade in goods and services.''
The joint statement said, ``We reiterate our firm belief that free market principles, and open trade and investment regimes will continue to drive global growth, employment and poverty reduction.''
APEC leaders said they would take necessary steps to address economic problems, predicting the economic outlook will get brighter in about a year and a half. ``We are convinced that we can overcome this crisis in a period of eighteen months. We have already taken urgent and extraordinary steps to stabilize our financial sectors and strengthen economic growth and promote investment and consumption,'' the statement said.
``We will continue to take such steps, and work closely, in a coordinated and comprehensive manner, to implement future actions to address this crisis.''
The APEC leaders also pledged to support ``efforts by export credit agencies, international financial institutions and private banks to ensure that adequate finance was available to business, including small and medium-sized enterprises, and to keep trade and investment flowing in the region.''
The statement also said that as financial systems deepen and become more complex, ``regulatory and supervisory tools must be more effective.''
In the statement, 21 APEC leaders also pledged to work together in reviving the Doha Development Agenda negotiations that stalled earlier this year. APEC members will discuss that in detail in an upcoming ministerial meeting next month in Geneva.
The leaders also said emerging economies should play a bigger role in reforming the global financial system and possibly adopting a new financial regulatory structure.
President Lee flew to Los Angeles Monday for a one-day visit after wrapping up his APEC summit. He will return to Seoul today.