Editorials
Friday, November 20, 1998

Little to show for
APEC conference

THE Asia Pacific Economic Cooperation (APEC) meeting was doomed by the choice of Kuala Lumpur as its location. That put the conference in the midst of the furor over Malaysian Prime Minister Mahathir Mohamad's firing of his deputy, Anwar Ibrahim, and his subsequent arrest on what appeared to be trumped-up charges.

This incident had assumed international proportions by the time the APEC ministers and heads of government gathered in Kuala Lumpur. Several leaders refused to confer separately with the Malaysian premier to protest his treatment of Anwar. Some officials, including Secretary of State Madeleine Albright, met with Anwar's wife to show their sympathy and support. And Vice President Al Gore, filling in for President Clinton, publicly declared U.S. support for demonstrators protesting Anwar's arrest and calling for Mahathir's resignation.

Gore's attack cheered advocates of democracy but angered Malaysian officials. And it drew criticism from some APEC representatives; an Australian minister accused Gore of grandstanding to further his political ambitions. Many diplomats consider it bad form to raise such issues publicly on these occasions.

American business leaders, eager to maintain friendly relations with Malaysia, also expressed dismay at the vice president's comments. Richard Holwill, co-chairman of the Asia committee of the U.S. Chamber of Commerce, said the American business community was "absolutely appalled."

Even if Gore had not made his provocative remarks, the conference would have suffered by Clinton's cancelation of his appearance in order to deal with the crisis with Iraq. Also missing was another important player, Indonesian President B.J. Habibie, who was forced to stay home to deal with anti-government demonstrations that turned into riots.

But the major frustration of the meeting, from the U.S. point of view, was Japan's refusal to accept trade liberalization proposals for forestry and fishing products. As Asia's biggest economy, and the world's second largest, Japan plays a crucial role in Asia. Without its participation, little progress toward freer trade can be made.

Although the United States and Japan announced they were contributing $10 billion in new initiatives to revive Asian economies, most observers considered the amount too small to have a significant impact.

THE 21 national leaders wound up the meeting by pledging to root out the weaknesses that caused Asia's financial crisis but it was mostly an exercise in platitudes.

The Malaysians were happy because APEC endorsed Malaysian proposals to strengthen monitoring of short-term capital flows. Mahathir has blamed international currency speculators for his country's economic collapse -- as though his government bore no responsibility. APEC also adopted another Malaysia pet theme, agreeing to examine the business operations of international credit rating agencies -- an obvious red herring to divert attention from politicians' shortcomings.

Business leaders were openly contemptuous of APEC's efforts. A show of hands by 1,150 executives at a conference on the APEC sidelines showed that about one-half thought its response to the crisis was "woefully inadequate." About the same number indicated APEC had done "little" to help.

But it was unrealistic to expect APEC to do much. Each leader puts his country's national interests first, and in the view of many the current circumstances call for protectionist measures, not liberalization.

Many are willing to pay little more than lip service to the ideal of free trade. And the size of APEC makes it very difficult to gain approval of any meaningful proposal.

The United States got little out of this conference except an opportunity to reaffirm its commitment to democracy, and even that didn't go down well.

North Korean demand

COMMUNIST North Korea is so isolated that its officials have only a tenuous grasp of reality. Example: They have asked the United States to pay $300 million for the right to inspect an underground site northeast of Pyongyang that U.S. officials suspect is being used to manufacture nuclear weapons. The request was rejected. But the fact that it could have been made in all seriousness is in itself astonishing.

State Department spokesman James Rubin called the North Korean demand for compensation for a U.S. inspection "ridiculous." Rubin said, "We're not going to pay compensation to confirm that they are living up to their obligations under this important nuclear agreement." He referred to a 1994 agreement under which North Korea pledged to stop trying to make nuclear weapons.

That agreement is threatened by the activity at the site, as revealed by satellite photography. Washington is demanding access to the site at ground level to evaluate the satellite findings. If the inspection confirms the findings, the 1994 agreement could be scrapped.

North Korea increased tensions by firing a rocket over Japan into the Pacific, demonstrating its ability to strike Japan with missiles. Activity at the underground site has alarmed Clinton administration officials who thought they had eliminated the North Korean nuclear threat.

Demanding that the U.S. pay through the nose to determine whether North Korea is complying with its commitments isn't just unreasonable. It's outrageous. But that's what we have come to expect from the strange government of Kim Jong-il.

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Rupert E. Phillips, CEO

John M. Flanagan, Editor & Publisher

David Shapiro, Managing Editor

Diane Yukihiro Chang, Senior Editor & Editorial Page Editor

Frank Bridgewater & Michael Rovner, Assistant Managing Editors

A.A. Smyser, Contributing Editor