Towards One Community: Meet the Challenge, Make the Change

This is a landmark year for APEC: It marks the mid-point between the creation of the forum in 1989 and the deadline for all economies to meet the Bogor Goals of free and open trade in 2020. APEC officials will undertake a mid-term stock-take this year to pinpoint where APEC is in its progress towards meeting the Bogor Goals.

Advancing free trade will be at the forefront of APEC's agenda again this year. APEC will continue its strong political support for the World Trade Organization's (WTO) Doha Development Agenda (DDA) and renew its commitment to the Bogor Goals.

APEC's committees are directed by senior officials, who will meet at four Senior Officials' Meetings (SOM) this year. SOM has agreed on a set of priorities for APEC Korea 2005 and will direct the APEC's work under the central theme, "Towards One Community: Meet the Challenge, Make the Change".

Seven key priorities will be addressed this year: advancing freer trade; supporting the DDA; fighting corruption; sharing prosperity of the knowledge-based economy and protecting intellectual property rights; safeguarding human security in areas such as counter-terrorism, energy security, health and disaster response and preparedness; supporting small- and medium-sized enterprises and micro-enterprises; reforming APEC, and promoting cross-cultural communication.

The Committee on Trade and Investment, or CTI, is APEC's voice on global trade and investment issues. CTI will work with its sub-fora and the business community to deliver meaningful results on APEC's Trade and Investment Liberalization and Facilitation agenda by the time of the APEC Leaders' and Ministerial Meetings in Busan in November.

All of the major events on APEC's calendar this year will take place before the Sixth WTO Ministerial Conference in Hong Kong, China, in December. High expectations for the Hong Kong meeting "adds greater importance to APEC 2005," says APEC SOM Chair Ambassador Kim Jong Hoon of Korea in a recent web interview with the APEC Secretariat in Singapore. "As this year's APEC Chair, Korea is determined to play a very active role in helping to generate considerable progress at the Doha negotiations."

APEC is planning a separate Doha Development Agenda session at the Meeting of Ministers Responsible for Trade in June. And in November, at the time of the APEC Ministerial Meeting in Busan, "we will consider on the basis of the progress made thus far in the DDA process (whether) to invite non-APEC member ministers and organize a mini-ministerial meeting with a specific focus on working to prepare for success in Hong Kong the following month," Kim says.

For its part, CTI wants to make sure that the 21 members of APEC work to ensure that the Hong Kong conference will be successful. Says CTI Chair Alan Bowman: "When APEC speaks with one voice it is very influential - it serves as a bridging mechanism between developing and developed economies. In both June and November APEC has a chance to issue very strong political statements in support of the WTO and these often have a very significant impact in Geneva."

This year CTI will be working on all aspects of trade facilitation: from simplifying customs procedures to developing measures to help economies harmonize product standards to enhancing business mobility to developing e-commerce. The committee will continue to help economies monitor and implement measures listed in the Trade Facilitation Action Plan and identify common capacity building needs. In addition, it will initiate a dialogue with international financial institutions to assist developing economies access funding and expertise for trade facilitation-related capacity building projects.

"We can organize more capacity building projects (this year)," says Bowman. "APEC has been very helpful in training officials from developing countries on WTO issues so we are going to organize more training programs and hopefully this will help bridge the gap."

CTI will also be working on implementing transparency standards in nine trade policy areas. APEC's Transparency Standards are the most comprehensive adopted by any international forum and address business concerns in the following areas: services; investment; competition law and policy and regulatory reform; standards and conformance; intellectual property; customs procedures; market access; business mobility; and government procurement.

Earlier this year APEC representatives participated in an APEC-WTO Trade Facilitation Round Table. There were presentations from customs officials from developing countries that had made progress by changing the way they do things. "Several developing economies are reaching their full trading potential because their customs procedures are outdated," Bowman explains. "Sometimes there is a lack of transparency in administering rules and regulations. This hurts a country's business environment because it creates uncertainty among both foreign and domestic traders and investors. What we aim to achieve is to have economies agree on rules that would govern things like customs clearance procedures. This workshop brought some of the more advanced developing economies from Asia to make presentations to the rest of the world on how they improved their own customs procedures and how that helped their economies."

This year APEC will continue to work to cut business transaction costs by cutting red tape, embracing automation, harmonizing standards and eliminating unnecessary barriers to trade. So far APEC economies are on track to meet the 2006 target of cutting regional business transaction costs by 5%.

CTI is also helping economies better participate in WTO services negotiations. Economies need to table offers on which services sectors they are prepared to liberalize. "Sometimes, developing economies need help in preparing their WTO services offers, a very complex process that requires weighing the pros and cons of liberalization in sectors that are sometimes very sensitive. APEC's Group on Services is conducting work in this area, and has already organized a very useful workshop on preparing services offers in early March in Seoul," Bowman explains.

APEC economies will also continue to fight corruption and terrorism and promote a clean and safe environment for trade to flourish. The APEC Anti-Corruption and Transparency Capacity-Building Program Task Force was set up and its scope and structure was finalized at the first Senior Officials' Meeting this year. The Task Force will assist by recommending measures that prevent and fight corruption, particularly in the areas of government procurement and taxation.

"We try to get economies to observe certain standards with respect to transparency and the availability of information," Bowman notes. "If firm "x" is told they need to do this, that, and the other but their bid is rejected, we want them to have some recourse... some way of getting their case heard and the problem resolved in their favour if it is justified. Corruption breeds in non-transparent situations. If there is no transparent manner to obtain information on what you need to do (as a business person), then it provides opportunities for corrupt officials to extract fees for services." For example, there is a clear link between improved customs automation and the fight against corruption, which is why APEC's efforts to promote e-commerce and automated customs procedures are so vital. "It is more difficult for an internet customs portal to be corrupt, or to provide different types of information to different people."

CTI also expects to contribute this year to Ministerial Statements on the WTO in areas such as the abolition of all forms of agricultural export subsidies; unjustifiable export prohibitions and restrictions; services; and market access.

On other fronts, APEC will take more steps this year to foster innovation in science and technology by protecting intellectual property rights and enhancing digital opportunities. IPR issues that will be addressed include online and offline piracy, best practices and capacity building in IPR enforcement. CTI will also continue to encourage member economies to establish APEC IPR Service Centers to help business obtain timely information on the protection of their IPRs in all 21 APEC economies.

So far five such centers have been opened. CTI's Intellectual Property Experts Group will hold training seminars on intellectual policy enforcement and cooperate on harmonizing IPR legal systems. It will complete the survey on best practices of APEC economies in combating optical disk piracy, finalize the project for standardizing the trademark application form; hold a seminar on developing a successful IPR regime; hold an APEC workshop on intellectual property for SMEs and Micro-enterprises; welcome China's initiative to host a 2005 enforcement symposium and improve the IPEG website with materials and links to information sources.

CTI will also work with SOM to forward to the WTO the list of three products (multi-chip integrated circuits/stacked die semiconductor chips, digital multifunction machines and modems) for tariff elimination agreed last year in Santiago and raise consciousness about them in Geneva. It will hold an APEC Seminar on the IT/Electronics Industry and discuss measures to expand digital opportunities in APEC as well as to support the WTO.

The SOM Committee on Economic and Technical Cooperation, or ESC, helps senior officials coordinate and manage APEC's wide-ranging economic and technical cooperation or ECOTECH agenda. Addressing the social dimension of globalization has been one of ECOTECH's priorities since 2003. The committee aims on the one hand to cushion/mitigate the adverse impact of globalization on vulnerable groups and on the other to make sustainable and equitable economic development possible.

To strengthen APEC's work in ECOTECH, discussions have been held with international financial institutions to identify areas for cooperation. As a result, APEC and the World Bank's Global Development Learning Network agreed in 2004 to conduct a series of pilot projects. One of these is the Low Cost, Appropriate Technology and Approaches for Rural Distance Learning (RDL) to be provided in April 2005 for APEC members through the GDLN. The course is designed for staff from development agencies, government ministries, NGOs, research and academic institutions who want to find ways to serve the development and educational needs of rural populations. Instruction will be delivered from Washington, D.C. via videoconference through the GDLN to participants in Chile, Peru, Guatemala and the Dominican Republic. .

The course is based on lessons learned from a two-year research project on RDL sponsored by the World Bank and the Department for International Development, United Kingdom (DFID). The project focused on the development of planning strategies for sustainable distance learning services geared to rural, nomadic and isolated populations. The project's findings and recommendations were integrated into a RDL Toolkit in CD-ROM format, which forms the basis of the course.

Other possible training subjects for Rural Distance Learning might include agriculture and herd production; public administration and management training, technical training for public sector employees, IT training to support infrastructure expansion, public security and judicial support, community-based learning, health services support and public school administrator and teacher training.

n July/August the APEC's Small and Medium Enterprises Working Group will be holding a workshop on micro-enterprises and using video conferencing to connect participants who are unable to take part physically in the workshop. This project is about micro and small-enterprise financing as a tool for mainstreaming the informal sector. "We are going to use the GDLN facilities to have an effective interaction between micro organizations and SMEs," explains Ambassador Juan Carlos Capunay of Peru and chair of the ESC.
"Micro and small enterprises represent almost 70% of all economic activity in APEC. About 80% of the population in APEC is working in a small enterprise. So this is one of the key areas in which we work."

The ESC is also trying to reduce the digital divide through its APEC Digital Opportunity Center (ADOC). ADOC is working well in five APEC economies and has selected ten projects in each economy to promote IT development. IT experts will be dispatched to developing economies to exchange views and consult on e-infrastructure development. A program called the "IT Leaders' Training Camp" will be held annually. Five trainees from five member economies will be invited to Chinese Taipei for two weeks of intensive training. The courses will include field trips to leading IT companies and organizations and the trainees will be expected to develop a feasible IT project tailored to their member economy's specific e-infrastructure needs. ADOC will also cooperate with selected member economies to set up IT schools. Computers, telecommunications equipment and training courses will be provided to students, teachers, institutional trainers and the general public to augment IT skills. Advanced e-Learning programs will also be developed to provide the region's IT professionals the best online education in ICT.

The ESC this year will continue to expand its relationship with international financial institutions. The Second APEC/IFIs Roundtable Dialogue on ECOTECH is planned this year.

The ESC will set up a Strategic Action Plan for English and other languages in the APEC region. Its philosophy: The ability to communicate across language barriers is essential to international trade and to building understanding among interconnected global economies. One project involves working on effective ways to provide English-language skills needed by SMEs.

APEC's Economic Committee (EC) will also be very active this year. The committee was set up to conduct policy-relevant economic analysis and dialogue as well as to implement structural reform activities within APEC. The EC provides in-depth analysis of key cross-cutting economic issues on the APEC agenda.

The EC has set up a special task force to prepare for the 2005 APEC Economic Outlook Symposium, scheduled for July. It is also researching topics such as the patterns and prospects on technological progress in APEC. The report will examine the rapid growth of Asian economies as well as the technological innovation of some of the lower-income APEC economies, including China, where many of the highest-technology products are made, focusing on linkages of foreign direct investment and international production.

The EC is also working on the 2005 APEC Economic Outlook with chapters on economic performance and prospects and the economic impact of counter-terrorism in the APEC region. Chapter One will review recent economic developments and forecasts future prospects for the APEC economies. The assessment of macro-economic performance will be made based on the individual economy reports submitted by each member economy. Chapter Two will examine the macro-economic consequences of terrorism in terms of the flows of commodity trade and FDI flows as well as evaluate the effectiveness of counter-terrorism strategies.

Security will remain a top priority this year. A new chair of the Counter Terrorism Task Force (CTTF), Ambassador Benjamin Defensor of the Philippines, has been appointed. CTTF will focus on taking practical action to enhance cooperation and coordination among member economies. Capacity building is planned to help economies to implement such counter-terrorism measures as controls on cargo and people in transit and export controls.

In the wake of the recent Tsunami in the Indian Ocean, APEC also plans to press for better preparedness against similar disasters in the future. Much work needs to be done, especially in areas such as epidemic control, early warning systems, capacity building and APEC's role in assisting vulnerable industries such as fisheries and tourism.

On other fronts, the U.S. is working with China this year to organize a workshop in Beijing from September 18-22 to create an overall strategy for APEC to mitigate the impact of Invasive Alien Species.

APEC members will also discuss ways to facilitate community building through economic development and the celebration of cultural diversity. Korea, for example, plans to explore the possibility of hosting events such as an APEC film festival to showcase the rich and diverse cultures of the group. Economic and technical cooperation, in particular mutual cooperation in capacity building activities, will be key.