The Asahi Shimbun -
VIENTIANE, Laos-Of all the issues addressed by an action strategy adopted by Japan, China and South Korea here on Monday, none is more important to Tokyo than Beijing's agreeing to discuss trade and investment rules for foreign firms doing business in China, analysts say.
Japanese Prime Minister Junichiro Koizumi, Chinese Premier Wen Jiabao and South Korean President Roh Moo Hyun agreed to hold further talks on issues such as environmental protection and peace on the Korean Peninsula, but it was the possibility of making headway on trade and investment discussions that created the biggest buzz back in Japan.
``The international community is closely watching the cooperation among Japan, China and South Korea,'' said Koizumi, who chaired the meeting. ``We need to establish a legal framework for a steady investment environment.''
Japanese and other foreign companies seeking to expand their operations in China have long complained about the country's tight control over foreign capital and murky licensing processes.
China has been reluctant to deal with calls from Tokyo and Seoul to remove the hurdles impeding foreign firms doing business in the rapidly growing economy, so the country's agreement to at least sit for trilateral talks is seen as a welcome step in a process that could eventually pave the way for a full-fledged, three-way investment agreement.
The strategy outlines guidelines for three-way cooperation that are based on a joint declaration on the promotion of trilateral cooperation adopted by the three countries in October 2003.
The partners intend to work out a plan of action in accordance with the action strategy.
Although Japan and South Korea are calling for an early signing of a formal investment agreement, Chinese officials have so far said it is too early for a conclusion to be reached, citing differences in the economic development of the three countries.
In the area of trade and investment, the action strategy reaffirms the importance of protecting intellectual property rights and calls for a strengthening of cooperation among the heads of the countries' patent authorities. The countries also said they would discuss ways to improve consultation mechanisms.
The three countries also said they will hold talks ``in a timely manner'' for a legal framework on direct investment,.
They also intend to promote exchange of information through existing trilateral mechanisms and by encouraging prior consultations to settle economic disputes.
Japanese automakers, which have faced obstacles in China, will welcome the action strategy. The automakers, for example, are not allowed to own more than a 50-percent stake in a manufacturing joint venture with local partners unless they specifically wish to produce for export only.
Protecting intellectual property rights in China has been another nagging problem for Japanese firms.
A joint study group formed last spring by industry, government and academic representatives of the three countries submitted a report to the three leaders calling for improved transparency in China's administrative processes.
The report pointed to a lack of support for foreign firms in China that seek explanations or interpretations of regulations.
Chinese authorities, moreover, do not issue written notification when an application for doing business in the country is rejected.
On the issue of security, the action strategy calls for ``more frequent contact'' among the countries' defense chiefs and promotion of working-level and senior official-level exchanges to build mutual confidence.
During Monday's meeting, the sixth in a series of talks between the three countries, the leaders also affirmed the need to seek an early resumption of the six-party talks on North Korea's nuclear ambitions.(IHT/Asahi: November 30,2004)
Source: Asahi
