Remarks by H.E. Mr. Naoto Kan, Prime Minister of Japan,
at the Seoul G20 Business Summit Trade and Investment Session ("Revitalizing Trade")
It is a true pleasure to have the opportunity today to meet you who are drivers of the global economy. Having come to participate in this G20 summit meeting, I would like to share my thoughts with you on this occasion, in light of today's topic of revitalizing trade.
Needless to say, trade is indispensable for strong and sustained growth. The miraculous growth of the countries of East Asia and their subsequent overcoming of the Asian Financial Crisis are testament to this fact. As you well know, in history, among the responses to the Great Depression which began in 1929, countries, each with a view to expanding the markets for their respective products, increasingly shifted to bloc economies while attempting to boost their own economies by introducing protectionist measures and engaging in competitive currency devaluations. Yet, we are all well aware of the history that, to the contrary, the volume of global trade in fact declined tremendously and the world lapsed into a long-term depression.
In the global economic crisis of 2008, the blow suffered by trade was again enormous, with the overall volume of trade worldwide contracting as much as 10% in 2009. Yet one trend in contrast to the happenings of 1929 prevented a still greater blow from being struck. Through the wisdom of the persons gathered at the G20 meetings, we realized the achievement of deterring protectionism. At the first summit, convened in Washington, DC in the immediate aftermath of the crisis, we issued a declaration rejecting protectionism and urged the WTO and other international organizations to undertake monitoring. At our second summit, responding to a contraction in trade finance, we agreed to make available US$250 billion over two years, thereby expanding trade finance. These measures imparted a sense of reassurance to the market and contributed significantly to the recovery of trade. In the roughly one year after the onset of the crisis, trade volume had been restored soundly to approximately its pre-crisis level, and despite encompassing vulnerability, the global economy continues to recover.
In this way we of the G20 succeeded in avoiding the recurrence of a global depression and in leading trade to recovery. However, with the creation of new barriers to trade and the imposition of export restrictions, including in the areas of resources and food, recently actions can also be seen towards regression away from the G20's successes thus far. Moreover, there are concerns being voiced regarding competitive currency devaluations with a trend now in motion that evokes the Great Depression.
Trade is increasingly important in enhancing the growth and development of the global economy, and the countries of the G20 are called upon to demonstrate through concrete actions their determination to resist protectionism and continue to expand trade finance while avoiding competitive devaluations of their currencies. Naturally, the expansion of trade is premised on the growth of the global economy. It is essential that the G20 restore fiscal health, reform the financial sector, and advance structural reforms and other efforts in accordance with a common framework fostering growth that is robust, sustainable, and balanced.
I will be serving as the chair of the APEC Economic Leaders' Meeting, which will convene immediately after this G20 summit. Having come through the global financial and economic crisis, there are expectations once more towards the Asia-Pacific region as the growth center of the world. In order to realize steady growth of an Asia-Pacific region that leads world growth, it is important that liberalization and facilitation of trade and investment advance even further. In order to make this region more free and open, I will work for us to reach agreement on strengthening APEC's efforts still further, including definitively setting out as APEC both our support for the multilateral trading system and our rejection of protectionism.
Japan is also determined to open itself in an even more active manner. Japan has just recently reached a Cabinet decision to pursue high-level economic partnerships, particularly regarding EPAs (Economic Partnership Agreements) and broader regional economic partnerships that will yield substantial benefits. Notably, regarding the Trans-Pacific Partnership (TPP) Agreement, Japan will launch consultations with relevant countries while we expeditiously improve the domestic environment. Concurrently with revitalization of our trade, Japan intends to proactively advance such economic partnerships in a variety of modalities.
The distinguished CEOs here have advocated that the WTO Doha Round negotiations be concluded within 2011. In order for negotiations to be concluded, it is important that each of the countries of the G20 fulfills its responsibilities in accordance with its position in the global economy. Should we miss the opportunity of 2011, there is a possibility that this will result in further paralysis in negotiations. In order to bring about an early conclusion of this Round, I believe it is critical that we indicate our definitive commitment as the G20 to entering into the final stage of negotiations and that we politically direct our respective negotiators to engage in substantive negotiations and formulate a final draft agreement. I consider it essential for us to engage in efforts in cooperation with you, the business leaders of the G20 countries, to enable this WTO Doha Round to make substantial progress in 2011. I will end my remarks by expressing my wish for this G20 meeting to bring about significant results concerning trade and investment.