Major calls for UN to put its house in order

Bangkok summit: EU states duck rights issues to avoid a damaging rift with world's strongest economies

DONALD MACINTYRE

Bangkok

John Major made a plea for rapid reform in the United Nations yesterday at the EU-Asia economic summit, as most European leaders agreed to avoid confrontation with China and South-East- Asian economic powers over human rights.

Mr Major pressed the case for streamlining the UN and putting it on a firm financial footing following estimates that it could "run out of money in November". The Prime Minister said it would be "ludicrous" for the UN to go bust and warned it "must not be allowed to grind to a halt".

He urged Asian countries to back EU proposals for tough penalties on non-payers, to accelerate the payment of arrears and reform contributions to take account of the relative wealth of members.

Mr Major, who won strong support from Thailand for his call for UN reforms, will today call for the liberalisation of Asian markets.

The threat of a walk-out by Indonesia, led by President Suharto, if Portugal used the summit to resume attacks on human rights abuses in East Timor was averted when the Portuguese Prime Minister, Antonio Guterres, talked informally to the Mr Suharto in the fringes of the summit. The Portuguese leader suggested a resumption of diplomatic contacts between the two countries, which elicited a non-committal response from Mr Suharto.

The Europeans' desire to avoid conflict over human rights reflects the importance attached by the EU to expanding trade relations with the fastest growing economies in the world. Mr Major has repeatedly pointed out that the countries at the summit account for more than half the world's Gross Domestic Product.

Jacques Santer, the EU Commission President, made a plea for Asian countries to accept that the Single European Market "has greatly improved the opportunities for third countries to do business in the European Union".

In a thinly disguised appeal to Asian countries to lower barriers against EU exports, he pointed out that 40 per cent of imports of manufactured goods would be duty-free, while tariffs on other products would be cut by a third in the next decade.

Leon Brittan, the EU Trade Commissioner, has been active pressing Asian countries to open up their vast telecommunications markets, to secure a worldwide liberalisation agreement by the April deadline set by the World Trade Organisation. An aide to Sir Leon admitted they failed to draw a clear response and added: "We are into the last five weeks so it is a very urgent process."

In meetings with the Chinese government, Sir Leon pressed for the level of liberalisation that would enable China to qualify for WTO membership. Sir Leon told the Prime Minister, Li Peng, that China needed to end the monopoly of state organisations running import and export businesses, reduce tariffs and liberalise the car industry. He said if Peking took such steps the EU would back its membership of WTO.

Sir Leon urged Peking to stop restricting the free flow of economic information through overseas news agencies, saying it violated the WTO principles.

He also pressed Li Peng to accept Hong Kong's continued importance as an entrepreneurial centre, and was assured its "capitalism" would survive the handover to China.