Topic Focuses of APEC Meeting 2014

h e No v e mb e r A PE C
international economic event for Asia-Pacific economies this year and comes 13 years after China hosted its first APEC summit China in Shanghai. Economies have changed a great dea l since 2001 as a result of increased trade and development, with APEC economies now accounting for 55% of world GDP and 44% of world trade.
Given the slowdown in economic activity in the region following the 2008-10 global financial, reaching agreement in Beijing on the right economic initiatives for APEC economies is critical since it has implications for employment levels, households’ incomes and poverty reduction in the region. Facilitating international trade and investment in the region, a key theme of APEC since it’s inception, is essential for spurring Asia-he themes for this year’s
international trade in the region is central to advancing regional economic integration
Topic Focuses of APEC Meeting 2014
Prof. T ony Makin, Director, Griffith APEC Study Centre Griffith University, Australia
and connectivity. It is particularly important that trade protectionism does not proliferate. While import tariffs and quotas and export subsidies have thankfully not significantly increased following the crisis (unlike they did for instance during the economic crisis period of the 1930s), other international trade restrictions have risen through less transparent measures, such as anti-dumping actions and countervailing duties.
It is important to remember that international trade and investment are not ends in themselves however, but means to higher economic growth, along with infrastructure, another important theme of the Beijing summit. Infrastructure inf luences an economy’s aggregate demand and supply sides by increasing demand through investment, while simultaneously adding to the capital stock. However the economic benefits of large infrastructure projects need to exceed their costs before being approved by
major economies are still practising financial and monetary policies which make path to recovery in the global economy unclear, China’s leadership of APEC this year has been important. It has maintained the focus in APEC on building growth among APEC
members of APEC is their number one priority. For the advanced economies where economic growth has slowed, restoring growth is their number one priority. This common desire for higher growth rates is the glue in the economic partnership among APEC economies. All of these key issues are vital to taking advantage of expanded trade and
Alan Oxley,
Chair, Australian
APEC Study Centre at
RMIT University
fastest growing region in the world, and the wider global economy continues to grow below potential. In the five years leading up to the 2008-10 North Atlantic banking crisis, average world economic growth was around 5% per annum, whereas growth since then has averaged 3.5%.
Since the 2008-10 financial crisis economic growth and export and import flows in the region have been below pre-crisis levels, in part reflecting a reduction in China’s stellar growth from the pre-crisis rates of around 10% to more
during and since the Global Financial Crisis. While it has been at lower rates of growth than before the crisis, they are still higher than growth rates in the rest of the world. In this sense it has remained an important driver
he key challenge for China
strategies to advance the themes for APEC in 2014 to create an integrated open economy among APEC members. APEC members are committed to explore how to achieve this. Two preliminary processes to build Free Trade Areas among APEC economies are under way - the Trans - Pacific Partnership and the Regional
The key challenge for China and other APEC economies is to combine strategies to advance the themes for APEC in 2014 to create an integrated open economy among
APEC members.
be seen as a panacea for growth if the additional public spending is on unproductive activity, such as ‘roads and bridges to nowhere’. There is also the risk that servicing infrastructure-related debt will become more burden some for many APEC economies as current monetary policies around the world are eventually tightened and interest rates rise on
borrowings to finance infrastructure.
PEC) continues to play the key role in respond ing to globa l econom ic challenges and ensuring continued prosperity and stability of Asia-Pacific Economies. China’s presidency in 2014 cemented APEC as the Asia-Pacific’s premier regional economic cooperation mechanism. The agenda of APEC-2014 was set in a way that brings together advanced and emerging economies to promote open trade and investment, as well as to build capacity and enhance connectivity and regional integration. Chinese APEC year also provided a key vehicle to drive a broad agenda to unlock
ic economies
of the most serious global challenges —economic crisis of 2008-2009 and consolidated the efforts to ensure balanced and sustainable development of the economy. Economic growth is picking up, but the risk of repetition of global economic crisis is still very high.
Today the number of F T As/RTAs in Asia-Pacific region stands at approximately 75 agreements. Asia-Pacific economies have pursued trade and investment liberalisation and facilitation through various avenues, including through their strong and on-going support for the multilateral trading system, as well as through collective and
Dr. Natalia STAPRAN, Director, Russian APEC Study Center, Russian Presidential Academy of National Economy and Public Administration
(RANEPA)
individual actions undertaken in APEC. While much progress has been made over the past two decades, there is still work to be done if APEC economies are to meet the Bogor Goals. Particular challenges include helping to bridge the gap between developed and developing economies through capacity building and technical assistance aimed at making growth more
the APEC’s work. Up until now major efforts were devoted to negotiations and conclusion of the agreements with relatively narrow number of participants. T his is true for Russia that develops the Customs Union with Kazakhstan and Belarus and creates the Eurasian Economic Union next year. That is also true for TPP or RCEP . Even these two mentioned projects so far are not APEC-wide.
In that sense China’s initiative aimed at pushing forward the practical work on the establishment of region-wide FTAAP is very important. It is crucial for all FTAs to be arranged and designed in a transparent and rules-based manner without undermining multilateral trading system. APEC members continue to share the goal of FTAAP it is feasible to address all concerns, develop and agree upon very practical steps how to combine under the umbrella of FTAAP the existing RT As and large-scale partnerships that are under negotiations.
Comprehensive Economic Partnership. Participation in each includes a significant number of members of APEC, although the participants are not all the same.
Clearly these negotiations are emerging as building blocks for a Free Trade Area including all members of APEC in the not too distant future.
Tariff barriers to trade in goods among most APEC economies are relatively low. Securing consistent and steady growth in the future among APEC economies will depend on action by APEC members to reduce barriers to services and barriers to investment. This will boost foreign investment, improve competitiveness in services industries,
increase grow th and raise living standards. This must be the key objective of action to build a common free trade
he rate of change among
here is a clear inclination among many leading APEC economies to continue to encourage more investment and to open services markets. Some of these changes will occur before there is formal agreement in new F T As to do so. Businesses need to constantly monitor markets of interest so they will see these changes and take advantage of them.
Chinese APEC year also provided a key vehicle to drive a broad agenda to unlock the economic growth
potential.
priorities. The work on the APEC Blueprint
for Connectivity undertaken in 2014
under Chinese presidency was timely and
important for summarizing the work related
to physical, institutional and people-to-people
connectivity. Russia provided inputs for the
Blueprint, sharing our best practices including
the cross-border logistics, single window
practices, IT and emergency connectivity,
nments rea l iz e how
business. T his activity has to be supported
by some initiatives involving different
economies to ensure level-playing field
for the international business. Besides, in
APEC best practices were developed for a
vast number of initiatives to liberalize trade
in terms of making it faster, easier and more
efficient for the business. They include such
issues as trade facilitation and customs,
supply chain connectivity, strengthening
g l o b a l v a l u e c h a i n c o o p e r a t i o n,
comprehensive connectivity, etc. Taking
them forward and strengthening them
on a regional basis would be important to
enhance trade liberalization in the region.
Infrastructure is the key issue and driver
for economic growth in the region. In order
to be able to make strong contribution to
balanced and sustainable development of
APEC region it is necessary to work closely
with the business and develop the partnership
between government representatives
and business community. Taking into
consideration the needs of business and
the aim to develop effective and bankable
infrastructure projects it is important to
promote collaboration in some specific areas,
such as implementation of infrastructure
projects aimed at improving the profitability
of industrial facilities; analysis of possible
ways to modernize the transport routes in
order to bring them into compliance with the
s for t he i n f r a st r uc t u re
attracting the private capital into cross-border
projects on infrastructure. We believe that
development of public-private partnerships
here can combine together the expertise from
several governments, leading construction
and operating companies and multilateral
development banks. It will help to increase
investors’ confidence in profits expectations
and investment protection.
The initiative to launch the analytical work will be
of great importance for both government officials
and business community, show possible advantages
of an FTAAP realization and the ways to avoid
trade distortion.
‘Innovative development and economic
reform’ is a key condition for the economic growth.
In this regard it is important to continue the work
within the APEC Policy Partnership on Science,
Technology and Innovation that was created to
fulfill the specific task - ensure innovation-friendly
environment in the APEC economies through triple
cooperation of business, academia and government.
In 2014 China proposed to take concrete actions
in its implementation that will be useful to develop
a measurement framework to assess knowledge
flows from universities to the private sector and the
benefits of investment in science and technology.
Another important issue for this topic
is the inclusive support that includes human
resource development relevant for rapid innovative
growth. Job creation should be accompanied
with the creation of highly qualified work force
and development programs for human resources
mobility. More attention should be paid to the
youth employment and professional development
of women. It is very important to keep continuity
in gender focus activities.
In order to fulfill the task of enhance
the development of smart and green cities it is
important to summarize the work done in urban
planning and developments in construction,
transportation, energy and water supplies. It
will be useful to review the existing system of
standards, provide practical policy options and
strategies of urban development for our local
governments.
The Concept of ‘Connectivity’ was inherited
by China from last year Indonesia’s APEC。