Asia-Pacific Economic Cooperation

The Asia-Pacific Economic Cooperation (APEC)
APEC member countries shown in green
Headquarters		Singapore
Type		Economic forum
Member Economies		21
Leaders
-	APEC Chair	Japan
-	Executive Director	Muhamad Noor Yacob
Establishment		1989
Website www.apec.org

Asia-Pacific Economic Cooperation (APEC) is a forum for 21 Pacific Rim countries (styled "Member Economies") that seeks to promote free trade and economic cooperation throughout the Asia-Pacific region. Established in 1989 in response to the growing interdependence of Asia-Pacific economies and the advent of regional economic blocs (such as the European Union and the North American Free Trade Area) in other parts of the world, APEC works to raise living standards and education levels through sustainable economic growth and to foster a sense of community and an appreciation of shared interests among Asia-Pacific countries. Members account for approximately 40% of the world's population, approximately 54% of world GDP and about 44% of world trade.^[1]

An annual APEC Economic Leaders' Meeting is attended by the heads of government of all APEC members except the Republic of China (Taiwan) which is represented under the name Chinese Taipei by a ministerial-level official. The location of the meeting rotates annually among the member economies, and a famous tradition involves the attending Leaders dressing in a national costume of the host member.

History

In January 1989, Australian Prime Minister Bob Hawke called for more effective economic cooperation across the Pacific Rim region. This led to the first meeting of APEC in the Australian capital Canberra in November, chaired by Australian Foreign Affairs Minister Gareth Evans. Attended by political ministers from twelve countries, the meeting concluded with commitments for future annual meetings in Singapore and South Korea.

The initial proposal was opposed by countries of the Association of Southeast Asian Nations (ASEAN) which instead proposed the East Asia Economic Caucus which would exclude non-Asian countries such as the United States, Canada, Australia and New Zealand. The plan was opposed and strongly criticised by Japan and the United States.

The first APEC Economic Leaders' Meeting occurred in 1993 when U.S. president Bill Clinton, after discussions with Australian prime minister Paul Keating, invited the heads of government from member economies to a summit on Blake Island. He believed it would help bring the stalled Uruguay Round of trade talks on track. At the meeting, some leaders called for continued reduction of barriers to trade and investment, envisioning a community in the Asia-Pacific region that might promote prosperity through cooperation. The APEC Secretariat, based in Singapore, was established to coordinate the activities of the organisation.

During the meeting in 1994 in Bogor, Indonesia, APEC Leaders adopted the Bogor Goals that aim for free and open trade and investment in the Asia-Pacific by 2010 for industrialised economies and by 2020 for developing economies. In 1995, APEC established a business advisory body named the APEC Business Advisory Council (ABAC), composed of three business executives from each member economy.

Member Economies

South Korean President Roh Moo-hyun with Japanese Prime Minister Shinzo Abe and U.S. President George W. Bush at APEC 2006 in Hanoi.

APEC currently has 21 members, including most countries with a coastline on the Pacific Ocean. The organization is one of the few international organizations which Taiwan (albeit under the name Chinese Taipei) joined with full approval of mainland China. As a result, the APEC uses the term Member Economies rather than member countries to refer to its members.

Member economy	Date of accession
Australia	1989
Brunei	1989
Canada	1989
Indonesia	1989
Japan	1989
Republic of Korea	1989
Malaysia	1989
New Zealand	1989
Philippines	1989
Singapore	1989
Thailand	1989
United States	1989
Chinese Taipei[2]	1991
Hong Kong, China[3]	1991
People's Republic of China[4]	1991
Mexico	1993
Papua New Guinea	1993
Chile	1994
Peru	1998
Russia	1998
Vietnam	1998

Possible enlargement

India has requested membership in APEC, and received initial support from the United States, Japan^[5] and Australia. Officials have decided not to allow India to join for various reasons.^[6][7] However, the decision was made not to admit more members until 2010. Moreover, India does not border the Pacific which all members do. The Philippines trade negotiator was quoted as saying that there is concern that "Once the Indians come in, the (Asian) weighting would become heavier in this part of the world."^[8]

In addition to India, Mongolia, Pakistan, Laos, Bangladesh, Costa Rica, Colombia,^[9] and Ecuador,^[10] are among a dozen countries seeking membership in APEC by 2008. Colombia applied for APEC's membership as early as in 1995, but its bid was halted as the organization stopped accepting new members from 1993 to 1996,^[11] and the moratorium was further prolonged to 2007 due to the 1997 Asian Financial Crisis. Costa Rica, Colombia and Ecuador hope to become members in 2010. Guam has also been actively seeking a separate membership, citing the example of Hong Kong, but the request is opposed by the United States, which currently represents Guam.

APEC's Three Pillars

To meet the Bogor Goals, APEC carries out work in three main areas:

1. Trade and Investment Liberalisation

2. Business Facilitation

3. Economic and Technical Cooperation

APEC and Trade Liberalisation

According to the organization itself, when APEC was established in 1989 average trade barriers in the region stood at 16.9 percent, but had been reduced to 5.5% in 2004.^[12]

APEC's Business Facilitation Efforts

APEC has long been at the forefront of reform efforts in the area of business facilitation. Between 2002-2006 the costs of business transactions across the region was reduced by 6 percent, thanks to the APEC Trade Facilitation Action Plan (TFAPI). Between 2007 and 2010, APEC hopes to achieve an additional 5 percent reduction in business transaction costs. To this end, a new Trade Facilitation Action Plan has been endorsed. According to a 2008 research brief published by the World Bank as part of its Trade Costs and Facilitation Project, increasing transparency in the region's trading system is critical if APEC is to meet its Bogor Goal targets.^[13] The APEC Business Travel Card, a travel document for visa-free business travel within the region is one of the concrete measures to facilitate business.

Proposed Free Trade Area of the Asia-Pacific

APEC is considering the prospects and options for a Free Trade Area of the Asia-Pacific (FTAAP) which would include all member economies of Asia-Pacific Economic Cooperation (APEC). Since 2006, the APEC Business Advisory Council, promoting the theory that a free trade area has the best chance of converging the member nations and ensuring stable economic growth under free trade, has lobbied for the creation of a high-level task force to study and develop a plan for a free trade area. The proposal for a FTAAP arose due to the lack of progress in the Doha round of World Trade Organization negotiations, and as a way to overcome the 'spaghetti bowl' effect created by overlapping and conflicting elements of free trade agreements between members - there are as many as 60 free trade agreements and 117 being negotiated in Southeast Asia and the Asia-Pacific region.^{[14][14][15] [16][16]} The FTAAP is more ambitious in scope than the Doha round, which limits itself to reducing trade restrictions. The FTAAP would create a free trade zone that would considerably expand commerce and economic growth in the most dynamic region in the world.^[14][16] The economic expansion and growth in trade could exceed the expectations of other regional free trade areas such as the ASEAN Plus Three (ASEAN + China, Japan, and South Korea).^[17] Some criticisms include that the diversion of trade within APEC members would create trade imbalances, market conflicts and complications with nations of other regions.^[16] The development of the FTAAP is expected to take many years, involving essential studies, evaluations and negotiations between member economies.^[14] It is also affected by the absence of political will and popular agitations and lobbying against free trade in domestic politics.^[14]

APEC Study Center Consortium

In 1993, APEC Leaders decided to establish a network of APEC Study Centres (ASCs) amongst universities and research institutions in APEC member economies.^[18]

Notable centers include:

• Australian APEC Study Centre, Royal Melbourne Institute of Technology, Australia^[19]
• Berkeley APEC Study Center, University of California, Berkeley, United States^[20]
• Chinese Taipei APEC Study Center, Taiwan Institute of Economic Research, Taiwan^[21]
• HKU APEC Study Center, Hong Kong University, Hong Kong, China^[22]
• Kobe APEC Study Center, Kobe University, Japan^[23]
• Nankai APEC Study Center, Nankai University, People's Republic of China^[24]
• The Canadian APEC Study Centre, The Asia Pacific Foundation of Canada, Vancouver, Canada^[25]

APEC Business Advisory Council

The APEC Business Advisory Council (ABAC) was created by the APEC Economic Leaders in November 1995 with the aim of providing advice to the APEC Economic Leaders on ways to achieve the Bogor Goals and other specific business sector priorities, and to provide the business perspective on specific areas of cooperation.

Each economy nominates up to three members from the private sector to ABAC. These business leaders represent a wide range of industry sectors.

ABAC provides an annual report to APEC Economic Leaders containing recommendations to improve the business and investment environment in the Asia-Pacific region, and outlining business views about priority regional issues.

ABAC is also the only non-governmental organisation that is on the official agenda of the APEC Economic Leader’s Meeting.

Annual APEC Economic Leaders' Meetings

Since its formation in 1989, APEC has held annual meetings with representatives from all member economies. The first four annual meetings were attended by ministerial-level officials. Beginning in 1993, the annual meetings are named APEC Economic Leaders' Meetings and are attended by the heads of government from all member economies except Taiwan, which is represented by a ministerial-level official. The annual Leaders' Meetings are not called summits.

Meeting developments

In 1997, the APEC meeting was held in Vancouver. Controversy arose after officers of the Royal Canadian Mounted Police used pepper spray against protesters. The protesters objected to the presence of autocratic leaders such as Indonesian president Suharto.The private transportation services for over 80% of world leaders and delegates was handled by on of Canada's top passenger transportation coordinators and logistics specialists. James Miller was an accredited delegate for Japan, Canada, Mexico, Philippines, Brunei, Peoples Republic of China, United States in addition to coordinating and developing advanced transportation driving programs for all sedan, limousine and bus drivers under his control. He was responsible for processing screening applications to the RCMP and CSIS / APEC Security for each person under his direction for the event and training drivers for the event. He further declined orders from the RCMP to order vehicle drivers to continue through protesters if they attempted to block vehicles and stop motorcades. He was able to execute the entire process without any incidents involving world leaders and delegates and maintaining a safe record for the event. This was as a result of his months of preparations and planning, training of each and every employee no matter what the position they held and through very complex and confidential contingency planning. The company which contracted Mr. Miller's services failed to pay him his contracted fee of just over $40,000. CAD although they collected over $500,000. CAD from the various governments and organizations. The company which had him under contract went into bankruptcy several years later still owing Mr. Miller the full balance. The Japanese government, Canadian Government and others were made aware of the failure of Mr. Miller to be paid for his service for the APEC summit but did not make good on the amounts owed to Mr. Miller either as they did pay the contracting company. When asked, even today if he would ever do this type of event again Mr Miller replies, "Without hesitation, even if I knew I would not be paid for my services in the end, it was an amazing opportunity to not only be a part of the APEC Summit in Vancouver but to also e out on the tarmac and greeting world leaders and first ladies, top government officials and know that they were safe as a result of my work. It was a great honour to serve the many countries and delegates. I would do it again in a heartbeat".^{[26][27][28][29][30][31]}

At the 2001 Leaders' Meeting in Shanghai, APEC leaders pushed for a new round of trade negotiations and support for a program of trade capacity-building assistance, leading to the launch of the Doha Development Agenda a few weeks later. The meeting also endorsed the Shanghai Accord proposed by the United States, emphasising the implementation of open markets, structural reform, and capacity building. As part of the accord, the meeting committed to develop and implement APEC transparency standards, reduce trade transaction costs in the Asia-Pacific region by 5 percent over 5 years, and pursue trade liberalization policies relating to information technology goods and services.

In 2003, Jemaah Islamiah leader Riduan Isamuddin had planned to attack the APEC Leaders Meeting to be held in Bangkok in October. He was captured in the city of Ayutthaya, Thailand by Thai police on August 11, 2003, before he could finish planning the attack. Chile became the first South American nation to host the Leaders' Meeting in 2004. The agenda of that year was focused on terrorism and commerce, small and medium enterprise development, and contemplation of free trade agreements and regional trade agreements.

The 2005 Leaders' Meeting was held in Busan, South Korea. The meeting focused on the Doha round of World Trade Organization (WTO) negotiations, leading up to the WTO Ministerial Conference of 2005 held in Hong Kong in December. Weeks earlier, trade negotiations in Paris were held between several WTO members, including the United States and the European Union, centered on reducing agricultural trade barriers. APEC leaders at the summit urged the European Union to agree to reducing farm subsidies. Peaceful protests against APEC were staged in Busan, but the meeting schedule was not affected.

At the Leaders' Meeting held on November 19, 2006 in Hanoi, APEC leaders called for a new start to global free-trade negotiations while condemning terrorism and other threats to security. APEC also criticised North Korea for conducting a nuclear test and a missile test launch that year, urging the country to take "concrete and effective" steps toward nuclear disarmament. Concerns about nuclear proliferation in the region was discussed in addition to economic topics. The United States and Russia signed an agreement as part of Russia's bid to join the World Trade Organization.

The APEC Australia 2007 Leaders' Meeting was held in Sydney from 2-9 September 2007. The political leaders agreed to an "aspirational goal" of a 25% reduction of energy intensity correlative with economic development.^[32] Extreme security measures including airborne sharpshooters and extensive steel-and-concrete barricades were deployed against anticipated protesters and potential terrorists. However, protest activities were peaceful and the security envelope was penetrated with ease by a spoof diplomatic motorcade manned by members of the Australian television program The Chaser, one of whom was dressed to resemble the Al-Qaeda leader Osama bin Laden.

Meeting locations

The location of the meeting is rotated annually among the members. As a tradition, the leaders attending the meeting participate in a photo op in which they dress in a costume that reflects the culture of the host member.

Annual meetings of the Asia-Pacific Economic Cooperation

	Date	Host member	Location	Photo op fashion	Photo	Web site
1st	November 6–7, 1989	Australia	Canberra
2nd	July 29–31, 1990	Singapore	Singapore
3rd	November 12–14, 1991	Republic of Korea	Seoul
4th	September 10–11, 1992	Thailand	Bangkok
5th	November 19–20, 1993	United States	Seattle	Bombardier Jackets
6th	November 15, 1994	Indonesia	Bogor	Batik Shirts designed by Iwan Tirta[33]
7th	November 19, 1995	Japan	Osaka	Business Suits
8th	November 25, 1996	Philippines	Manila and Subic	Barong Shirts		[1]
9th	November 24–25, 1997	Canada	Vancouver	Leather Jackets		[2]
10th	November 17–18, 1998	Malaysia	Kuala Lumpur	Batik Shirts		[3]
11th	September 12–13, 1999	New Zealand	Auckland	Sailing Jackets		[4]
12th	November 15–16, 2000	Brunei Darussalam	Brunei	Kain Tenunan Shirts		[5]
13th	October 20–21, 2001	People's Republic of China	Shanghai	Tangzhuang
14th	October 26–27, 2002	Mexico	Los Cabos	Guayabera Shirts (M); Huipíles (F)
15th	October 20–21, 2003	Thailand	Bangkok	Brocade Shirts (M); Brocade Shawls (F)
16th	November 20–21, 2004	Chile	Santiago	Chamantos		[6]
17th	November 18–19, 2005	Republic of Korea	Busan	Hanboks
18th	November 18–19, 2006	Vietnam	Hanoi	Áo dài		[7]
19th	September 8–9, 2007	Australia	Sydney	Drizabones and Akubra Hats		[8]
20th	November 22–23, 2008	Peru	Lima	Ponchos		[9]
21st	November 14–15, 2009	Singapore	Singapore	Peranakan-Inspired Designer Shirts	‎	[10]
22nd	November 13–14, 2010	Japan	Yokohama			[11]
23rd	November 12–13, 2011	United States	Honolulu
24th	November 2012	Russia	Vladivostok			[12]
25th	November 2013	Indonesia

Criticism

APEC has been criticized for failing to clearly define itself or serve a useful purpose. According to the organisation, it is "the premier forum for facilitating economic growth, cooperation, trade and investment in the Asia-Pacific region" established to "further enhance economic growth and prosperity for the region and to strengthen the Asia-Pacific community."^[34] However, whether it has accomplished anything constructive remains debatable.^[35]

See also

• APEC Sydney Metropolitan Public Holiday 2007
• Asia-Europe Meeting
• ASEAN Free Trade Area
• East Asia Economic Caucus
• East Asia Summit
• PECC
• Asia-Pacific Trade Agreements Database

References

External links

• Asia-Pacific Economic Cooperation
• Congressional Research Service (CRS) Reports regarding APEC