Reversal of fortune focuses minds on business matters

'Difficult' subjects will play second fiddle to economics, writes Stephen Vines

It is unlikely that any of the diplomats accompanying John Major to the Asian-European Summit (Asem), which opens in Bangkok today, will care to gloat over the fact that back in 1855 Britain was the first Western power to conclude a treaty with what was then the Kingdom of Siam. The United States and other powers were denied access to the King's court.

Thailand, like other countries in the region, was drawn firmly into the European sphere of influence, mainly by Britain, which at one time ruled all, or part of, half the ten Asian nations attending the summit. Now South East Asia, China, Japan and South Korea, who have sent their heads of government to Bangkok, are increasingly looking to the New World for economic and political relations, making members of the European Union feel rather left out in the cold. Britain's influence has gone.

The Americas have had a formal link with the Asian states through the Asia-Pacific Economic co-operation forum (Apec), established in 1993, while Europe has struggled to regain a presence. Not just politically but economically, Europe's role is declining. In 1970 25 per cent of Asian imports came from Europe; two decades later that figure shrank to 15 per cent. Less than 3 per cent of European direct investment finds its way to Asia, while Japan, a fellow Asian state, has become the dominant economic player in the region, trailed by the US.

Some European powers, notably the Germans, have become increasingly aware of the shortcomings of the EU's relations with Asian countries, particularly the fast-developing economic powers who are setting a breath-taking pace of growth which leaves Europe far behind. As a whole the Asian nations' economies are growing by around 8 per cent per year, compared with growth of no more than 2 per cent in Europe.

Ideally, the EU would like to create an arrangement which mirrors the Apec forum. The Asian powers are equally keen for some kind of balancing arrangement which makes them less dependent on the world's last remaining superpower, and focuses the mind on the pursuit of business ties rather than what they view as interference in internal affairs, which comes in the form of pressure over human rights.

Sources in Bangkok who have seen the draft keynote speech to be delivered by the conference chairman, the Thai Prime Minister, Banharn Slipa-Archa, an old-style wheeling and dealing politician, say that the speech focuses on trading and business ties. It will also suggest that Europe and the Asian states work together to form a counterbalance to attempts by the US to set the agenda for the first ministerial meeting of the World Trade Organisation in December.

A pre-conference meeting of non-governmental organisations in Bangkok has urged the leaders of the 25 states attending the summit not to ignore the human dimension of trade, suggesting that human and labour rights cannot be considered as side issues.

However, Mr Banharn has made it clear that this is not on his agenda. At the beginning of the week he said: "I think non-relevant issues should be avoided ... such issues would include, perhaps, the issue of [Indonesian occupied] East Timor, child labour and things like that".

The European heads of government have shown no real enthusiasm for pursuing these matters, although some ritual references may be made. Western diplomats preparing for the meeting have let their Asian hosts know that they have not come to rock the boat.

However, one important non-trade matter is of interest to the Asian countries who want to see South-east Asia free of nuclear weapons. French nuclear tests in the Pacific have brought this issue to the fore, but there are equal concerns about the nuclear might of China which can be implicitly tackled by speaking in general terms of the nuclear threat.

There will be no great breakthroughs at this two-day summit; its purpose is to lay down markers and generally create a better atmosphere for relations. These are modest but realisable objectives, given the diversity of those attending the meeting.

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