The Asia-Pacific Economic Cooperation (APEC) is an inter-governmental forum for 21 member economies in the Pacific Rim that promotes free trade throughout the Asia-Pacific region.
- Following the success of ASEAN’s series of post-ministerial conferences launched in the mid-1980s, APEC started in 1989, in response to the growing interdependence of Asia Pacific economies and the advent of regional trade blocs in other parts of the world;
- It aimed to establish new markets for agricultural products and raw materials beyond Europe.
- Headquartered in Singapore, APEC is recognized as one of the highest-level multilateral blocs and oldest forums in the Asia-Pacific region and exerts a significant global influence.
- The heads of government of all APEC members except the Republic of China (which is represented by a ministerial-level official under the name Chinese Taipei as economic leader) attend an annual APEC Economic Leaders’ Meeting.
- The location of the meeting rotates annually among the member economies, and a famous tradition, followed for most (but not all) summits, involves the attending leaders dressing in a national costume of the host country.
- APEC has three official observers: the Association of Southeast Asian Nations Secretariat, the Pacific Economic Cooperation Council and the Pacific Islands Forum Secretariat
- APEC’s Host Economy of the Year is considered to be invited in the first place for geographical representation to attend G20 meetings following G20 guidelines.
- India is not a Member.
- APEC is the premier Asia-Pacific economic forum. Our primary goal is to support sustainable economic growth and prosperity in the Asia-Pacific region.
- We are united in our drive to build a dynamic and harmonious Asia-Pacific community by championing free and open trade and investment, promoting and accelerating regional economic integration, encouraging economic and technical cooperation, enhancing human security, and facilitating a favourable and sustainable business environment. Our initiatives turn policy goals into concrete results and agreements into tangible benefits.
- The broad objectives are to provide a forum for discussion on a wide range of economic issues and to promote multilateral cooperation among the market-oriented economies of the region. Specifically, APEC aims to promote economic and technical cooperation among the members by stimulating the flow of goods, services, capital and technology; to develop a liberalized trade and investment regime; to encourage private investment, and to support ‘open regionalism’.
- APEC consists of Annual Ministerial Meetings, Senior Officials Meeting, Working Groups and a Secretariat.
- The governing body of APEC is the Annual Ministerial Meeting of the foreign and trade ministers of all the member-states.
- The chairmanship of the meetings rotates every year among the members.
- The Senior Officials Meetings, consisting of representatives of all the member-states, are held annually and are responsible for the implementation of policies framed by Ministerial Meetings.
- There are ten Working Groups dealing with Telecommunications, Trade and Investment Data, Fisheries, Tourism, Transportation, Trade Promotion, Investment and Technology, Human Resource Development, Regional Energy Cooperation and Marine Resource Conservation, and two ad hoc groups dealing with Regional Trade Liberalization and Economic Policy.
- The Secretariat is headed by the Executive Director who holds a term of one year.
How Has the Region Benefited?
- APEC has grown to become a dynamic engine of economic growth and one of the most important regional forums in the Asia-Pacific. Its 21 member economies are home to around 2.9 billion people and represent approximately 60 per cent of world GDP and 48 per cent of world trade in 2018.
- As a result of APEC’s work, growth has soared in the region, with real GDP increasing from USD 19 trillion in 1989 to USD 46.9 trillion in 2018. Meanwhile, residents of the Asia-Pacific saw their per capita income rise by 74 per cent, lifting millions out of poverty and creating a growing middle class in less than three decades.
- Bringing the region closer together, reducing trade barriers, and smoothing out differences in regulations have boosted trade which, in turn, has led to this dramatic increase in prosperity. Average tariffs fell from 17 per cent in 1989 to 5.3 per cent in 2018. During that same time period, the APEC region’s total trade increased over seven times—outpacing the rest of the world with two-thirds of this trade occurring between member economies.
- APEC implements a wide variety of initiatives to help integrate the region’s economies and promote trade while addressing sustainability and social equity.
SCOPE OF WORK
The Three Pillars of APEC’s agenda focus on:
1. Trade and Investment Liberalization
APEC members take actions to reduce tariff and non-tariff barriers to trade and investment that boosts job creation, incomes and growth. Collaboration is guided by APEC’s Regional Economic Integration agenda and includes the advancement of bilateral and regional trade agreements and the long-term goal of a Free Trade Area of the Asia-Pacific (FTAAP).
2. Business Facilitation
APEC members pursue measures to reduce the time, cost and uncertainty of doing business in the region and open new economic opportunities including for small firms, women and youth. APEC’s Structural Reform agenda supports the development and harmonization of policies that improve market access and efficiency and uphold public interest such as the safeguarding of health and safety.
3. Economic and Technical Cooperation (ECOTECH)
ECOTECH builds the technical capacity of APEC’s diverse members to promote trade, investment and robust, secure and sustainable economic growth that widely benefits the region’s people. Priorities include strengthening anti-corruption, cross-border education and skills training, emergency preparedness, energy security, environmental protection, defence against pandemics and infrastructure development, among others.
Osaka Action Agenda
The Osaka Action Agenda provides a framework for meeting the Bogor Goals through trade and investment liberalisation, business facilitation and sectoral activities, underpinned by policy dialogues and economic and technical cooperation. As part of this framework, General Principles have been defined for APEC member economies as they proceed through the APEC liberalisation and facilitation process.
The following General Principles are provided in the Osaka Action Agenda and are applied to the entire APEC liberalisation and facilitation process:
- Comprehensiveness – addressing all impediments to achieving the long-term goal of free and open trade.
- WTO-consistency – measures undertaken in the context of the APEC Action Agenda are consistent with the principles of the World Trade Organization (WTO).
- Comparability – APEC member economies endeavour to have comparable trade and investment liberalisation and facilitation, taking into account the general levels achieved by each APEC economy.
- Non-discrimination – reductions in barriers to trade achieved through APEC are available to all APEC Member Economies and non-APEC economies.
- Transparency – the laws, regulations and administrative procedures in all APEC member economies which affect the flow of goods, services and capital among APEC member economies are transparent.
- Standstill – APEC Member Economies do not take measures which have the effect of increasing levels of protection.
- Simultaneous start, continuous process and differentiated timetables – APEC member economies began simultaneously the process of liberalisation, facilitation and cooperation and continuously contribute to the long-term goal of free and open trade and investment.
- Flexibility – APEC member economies deal with the liberalisation and facilitation process in a flexible manner, taking into account differing levels of economic development.
- Cooperation – Economic and technical cooperation contributing to liberalisation and facilitation is actively pursued.
- India has requested membership in APEC and received initial support from the United States, Japan, Australia and Papua New Guinea.
- Officials have decided not to allow India to join for various reasons, considering that India does not border the Pacific Ocean, which all current members do.
- However, India was invited to be an observer for the first time in November 2011.
- APEC has been criticised for promoting free trade agreements that would impose restrictions on national and local laws, which regulate and ensure labour rights, environmental protection and safe and affordable access to medicine.
- 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.
- The effectiveness and fairness of its role have been questioned, especially from the viewpoints of European countries that cannot take part in APEC and Pacific Island nations that cannot participate but stand to be affected by its decisions.
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