- The Washington Times - Monday, November 29, 2004

VIENTIANE, Laos (AP) — Rising power China moved yesterday to expand its influence in a region long dominated by the United States by signing an accord with Southeast Asian nations to create the world’s largest free-trade area by 2010 — a sprawling market of nearly 2 billion people.

China’s concerns about securing vital sea lanes and satisfying its booming economy’s appetite for oil and raw materials were seen as key motivations for the trade pact with the 10-nation Association of Southeast Asian Nations at the group’s annual summit in Laos.

China is forging new alliances that would reduce, and possibly eventually challenge, America’s influence in Asia, some analysts say.

“China is using its huge market as a bait to lure ASEAN countries away from U.S. and Japan and build closer relations,” said Chao Chien-min, a China watcher and political science professor at Taiwan’s National Chengchi University.

“I think what Beijing has in mind is to forge good economic and trade relations now and then increase exchanges in other areas, particularly in the military and security arena,” Mr. Chao said.

The agreements signed yesterday removed tariffs on goods and created a mechanism to resolve ASEAN-China trade disputes. The accord aims to end all tariffs by 2010, drawing ASEAN’s combined economies — worth $1 trillion — closer to China’s $1.4 trillion economy.

Ong Keng Yong, ASEAN’s secretary-general, said trade with China would speed up with the free-trade agreement. “So by the time this whole FTA [free-trade agreement] is done, as we want to by 2010, it should become quite substantial: $130 billion or $140 billion, perhaps,” he told reporters.

In comparison, the annual ASEAN-U.S. trade is $120 billion and ASEAN-EU trade is $110 billion per year, he said.

Mr. Ong said it would be a long time before China surpassed the United States because the Americans are bigger investors in the region.

China’s deal with the Association of Southeast Asian Nations was sealed as the 10-nation group agreed to another pact that would build an ASEAN community, much like the European Union, by 2020.

The runup to the ASEAN summit in the Laotian capital was clouded by concerns that Thailand’s crackdown last month on a protest that left 85 Muslims dead could inflame militants, and over Burma’s failure to deliver on pledges to move toward democracy.

Some member countries indicated they might call those two ASEAN colleagues to task — in a break with the group’s tradition of keeping out of domestic affairs. But both issues were kept off the table during the summit’s ASEAN-only agenda yesterday, Thai government spokesman Jakrapob Penkair said.

Thai Prime Minister Thaksin Shinawatra had threatened to walk out if the crackdown were raised at the summit of ASEAN members Brunei, Cambodia, Indonesia, Laos, Malaysia, Burma, Philippines, Singapore, Thailand and Vietnam.

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