TRANSCRIPT: DEPUTY USTR FISHER JUNE 16 WORLDNET PROGRAM ON APEC
(U.S. to continue pushing trade liberalization at APEC)Washington -- The United States will continue to encourage early voluntary sectoral liberalization efforts at the upcoming trade ministerial of the Asia-Pacific Economic Cooperation (APEC) June 28-30, according to Deputy U.S. Trade Representative Richard Fisher.
Early voluntary sectoral liberalization (EVSL) refers to the gradual elimination of tariffs in the nine priority areas of chemicals, fish products, forestry products, energy goods and services, environmental goods and services, gems and jewelry, medical equipment, telecommunications and toys.
"We want to make sure that other countries in the APEC membership continue the process of liberalization, pushing the envelope to liberalization and restore their growth," Fisher said in a June 16 Worldnet "Dialogue" program with Canberra, Tokyo and Wellington.
Fisher said the United States has been encouraged by the lack of "backsliding" on liberalization efforts despite the effects of the global economic crisis on many APEC members.
"There has been a continued commitment to expanding trade liberalization and the liberalization of these economies and commitments to their individual action plans as well as collective action plans," he said. "I think we are all moving in the right direction, and I have no reason to believe that these goals will not be achieved despite the setbacks that we have had in the past year and a half, particularly the last two years."
According to Fisher, APEC's commitment to EVSL will be critical to broader liberalization efforts at this year's World Trade Organization (WTO) meeting in Seattle late November.
"The round -- and the other initiatives -- that will come out of Seattle are very, very important at this juncture. We are talking about significant further liberalization and removal of trade barriers throughout the world," he said. "APEC has to demonstrate that collectively -- again, we are not retreating from the principles of free trade."
Fisher noted that the state of Japan's economy -- the second largest in the world -- remains a matter of some concern.
"Japan right now is a millstone around the neck of the world economy," he said. "It is important that it grow. And yet we see businesses in Japan beginning to embrace structural change, moving to return on equity management, working their assets very hard, being conscious of shareholder rights. And as you move through big banks, putting an emphasis on profitability and not just simply business for business sake, just for growing every larger market share."
"But what we do not see yet is a commitment by the Japanese government to move away from a command-and-control mentality to a government that encourages competition," he said.
Following is a transcript of the program:
(begin transcript)
WORLDNET "DIALOGUE"
UNITED STATES INFORMATION AGENCY
Television and Film Service of Washington, D.C.GUEST: Ambassador Richard Fisher
Deputy United States Trade RepresentativeTOPIC: Upcoming Asia-Pacific Economic Cooperation Conference
POSTS: Canberra, Tokyo, Wellington
HOST: Judlyne Lilly
DATE: June 16, 1999
TIME: 20:00 - 21:00 EDTMODERATOR: Hello, I'm Judlyne Lilly, and welcome to Worldnet's "Dialogue." The Asia Pacific Economic Cooperation, also known as APEC, has become the primary regional vehicle for promoting open trade and practical economic cooperation. Its goal is to advance Asia-Pacific economic dynamism and sense of community. On this edition of "Dialogue" we will be discussing the upcoming APEC conference to be held in New Zealand from June 28th through the 30th. Joining us to discuss APEC issues is Ambassador Richard Fisher, deputy United States Trade Representative. Welcome to Worldnet's "Dialogue," sir.
FISHER: Thank you.
MODERATOR: Ambassador, can you please tell us the role of the U.S. in this year's conference and what are some of the key issues that will be addressed this year?
FISHER: Well, this year's conference is going to be chaired by New Zealand, a remarkably able trade minister I might add in Lockwood Smith, and the meeting is coming up shortly, two weeks from now.
Our role as a full member of APEC, as the member with the largest market within the region, is to continue to advance the issues that are at the forefront of our agenda for 1999 with Chairman Smith and also the other members have agreed will be the emphasis for this year. And those include continuing work on what is known as the sectoral liberalization issue, early voluntary sectoral liberalization. Basically this means nine different areas from chemicals to forestry and fisheries, and toys and gems and jewelry that we discussed in our last meeting when the leaders got together in Kuala Lumpur, to push for liberalization of tariffs in those important sectors. And then to continue to work to develop an agenda for the World Trade Organization ministerial, which will take place at the end of the year in Seattle, which is a major meeting of all members of the WTO. And in this case the members of APEC will want to formulate as much of a common opinion as possible and advance that agenda towards further trade liberalization.
And then finally to report on each country's individual action plans, and then what we know as the collective action plans of our countries, where we work together as groupings rather than as individual nations. So this is a very ambitious agenda. It takes place against the background of what is still a crisis in the sense that we don't have everybody growing as rapidly as we would like to. Our market is the largest market, as I mentioned. It is also the market that continues to grow, frankly fascinating even our ownselves here in the United States that we continue to grow with no inflation, the economic cycle continues to expand, and we are the market of first and last and sometimes final resort.
I might add, by the way, of course New Zealand has had a magnificent liberalization of its economy over the current government and its predecessors, and Australia continues to grow almost defying the odds. So we are not the only growers in the world, but we are a large destination point. We want to make sure that other countries in the APEC membership continue the process of liberalization, pushing the envelope to liberalization and restore their growth.
MODERATOR: Thank you. Our participants are standing by in Tokyo, Canberra, and Wellington. Please go ahead with your questions in Tokyo.
Q: Thank you very much. My name is -- (inaudible) -- with an agricultural newspaper in Japan. You referred to APEC earlier, and you also cited nine sectors for possible liberalization, and you would like to see progress in liberalization in the nine specified areas. But with regard to agriculture, fisheries and food, the Japanese government on these issues has said that that they should defer any decision within APEC until the WTO takes up these issues. So therefore what is the position the U.S. government vis-a-vis the Japanese government position on these areas? Thank you.
FISHER: Thank you for the kind question. The Japanese government in Kuala Lumpur agreed, as did the other members of APEC, to forward these two sectoral areas, referring specifically in this case to fishery and forestry, along with the other what we call the front nine APEC sectors, into the WTO, so that we would then explore and be at the forefront of liberalization of the sectors. Japan made a commitment to do so, we made a commitment to do so, the other members of APEC made a commitment to do so. And so our expectation is quite simple, and that is that Japan will honor that commitment, that we will advance this sectoral liberalization clause at the WTO. We have actually done so. And in fact again under the leadership of New Zealand we have been in process of effecting that transition, in a sense expanding it beyond APEC into the WTO agenda. We fully expect it will be a signal, and important part of the WTO agenda in the ministerial which will take place in Seattle. And we fully expect as friends and allies of Japan, as members of APEC, co-members, partners of APEC -- and by the way let me add with Japan as one of the founding members of APEC, in fact one of the originators of the ideas of APEC, that Japan will step up to the plate and do its duty and forward the agenda of liberalization and in fact the elimination of tariffs in these two important areas of forestry and fishery.
MODERATOR: Thank you in Tokyo. Our participants are standing by in Canberra. Please go ahead with your first question.
Q: Good morning, ambassador. My name is Geoff Barker from the Australian Financial Review. Since we are talking about free and open trade, it won't surprise you to know that I'd like to talk about lamb. When will we see a decision on future access for Australian lamb into the United States market?
FISHER: Well, I believe that we will see a decision in fairly short order. We have not reached the decision yet within the administration, but I expect that one is imminent.
Let me just make a few points on this subject matter, whatever the decision turns out to be. First of all, we have been prodigious buyers of lamb from Australia and New Zealand. And, secondly, we have, as you know, had a case brought under Section 201 of our trade laws. We rarely have had cases brought under 201. And in fact in the last few years only six cases have been brought. Three have gone to fruition. One which we recently had was on broom-corn brooms -- it sounds esoteric but basically it's the stuff that goes into brooms that sweep floors. Let me add parenthetically that Benjamin Franklin was the one who brought these broom-corn seeds to the United States during our colonial period. We built an industry. The industry felt that it has been injured by imports, and so we invoked the 201 after a suit was brought, and indeed we provided for some relief for the industry.
In the case of broom-corn brooms, the president recently lifted that relief because the industry hasn't made an effort to adjust. So it's a rare thing to bring these cases. It is brought before an independent body -- in this case the ITC, in this case the United States. The ITC made a ruling and now we are setting about, providing for the package that is incumbent on us to provide -- to provide some relief to the industry under the conditions which it faces. And we will have to wait to see what that decision will be, when it will be announced. I expect it will be done very shortly.
MODERATOR: Thank you. We are going now to Wellington. Go ahead please with your first question. Wellington, we are awaiting your first question. Go ahead please. (Technical difficulties.) We are having some technical difficulties.
FISHER: Can I come back to the gentleman in Australia while we are waiting?
MODERATOR: Certainly. We'll get to you in just a moment.
FISHER: While we are waiting for the gentleman from Wellington. I think, now that I think about your question, there is sort of an underlying premise to that question which is concern about our ardor for free trade in the United States. I want to continue to emphasize the point that we are running a very aggressive economy here. We are growing significantly. We are an end point for so many particularly after this implosion of demand that took place in the Asia-Pacific basin. Of course as I mentioned earlier, Australia has managed to grow at rather remarkable rates in the face of this very difficult circumstances in their immediate market.
This country, the United States, is committed, in fact is a leader in terms of free and open trade. We have a very low tariff rate applied overall in this country, a single -- low single digits. We continue to run, by the way, a significant trade deficit, we fully expect on good this year according to private forecasts that our trade deficit could exceed $340 billion, or above $300 billion.
Our job is to grow, our job is to consume, our job is to take up the slack. There are always going to be areas -- and you referenced one of them in particular -- where industries feel that they have a reasonable cause to provide for some adjustment, to have some relief, and in this case as I mentioned it is very rare that Section 201 is brought. But on the other hand we try very hard once we have a decision from an independent authority to put together a program which solves the problem and doesn't exacerbate tension between our countries, and we are endeavoring to do so in the lamb case.
Now maybe the gentleman from Wellington is on the line.
MODERATOR: We are having some technical difficulties with Wellington. We are going to go ahead and return to Tokyo for your questions. Go ahead, Tokyo.
Q: Now, concerning the Asian economic forecast, what is your outlook for the Asian economy? It seems that all of the Asian countries in terms of their GDPs are showing improvement. Do you think this is a full-scale improvement? And right now Ambassador Pickering is in China and he is talking about the WTO matter with China. Concerning the Chinese accession to the WTO within the year, what is your outlook?
FISHER: Well, there are two questions here. One is the economic growth taking place in Asia, and the other is with regard to China. If I forget about China -- which I won't -- just come back and get me.
First, we do note that Japan had a quarter of sudden bouts back in its economic growth. We have noted that Korea, which is a very powerful market in terms of size, has made a complete V-shaped recovery in terms of industrial production from the pre-crisis levels. And we also note that Thailand and Malaysia are doing very well. And, as I mentioned earlier, the important countries to the far south -- that is, Australia and New Zealand -- are enjoying rather favorable economic circumstances under very trying conditions under superb leadership.
I want to come back to Japan here, because we are very, very concerned about Japan. Your government has rather boldly put forward a significant amount of fiscal stimulus -- over 1 trillion U.S. dollars in stimulus has taken place. Magnificent construction enterprises have been launched in order to try to bolster up the economy. The Japanese government has run a very accommodative monetary policy. In fact, as you know better than I, interest rates are extremely low and were almost negative for a short period of time. Those are two legs to a stool of restoring prolonging economic growth. But there is a third leg missing, and without it we don't believe we can have sustained economic growth in Japan, and that is a serious restructuring of the Japanese economy, which means deregulating and reregulating and rechanneling the efforts of the Japanese economy and helping it move into the information age from the machinery age. And therein lies a major problem. To be utterly frank, Japan right now is a millstone around the neck of the world economy -- the second most powerful economy in the world. It is important that it grow. And yet we see businesses in Japan beginning to embrace structural change, moving to return on equity management, working their assets very hard, being conscious of shareholder rights. And as you move through big banks, putting an emphasis on profitability and not just simply business for business sake, just for growing every larger market share.
But what we do not see yet is a commitment by the Japanese government to move away from a command-and-control mentality to a government that encourages competition.
When Prime Minister Obuchi visited the United States, he made a very important statement, and in fact he wrote a piece for the New York Times on the op-ed page. He said that if Japan didn't make these adjustments it was doomed to economic and technological disaster. We agree with the prime minister, and indeed we are looking now to see that he leads this government again away from a command-and-control mentality into promoting the ethic of competition. What we worry about is that Japan cannot make the transformation to the information age.
And I notice this has become part of the parlance of economic discussion presently. For example, the other day there was a very long piece in one of our major newspapers -- I believe it was the New York Times. It referred to Germany as the Japan of Europe, because Germany had so many structural rigidities and was having trouble with economic growth. But Japan is viewed presently as the largest single problem in terms of restoring growth in the world at large. And it is critical that this structural rigidity that exists within Japan be changed, and we are working with your government, and having a very significant discussion -- it's called the enhanced initiative on deregulation, of which I have the fortunate obligation to lead on behalf of the United States, with my counterpart who is the deputy minister of foreign affairs, and all the different agencies of Japan, to try to effect significant change to liberate the economic spirit that we know is there in Japan and restore long-term economic growth.
Now, with regard to China, you mentioned that Ambassador Pickering is there having his meetings today. We on April 8th announced a significant amount of progress on market access issues in terms of our bilateral discussions with the People's Republic of China for their accession to the World Trade Organization. At that point, as you remember, we had, according to Premier Zhu, in his own words, we were about 99 percent of the way there. Whether it's 95 or 99 percent of the way there, there is still more to do. Since the unfortunate incidence in Belgrade, which Ambassador Pickering is discussing now in Beijing, we have had no further discussions with the Chinese. In essence the ball is in their court. That is, when they wish to get back to the negotiating table we are ready. We have made a commitment to make a best effort to complete this process so that they might join the WTO or accede to the WTO by the end of this year. And we are ready to continue our discussions. And an important point is this: that we can only move forward from the April 8 point and we cannot move backwards. And we have some issues we still need to resolve.
But in terms of China's being able to exact in this discussion of trade some kind of price for the unfortunate incidence in Belgrade, that's not going to happen. We will deal with this trade accession issue on its own merits, and it has to be a commercially sound deal. And if it is not commercially sound then we can't meet what is our commitment or our quid pro quo, which is normal trade relations delivered on a permanent basis, from the United States Senate, from our legislature on Capitol Hill.
So we are waiting to reengage in these discussions with China, and again the ball is in their court as to when we will reengage. And once they decide they wish to talk to us again, we will be eager to do so.
And I might add parenthetically they have not been discussing trade issues with any of the NATO countries. They have not engaged with the European Union as well. And once they decide to do so I know the United States in fact -- I can tell you we are eager to engage in this discussion and we look forward to doing so.
Q: Kori Ida (ph), NHK Television. This is not on APEC. I have a question on steel, if that's okay. And I believe the steel quota though will be voted in the U.S. Senate next week -- I believe it's on the 22nd and 25th. How do you see the possibility of the bill to be passed, number one? And as has been pointed out that this is very protectionist bill, how do you view the global economic effect by this? Thank you.
FISHER: I had the opportunity today to appear before the Senate Finance Committee to discuss an alternative bill that is being put forward by the chairman of that committee, Senator Roth, and to address this very issue.
We made it very clear that on behalf of the administration of this country; that is, the executive branch and of the president, that we do not find a quota bill to be attractive, and indeed we would seek to veto that bill. We believe that a quota bill would be destructive. You reference this in your question. It would send the wrong signal to the rest of the world, and it would not be in keeping with what we should be doing here. We have been suffering from significant import surges on steel. We took note of this late last year. We have had very good and vigorous diplomacy in the case of Japan, where you are calling from. And indeed Japanese exports of steel to the United States have declined significantly. And we have had substantial relief to the point where the actual imported tonnage of steel into the United States now is actually running at the levels at which, or close to the levels at which the quota bill would require after it were enacted, if it were enacted. And of course as I mentioned earlier we do not support the quota bill in the Clinton administration.
So in answer to your question, we are against the quota bill. At the same time, we expect that because of circumstances that have developed in the world, which is an implosion of demand in Asia, because were are the market of last and first and only resort, we can't let people abuse their access to these markets. We have been gratified to see the relief that has come in terms of tonnage shipped to this market, and will continue to remain vigilant and use our trade laws and use the World Trade Organization and our rights therein to make sure that people don't take advantage of the fact that we are growing still so prodigiously here in the United States. But we are against the quota bill, and we have made that very clear.
MODERATOR: Thank you, Tokyo. We will now go to Wellington for your first question. Go ahead in Wellington.
Q: Yes, hello, it's -- (inaudible) -- from the Evening Post in Wellington. I'd just like to return to lamb, but in terms of what it means for APEC. I'm just wondering, you made a defense -- a likely decision on tariffs, I guess on lamb. But given that America says it's an advocate of free trade, a lot of us are receiving the wrong signal this year, particularly as it is aimed at the two economies -- (inaudible) -- within APEC you could say would be the strongest advocates of free trade apart from the United States.
FISHER: Well, Brent, we haven't had a decision yet, so we can't prejudge that decision. Again, this is a use of Section 201 of our law, and in fact the burden of proof in Section 201, as we applied in the United States, is actually much more rigorous than what the WTO allows its other members under their safeguards provision. And we had a discussion about this very issue today, not on lamb per se, but about Section 201, in our appearance before the Finance Committee of the United States Senate. So I wouldn't prejudge the decision, because it hasn't been reached.
And, secondly, whatever the decision is, again it is in keeping with our laws in the United States and the burden of proof in the law that we have under Section 201 is more rigorous than what is available to other WTO members within the WTO under the safeguards provision.
I want to remind you that we are, as I said earlier, I hope you were on the show then, we are running a significant rate of economic growth in the United States. We are consuming a dramatic amount of imported products in the United States in all sectors. We are very, very mindful of the fact that whatever action we take, whether it's in steel or lamb or any other area, sends a signal to the rest of the world. The president I can tell you in Cabinet meeting after Cabinet meeting or other public pronouncements it is made very clear that we must keep an open market, and that we must continue to send the right signal to the rest of the world as we deplore them not to move backward on trade, but indeed to move forward.
And it is within this context that I think the APEC meeting is going to be so important in New Zealand. We have to show a commitment to further forward motion on trade towards further liberalization and greater transparency. And I believe that when you look at the United States, just as when you look at New Zealand or you look at Australia, you see that that commitment is there. There will be individual cases where industry -- specific industries need relief. They have to go through a very rigorous process to get that relief, and again they have to go through an independent authority like the ITC, and accepted rules of the road. And that's where we are on lamb, and let's see what the decision is, and then perhaps we can discuss it when I see you in Wellington.
MODERATOR: Thank you, Wellington. And now let's go to Canberra for more questions. Go ahead, Canberra.
Q: Geoffrey Barker again, ambassador. You noted that the U.S. is a prodigiously growing economy. You noted also that there will always be industries there which have a reasonable claim for "relief" I think was your term. Isn't the case in this lamb business that U.S. policy is in effect hostage to the political influence of important but declining and inefficient sheep producers, and is there a reason for a prodigiously growing economy to qualify its free trade rhetoric?
FISHER: Well, I think there's a subtext to your question, which I detected, but I won't address that quite specifically. Look, if you look at the numbers in terms of the exports of both fresh and chilled lamb and frozen lamb that have come into the United States from Australia and from New Zealand, I think you'll find that the amount of tonnage that came into the United States as it were, the number of kilos that have come into the United States in the last few years has been significantly large. They have been growing, speaking of prodigiously, rather prodigiously. It's a very steep growth curve. And we are very mindful of the fact that you have a very competitive industry.
To be sure, in all cases of trade, whether it is in Australia or whether it is in the United States, politics does play a role. Our job is to again heed the instructions, or at least the ruling of an independent authority -- in this case the ITC -- that is not a politicized process. We do not interfere with it in any way, shape or form. A case was brought. It was brought before that independent body. The independent body made its ruling. And it is now our job to structure a package that deals with the ruling that we were handed down.
So we could talk about lamb for an entire hour; we don't have the decision yet, and therefore I think it's best to wait for the decision until we get it. And regardless of whatever that decision may be, just to repeat myself, I want to remind you that we do import a dramatic amount from the rest of the world, and we are a very free-trading country, and we will continue to be so.
Q: Just to follow up my question, if the decision does go against the sort of interests Australia has in this, and New Zealand, what -- and just to follow up on that question from my colleague in Wellington, what do you expect could substantially come out of the APEC leaders meeting against that background? And, secondly, what does the U.S. now see as the future for the organization? Does it for example see it being able to evolve into broader areas of Asia-Pacific security perhaps?
FISHER: Well, I think its principal focus is on economic issues. APEC has been a magnificent forum. It has provided tremendous leadership. Remember again, it's not a trade pact per se; it stresses the word "cooperation." Without APEC we couldn't have had a successful Uruguay Round; we definitely could not have had an information technology agreement. The genesis of that information technology agreement, which was a huge trade package, came from within APEC and through APEC leadership.
I think there's plenty that APEC can do. APEC has to demonstrate that collectively -- again, we are not retreating from the principles of free trade. And you preface your question by saying "if" -- I am not going to work in hypotheticals here. All I know is that what has happened is that APEC has been at the forefront of leadership. And I fully expect that in the case of this leadership now, that is New Zealand in the chair. But even if it were Australia in the chair, under the very able leadership of Tim Fisher, who is a magnificent trade minister, deputy prime minister, Minister Fisher, as would Lockwood Smith and as will all the other members of APEC, that we continue to use this agenda to do what it has done so well before.
I think one thing that is very noteworthy is the fact that despite the tremendous stress that many of the APEC members have been under with a tremendous implosion of economic growth and a huge financial crisis that took place within Asia, and even now as this has rolled over into some of the Latin American members of APEC, in terms of pressures that have come on their economies -- Chile for example with an implosion on commodity prices that have affected them very severely -- there still is a commitment by the APEC membership to elevate the quality of the discussion to move the WTO agenda further forward.
And I fully expect that regardless of the outcome of the lamb decision, whatever that may be, that that commitment will be in place -- I know it's in place -- and we will continue to move the agenda forward, and APEC will continue to show leadership.
The round -- and the other initiatives -- that will come out of Seattle are very, very important at this juncture. We are talking about significant further liberalization and removal of trade barriers throughout the world. And, by the way, those that have concerns about whether the United States is becoming protectionist or whatever, it is important as we battle protectionism within our own country, within our own Congress, within certain groups within our own country, that we are able to show, we in the United States, that working within the WTO and initiating with the leadership of APEC, that the rest of the world is working with us to move forward to further liberalize trade. And the best way for us to battle protectionist forces in this country we are gaining freedom to access other markets in the rest of the world. So I think APEC plays a critical role here, and that's why these meetings in New Zealand are so important, whatever the decision may be on lamb.
Q: Well, can I just ask a question that perhaps my New Zealand colleague may be anticipating, but is the U.S. backing the New Zealand candidate for the chairmanship of the WTO?
FISHER: I think we have, again in the case of the director general's race that you are referring to, we have made very clear what our preference is, and we expect that issue to be resolved in a timely manner. I think people forget that if you go back to the previous director general there was also some controversy, or at least some turmoil that surrounded that appointment. It wasn't as difficult or exactly the same as the current sort of impact that has been reached. We expect to have that issue resolved. And I imagine there will be some discussion of that in the corridors certainly at the APEC meeting, and I will leave that up to my minister, Ambassador Barshefsky, to conduct those discussions.
Q: On another issue, in this region we are obviously very intensely focused on what happens in Indonesia now because of its role both in APEC and ASEAN. Have you any view at the moment of where the U.S. sees the Indonesian economy going and Indonesia's role in APEC going? Now that the election is over do you see any change in the way Indonesia plays into these forums?
FISHER: Again, I would imagine your intimate knowledge of Indonesia far exceeds mine. What we from a trade standpoint wish to see, from what we wish to see from an economic standpoint, is the return of stability to Indonesia and the restoration of economic growth. It is a country that has gone through severe stress, and as a result of these elections will settle out and that order be restored, that balance be achieved, and that they are able to participate fully in the global system, and that they can become viable economic trading partners. So I really don't have any comment from my portfolio perspective -- that is, as a deputy trade minister -- on the political process in Indonesia, except that we are eager for them to reach some degree of stability, determine where they are going in the future, become and remain full-fledged participants in the APEC process.
Your foreign minister, by the way, has been tremendous in terms of his leadership on the issue of East Timor, and I know that Australia is vitally concerned about the future of Indonesia. I would simply say on the economic front we share with Australia the same concern, and we look forward to stability being achieved so that again economic growth can be restored, the well-being of the Indonesian people can be elevated, and they can be realizing their full potential as a tremendously populous country and potentially a greatly productive country. We just want to make sure that they are full participants in the system. And that is the most difficult case that is presently at hand in that part of the world, and we are eager for it to be again resolved through progress.
So I don't have much more to add to that. I wish I knew more about the specifics of the politics, but I am afraid that I don't.
MODERATOR: Thank you, Canberra. Now let's go to Wellington for more questions. Go ahead, Wellington.
Q: Chris Nixon from the Institute of Economic Research. Ambassador, we in the far south are not growing very fast. One of the major reasons for that or one of the major impediments to growth is the fact that we can't get into the OECD market. But on a more positive note, what do you think of the New Zealand initiative in APEC to strengthen markets? The initiative moves beyond sort of the traditional trading areas and lots of competition in and behind the border of each country to improve transparency. Again, will we be supported by the U.S. in this initiative or not?
FISHER: Well, we will have discussions about this. In general we do support your concept to enhance transparency. This has been our major thrust of the WTO and in all fora, and again we are looking to the leadership of Lockwood Smith and your government on this front. But anything that moves forward, the general premise of greater transparency, more liberalization, more free market operation, the policy that we endorse in the United States and in fact promote.
With regard to your growth, you are right, I don't want to lump you in exactly with Australia, but I did want to note in my comments that the Australian growth situation has indeed been very strong and we applaud it. And we know in the situation in New Zealand we are eager to see significant growth restored. New Zealand has been a tremendous leadership over the last many years in terms of dramatic economic liberalization, unilateral initiatives to remove market barriers, to embrace a very free market economy, and indeed from not just the fiscal policy side or from the trade policy side, but even in terms of monetary policy, and has been a model for the rest of the world. So we look to New Zealand leadership, and we are eager to discuss these issues when we are in New Zealand two weeks from now.
Q: Hi, it's -- (inaudible) -- again. Just sort of following on from that issue, there seems to be some sense that within the APEC crisis it's kind of one size fits all, and all economies seem to be expected to follow a particular model. Do you believe there's room for flexibility in the way different economies go down the liberalization road, or is it simply a single route that all of them have to follow in the same way?
FISHER: Well, first of all, there is consensus that is achieved, for example on the EVSL, the early voluntary sectoral liberalization. I was a participant in all of those discussions, painstakingly negotiated and agreed to the language, and that consensus was achieved.
I would make the point that you can't use the argument you just gave to endorse laggards or to use that as an excuse not to move forward. And just as we fully expect that Japan will honor its commitment in forestry and fisheries, it's not that one size fits all or that one speed moves all, but the fact is that we agreed on something, that it was reached by consensus, and once that is done then yes indeed I think it should be expected that all countries move in the same direction. There might be minor exceptions, but once a consensus is achieved that consensus is hard-fought, and it should be adhered to and lived up to.
Q: This is Chris Nixon again. The WTO has succeeded, particularly in trade of industrial products over the past 50 years without the need for sort of an annual general ministerial. Every two or three years when there is something important to sign the ministers turn up and sign them. In the APEC process we have a ministerial every year. Do you think this is building up too much expectations of the process?
FISHER: Well, I think the expectations --
Q: And do you think we will be able to fulfill those expectations?
FISHER: I think unfortunately in this world whenever groups of leaders get together people expect dramatic packages to be announced. But that's not the purpose of APEC. APEC is a forum. It stresses the word "cooperation." And I think it's very, very important, particularly because of, as you call it in the far south or the deep south, such dramatic changes have been made in the case of your country, dramatic liberalization in the case of Australia, incredible economic growth that took place and then was waylaid in all the Southeast Asian countries and Korea. And because of the importance of Japan as such a heavyweight in this system -- although unfortunately now a weight that is dragging the rest of the system down -- that given the dynamism of the area, given the new economic philosophies that have been embraced during the past decade, and particularly given this pressure that many of these countries have come under during the financial crisis, that there be a constant dialogue, that there be an ability for deputy ministers and trade ministers and for leaders, heads of state and heads of government, to get together every now and then and chart the future. And I think it is a magnificent structure. It brings together again these Pacific nations, including the United States, including some Latin countries, and of course these vital countries in the Pacific itself, and exerts influence on what happens in the rest of the world. And just because the WTO only meets periodically, and just because we will have one of those periodic meetings in Seattle at the end of this year, that doesn't mean we shouldn't have an annual discussion with these important -- some emerging, some already extremely mature countries, like the United States -- and that we compare notes and that we figure out how we want to continue to move forward, and that we assume leadership as APEC members. Again, we never would have had an information technology agreement had it not been for APEC. And I would argue we never would have successfully completed the Uruguay Round had it not been for APEC.
So I do feel that these annual meetings are constructive, they are useful, and yet I would urge the media not to expect dramatic announcements to come out of each one of them. It is doing its job by moving the progress of liberalization of trade forward. It's doing its job by pressing the envelope. And that's what APEC is all about.
Q: Hi -- (inaudible) -- again. Look, on this plain discussion I think through this series of issues and difficulties -- lamb, steel, disagreement over who should head the WTO, I think American concerns about increased imports is a result of countries looking to the American market in light of the Asian downturn. On most of these issues APEC members seem to be on different sides on various parts of them. Do you see these sorts of political difficulties making it more difficult to make any headway this year at APEC?
FISHER: Well, you know, there are always going to be issues that are divisive. The purpose of having a group like APEC is to talk about whatever the divisive issues are, and again to move forward as a group.
Every relationship, including the best of marriages, has friction points. And the purpose of cooperation is to overcome those friction points and move forward. I think it's a general premise which certainly APEC is an example of the way it works. So I have a feeling that in a sense the press is making large mountains out of what are not molehills but are significant areas of friction. You mentioned in the beginning of this discussion, you referenced the pending decision on lamb. And yet a single issue, whether it's lamb or any other subject, should not be viewed as something that will tear APEC asunder. It's not going to happen. And APEC will continue to do its work. Its work is to promote further liberalization and to lead, serve as an example for the rest of the world. I expect it to fully continue to do so. Whether there are dramatic breakthroughs in the process or not is not the issue. It's that it continues to encourage and buttress forward motion. And I think APEC will continue to do so, and I expect this meeting that will take place, and then the leaders meeting that will ensue will serve exactly that function.
MODERATOR: Thank you, Wellington. And now we are going to go to Tokyo for your question. Go ahead, Tokyo.
Q: My name is -- (inaudible) -- Shimbun. Japan as we know is embracing industrial structural reforms, and on the short-term time horizon this may lead to a reduction of the economy or business downturn. What do you feel about this? You earlier mentioned that Japan should go into deregulation, but what is the timetable, and in which areas would you ask for further deregulation?
FISHER: Let me remind you that in 1990 people were writing the United States off. In fact, as late as or as early as the late 1970s serious scholars were saying the United States had reached the point of economic maturity, that we were falling behind the rest of the world, the dynamism in Europe and the Asia-Pacific miracle, and that in essence we were finished. Well, President Jimmy Carter started the process of deregulation under a very able leader in the Council of Economic Advisers, a man named Alfred Kahn (ph), and we began to deregulate and restructure and remove government interference in our transportation industry initially, and we have continued that process in many different areas, including very radically in the Clinton administration, our current administration under our current president, in the telecommunications area.
The great fear that we had at the time was that this would result in job destruction and not job creation. And indeed the numbers tell the story. As recently as 1990, Professor Kennedy at Yale University was making the argument that we were finished, and here we are in 1999 after the longest economic expansion in our history, with statistically no unemployment and yet no inflation in our system. We have very low interest rates by our standards. The American dream, which is home ownership and perhaps a little ownership of the stock market, has been realized by more people than ever in our history. And we know from our own example here in the United States and from our own experience that dramatic deregulation and restructuring and letting competition work its magic it works to restore economic growth and works to restore jobs.
And I would say this much we know about Japan: If this adjustment is not made, if government does not encourage competition in Japan but instead continues to embrace the command-and-control mode that was so successful during the machinery age and the recovery from the Second World War, then there will not be sustained economic growth in Japan; there will be more unemployment in Japan, the Japanese people will be less secure financially. And with your demography -- that is, with your aging population -- there will begin to be great worry about the long-term financial security of that Asian population.
And so we know from our own experience the value of deregulation and restructuring an economy. And, by the way, letting the private sector lead that restructuring of the economy -- it worked in the United States -- there is nothing unique about this country that can't be applied in terms of your own culture in Japan to work in Japan as well. And I think by focusing on the short term and the immediate politics of the short term in the case of the resistance to deregulation, reregulation and restructuring. But Japan can be very shortsighted. What needs to be done is to restore long-term, sustained economic growth in Japan. And unless there is this emphasis on restructuring, unless the government supports some of the measures that are now being taken by significant corporations in the private sector in Japan, unless competition is encouraged, then we believe and we worry that job creation will be permanently retarded in Japan, and so long-term economic growth, sustainable, prosperous economic growth will not be restored in Japan. And we believe this is a tough decision to make. We made that very tough decision ourselves in this country.
And let me just add one other thing. The other thing we did in the United States simultaneously, while we had reports weekly, daily in the press of huge lay-offs in the corporate world, we also simultaneously dismantled and reformed under the leadership of President Clinton our welfare system in the United States, our social safety net. We took a big risk. We did it all at once, and it has proven to be successful. And we believe absolutely firmly that it will be successful also in Japan -- that is, if the government continues to move forward in the direction of restructuring and deregulation, that it will result in greater job employment and greater job creation and greater financial security for the Japanese people. We just are looking forward to the Japanese government embracing this and proceeding with great courage, which we know Prime Minister Obuchi has, into a restructuring of the economy. It can be done. We did it ourselves. And we fully expect that Japan can do it, and we know that it must do it in order to have long-term sustainable economic growth.
MODERATOR: Thank you, Tokyo. Now let's go to Canberra for more questions.
Q: Ambassador, one issue which hasn't been raised this morning is the frequently perceived linkage that the United States makes between trade policy and human rights issues. Just specifically, are there still U.S. trade restrictions on Indonesia over human rights issues? I don't know. And, more generally, what now is the U.S. attitude to these sorts of linkages now?
FISHER: Well, first of all, the greatest liberator of potential any human being is to have employment and to have economic growth. We embraced, as you know, what we call New Democrats within our own political system -- firm commitment to economic growth, and we make it very clear that the best way to enhance human welfare is to have economic growth, and the best way to achieve economic growth is through ever-expanding markets and through free and open trade. There is no better promoter of basic human rights than that basic premise.
As far as the issue is concerned, the president just yesterday your time made a speech before the International Labor Organization where we have taken on fully frontally the issue of child labor and abuses of child labor in the rest of the world. We make this very much a part of our agenda in terms of our basic policy throughout the world to adhere to and support basic workers' rights, and particularly the elimination of the exploitation of child labor -- not so much that this is linked in directly with our different trade negotiations, but this is a fundamental social and political and diplomatic policy which we embrace and we will be aggressive with, as the president announced in his speech. I don't know if that answers your question or not, but there we are.
MODERATOR: I think they'll have an opportunity to talk to you again about that.
Thank you, Canberra. Let's now go to Wellington for more questions.
Q: Chris Nixon. The long-term status on APEC -- I want to focus on that for a little bit. Are we being too optimistic about 2010 and 2020 objectives? And as it were the strategies to enter into free trade agreements around the Pacific and the Americas if this fails, the 2020 -- (inaudible) -- ?
FISHER: Really it's not quite the year 2000 -- to prejudge what will happen in 2010 and 2020, and any inference or suggestion that we might fail I think is dramatically cynically. The point is to have a target, the point is to look forward to the future. I think what we have set out as a group is doable. To be sure we were waylaid by this crisis that occurred. We have been encouraged that in most all the APEC countries, however, there hasn't been backsliding. There has been a continued commitment to expanding trade liberalization and the liberalization of these economies and commitments to their individual action plans as well as collective action plans.
So I am not a pessimist as far as the 2010 date and the 2020 dates are concerned. In fact, I am an optimist, and I think time will tell of course, but I think we are all moving in the right direction, and I have no reason to believe that these goals will not be achieved despite the setbacks that we have had in the past year and a half, particularly the last two years.
MODERATOR: Thank you, Wellington. We are running short of time, so Tokyo please ask a short question, and we are going to request, ambassador, a short answer.
FISHER: I don't know if I am capable of a short answer.
MODERATOR: Go ahead please.
Q: (Inaudible) -- Shimbun. I would like to talk about -- (inaudible) -- food. I believe that this is an issue, a thorny issue between the EU and the United States. However, I believe this is -- (inaudible) -- of the newly emerging community. And also I understand that in the next round of WTO you will have to accommodate the request of the community. I believe such a discussion has been taken up at the OECD. But can we talk about genetically modified food, the U.S. government's position on genetically modified food from now on? Thank you.
FISHER: Well, again, I think we have made our position very, very clear. As long as science supports -- and not some arbitrary measurements -- the fact the genetically-modified organisms, GMOs as they are referred to, do not cause danger to people, that indeed we should be allowed to compete for example with our beef exports to Europe. And both we and Canada have recently brought a request for a dispute settlement with the European Union. The WTO has made it clear that these hormonally changed beef can be sold into their markets, should be sold in that market, and yet Europe has resisted. And we will continue to pursue a solution to that problem. In the meantime, we have rights which we are exercising under the WTO.
The discussion around this issue deals with the science of genetic modification, and I think this will be something which will be discussed for quite some time. But we can't let arbitrary rules impose themselves here. Hard science must be observed. The WTO makes a ruling, it is based on scientific principles. And if a country which is affected by the ruling does not wish to go along, then we have rights to pursue some kind of relief, or retribution rather, in the case of the countries, or in this case the European Union, not being willing to abide by WTO rules. That's the way the WTO is structured. And we will exercise our rights fully in all instances. Thank you very much.
MODERATOR: Thank you, sir. And with that I am afraid our discussion must come to an end. Our thanks to Ambassador Richard Fisher for joining us today, as well as to all of our participants in Tokyo, Canberra, and Wellington. From Washington, I'm Judlyne Lilly for Worldnet's "Dialogue."
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