Citing the potential for heightened market efficiencies that could result, Philippine president Gloria Macapagal Arroyo recently offered strong support to a call by China for the establishment of a free trade agreement with the Association of Southeast Asian Nations. Such a move would create the world's largest such trading bloc, containing some 1.8 billion people.

Chinese officials met in mid-May with representatives of the 10-nation Asean bloc, which includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, The Philippines, Singapore, Thailand, and Vietnam, for talks on the proposed Asean/China pact.

The idea was originally broached last November by China and has been given serious consideration by Asean member countries because of concerns that an emerging China could be a rival for foreign investment.