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Web-only Exclusives
November 30, 2000

From Our Correspondent: Hirohito and the War
A conversation with biographer Herbert Bix

From Our Correspondent: A Rough Road Ahead
Bad news for the Philippines - and some others

From Our Correspondent: Making Enemies
Indonesia needs friends. So why is it picking fights?

Asiaweek TIME AsiaNow

Alejandro Reyes APEC '99: Day Three
East Timor, Trade Talks, Clinton - and What the Leaders Will Wear

Trade Creeps Back
Best-Kept Secret Revealed

September 10, 1999
Web posted at 7:30 p.m. Hong Kong time, 7:30 a.m. EDT

APEC '99 by the Numbers

Day Seven
Men - and One Woman - in Black
- Monday, Sept. 13, 1999

Day Six
On the Diplomatic Trail With Thailand's Chuan Leekpai
- Sunday, Sept. 12, 1999

Day Five
Days of Diplomacy
- Saturday, Sept. 11, 1999

Day Four
Even before he arrives, Bill Clinton makes his presence felt
- Friday, Sept. 10, 1999

Day Three
East Timor, Trade Talks, Clinton - and What The Leaders Will Wear
- Thursday, Sept. 9, 1999

Day Two: The Missing Agenda
Between East Timor and impending Sino-U.S. talks, the real business of APEC is being pushed aside
- Wednesday, Sept. 8, 1999

Day One
The hosts spend big to put their best foot forward. But will the Timor situation rain on Auckland's parade?
- Tuesday, Sept. 7, 1999

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Today's headlines from across the region

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Daily commentary from the editors of TIME Asia

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Each business evening with analysts around the region

Credit New Zealand Foreign Minister Don McKinnon with the revelation of the day - the third day of the Asia-Pacific Economic Cooperation forum's annual meeting in Auckland. "This issue is much bigger than APEC," he said, referring to the East Timor crisis. "The whole issue belongs in New York and Jakarta." McKinnon was speaking after the Sept. 9 special ministerial session that had been hastily convened to discuss the bloody turmoil in the Indonesian province. Co-chaired by Canada and Australia, the talks were attended by 19 of APEC's 20 members - only Taiwan and Hong Kong were absent - as well as Britain, which is not part of the organization. But seven countries, including China and Russia, did not send their foreign ministers. Indonesia insisted it had no representative at all, although an official from Jakarta's delegation sat in the Town Hall room taking notes.

East Timor continued to be the topic of the moment, despite the best efforts of trade ministers who began their first day of meetings. While the hosts worked hard to play up the emergency conference, the reality is that it achieved little more than allow Australia, New Zealand, Canada, the U.S., and the European Union (represented by British Foreign Secretary Robin Cook) to show they weren't just sitting back and doing nothing. There was a pledge to support the U.N.'s mission in East Timor and a collective expression of "grave concern" for the territory and its people. But an intervention force without Jakarta's approval was ruled out - for now. "There will be an international force; the only question is when," Australian Foreign Minister Alexander Downer said. "There is no enthusiasm in the international community to go to war with Indonesia." Canadian Foreign Minister Lloyd Axworthy reckoned that the U.N. Security Council should address the matter as quickly as possible. Cook issued a sober warning: "In all candor, nothing is more likely to make it impossible for the government of Indonesia than for us to demand a response by a deadline."

The British minister's cautious line may have been the result of persuasion by the Southeast Asian foreign ministers who participated in the crisis conference. Axworthy, Downer and McKinnon had lobbied hard to get the three - Thailand's Surin Pitsuwan, S. Jayakumar of Singapore and Domingo Siazon of the Philippines - to attend. At the table, the trio argued for prudence in dealing with their neighbor. President B.J. Habibie's position is fragile - he may fail to win reselection in November - and testing him now could further destabilize the government. Indeed, rumors of a military-led coup in Jakarta were already circulating. By evening, some news agencies were reporting that Habibie's defense chief Gen. Wiranto was effectively in control of the government.

Whatever the situation in Indonesia, East Timor is likely to remain the hot topic for the rest of the APEC meeting. Nobel peace laureate Jose Ramos-Horta was to arrive in Auckland on Sept. 10, while his co-prize winner Bishop Carlos Belo, who fled East Timor for Australia earlier this week, may also turn up. Habibie will not make it to the weekend summit, but will be represented by Economics Minister Ginandjar Kartasasmita. He spent the day defending his government. If the international community was angry about what was happening in East Timor, "we are madder and angrier," he insisted. Jakarta had no intention of reneging on its commitment to honor the results of the Aug. 30 referendum in which East Timorese roundly rejected autonomy under Indonesian sovereignty. Habibie, he said, was still fully in charge.  

Trade Creeps Back
APEC Policy wonks need not fret. Despite East Timor, officials and ministers have been avoiding the bright sunshine to stay indoors and work on APEC trade agenda (though they did linger a couple of hours beyond the allotted lunch period to enjoy Auckland's harbor front). The main mission: to set a list of priorities which the Pacific Rim economies can take to the crucial World Trade Organization ministerial meeting in Seattle in late November. That conference is expected to launch a new "millennium round" of global trade negotiations. But the APEC talks haven't been going smoothly.

As expected, some Asian economies led by Japan and Malaysia are resisting efforts by the U.S. to insist on a so-called "early harvest" approach, in which APEC would press for early liberalization in key sectors, including such contentious areas as forest products, fishing and agriculture. Those opposed to Washington's tactics want to go for a more gradual, comprehensive strategy, or "single undertaking."

Anti-dumping has also become a tough topic. Some countries including South Korea, Thailand, Japan, Mexico and Chile have been pressing for APEC to call for a review of the WTO's anti-dumping agreement (which allows countries to penalize trading partners for exporting goods at much lower prices than their true value). The U.S., which has frequently imposed such penalties, is opposed to revisiting the scheme.

China and Taiwan, who don't speak to each other at APEC, but sit at the same table, got wrapped up in a mini-war over words. Officials had agreed to a statement that would call for both to become WTO members by the Seattle conference. But the Chinese wanted the statement to specify that the mainland would join first. Taiwan, or Chinese Taipei, as they are known in APEC-speak, then argued that the contentious paragraph should be scrapped. Under the APEC practice of decision-by-consensus, one objection can beat the majority. Ministers may yet resolve this one.  

Best-Kept Secret Revealed
Since the second APEC leaders' meeting in Bogor, Indonesia, when the guests were kitted out in specially tailored batik shirts, what the VIPs will wear at their day-long informal retreat has been a key pre-summit question. In 1996, the Filipinos gave each leader their very own barong, or elaborately embroidered native shirt, to wear. The following year in Vancouver, the Canadians provided leather bomber jackets. In Kuala Lumpur in 1998, the uniform was again colorful batik. On Sept. 13, expect the leaders to be wearing yachting windbreakers (style and colors have not been revealed, but it's probably safe to rule out floppy hoods and eye-catching pastels) - a salute to the America's Cup competition which is to begin in Auckland's harbor next month. Prime Minister Jenny Shipley is reported to have personally selected the garment on the advice of a committee of Auckland patrons of the arts.  

On his departure for New Zealand in the early evening of Sept. 9, Washington time, U.S. President Bill Clinton said he was "so deeply concerned" by the situation in East Timor. "There are forces who want to reverse the popular will," he said. "If Indonesia does not end the violence, it must invite the international community to assist in restoring security. We cannot have a reversal of course here. My own decision on whether to support further [economic] assistance will depend on how Indonesia handles this situation."

Clinton said that the U.S. had cut all military contacts with Indonesia. He was consulting with Australia and other countries, the U.N. and with his own Congress on how the U.S. might be involved should there be a peacekeeping force for East Timor. "There are a number of countries willing to support [a contingent] if Indonesia will ask. The frustrating thing is that they either can't or won't stop the violence, but they either can't or won't admit that." He warned that Jakarta would be judged by how it handles the crisis. "It would be a pity if the Indonesian recovery is crashed by this," the president concluded. "Nobody will want to continue to invest there if they continue to let this sort of travesty go on."

Clinton is set to arrive in Auckland tomorrow and will be holding a series of bilaterals, including a meeting with Chinese leader Jiang Zemin. On Sept. 9, U.S. Trade Representative Charlene Barshefsky and counterpart Shi Guangsheng agreed to resume Sino-American negotiations on Beijing's membership in the WTO. Talks were halted after the U.S.-led NATO bombing of the Chinese embassy in Belgrade in May. In Auckland, Barshefsky said that, while time was running out, it was not impossible for China to join the WTO by the end of November. "Certainly China is under some significant time pressure if it wishes to be a member of the WTO by the time of the Seattle meeting, let alone by the end of the year." Count on Jiang and Clinton to have something to say about this after their meeting.

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