This week's Apec Leaders Meeting in Bali could mark a turning point as to whether the 21-member state organisation remains relevant to its members. We therefore fully agree with the view of the Pacific Economic Cooperation Council (PECC) that Apec should
As PECC co-chair Jusuf Wanandi observed last week, the 24-year-old Apec acutely lacks focus, as the organisation tends to work simultaneously on so many issues and tries to resolve virtually all development problems.
We think Apec should realign its priorities to focus on the most strategic aspects of its top priority goals: trade and investment liberalisation, sustainable and inclusive growth, connectivity in its broadest sense and strengthening the World Trade Organisation (WTO)-based multilateral trading system.
Achievements in these areas could become confidence-building bricks to strengthen the role of Apec as a regional institution and as a diplomatic instrument able to mitigate differences between its members as well as an effective forum where different values compete and are played out.
As the host and chair of Apec, Indonesia – despite the absence of US President Barack Obama in the summit due the US budget crisis – should exert its leadership and make Apec leaders focus their attention on those important areas.
Trade, investment, sustainable development, connectivity and the multilateral trading system are interrelated. Investment usually follows trade, but trade is virtually impossible without physical and institutional connectivity, which in turn requires basic infrastructure and the removal of non-trade barriers related to customs clearance and quality standards. Further down the line, good connectivity facilitates efficient supply-chain management. All these things are classified by the WTO into trade facilitation programmes.
Various studies, including by the World Bank, have concluded that investment in trade facilitation, such as improvements in customs and ports, significantly increase trade, thereby boosting growth and creating new opportunities for poor people to improve their lives. The benefits of trade facilitation will be greater still if rich countries act to remove barriers to trade and open their markets to developing countries’ exports.
Apec’s strong commitment to a multilateral trading system is also strategic for a stable global economic condition. Apec leaders should reaffirm their collective and individual commitments to concluding an ambitious and balanced Doha agreement by breaking the current deadlock.
Indonesia’s leadership is again on call here as the host of the upcoming WTO ministerial conference in Bali in December. The multilateral talks have floundered for almost 12 years over some sensitive issues.
A united Apec stance is still a force to be reckoned with, putting it in a position not to be ignored. Apec includes seven of the world’s 13 largest economies, represents more than a third of the world’s population, constitutes 60 per cent of the global economy and more than half of the world’s trade. Apec truly has a big role to play in helping unblock global trade talks as a way of achieving the grouping’s free trade goals.