A Case Analysis of Asia Pacific Economic Cooperation

in International Trade Practices .

The Asia-Pacific region has consistently been the most economically

dynamic region in the world. Since APEC's inception in 1989, APEC's
total trade has grown 395%, significantly outpacing the rest of the
world. In the same period, GDP (in purchasing power parity terms) in
the APEC region has tripled, while GDP in the rest of the world has less
than doubled.

APEC initiatives that help facilitate trade include: The introduction of

electronic/paperless systems by all member economies, covering the
payment of duties, and customs and trade-related document
processing.

The Single Window Strategic Plan, adopted in 2007, provides a

framework for the development of Single Window systems which will
allow importers and exporters to submit information to government
once, instead of to multiple government agencies, through a single
entry point.

ndards of living for the citizens of the region.

Economic and Technical Cooperation

• APEC's Economic and Technical Cooperation (ECOTECH)

activities are designed to build capacity and skills in APEC
Member Economies at both the individual and institutional level,
to enable them to participate more fully in the regional economy
and the liberalisation process.
• Since APEC first began to undertake capacity building work in
1993, more than 1200 projects have been initiated; and in 2008,
APEC was implementing a total of 212 capacity building projects
with a total value of US$13.5m.
• A particular focus has been reducing the digital divide between
developed and developing economies:
 o In 2000, APEC set a goal of tripling internet usage in the
region and that goal has now been achieved, as recognised
by the 2008 APEC Ministerial Meeting on the
Telecommunications and Information Industry. APEC's new
goal is to achieve universal access to broadband by 2015.
o A network of 41 APEC Digital Opportunity Centers (ADOC)
now operate in seven Member Economies. ADOC's
objective is to transform the digital divide into digital
opportunities and the centres act as local information and
communication technology (ICT) resource centres,
providing citizens and businesses of the region with access
to ICT technologies, education and training.
o APEC is also developing a Digital Prosperity Checklist that
outlines specific steps economies can take to enable them
to utilise ICT as catalysts for growth and development
o

Trade and Investment Liberalisation

• APEC is the premier forum for trade and investment liberalisation

in the Asia-Pacific and has set targets dates for "free and open
trade": no later than the year 2010 for industrialised economies,
and 2020 for developing economies (the Bogor Goals).
• When APEC was established in 1989 average trade barriers in
the region stood at 16.9%; by 2004 barriers had been reduced by
approximately 70% to 5.5%.3
• As a consequence, intra-APEC merchandise trade (exports and
imports) has grown from US$1.7 trillion in 1989 to US$8.44
trillion in 2007 - an average increase of 8.5% per year; and
merchandise trade within the region accounted for 67% of
APEC's total merchandise trade in 2007.4
• Similarly, trade with the rest of the world has increased from
US$3 trillion in 1989 to US$15 trillion in 2007, an average
increase of 8.3% per year. Trade in the rest of the world has
increased at 7.6% over the same period.
• Over 30 bilateral free trade agreements (FTAs) have been
concluded between APEC Member Economies.

Business Facilitation

APEC's work under its three main pillars of activity, Trade and
Investment Liberalisation, Business Facilitation and Economic and
Technical Cooperation, has helped drive this economic growth and
improve employment opportunities and sta As a result of the APEC
Trade Facilitation Action Plan (TFAP I) the cost of business transactions
across the region was reduced by 5% between 2002 and 2006.

A second trade facilitation action plan (TFAP II), aims to reduce

transaction costs by a further 5% between 2007 and 2010.

• Providing business with a concise one-stop repository of customs

and trade facilitation related information for all APEC economies
through the APEC Customs and Trade Facilitation Handbook The
APEC Tariff Database provides users with easy access to APEC
member economies' tariff schedules, concessions, prohibitions
and other information.
•
• In 2008, a groundbreaking Investment Facilitation Action Plan
was endorsed; it aims to improve the investment environment in
Member Economies.
• The APEC Privacy Framework provides guidance and direction to
both APEC Member Economies and businesses on implementing
information privacy protection policies and procedures. By
facilitating information flows it will facilitate trade and e-
commerce.
• The APEC Business Travel Card (ABTC) provides substantial time
and cost savings to business people and facilitates their travel in
the region, by allowing visa free travel and express lane transit
at airports in participating economies.
• APEC is also removing behind-the-border barriers to trade
through its Structural Reform agenda, which focuses on
reforming domestic policies and institutions that adversely affect
the operation of markets, and the capacity of businesses to
access markets and to operate efficiently.

Member Economies

APEC has 21 members. The word 'economies' is used to describe APEC

members because the APEC cooperative process is predominantly
concerned with trade and economic issues, with members engaging
with one another as economic entities.
Individual economy reports, key economic statistics and economy
websites can be accessed in this section.
 APEC Members Date of Joining

Australia 6-7 Nov 1989

Brunei Darussalam 6-7 Nov 1989

Canada 6-7 Nov 1989

Chile 11-12 Nov 1994

People's Republic of 12-14 Nov 1991

China
12-14 Nov 1991
Hong Kong, China
6-7 Nov 1989
Indonesia
6-7 Nov 1989
Japan
6-7 Nov 1989
Republic of Korea
6-7 Nov 1989
Malaysia
17-19 Nov 1993
Mexico
6-7 Nov 1989
New Zealand
17-19 Nov 1993
Papua New Guinea
14-15 Nov 1998
Peru
6-7 Nov 1989
The Philippines
14-15 Nov 1998
Russia
6-7 Nov 1989
Singapore
12-14 Nov 1991
Chinese Taipei
6-7 Nov 1989
Thailand
6-7 Nov 1989
The United States
14-15 Nov 1998
Viet Nam
Projects

Projects are a vital part of the APEC process. They help turn APEC
Ministers' and Economic Leaders' policy directions into actions and
create real benefits for people living in the Asia-Pacific region.

APEC contributes funding to over 100 projects each year, to a total

value of around US$8 million. The majority of projects are focused on
transferring knowledge and skills between members and building
capacity so that each economy can move closer towards the Bogor
Goals of free and open trade and investment.

Projects cover a wide range of important sectors. In addition to

cooperation for trade liberalisation, APEC also supports projects that
seek to make trade and doing business easier and more efficient such
as: agreeing to common standards for product testing and labelling;
developing safer and more efficient transportation routes; and
providing information on each member's regulatory and legislative
requirements for imports and exports.

APEC also works to maximise the benefits of globalisation. In

particular, APEC supports projects that: promote public health; improve
the skills of workers; reduce the risks of and improve responses to
natural disasters and emergencies; and that help small, medium and
micro-sized enterprises to grow and access markets.

Information about individual projects can be found through the APEC

Project Database: http://member.aimp.apec.org/pdb_sites/default.aspx
Please note that you will need an APEC Information Management Portal
(AIMP) login to access this site.

How are APEC projects funded?

APEC projects are funded through contributions by member
economies. There are three main sources of APEC project funding:

Operational Account
The Operational Account is comprised of members' annual
contributions. Projects in support of APEC's Economic and Technical
Cooperation (ECOTECH) agenda are funded by the Operational
Account.

Trade and Investment Liberalisation and Facilitation Special Account

(TILF)
Cooperative projects that assist APEC member economies to meet the
free trade and investment goals in the Osaka Action Agenda are
funded by the TILF Special Account.

The TILF was established during the 1995 APEC Economic Leaders'
Meeting when Japan announced its intention to contribute up to 10
billion yen to fund projects which encourage trade and investment
liberalisation and facilitation. Since then, other member economies
have also made contributions to the TILF, and around 600 projects
have been funded.

APEC Support Fund (ASF)

The ASF supports projects that address the capacity building needs of
APEC's developing members, especially in the high priority areas of
economic and technical cooperation.

The ASF was established in 2005 with an initial contribution of AUD1

million from Australia. Since then, donations have been received from
other economies for both general and specific capacity building
projects. Currently, funds are available in the specific areas of human
security, avian influenza and pandemics, technology, energy efficiency
and for the implementation of APEC's Second Trade Facilitation Action
Plan.

How are APEC projects implemented?

APEC projects are managed and implemented across all 21 member
economies in accordance with the Guidebook on APEC Projects. The
Guidebook is constantly under revision to improve how projects are
carried out.

APEC encourages the involvement of the private sector, universities

and governments in the region in its projects. Typically, requests for
proposals/tenders to implement projects are advertised on the APEC
website. Current requests for proposals/tenders, if any, are listed here.

For further information on specific projects and the process for

uploading proposals, please review the Guidebook on APEC Projects or
contact the relevant APEC Secretariat Program Directors.
Industry Dialogues

Close consultations with the business community through Industry

Dialogues are an effective method of pursuing liberalisation initiatives
as part of APEC. These dialogues improve mutual understanding of key
imperatives for future policies and enhance the competitiveness of the
industries.

Currently, Industry Dialogues serve to advance the development of

liberalisation initiatives in two of the 15 areas identified by APEC for
early voluntary sectoral liberalisation: the automotive and chemical
industries. Government officials involved in trade and regulatory policy
within APEC Member Economies join industry representatives to
discuss issues relevant to enhancing competitiveness for the specific
industry.

The APEC Automotive Dialogue was established in 1999 to serve as a

forum for government officials and senior industry representatives to
work together on strategies for increasing integration and
development of the automotive sector in the region.

The APEC Chemical Dialogue began in 2002. This dialogue has focused
on trade and trade-related regulatory issues affecting the
competitiveness and sustainable development of the industry. The
dialogue will likely lead to a work programme that will focus on non-
tariff measures, trade facilitation, and economic and technical
cooperation related to the industry in the Asia-Pacific region.

The Life Sciences Innovation Forum was first held in 2003 to address
the challenges of risk detection and prevention, treatment and cures of
the communicable and lifestyle diseases which afflict our people.
Guiding principles moving forward must include transparency,
meaningful dialogue with stakeholders and recognition of due process.
Capacity building is critical to successful implementation.

Recommendations made as part of the Industry Dialogues are reported

to the Committee on Trade and Investment, who pass appropriate
information to APEC Senior Officials, Ministers and Leaders. APEC
Member Economies consider implementation of these
recommendations in line with APEC's flexible, voluntary and consensus
oriented approach to trade facilitation and economic and technical
cooperation
APEC Business Advisory Council

Commerce is the lifeblood of the region and business is the engine of

economic growth.

Recognising the integral role of business and the value of

representative business advice on key issues, APEC Leaders
established the APEC Business Advisory Council (ABAC) in 1995.

This private sector body presents recommendations to APEC Leaders in

an annual dialogue and advises APEC officials on business sector
priorities and concerns. ABAC meets four times per year, and ABAC
representatives also attend Senior Officials' Meetings, the Annual
Ministerial Meeting and the sectoral Ministerial Meetings.

ABAC comprises up to three senior business people from each APEC

economy and the appointments are made by the Leader of the
member economy concerned. The Chair of ABAC comes from the
economy that is hosting APEC and therefore changes annually. ABAC
represents a diverse range of sectors and includes small and large
enterprises.

Achievements

ABAC's annual reports to APEC Economic Leaders outline business

views about priority regional issues and contain recommendations to
improve the business and investment environment in the APEC region.
Many of ABAC's recommendations, for example the idea of a Free
Trade Area of the Asia Pacific, have become core APEC activities.

Building on the progress made in the previous year, ABAC has decided
to adopt - "Working towards Sustainable Growth for All" - as the central
theme for 2010. ABAC will be focusing on strengthening economic
structure for balanced growth, advancing regional economic
integration, and enhancing economic growth in harmony with the
environment.

Five working groups have been established to carry out the 2010 work
program. These include: Liberalisation Working Group, Facilitation
Working Group, Sustainable Development Working Group, Finance and
Economics Working Group, and Capacity Building Action Plan Working
Group.
The first ABAC meeting in 2010 will take place from 9 - 12 February
2010, in Melbourne, Australia. As part of continuing efforts to enhance
APEC-ABAC cooperation, ABAC members will also have a dialogue with
APEC Senior Officials. On 9 February 2010, a Forum on Public Private
Partnerships (PPPs) will be organised to promote and to further work
within APEC community on PPPs.

Budget and Management Committee

The Budget and Management Committee (BMC) advises the Senior

Officials' Meeting (SOM) on budgetary, administrative and managerial
issues. Its key responsibility is to prepare the budget for APEC and
approve and recommend APEC funding for projects.

The BMC also monitors and evaluates APEC's project management

systems. It takes decisions and makes recommendations to Senior
Officials' Meetings (SOM) to improve project efficiency and
effectiveness. It also works closely with other Committees to ensure
projects remain relevant to APEC's core goals and objectives.

To find out more about APEC projects, please visit:

http://www.apec.org/apec/projects.html