Asian leaders were meeting in Singapore on Wednesday to discuss free trade, financial market stability and cutting greenhouse gases, after a Southeast Asian summit overshadowed by controversy over Myanmar.
The Association of South East Asian Nations, which signed a landmark charter on Tuesday aiming for economic integration, is meeting leaders from Japan, China, South Korea, India, Australia and New Zealand in the annual "ASEAN+6" meeting.
ASEAN is negotiating free trade with all of them, with a China-ASEAN deal seen as the most advanced and possible by 2010. An agreement with India has stalled over agricultural tariffs, and potential deals with the United States and EU are off since both have sanctions on Myanmar.
"The agreement with China is the most advanced and nearing completion," said Rodolfo Severino, visiting research fellow at the Institute of Southeast Asian Studies and Secretary-General of ASEAN from 1998-2002. "The one with Australia and New Zealand is one of the most beneficial, since it includes technical assistance."
Greenhouse gas emissions will be a hot topic. Japan will present a proposal to cut emissions and give incentives to developing nation polluters such as China, a move analysts say could complement the United Nations Kyoto Protocol on climate change.
Japanese Prime Minister Yasuo Fukuda plans to pledge more than $1.8 billion in loans for environmental projects in Asia during the meeting, Japanese media have said, to finance projects such as sewage disposal and scrubbing of sulphur dioxide from power plant chimneys.
Analysts say Japan is trying to form an Asian consensus that would be the basis for its negotiating position at U.N. climate talks in Indonesia next month that aim to find a successor to Kyoto, whose current targets to cut emissions end in 2012 and do not include the U.S. or China.
"Other countries import a lot of products from China so the notion is that they should be responsible for some of the emissions made by China," said Yonghun Jung of the Asia Pacific Energy Research Centre in Tokyo.
Japan, as host to next year's Group of Eight summit, where global warming is expected to be a top agenda item, is keen to be seen taking leadership on environmental issues.
But Japan, the world's fifth-biggest greenhouse gas emitter and the only country in Asia with a Kyoto Protocol target, is itself still far from hitting its goal.
Japan's prime minister on Tuesday promised he would visit China as soon as possible, in a symbol of warming ties, but the leaders of both countries side-stepped issues that could undermine relations.
Yasuo Fukuda, making his Asian diplomacy debut after taking office in September, held his first summit with Chinese Premier Wen Jiabao in Singapore on Tuesday.
The moves for closer ties are in stark contrast to relations under former prime minister Junichiro Koizumi, who only met Chinese and South Korean leaders occasionally.
The U.N. envoy to Myanmar, Ibrahim Gambari, was planning to brief the East Asia summit on the situation in Myanmar, but some ASEAN members opposed that and he has ended up talking to individual delegations instead.
The new ASEAN charter calls for human rights and democracy, but offers little in the way of enforcement measures. The document underlines the primacy of ASEAN's longstanding policy of non-interference in each other's internal affairs.
The charter sets up ASEAN as a legal entity that can enter into legally enforceable agreements with other countries and blocs.
It also sets out an an economic blueprint that includes timetables for trade reform, but does not include a customs union, a free trade area with a common external tariff, which businesses would have preferred.