APEC Business Advisory Council Expresses Deep Concern over Global Economic Outlook
The APEC Business Advisory Council (ABAC), the private sector arm of the APEC Forum, just completed its first meeting of 2003, 3-5 March, in Lima, Peru. In the course of laying out its work plan for the year, ABAC expressed its deep concern over the current global economic outlook.
ABAC's believes that the global economic situation is more daunting than when ABAC last met in Los Cabos, Mexico in October 2002. Growth prospects have slipped, business confidence fallen, and investment has slowed throughout the Asia-Pacific region and beyond.
Real economic growth can only occur with an expanding business commitment in investment, employment and trade; the deterioration throughout APEC of the key economic indicators needs urgent attention from the APEC Leaders.
ABAC believes this situation can be reversed if, among other things, the APEC Leaders vigorously promote free, open and fair trade in the APEC region; enhance security in ways that continue to allow the free flows of goods and people; and confront critical challenges in corporate governance and transparency.
ABAC's deliberations in Lima were opened by strong remarks by Alejandro Toledo, President of Peru, who asserted his commitment to attracting investment, promoting economic growth and reducing poverty. President Toledo also hosted ABAC members, legislators, diplomats and business leaders at a gala dinner at the Presidential Palace.
ABAC's work during the year is to draft and finalize the text of its Report to APEC Economic Leaders. The five bodies set up within ABAC this year to develop the priorities are working groups on financial stability, trade and investment liberalization, trade and business facilitation, capacity building as well as an Action Plan Monitoring Committee.
Although these working groups will continue to refine their proposals over the course of this year, they set the broad parameters of their work at this meeting in Lima.
The working group on financial stability explored the impact of the new security environment on business and financial systems. It also targeted the severely undercapitalized reinsurance market and considered steps to improve corporate governance and transparency, as well as further strengthen financial, including capital, markets.
The trade and investment liberalization working group set priorities to move ahead the Doha Development Agenda, especially in agriculture and services; discussed transportation liberalization and facilitation; and reviewed the relationships between regional and bilateral free trade agreements and the WTO/APEC approaches.
The trade and business facilitation working group discussed security as it affects facilitation and energy security. It also explored strengthening intellectual property rights protections in a number of different areas and planned how to address new European Union regulations affecting all chemical products, products found in virtually every industry.
Under capacity building, recommendations will focus on cooperation with other ABAC working groups and other capacity work that cuts across APEC such as SME development, building critical infrastructure and establishing recycling-based economies. The group also discussed how to strengthen institutions for capital markets; enhance organizations through improved corporate governance; and build human capital for executives and professionals.
The final working group is charged with monitoring APEC's Individual Action Plans, the key tool for tracking trade liberalization and facilitation progress by APEC members. This group will support the mid-term review of APEC's free trade and investment goals, seek to promote greater progress in agricultural issues, and continue to push for more accountability from APEC on past recommendations from ABAC.
ABAC is chaired this year by Dr. Viphandh Roengpithya, President, Asian University of Science and Technology of Bangkok, Thailand.
ABAC comprises up to three senior business representatives from each of APEC's 21 member economies appointed by their respective heads of economy to advise APEC Economic Leaders and Ministers on issues affecting business.
As in the past years, ABAC's final report will recommend ways to improve business and investment in the APEC region and to help ensure that all in the region enjoy the benefits of globalization. In addition, ABAC will provide a pre-report highlighting some urgent recommendations ABAC would like to see action on and which will be delivered to APEC Ministers Responsible for Trade, who will meet in June in Thailand.