The economic woes in South East Asia are expected to dominate the APEC summit in Vancouver which opens today with meetings of the foreign and trade ministers of the 18 member countries from the so-called Pacific Rim.
President Clinton and China's President Jiang Zemin will be among the heads of state and government attending the leaders' summit next Monday and Tuesday in the Canadian city of Vancouver.
For the US, the summit comes embarrassingly soon after Congress refused to grant President Clinton "fast track" authority to negotiate new trade agreements. One of APEC's main aims is to eliminate tariffs and other barriers to trade in the region over the next decade.
US officials have predicted there will be appeals in Vancouver for aid and financial bail-outs from a number of the once-vaunted "tiger economies" which ran into difficulties last summer, starting with Thailand and spreading to Malaysia, the Philippines and Indonesia.
But the US Congress has also just rejected the Clinton proposal to grant the International Monetary Fund (IMF) $3.5 billion (£2.3 billion) in loan guarantees which could be used to help APEC countries in trouble.
APEC, which stands for Asia Pacific Economic Co-operation, is an association of 18 countries bordering the Pacific which has been working since 1989 to reduce barriers to trade and investment, ease the exchange of services and resources and strengthen economic and technical co-operation.
The summit will also keep an anxious eye on the financial turmoil South Korea and Japan which could trigger a domino effect reaching as far as the US itself as well as South-East Asia.
But the US co-ordinator for APEC, Ambassador John Stern Wolf, has warned that: "Anybody who thinks that the 18 leaders getting together will then fashion a silver bullet which will kill this crisis are anticipating too much."
One of the ideas being put forward by a panel of economists headed by Mr Fred Bergsten is the creation of an APEC fund to deal with future regional financial turmoil, but the US is so far noncommittal saying that there are "a lot of ideas out there".
The IMF along with Japan has already co-ordinated a $17.2 billion economic aid package for Thailand and is working on others for Indonesia and the Philippines. The US which did not participate in the Thailand bail-out has been criticised for this aloofness which may have contributed to the recent dramatic falls in the region's stock markets.
The plunge in the Hong Kong stock exchange several weeks ago affected stock markets in Europe and the US, leading to fears of another crash on the lines of 1987.
The currency turmoil has involved four devaluations since July and severe downward pressure on the Korean won and the Hong Kong dollar. This has produced diverse views on whether the developing South-East Asian economies should continue to be liberalised or whether new regulations are needed to protect them from financial speculation.
The US is concerned about its growing trade deficit with the APEC countries. Out of a total US merchandise trade deficit of $170.2 billion in 1996, some $143 billion was accounted for in trade with APEC. Over half of this was due to deficits with Japan, Canada, China and Mexico.
In addition to discussions on how to cope with currency crises, the APEC summit agenda also includes further moves towards free trade; sectors for early liberalisation and lowering the cost of doing business.
The APEC countries have already agreed to the goal of free and open trade and investment for the Pacific rim. The industrialised economies such as the US, Japan, Canada, Australia, New Zealand and Singapore are to achieve that goal by 2010. The developing economies including China have until 2020.
For the US this goal, which is not legally binding, has been complicated by the recent failure of President Clinton to obtain "fast track' authority. He would need this authority, which means Congress cannot amend any agreement, to enable the US to negotiate across-the-board tariff cuts and other trade liberalisation with the APEC countries.
But the US can negotiate sectoral agreements seen as extensions of the Uruguay Round trade agreement. Thus at last year's APEC summit in Manila, the APEC leaders supported a US proposal for an Information Technology Agreement.
Under this plan, the APEC countries will eliminate tariffs on computers, software, telecommunications and other information technology products by 2000. The World Trade Organisation (WTO) which includes Ireland later adopted this agreement.
Other sectors where the US would like to obtain tariff reductions with APEC partners include paper and wood products, non ferrous metals, fish and fish products and possibly chemicals.
Canada has proposed eliminating duties on environmental technology and goods.
There will also be debate on whether or not agreements reached within APEC should be extended unilaterally to other countries, termed "open regionalism", or whether APEC will become a trade bloc like the EU. Japan favours non-discriminatory agreements, which would apply to non-APEC countries on a most-favoured-nation basis. But the US normally insists on extending trade benefits on a reciprocal basis.
But for the APEC leaders and the rest of the world the economic crisis which has hit South East Asia is the over-riding concern. Can it be checked, or must it spread to become a world-wide slump? There should be some response from Vancouver.
