'Wider trade deal to bring more benefits for ASEAN Plus 6 than smaller pacts'

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SINGAPORE, Nov 18 (AFP): A free-trade zone in ASEAN's 10 states plus Australia, China, India, Japan, New Zealand and South Korea would bring more benefits than any of the region's smaller trade pacts, a new study said.
The creation of such a massive zone is not likely to inflict big losses on those outside the region like the United States or the European Union, the Asian Development Bank (ADB) said in its study.
Analysis carried out by the ADB Institute, the bank's research arm, showed that a 16-nation FTA, if realised from 2017, would bring the nations annual gains totalling 285 billion dollars.
This compares with an estimated 228 billion dollars in gains under an East Asia-wide FTA covering only 13 countries-excluding Australia, India and New Zealand.
"The ASEAN Plus 6 scenario turns out in our study to bring the most gains," ADB senior trade economist Ganesh Wignaraja told the news agency, referring to the 10-nation Association of Southeast Asian Nations (ASEAN).
"But the ASEAN Plus 3 scenario is a good halfway house to get some consolidation," said Wignaraja, one of the paper's authors.
Leaders of the 16 East Asian states including Chinese Premier Wen Jiabao and Indian Prime Minister Manmohan Singh will meet in Singapore Wednesday after the ASEAN summit, with market-opening issues atop the agenda.
The ADB said the so-called ASEAN Plus 6 deal would easily generate more benefits than the 102 bilateral and regional free trade agreements (FTAs) in East Asia that have either been concluded, are in negotiations or proposed.
Trade losses to countries outside a 16-nation or 13-nation free trade zone would be modest, which should ease fears that the proliferation of FTAs will lead to increasing protectionism, the paper said.
Both scenarios are in their infancy, and analysts say prospective signatories such as China, Japan and South Korea would not be able to move forward before resolving a myriad of bilateral issues.
The study said a broader Asia-wide arrangement would consolidate the varying provisions of the current "noodle bowl" of FTAs, which have grown since the current Doha round of world trade talks went into limbo.
It said ASEAN would act as a "natural hub" for this wider free-trade zone. But for consolidation to happen, the bloc must first deepen its own economic integration-a lofty goal expected to face significant hurdles.
China, Japan and South Korea must also cooperate more closely and India needs to pursue further structural reforms, the paper said.
Meanwhile, environmental groups are piling the pressure on Asian nations to do more to fight global warming ahead of a key climate conference next month, calling their pledges so far nothing but empty promises.
Leaders of 16 countries meeting in Singapore this week have agreed to increase the region's forest cover, promote the use of clean energy sources and protect marine ecosystems, according to draft statements.
But activists say the declarations from the Association of Southeast Asian Nations (ASEAN) and the wider East Asia grouping including China and India do not go far enough.
"We want to see a more proactive stance from both ASEAN and the East Asia Summit," Rafael Senga, the Asia-Pacific energy coordinator for the World Wildlife Fund, said.
Athena Ballesteros, a climate campaigner with environmental watchdog Greenpeace, singled out leaders of the 10-nation ASEAN bloc for particular scorn.