Asian leaders seek to reduce Western trade ties

By Jason Szep and Martin Petty

HUA HIN, Thailand (Reuters) - Asia-Pacific leaders called on Sunday for regional-wide free trade and other measures to reduce dependence on the United States and big Western markets as Asia leads the way out of the global economic downturn.

Japanese Prime Minister Yukio Hatoyama urged Asian leaders to keep up fiscal and monetary stimulus measures even as their economies show mounting signs of recovery, saying there was "no room for complacency" and that the job market was still "dire".

"At the moment the global economy is showing signs of recovery, mainly in Asia," Hatoyama told the closed-door East Asia Summit of 16 Asia-Pacific leaders in the Thai town of Hua Hin, according to Foreign Ministry spokesman Kazuo Kodama.

At the meetings, held under tight security, Hatoyama found tentative support from his Asian counterparts for a proposed regional community inspired by the European Union that would account for nearly a quarter of global economic output.

"I think my long-term vision of forming an East Asia Community was largely welcomed by participants," Hatoyama told reporters. The bloc, however, would take more than 10 years to create and may include some sort of regional currency.

Thai Prime Minister Abhisit Vejjajiva, host of the meetings, said Asia clearly needed a new growth model leaning less on big Western trading partners and more on Asia-wide trade pacts. The global financial crisis, he said, bore this out.

"The old growth model, where simply put we have to rely on consumption in the West for goods and services produced here, we feel will no longer serve us as we move to the future," Abhisit told a news conference.