UNITED NATIONS (AFP) — The United States has agreed to join Singapore, New Zealand, Chile and Brunei in a free trade agreement that could set the pace for a broader Asia-Pacific free trade area, officials said.
US Trade Representative Susan Schwab is expected to announce Washington's decision to participate in the "Comprehensive Trans-Pacific Strategic Economic Partnership Agreement" at a meeting Monday with ministers from the four countries on the sidelines of the UN General Assembly, the officials said.
"I can confirm that the US will join," a US administration official told AFP.
The agreement, the first trade pact involving a group of Pacific Rim countries, was signed between Singapore, Chile and New Zealand in 2005 before Brunei joined it a year later.
It was commonly known as the "P4" group with a broad objective to tear down trade barriers among participants within a decade, officials said.
New Zealand Prime Minister Helen Clark promptly hailed the US decision as a boost for her country's economy.
"It's very, very big news. It has to be remembered the US accounts for close to 10 percent of our total trade," Clark told reporters on Monday.
"It's a huge economy. It's a growth engine of the world economy even in its slow times, and very important to us."
The US move to join the agreement will give impetus to a long-term initiative within the 21-member Asia-Pacific Economic Cooperation (APEC) to forge a Free Trade Agreement of the Asia Pacific, officials said.
APEC, which brings together nations including the United States, China, Russia, Chile, Japan, Canada, Australia and key Southeast Asian economies, accounts for nearly half of world trade.
Schwab planned to announce the "launch of negotiations" for the United States to join the P4 agreement at the talks Monday, one Asia-Pacific diplomat involved in the talks said.
In March, Washington decided to hold talks with the P4 on freeing up investment and financial services only.
"The terms of the US accession to the broad agreement is to be discussed later among the five parties," the diplomat told AFP. "The investment and financial services talks will be folded into the larger agreement."
The P4 group has a "benchmark matched by few preferential trade agreements," New Zealand's trade minister Phil Goff said during a recent Washington visit.
With many APEC members seeing the prospect of an Asia Pacific free trade area as a long-term goal, Goff said "the alternative is to create a bottom-up process where like-minded countries agree to come together to liberalize trade between them at a much faster rate."
The United States already has bilateral free trade agreements with Singapore and Chile, but not with New Zealand or Brunei.
But its free trade pacts with South Korea, Columbia and Panama have not been ratified by the Democratic-led Congress as President George W. Bush's administration nears the end of its term.
Bush on the sidelines of the UN meeting will on Wednesday hold talks on free trade with leaders of several nations in the Western hemisphere.
Last year, the United States exported a record 1.6 trillion dollars in goods and services to countries around the world. In the past four quarters, trade has accounted for more than half of the growth in the US economy, the White House said at the weekend.
For the first half of 2008, the United States exported 926 billion dollars worth of goods and services, 18 percent higher than the same period in 2007, it said. "The growth in exports has helped to strengthen the American economy."
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