Japanese and Chinese leaders entered talks today with their Asian counterparts focused heavily on whether the region should pursue an EU-style bloc, and whether Washington should be involved. Japan is going to stress that Washington is important to its idea of forming an East Asian Community when Japanese officials pitch the concept at a summit of 16 Asia-Pacific leaders in the Thai resort town of Hua Hin, a top government official said.

"The US involvement will be very important," Japan's deputy Chief Cabinet Secretary Yorihisa Matsuno told reporters on a flight to Thailand, referring to what Prime Minister Yukio Hatoyama plans to tell his Asian counterparts at the meetings.

Hatoyama plans to stress that the US-Japan alliance would remain the foundation of Tokyo's diplomacy, Matsuno said. The talks are part of a three-day leaders summit which got off to a rancorous start on Friday, marred by diplomatic tension, a budding trade feud and a few no-shows in the 10-member Association of South-East Asian Nations (ASEAN).

That bloc meets today with China, Japan and South Korea in an "ASEAN+3" forum that gives Asia's economic titans, China and Japan a chance to jockey for influence over trade agreements and investment opportunities in Southeast Asia, a region of 570 million people with a combined $1.1 trillion economy.

What is the East Asia summit?
It came into being in 2005 as an annual meeting among leaders of 16 Asian nations, including the 10 ASEAN countries - Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam -- and their dialogue partners China, Japan, South Korea, India, Australia and New Zealand.

It mainly discusses trade and economic issues, although security, human rights and geopolitical issues often feature in discussions on the sidelines.

Why are India, Australia and New Zealand involved?\
This summit was originally the brainchild of former Malaysian Premier Mahathir Mohamad, who wanted to create an East Asia Economic Caucus among the "Asian Tiger" economies. (Some pundits called it the caucus without the Caucasians). The United States through Japan lobbied hard to first bring Australia and New Zealand into the group and later India, which shares security and trade concerns with the summit participants.

What has been achieved at past summits?
The summit has been searching for an existential purpose since the 2005 inaugural meeting in Kuala Lumpur. The next summit in Cebu, Philippines sketched out a vision of an East Asia free trade area, and signed a declaration on energy security. The third one, in Singapore in November 2007, came out with a declaration on climate change and energy.

The current summit was initially scheduled for December last year but was postponed when anti-government protestors shut down Bangkok's airports. It was moved to Pattaya in April but was subsequently aborted when a rival protest group broke through police and army lines and stormed the summit venue. Next year it will be in Vietnam, which takes over as chair of ASEAN.

So what will be talked about this time?
In Hua Hin, trade ties, regional security, disaster relief and human rights are among the issues up for discussion. The leaders will also discuss a coordinated stand for the conference on climate change in Copenhagen later this year. Some of the more interesting stuff takes place on the sidelines.

The first summit was largely spoiled by spats between Japan and its neighbours over then-Prime Minister Junichiro Koizumi's visits to the controversial Yasukuni war shrine.

The leaders of Thailand and Cambodia will no doubt exchange words after Cambodian Prime Minister Hun Sen said on Friday he would hire exiled former Thai Prime Minister Thaksin Shinawatra as an economic advisor. A Thai court last year found Thaksin guilty of corruption and sentenced the fugitive leader to two years in jail.

Myanmar's poor human rights record is usually a talking point in the corridors, although it rarely figures in the discussion among leaders. Myanmar successfully blocked any discussion of its internal affairs at the last summit in Singapore. Recent tensions in the China-India relationship will also likely come up, including over the Dalai Lama's upcoming visit to a disputed border area.

Australia could raise with China the case of an Australian company executive arrested in China on charges of corporate espionage, an issue which has stoked concern in China's foreign investment community. The three North Asian countries may discuss how to restart stalled nuclear talks with North Korea.

What is the Chiang Mai Initiative?
It is a pool of foreign currency reserves among the ASEAN+3 countries worth $120 billion. It is aimed at providing emergency balance of payments support through currency swap arrangements, should one of the members experience the kind of capital flight that marked the Asian financial crisis of 1997/98.

Like many of ASEAN's initiatives, it is more viable on paper than in practice. The requirement that a country must be in an IMF programme, or in talks for one, is likely to deter most would-be recipients -- including Thailand, South Korea and Indonesia, which have bitter memories of their IMF bailouts of a decade ago.

There has been some brainstorming around the idea that the Chiang Mai Initiative could eventually lead to an Asian Monetary Unit, similar to the old European Currency Unit that eventually led to the creation of the euro.

Why meet in Hua Hin?
The summit is being held in the resort town of Hua Hin, a two-hour drive south of Bangkok where more than 18 000 police and members of the armed forces, empowered by a tough Internal Security Act, have set up a no-go zone around the town to avoid a repeat of the Pattaya fiasco. - Reuters