1. The Idea of “East Asian Economic Community” from Business Perspective
APEC　OFFICIAL　SYMPOSIUM
September 27, Kakutaro Kitashiro
Chairman, KEIZAI DOYUKAI
(Japan Association for Corporate Executives)
Chairman of the Board, IBM Japan Ltd.

2. AGENDA Growing East Asia and Challenges
The Principles of East Asian Community
Recommendations to Realize the East Asian Community

3. Growing East Asia and Challenges

4. GDP Growth Rate Projection for 2015
Japan US EU
China
India
ASEAN４
NIEｓ
World Bank(2006)
1.7
3.6
2.0
6.1
5.5
IEA(2004)
1.9
2.3
2.1
5.0
4.7
3.8
Japanese Gov.(2004)
1.5
3.1
1.8
6.9
4.1
Average
3.0
6.0
4.8
4.3
The source : 2006 White Paper on International Economy and Trade

5. 21.2% (36.3 times in monetary terms)
GDP Growth in East Asia
East Asia : (ASEAN10+Japan,China,Korea)
1980
2005
2015 (Forecast)
East Asia’s share in global GDP *2
16.3%
20.2%
27.0% *3
East Asia’s share in global export *4
14.1%
26.6% -
East Asia’s share in World Investment *5
6.8%
21.2% (36.3 times in monetary terms)
*2 Calculation is based on the IMF World Economic Outlook Database.
*3 METI, Trade and Industry 2006 White Paper on Internal Economy and Trade 2006,Figure
*4 *5 Prepared by the Mitsui Global Strategic Studies Institute(UNCTAD World Investment Report 2005)

6. Intra-regional Trade Ratio
EU15
East Asia
NAFTA
60%
54%
45%
’93:Single Market completed
’87:Single European Act
’93:ASEAN CEPT
’94:NAFTA
The source : 2005 White Paper on International Economy and Trade

7. Japanese Trade Dependency on East Asia
1998
2005
Increase (of which Chinese contribution)
Share of Japan’s exports to East Asia
34.0%
47.9%
+13.9% (+8.2%)
Share of Japan’s imports from East Asia
35.6%
44.7%
+9.1% (+4.8%)
*7 Compiled by Mitsui Global Strategic Studies Institute based on data from IMF Direction of Trade Statistics,
CD-ROM July 2006, and ADB Key Indicators of Developing Asia and Pacific Countries.

8. GDP per Capita 1990 2005 Japan 24,724 dollars 35,787 dollars Singapore
Brunei
15,049 dollars**
17,632 dollars
South Korea
5,893 dollars
16,422 dollars
Malaysia
2,432 dollars
5,040 dollars
Thailand
1,528 dollars
2,577 dollars
China
342 dollars
1,703 dollars
Indonesia
628 dollars
1,259 dollars
Philippines
725 dollars
1,159 dollars
Vietnam
97 dollars
612 dollars
Laos
210 dollars
463 dollars
Cambodia
106 dollars
375 dollars
Myanmar
68 dollars
*8 Sources: “Global Economic Trends” edited by the Cabinet Office, Office of the Director General of Policy Coordination, and IMF World Economic Outlook.
** Based on the figure as of 1992 for Brunei.

9. The World Competitiveness Factors Ranking
Economy
Country Ranking
Government
Efficiency
Business Efficiency
Infrastructure
Hong Kong 2 1 16
Singapore 3 7 5
Japan 17 31 23
Taiwan 18 24 14 20
China Mainland 19 30 37
Malaysia
Thailand 32 21 28 48
Korea 38 47 45
Philippines 49 44 56
Indonesia 60 51 57 61
Source: IMD WORLD COMPETITIVENESS YEARBOOK 2006

10. Tariff Comparison
The source : 2006 White Paper on International Economy and Trade

11. Effect on Trade Promotion
$191B
The risk of political instability 4%
Custom clearance
Process
17%
$148B
Estimated Effect of Trade Facilitation Measures
56%
Transparency*1
10%
Streamlining of
port operations
29%
*1 : Enhance the transparency of customs clearance formalities
The source : 2006 White Paper on International Economy and Trade

12. The Principles of East Asian Community

13. Various Functional and Regional Cooperation
the Bali Regional Ministerial Meeting on Counter-Terrorism
Japan, China and Korea Cooperation
The Chiang Mai Initiative , The Asian Bond Market Initiative
UK　France Germany　　Canada ＥＵ
ASEAN + 3
Aus. NZ
ＰＮＧ US
豪州　　ＮＺ
North Korea Mongolia　　　
Indonesia
Malaysia
Philippines
Singapore
Thailand
Brunei
Vietnam
Laos
Myanmar
Cambodia
The East Asian summit
ブルネイ　ベトナム　ラオス　ミャンマーカンボジア
インドネシアマレーシア　フィリピン　　シンガポールタイ
Japan
China
Korea
日　本　　　中　国　韓　国
Bangladesh Sri Lanka
India
インド
Russia
The Bali Process
Pakistan
ReCAAP
ARF
The Asian Bond Fund
ASEAN
The Source ： The Ministry of Foreign Affairs of Japan, Asian and Oceanian Affairs Bureau

14. Approach to the East Asian Community
Road map for the realization of a　“community”
Share the common goal
One step at a time
Building equal partnerships
Expansion centering on the ASEAN
Realization of an open community
Creation of a disparity correction mechanism within East Asian region

15. Objective and Basic Principles
Co-prosperity and co-existence within the East Asian region
Basic Principles
Democracy
Market economy
Basic human rights

16. Basic Rules of the East Asian Community
Mutual cooperation
Non-intervention in other countries’ internal　affairs
Peaceful resolution of disputes
Renunciation of the use of military force
Correction of regional disparities
Equal partnerships

17. Realize the East Asian Community
Recommendations to
Realize the East Asian Community

18. Recommendations to Japanese Gov.
Early realization of heads of state summits between Japan and China/South Korea
Open the market for agricultural products, etc. for the facilitation of intra-regional FTAs/EPAs
Establish an East Asian Regional Development Fund
Launch a Council on the Promotion of the East Asian Community

19. Innovation for Sustainable Growth in Asia
Talent
Workforce Training
Public expenditure on education
Promote Market Economy
Maximize FDI through deregulation
ODA and East Asian Regional Development Fund
Commercial system within the region
Corporate Social Responsibility in the local communities
Key to Innovation
Talent
Investment
Investment
Infrastructure
Infrastructure
Council on Competitiveness, Innovate America (2004)

20. Conclusion Co-prosperity and Co-existence within the East Asian region
Japan: Four Recommendations
East Asia: Innovation for Sustainable Growth

21. Thank you

22. Back up chart

23. Foreign Direct Investment
FDI to East Asia
Foreign Direct Investment
2004
2005
Growth Rate
Contribution
Share
East Asia
Japan
7,809
3,223
△ 58.7
△ 0.6
0.3
China
54,936
79,127
44.0
3.1
8.2
NIES
60,000
61,952
3.3
0.2
6.4
Korea
9,246
4,339
△ 53.1
0.4
　Taiwan
1,898
1,625
△ 14.4
△ 0.0
　Hong Kong
34,036
35,905
5.5
3.7
Singapore
14,820
20,083
35.5
0.7
2.1
ASEAN4
7,749
11,374
46.8
0.5
1.2
　Thailand
1,414
4,008
183.4
　Malaysia
4,624
3,976
△ 14.0
△ 0.1
　Indonesia
1,023
2,258
120.8
　Philippines
688
1,132
64.5
0.1
World Total
782,839
964,744
23.2
100.0
The source : JETRO White Paper on International Trade and Foreign Direct Investment 2006