What is the East Asia Summit all about?

What is the East Asia Summit all about?
Tue Apr 7, 2009 5:36pm IST
By Bill Tarrant

SINGAPORE (Reuters) - The global economic crisis and the security threat posed by North Korea's rocket launch will grab much of the attention this weekend when Asian leaders gather in Thailand for their annual summit.

The "East Asia Summit", bringing together the 10-member Association of Southeast Asian Nations (ASEAN) and its dialogue partners, will be held in the Thai resort of Pattaya from April 10-12.

It will offer the first opportunity for the leaders of Japan, China and South Korea to meet after North Korea launched a rocket on Sunday, and also comes barely a week after G20 members agreed a $1.1 trillion blueprint to revive the global economy.

Here are some key questions about the meeting.

WHAT IS THE EAST ASIA SUMMIT? It came into being in 2005 as an annual meeting among leaders of 16 Asian nations, including the 10 ASEAN countries -- Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam -- and their dialogue partners China, Japan, South Korea, India, Australia and New Zealand.

It mainly discusses trade and economic issues, although security, human rights and geopolitical issues often feature in discussions on the sidelines.

WHY ARE INDIA, AUSTRALIA AND NEW ZEALAND INVOLVED?

This summit was originally the brainchild of former Malaysian premier Mahathir Mohamad, who wanted to create an East Asia Economic Caucus among the "Asian Tiger" economies. (Some pundits called it the caucus without the Caucasians). The United States through Japan lobbied hard to first bring Australia and New Zealand into the group and later India, which shares security and trade concerns with the summit participants.

WHAT'S ON THE AGENDA?

The summit has been searching for an existential purpose since the 2005 inaugural meeting in Kuala Lumpur. The next summit in Cebu, Philippines sketched out a vision of an East Asia free trade area, and signed a declaration on energy security. The last one in Singapore in November 2007 came out with a declaration on climate change and energy.

The leaders this time are expected to talk about macroeconomic responses to the global financial crisis, how to kickstart the stalled Doha round of world trade talks, and ways to protect their currencies from speculative attacks. They will discuss a coordinated stand for the conference on climate change in Copenhagen later this year and their previous initiatives on energy and food security.

Some of the more interesting stuff takes place on the sidelines. The first summit was largely spoiled by spats between Japan and its neighbours over then prime minister Junichiro Koizumi's visits to the controversial Yakusini war shrine. The three North Asian countries this time are expected to discuss how to restart stalled nuclear talks with North Korea after Pyongyang fired a long-range rocket over Japan at the weekend.

The leaders of Thailand and Cambodia will have the opportunity to discuss their border dispute after last week's clashes caused casualties on both sides.

Myanmar's poor human rights record is usually a talking point in the corridors, although it rarely figures in the discussion among leaders. Myanmar successfully blocked any discussion of its internal affairs at the last summit in Singapore.

WHAT IS THE "CHIANG MAI INITIATIVE"?

It is a pool of foreign currency reserves among the ASEAN+3 countries worth $120 billion. It is aimed at providing emergency balance of payments support through currency swap arrangements, should one of the members experience the kind of capital flight that marked the Asian financial crisis of 1997/98.

Like many of ASEAN's initiatives, it is more viable on paper than in practice. The requirement that a country must be in an IMF programme, or in talks for one, is likely to deter most would-be recipients -- including Thailand, South Korea and Indonesia, which have bitter memories of their IMF bailouts of a decade ago.

There has been some brainstorming around the idea that the Chiang Mai Initiative could eventually lead to an Asian Monetary Unit, similar to the old European Currency Unit that eventually led to the creation of the euro.

That appears to be pie-in-the-sky at the moment. But China, Malaysia, Indonesia and Thailand joined Russia in calling for an international reserve currency system at last week's G20 meeting in London, and that could get another airing at this weekend's summit in Pattaya.

China and Russia have floated ideas about reducing reliance on the U.S. dollar as the world's primary unit of foreign exchange, possible by developing the Special Drawing Rights issued by the IMF.

WHY MEET IN PATTAYA?

The summit is being held in Pattaya, a resort town famed for its racy nightlife about 150 km (90 miles) from Bangkok, to avoid protesters in the Thai capital, who have surrounded Prime Minister Abhisit Vejjajiva's offices to force him from power.

On Tuesday, protesters smashed the window of Abhisit's official car following a cabinet meeting in Pattaya to inspect the summit facilities.

The summit was supposed to be held in Bangkok in December after the annual ASEAN leaders' meeting, as is customary. But those meetings were postponed after protesters seized Bangkok's main airport and effectively shut down passenger and cargo traffic.