PROPOSALS for a free-trade zone in the Asia-Pacific area should have sufficient support to survive the next crucial stage of negotiations, says Victor Fung, chairman of the Hong Kong Trade Development Council. But problems could arise over whether members of the Asia-Pacific Economic Co-operation (APEC), such as China, would be granted concessions because of their newly emerging or developing country status. Mr Fung, a member of the Eminent Persons' Group which wrote the report, said the key recommendations will be debated at a ministers' summit in Jakarta in November. He said: ''The chances of success are very high. Although we are acting as members of the Eminent Persons' Group, we are members of, or appointed by, our respective governments and represent their viewpoints. ''We have thrashed it out and the chances of it going to the next stage are quite high.'' The proposed trading community will cover 37 per cent of the world's population, 40 per cent of its total trade, and half of its gross national product. It will encompass 17 countries on both sides of the Pacific Rim and include countries as diverse as China, with 1.2 billion people and per capita annual income of US$370, and Singapore with 2.8 million people and average annual income of $27,000. Mr Fung said: ''The guiding principle behind the report was open regionalism, which would commit members to free trade in the region without turning them into a trading bloc. ''Because we are not advocating a free-trade area, individual APEC members would be free to decide whether to lower their barriers to non-APEC members. ''The driving forces would be self-interest and peer pressure, not regulations and sanctions.'' The recommended timetable will give member states up to 25 years to introduce the reform package. Advanced countries will have 10 years, newly emerging countries 15, and developing countries 20. Top of the agenda will be setting up a task force on anti-dumping strategies and competition policy. He said: ''This will lead to other issues such as the way domestic policies impact on international trade. This may also not be amenable to quick solutions.'' Recommendations also include a voluntary investment code ensuring investment policies are transparent, and equal treatment for investment by member states. Mr Fung said: ''If APEC could adopt this, then it would help the flow of capital within Asia and from outside. Our position is that a strong market will be stronger if there is capital flow.'' There also will be a mediation-based forum to resolve trade disputes between members.