Strengthening the economic architecture of the Asia Pacific region led discussions of a leading business council arising from deep concerns about the growing pressures of economic fragmentation and the risks that this poses to growth, inclusion within each APEC nation along with the impact of climate change.
The APEC Business Advisory Council (ABAC), met over the last three days in Kuala Lumpur where representative chairs of APEC member nations deliberated in broad-ranging discussions with APEC Senior Officials, where the focus was on key issue areas of work outlined by ABAC Peru.
These discussions are the first of many public-private interactions with APEC Senior Officials and Ministers and set the stage for another year of ambitious collaboration.
“We are at a critical juncture for the global economy and the planet. Business and governments must come together to act decisively to create a prosperous, sustainable and stable future for our communities,” said ABAC Chair 2024, Julia Torreblanca of ABAC Peru.
“As business advisors to the APEC Leaders, we are committed to playing our role in collaboratively tackling these challenges for the benefit of our people.”
“Our theme for the year is ‘People, Business, Prosperity’, to guide our work across key issues including trade and investment facilitation, digital transformation, sustainability, and inclusion,” Torreblanca added.
According to the APEC Policy Support Unit, FDI inflows into the APEC region have been falling (-9% in 2022) despite the fact the bloc performs better than global average at investment facilitation.
“Seeing APEC FDI inflows decrease even with post-covid rebound is concerning. Action is needed urgently to get us back into the route of sustainable economic growth.”
“We should build towards that now through practical initiatives, for example digital trade coherence and responsible artificial intelligence, supply chains, women’s access to financing and the trade tools we need to fight climate change.”
One of ABAC’s priorities for 2024 is strengthening the economic architecture of the region, working closely with APEC colleagues to make tangible progress towards the Free Trade Area of the Asia-Pacific (FTAAP).
“The eventual FTAAP should draw on the best of the high-quality trade agreements in the region,” said Torreblanca.
Another ABAC 2024 priority is to develop practical ideas about how to support the transition from the informal to the formal economy.
“This is a real challenge for many developing economies in the region, hindering our ability to fulfil our economic potential and provide people with more and better opportunities. We want to develop pragmatic approaches that can help shift the dial,” she added.
ABAC also issued a statement for the upcoming World Trade Organization Ministerial Conference, MC13, urgently calling for Trade Ministers to drive ambitious outcomes, including the reinstatement of the full functioning of the dispute settlement system, and a permanent ban on tariffs on electronic transmissions.
In this era of global challenges, the APEC Business Advisory Council (ABAC) recognises that the WTO is instrumental in fostering prosperity, peace, stability, economic security, and equitable opportunities for all.
Key points of the statement raised factors of the global landscape rapidly evolving, and so too must the WTO which is uniquely positioned to develop the essential tools to combat pressing global risks such as trade distorting practices, rising unilateralism, climate change and food insecurity.
Its effectiveness depends upon the unwavering support and commitment of us all.
ABAC, although still in the working stage, has called for an agreement on a permanent Moratorium on Customs Duties on Electronic Transmissions, in order to prevent the creation of new trade barriers in the digital economy which is so vital to growth, inclusion and sustainability in their interconnected communities.
And, new tariffs would hit the most vulnerable the hardest, and work against economic development, where they are presently outlining plans to seek the immediate reinstatement of the Appellate Body and agreement to necessary reforms to the WTO’s dispute settlement system, without which the WTO architecture of commitments, obligations and mutually beneficial opportunities is in jeopardy.
While pursuing meaningful reforms in agriculture and fisheries, including the substantial reduction and elimination of trade-distorting agriculture subsidies, the urgent ratification of the Fish Subsidies Agreement, and the conclusion of the Agreement’s second phase, in order to avert the wanton destruction of the global commons and ensure fair competition and food security for all.
ABAC has also called on APEC Ministers to champion open plurilateral agreements, including the Joint Statement Initiatives. These initiatives provide pragmatic and innovative solutions to critical challenges. Three-quarters of the WTO’s membership are participants. Attempts to derail these efforts undermine our shared goals of global development and prosperity. In particular, we urge APEC Ministers.
The regional business council also call for a full endorsement of the Investment Facilitation for Development Agreement and its integration into the WTO legal framework, which promises to unlock development, prosperity and sustainability in the region and champion a package of substantive outcomes on E-Commerce this year, to enable economies to leverage the full benefits of the digital age, facilitate trusted cross-border data flows, mitigate the digital divide, and counter regulatory fragmentation, along with support initiatives that seek to enable trade effectively to address sustainability, including responding to climate change, the most urgent threat to humanity.
ABAC will convene its next meeting in late April in Hong Kong, China as it works to develop its recommendations for presentation to APEC Leaders during their summit in November.
The APEC Member Economies include Australia; Brunei Darussalam; Canada; Chile; China; Hong Kong, China; Indonesia; Japan; Korea; Malaysia; Mexico; New Zealand; Papua New Guinea; Peru; Philippines; Russia; Singapore; Chinese Taipei; Thailand; United States of America; and Vietnam.
ABAC was created by APEC Leaders in 1995 to be the primary voice of business in APEC. Each economy has three members who are appointed by their respective Leaders. They meet four times a year in preparation for the presentation of their recommendations to the Leaders in a dialogue that is a key event in the annual Leaders Meeting.
Under Peru’s leadership, ABAC is pursuing a work program under the theme “People. Business. Prosperity.” to respond to the challenge of maintaining the economic vitality of the Asia-Pacific Region and ensure it benefits all.
Present chairs for ABAC 2024 Chair is Julia Torreblanca (Peru) and the Co-Chairs are Dominic Ng (USA) and Hyunghee Lee (Korea), with three (3) working group chairs, namely: Rachel Taulelei, Regional Economic Integration Working Group (REIWG); Ning Gaoning, Sustainability Working Group (SWG); and Tom Harley, Human Development Working Group (HDWG); and two (2) Task Force Chairs, namely: Jan De Silva, Digital and Innovation Task Force (DITF); and Hiroshi Nakaso, Finance and Investment Task Force (FITF).
