11.15.2006 - 11:20am ET

(CSRwire) Leaders from Asia-Pacific Economic Cooperation (APEC) countries should take the opportunity to push forward a development agenda at their meetings this week in Hanoi, said international agency Oxfam today. They should avoid signing free trade deals with the US or amongst their members that do not take into account the development needs of poorer countries.

Government sources indicate that the twenty-one Pacific Rim countries that make up APEC intend to adopt an action plan at the meeting to achieve free and open trade and investment by 2010 and also discuss the possibility of creating a regional free trade zone. They will also talk about ways to reactivate the stalled trade negotiations at the World Trade Organisation (WTO).

"APEC should think carefully about creating a regional free trade zone," warned Matthew Coghlan, Regional Trade Policy Officer for Oxfam. "APEC is made up of both developed and developing countries. A free trade agreement based on the US model, with deep and rapid liberalisation, and WTO-plus provisions and commitments, will pose problems for the latter as they seek to develop."

"APEC countries should proceed with caution before signing free trade agreements with the US. The negotiations threaten developing countries with harsh conditions that will have a negative impact on development, particularly on poor people in rural areas," said Coghlan. "US FTAs undermine the potential for poor countries to use trade to lift their populations out of poverty. Oxfam wants to see leaders be accountable, taking their citizen's best interest at heart, and negotiating in a transparent way"

Free trade deals with WTO plus conditions can block access to affordable medicines by including stringent intellectual-property rules. They also tend to favour foreign investors over the environment and the public interest.

For example, Thailand, which had been negotiating a free trade agreement with the US and might continue once a democratically elected government takes power, would potentially lose its ability to produce new patented essential and affordable HIV anti-retroviral drugs, costing the country an additional $3.2 billion in medicine costs by 2025 and jeopardizing the country's lauded HIV/AIDS treatment program. Medicine prices in Peru will increase by almost 10% in the first year and 100% after 10 years if the free trade deal with the US is implemented.

Trade deals the US is negotiating also fail to take into account the fact that the US subsidizes farm production with billions of dollars in taxpayer support, meaning that small farmers in Thailand and Peru might face massive dumping of subsidized farm products on their market.

"Bilateral trade agreements like the ones currently negotiated by the US in East Asia, favour big business and rich countries, and exacerbate existing inequalities between countries rather than reducing them," continued Coghlan. "APEC has prided itself as the premier forum to achieve shared economic development and prosperity in the Asia-Pacific region, let's see if its members will keep development needs in mind when they discuss trade."

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