Towards a consolidation of inter-regional diplomacy

The Economic Leaders of APEC met in-person for the first time in four years in Bangkok on 18-19 November 2022.

Asia Pacific Economic Cooperation ( APEC) is an original forum of cooperation on the world arena.By its composition it is an inter-governmental forum for 21 member economies that promotes free trade throughout the Asia-Pacific region. After a number of successful ASEAN's post-ministerial conferences, APEC started its functioning 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. Its initial major aim was to establish new markets for agricultural products and raw materials beyond Europe.

APEC is headquartered in Singapore and is recognized today as one of the highest-level multilateral blocs and oldest forums in the Asia-Pacific region and it exerts an important global influence on world economy.

APEC membership includes: Australia; Brunei Darussalam; Canada; Chile; People's Republic of China; Hong Kong, China; Indonesia; Japan; Republic of Korea; Malaysia; Mexico; New Zealand; Papua New Guinea; Peru; the Philippines; the Russian Federation; Singapore; Chinese Taipei; Thailand and the United States of America.

APEC has also three official observers: the ASEAN Secretariat, the Pacific Economic Cooperation Council and the Pacific Islands Forum Secretariat.

The APEC 2022 Leaders' Declaration is the most recent collective instrument of this forum and was adopted by consensus in Bangkok on 19 November 2022.

This diplomatic document has 23 paragraphs and starts by reminding that APEC will continue the implementation of the APEC Putrajaya Vision 2040, including through the Aotearoa Plan of Action. In 2022 the APEC Mee ting took place under the theme "Open. Connect. Balance."

We will analyse selectively this document, using the terminology of the original text and respecting the numerous English abbreviations established by its diplomatic negotiators and drafters.

Priorities

APEC advances work through three priorities: to be open to all opportunities, connected in all dimensions, and balanced in all aspects, in order to advance long-term robust, innovative and inclusive economic growth, as well as sustainability objectives in the Asia-Pacific region.

On substance, APEC 2022 Leaders declare :"We have been intensifying our efforts in responding to the COVID-19 pandemic and mitigating its impact on our people and economies to promote health and wellbeing, as well as improving the overall standard of living for all".

An interesting compromise solution has been achieved on the language for the formulations dealing with the war in Ukraine, as contained in the following paragraph reproduced in extenso :

"This year, we have also witnessed the war in Ukraine further adversely impact the global economy. There was a discussion on the issue. We reiterated our positions as expressed in other fora, including the UN Security Council and the UN General Assembly, which, in Resolution No. ES-11/1 dated 2 March 2022, as adopted by majority vote (141 votes for, 5 against, 35 abstentions, 12 absent) deplores in the strongest terms the aggression by the Russian Federation against Ukraine and demands its complete and unconditional withdrawal from the territory of Ukraine. Most members strongly condemned the war in Ukraine and stressed it is causing immense human suffering and exacerbating existing fragilities in the global economy – constraining growth, increasing inflation, disrupting supply chains, heightening energy and food insecurity, and elevating financial stability risks. There were other views and different assessments of the situation and sanctions. Recognising that APEC is not the forum to resolve security issues, we acknowledge that security issues can have significant consequences for the global economy".

What are the major commitments of APEC ?

In a carefully selected terminology the APEC Leaders summarized their position on trade and investment . They consider that "Trade and investment play a critical and indispensable role in enhancing the prosperity of our people by assisting with global challenges and can open up opportunities that offer tangible benefits. We underscore the importance of international trade and the World Trade Organization (WTO) in facilitating global economic recovery, growth, prosperity, alleviation of poverty, the welfare of all people, sustainable development, and facilitating cooperation in relation to the protection and conservation of the environment. We reaffirm our determination to deliver a free, open, fair, non-discriminatory, transparent, inclusive and predictable trade and investment environment. We will continue to work to ensure a level playing field to foster a favourable trade and investment environment and reaffirm our commitment to keep markets open and to address supply chain disruptions".

The question of trade could not be limited to aspects of principle.

Therefore, the APEC Declaration continues with a number of specific elements. Thus, the Leaders "welcome the successful outcomes of the Twelfth WTO Ministerial Conference (MC12) and are determined to uphold and further strengthen the rules-based multilateral trading system, with the WTO at its core. We look forward to the early and effective implementation of the MC12 outcomes. We will cooperate in the WTO to continue to support its necessary reform to improve all its functions, in order to ensure that it can better address existing and emerging global trade challenges. We commit to working together with a view to achieving meaningful progress by the Thirteenth WTO Ministerial Conference".

The question of free trade is, as generally known, on a permanent diplomatic agenda at the regional, inter-regional and global levels. The APEC Leaders could not avoid expressing their position on the current situation. In this context, they recognized " the useful contributions of the Lima Declaration and the Beijing Roadmap on progressing the Free Trade Area of the Asia-Pacific (FTAAP) agenda".

On a positive note, the APEC Leaders assessed also the past achievements in the field under consideration.They "note with appreciation of ABAC's recommendations in advancing the FTAAP Work Programs. We commend the public and private sector collaboration between the Ministers Responsible for Trade (MRT) and ABAC, which underscores APEC's emphasis on advancing an inclusive economic development. We will also continue our efforts in capacity building to improve trade negotiation skills of economies".

As COVID-19 pandemic had a strong negative impact on world economy the APAC Leaders found it appropriate to submit adequate proposals. In their view, "In order to achieve post-COVID-19 economic recovery, it is our priority to drive growth-focused structural reform that is designed to be inclusive, sustainable, and innovation-friendly. This includes fostering an enabling environment for businesses of all types, particularly micro, small and medium-sized enterprises (MSMEs) and start-ups, and collaborating to improve opportunities for them to be competitive, specialised, innovative, and expand into the international markets. We reaffirm our commitment to the Enhanced APEC Agenda for Structural Reform (EAASR) and endeavour to make collective and individual progress, including on the ease of doing business".

The Leaders demonstrated sensitivity in approaching current economic phenomena affecting world economy. They consider that "Macroeconomic and structural policies are vital to tackling rising inflation, ushering in sustained economic recovery, and raising living standards in the region. We reaffirm the importance of sustainable financing, capacity building, and technical assistance for innovation and growth as well as for addressing all environmental challenges, including climate change. We will continue to advance digital tools to facilitate economic activities and the provision of public services, including the delivery of assistance and stimulus packages to the people, and to drive financial inclusion".

Transports and connectivity are vital fields of action in all regions.

This seems to be the reason for which the APEC Leaders "commend APEC's work on safe passage, including under the Safe Passage Taskforce. We will further our cooperation to promote safe and seamless cross-border travel within our region as we emerge from the COVID-19 pandemic, including for essential workforces, including air and maritime crew, as well as improve infrastructure and tools, such as the interoperability of vaccination certificates and ensuring the APEC Business Travel Card (ABTC) is inclusive".

On connectivity the APEC Leaders "reaffirm our commitment to enhance an open and interconnected Asia-Pacific region, including through the implementation of the APEC Connectivity Blueprint (2015-2025). We will strengthen physical, institutional and people-to-people connectivity as well as take advantage of digital connectivity, and will intensify efforts to promote regional, sub-regional and remote area connectivity through quality infrastructure development and investment. We will promote regenerative tourism that is sustainable, inclusive and resilient, and to connect the entire tourism eco-system. We support efforts to foster open, secure and resilient supply chains, enhance supply chain connectivity and minimise supply chain disruptions. We encourage economies to continue efforts to remove barriers to logistics-related services. We welcome the endorsement of Phase Three of the Supply Chain Connectivity Framework Action Plan by the APEC Ministers".

Digital economy

Having in mind the current and future developments of digital economy, the APEC Leaders decided to offer some useful guidelines in this field. In their opinion, "digital technology and innovation have a greater role to play in advancing inclusive and sustainable growth, improving access to services as well as opportunities to generate income and better the livelihoods of our people, including by encouraging the transition of economic actors from the informal to the formal economy. We will deepen cooperation to bridge digital divides between and within economies, including on facilitating access to digital infrastructure and supporting development of digital skills and digital literacy. We will cooperate on facilitating the flow of data, and strengthening business and consumer trust in digital transactions".

Special attention is paid in the Declaration to the impact of digital transformation.The APEC Leaders assert that they " recognise the power of digital transformation in facilitating and reducing barriers to trade and unlocking exponential growth, including through nurturing the interoperability of digital systems and tools across the region. We encourage APEC to incubate more cutting-edge and comprehensive cooperation initiatives on digital economy. We will, therefore, accelerate the implementation of the APEC Internet and Digital Economy Roadmap (AIDER) to harness new and emerging technologies and the full potential of our society as well as create an enabling, inclusive, open, fair and non-discriminatory digital ecosystem for businesses and consumers'".

Equilibrium in world economy

Under the APEC 2022 already announced theme "Open. Connect. Balance" the APEC Leaders affirm their "commitment to promote strong, balanced, secure, sustainable and inclusive growth". In this respect, they are realistic and " recognise that more intensive efforts are needed to address today's challenges, including climate change, extreme weather and natural disasters, food security, and sustainable energy transitions that reduce greenhouse gas emissions, while ensuring energy resilience, access and security in the region, including by facilitating investments in relevant activities".

Recognizing theoretically what is to be done in general is not sufficient.That's why the APEC Leaders recall their "commitment to rationalise and phase out inefficient fossil fuel subsidies that encourage wasteful consumption, while recognising the importance of providing those in need with essential energy services".

An important practical decision has been announced in the Declaration presented in these pages. APEC endorsed the Bangkok Goals on the Bio-Circular-Green (BCG) Economy as a comprehensive framework to further APEC's sustainability objectives. In this regard, APEC Leaders "will advance the Bangkok Goals in a bold, responsive and comprehensive manner, building upon existing commitments and workstreams as well as considering new aspirational ones. We also welcome the launch of the APEC BCG Award this year to recognise the achievements of sustainability in the region".

Dealing with crises

Having in mind that the COVID-19 pandemic is not over, the APEC Leaders decided to continue to "mobilise resources to combat the COVID-19 pandemic and reinforce existing systems to prevent and prepare for, and respond to future health threats."

A promising announcement was made in this regard.The APEC Leaders are determined to ensure extensive immunisation of their people against COVID-19 as a global public good. It is imperative to further strengthen the public health workforce, acknowledging their tremendous contributions to protecting people's lives and safeguarding their health.Efforts should continue to improve digital solutions and access to health services, and strengthen health systems with a view to achieving universal health coverage.

The APEC Leaders adequately reacted to the threat of food-crisis.They decided to "expedite and intensify the work to promote agricultural development, including in rural areas, and promote long-term food security by ensuring that agricultural and food systems are more resilient, productive, innovative and sustainable, strengthening global food supply chains, and reducing food loss and waste.

Moreover, the APEC Leaders also reaffirmed their "commitment to work towards the sustainable resource management of agriculture, forestry and marine resources and fisheries. They welcomed the Implementation Plan of the Food Security Roadmap Towards 2030 as a pathway to achieve sufficient, safe, nutritious, accessible and affordable food for all.

Social field

Social issues could not be absent from this Declaration, even if it is primarily and specifically focused on economic items.The APEC Leaders considerations in this field deserve to be reproduced in toto. They recognize that long-term economic growth can only be achieved through realising the full potential of society. They welcome the continued efforts to use a gender mainstreaming approach in relevant APEC processes and accelerate the full implementation of the La Serena Roadmap for Women and Inclusive Growth (2019 – 2030). They are committed to building an environment where all, including MSMEs and women, are empowered to access economic opportunities and contribute to and benefit from economy.

Building on these initiatives, APEC Leaders encourage further efforts to expand APEC's work with other groups with untapped economic potential, such as Indigenous Peoples as appropriate, people with disabilities, and those from remote and rural communities, while also promoting the role of youth in advancing inclusive and sustainable economic growth. APEC will place a special emphasis on human resource development, particularly access to resources, reskilling, upskilling, lifelong learning, and other support, to advance employment and decent work for all as well as enable workforce to participate and lead in the digital and green economies.

Negative phenomena are not omitted to be mentioned. APEC Leaders recognized the detrimental impact of corruption on economic growth and development and they are committed to taking practical actions and a united approach, to jointly fight cross-border corruption and deny safe haven to corruption offenders and their illicit assets.

Future and past

Special emphasis is put in the Declaration on some future actions. For instance, the APEC Leaders reiterated their commitment to expedite the realisation of the APEC Putrajaya Vision 2040, including through the Aotearoa Plan of Action. In this endeavour, it is necessary to improve APEC's governance and organisational structure, with a view to efficiently and effectively delivering upon all elements of the APEC Putrajaya Vision 2040 and deepen engagement with stakeholders, including the ABAC, and international and regional organisations.

Current candidates for admission to APEC are : India,Bangladesh, Pakistan, Sri Lanka, Macau,] Mongolia, Laos, Cambodia, Costa Rica, Colombia, Panama and Ecuador.

As far as past APEC events are concerned, the Leaders welcomed the positive outcomes of the 2022 APEC Ministerial Meeting, as well as the 2022 Sectoral Ministerial Meetings for Trade, Tourism, Health, Forestry, Food Security, Women and the Economy, Small and Medium Enterprises, and Finance.

Finally, the APEC Leaders thanked Thailand for hosting APEC in 2022, looking forward to APEC 2023, which will be hosted by the United States of America and they also welcomed Peru and the Republic of Korea as hosts of APEC 2024 and 2025, respectively.

A question remained without answer in the Declaration. Can APEC be enlarged in the future ? Informal diplomatic materials provide some preliminary information on the matter..

Conclusion

Australia is a founding father of APEC established in 1989.Today, APEC's member economies comprise around three quarters of Australia's trade. From a diplomatic evaluation, it appears that this forum provides Australia with an important seat at the negotiation table to shape Asia-Pacific region's economic future.

Australian Prime Minister Anthony Albanese joined the APEC Economic Leaders' Meeting from 17-19 November. He welcomed the meeting's endorsement of the Bangkok Goals on the Bio-Circular Green Economy (BGC), mentioned in the final Declaration. In addition, in his statement he emphasised the importance of a rules-based, free and open trade and investment environment that will support economic recovery and the strengthening of supply chains.

He also highlighted the value of digital confidence in realising the full benefits of the digital economy and committed to work together across the region to strengthen business and consumer trust in digital transactions.

As a general conclusion for this article it can be reminded that the APEC success can be achieved only collectively by the active contributions of all APEC members while expecting that they are genuinely guided by the duty of solidarity and a strong sense of responsibility for the fate of inter-regional cooperation on our planet.