For 2013, the CTI held its first meeting on 3-4 February in Jakarta, Indonesia where it adopted a work program that is organized around five priority areas and contributes to APEC 2013 Priorities under the theme, “Resilient Asia-Pacific, Engine of Global Growth.” The five areas are: (i) support for the multilateral trading system; (ii) attaining the Bogor goals, trade and investment liberalization, regional economic integration; (iii) promoting connectivity; (iv) expanding regulatory cooperation and advancing regulatory coherence; and (v) contributions to APEC growth strategy and cross-cutting mandates.
The key elements of the CTI’s work in 2013 include, amongst others:
Support for the Multilateral Trading System
- CTI discussed a proposal by Indonesia on “Supporting the Multilateral System by Devising APEC Statement to Support the WTO Trade Facilitation Agreement” and agreed that member economies would provide inputs/comments in writing to Indonesia for the drafting of appropriate APEC statements on the WTO DDA negotiations ahead of the 9th WTO Ministerial Conference in Bali in December.
- CTI noted the importance of advancing negotiations on expanding the product coverage of the WTO Information Technology Agreement (ITA) in response to APEC Economic Leaders’ Meeting (AELM) and APEC Ministerial Meeting (AMM) instructions from Vladivostok. Many economies emphasized that their representatives in the WTO would work actively towards a successful conclusion.
Attaining the Bogor Goals
- CTI will consider at CTI2 a suggestion for a more focused discussion on non-tariff measures/barriers in goods, services and investment in support of Indonesia’s “Attaining the Bogor Goals” priority.
- CTI discussed and agreed to a Proposal on Local Content Requirements (LCRs) by Japan, Korea and the United States. A trade policy dialogue will be held at CTI2 to better understand the effects of LCRs on trade and investment and economic growth in the region.
Exploring a Free Trade Area of the Asia-Pacific (FTAAP)
Next Generation Trade and Investment Issues
- CTI adopted a Work Program on Next Generation Trade and Investment Issues to guide its work in 2013 in response to APEC Economic Leaders’ instructions from November 2011 and September 2012. CTI received updates on the progress of previously agreed issues including presentations from the APEC Secretariat Policy Support Unit (PSU) on its issues paper on SMEs participation in global production chains and progress of its global supply chains project. For the latter, the PSU is conducting a case study on the supply chains for the electrical and electronics industries in the APEC region which will identify obstacles affecting the flow of these supply chains as well as areas where APEC can help to improve their operation and flow. CTI is also continuing to work on implementation practices for the 2011 policies on innovation and trade.
Environmental Goods and Services/Green Growth
- CTI emphasized the importance of economies planning to implement the APEC List of 54 Environmental Goods (adopted in 2012) by the end-2015. CTI also agreed that capacity building may be required to assist with the implementation and encouraged economies to identify those needs. CTI noted China’s intention to submit proposals to improve understanding amongst business stakeholders and relevant government officials about environmental goods and for a public-private policy dialogue on renewable and clean energy products.
- CTI also discussed new proposals relating to “Promoting Green Growth and Practical Road to Inclusive Growth: Promoting Agriculture-Based Goods” and “Trade in Used Electronics” (i.e. Electronics Stewardship) and agreed to provide written comments to the proponents.
Supply-Chain Connectivity Framework and Action Plan (SCFAP)
- CTI adopted a Work Plan on Supply-Chain Connectivity, developed by the Friends of the Chair (FoTC) on Supply-Chain Connectivity, to progress the supply-chain connectivity framework and action plan. Recognizing the activities in the action plans were either completed, underway or close to completion, CTI noted the need to do more to inject new momentum if economies are to fulfill the commitment of an APEC-wide target of a ten percent improvement in supply-chain performance by 2015, in terms of reduction of time, cost and uncertainty.
- CTI received a briefing from the PSU on the interim assessment it was undertaking of the implementation of the Supply Chain Connectivity Framework Action Plan (SCFAP) through the measurement framework agreed last year. The assessment highlighted that APEC has made significant progress in the overall performance of supply chain transactions. However, member economies will need to increase the rate of progress in some areas going forward.
- CTI considered the findings from the study by the PSU to assess the economic impact of submarine telecommunications cable disruptions and noted that Australia would develop a proposal for further work within APEC to address collaboration in cable protection, recovery and repair.
Expanding Regulatory Cooperation and Advancing Regulatory Convergence
- CTI took note of the requirement to review the APEC Regulatory Cooperation Advancement Mechanism (ARCAM) in 2013 in accordance with the 2010 APEC Regulatory Cooperation Process Mechanism on Trade-related Standards and Technical Regulations. CTI agreed that to further the review, economies will provide inputs and suggestions to the Chair to enable the Chair to summarise the inputs and present options for the ARCAM process for consideration ahead of CTI2.
- CTI also took note of the outcomes of the 2nd ARCAM Dialogue on self-regulation in advertising held in Hanoi in November 2012. The SCSC Convenor will consult intersessionally with members to examine and undertake further work, where appropriate, on the recommendations of the report.
Contributions to the 2010 APEC Leaders Growth Strategy and cross-cutting mandates
- CTI received updates from lead economies on projects to address the top barriers to SMEs in trading in the region identified in 2011 by Ministers Responsible for Trade and Ministers Responsible for SMEs. For Barrier #6: Problems navigating differing legal, regulatory, and technical requirements, Phase III of the APEC Services Trade Access Requirements (STAR) database has been successfully completed. The database includes information on all APEC economies, along with regulatory information on trade and investment in three new services sectors: education services, distribution services (retail and wholesale) and computer and related services. On Barrier #9 – Difficulty in Taking Advantage of Preferential Tariff Rates and Other Aspects of Trade Agreements, brief summaries of FTA benefits provided by some economies were being collated. Collated information was being made more user-friendly and easier to use by SMEs.
More information about the CTI's work program can also be found in the CTI's sub-groups webpages. The CTI will next meet in Surabaya, Indonesia on 13-14 April to advance its 2013 work program.
Average applied tariffs in APEC economies have been reduced from 16.9 percent in 1989, when APEC was established, to around 5.7 percent in 2011. APEC's total trade (goods and services) has increased from US$3.1 trillion in 1989 to US$19.7 trillion in 2011. Intra-APEC merchandise trade (exports and imports) has grown from US$3.5 trillion in 1996 to US$11.3 trillion in 2011, accounting for 66 percent of APEC's total merchandise trade.
In 2012, the key elements of CTI’s work program were aligned to three of the four APEC 2012 priorities of (i) trade and investment liberalisation, regional economic integration (REI); (ii) establishing reliable supply chains; and (iii) intensive cooperation to foster innovative growth, as well as the APEC 2011 priority of “expanding regulatory cooperation and advancing regulatory coherence.”
The 2012 CTI Annual Report to Ministers contains an overview of the CTI’s work in 2012 and outlines advances made by the Committee to take forward its work program. Those advances and achievements include:
- Agreement on the indicators to be included in the “dashboard” that would complement the Bogor Goals Progress Reports with easy-to-understand figures to summarise advances in areas critical to promoting greater regional economic integration. These reports and the dashboard for the 21 APEC economies are available on the APEC website.
- The Action Plan Framework for REI Capacity Building Needs Initiative including workshops on rules of origin (ROO), FTA implementation; and on environment and sanitary and phytosanitary measures (SPS).
- Development of an APEC list of Environmental Goods that directly and positively contribute to APEC’s green growth and sustainable development objectives on which applied tariff rates will be reduced by the end of 2015 to five per cent. The list was adopted by APEC Leaders and attached as Annex C to their declaration in 2012.
- The adoption of “Transparency in RTAs/FTAs” as a next generation trade and investment issue to be addressed in 2012 and endorsement of a model FTA chapter on transparency. The model chapter will be included in the set of APEC Model Measures for RTAs/FTAs developed between 2005-2008 as a reference for member economies seeking to negotiate RTAs/FTAs and to assist in promoting consistency in RTA/FTAs across the region.
- Agreement that discussions on “Local Content Requirements” and “Promoting and Facilitating Trade of Renewable and Clean Energy Products Through Dialogue” could be further conducted under the CTI's overall work program on trade and investment, while the discussion on “Creation and Dissemination of Creative Content in the Digital Environment” could be undertaken by the Intellectual Property Rights Experts Group (IPEG).
- Progress achieved in implementing the next generation trade and issues that were addressed by Leaders in 2011. A plan to produce Innovation and Trade Implementation Practices as a way to provide practical assistance to APEC economies implementing commitments to promote effective, non-discriminatory, and market-driven innovation policies was agreed. On the issues of (i) facilitating global supply chains; and (ii) enhancing small and medium-sized enterprises (SMEs) participation in global production chains, the Policy Support Unit (PSU) will conduct case studies in 2013, building on the outcomes of the Trade Policy Dialogue (TPD) and Seminar previously held on these issues;
- Further progress made in the implementation of the action plans endorsed in 2010 to address the eight chokepoints under the Supply-Chain Connectivity (SC) Framework. This included among others: a proposal to provide a systematic approach to addressing Chokepoint 1 which can be expanded to the other supply chain chokepoints in the SC framework; a Study by the PSU on the economic impact of the submarine telecommunications cable disruption; as well as capacity building programs on (i) enhancing the logistic performance through training and networking for APEC Local/Regional Logistics Subproviders, and (ii) a Pathfinder to enhance Supply Chain Connectivity by Establishing a Baseline De Minimis Value.
- Approval and commencement of the APEC Supply-Chain Connectivity Framework Self-Assessment Survey. The survey is intended to facilitate the interim assessment in 2013 on APEC economies’ progress towards the ten per cent targeted improvement in supply-chain performance by 2015, in terms of reducing the time, cost and uncertainty of moving goods and services throughout the region.
- The identification of “self-regulation in advertising” as the emerging regulatory issue to be worked on in 2012 under the APEC Regulatory Cooperation Advancement Mechanism on Trade Related Standards and Technical Regulations (ARCAM). The 2nd ARCAM Dialogue on the topic of “Advertising Standards – Principles and Practice” was held in Hanoi on 7-8 November 2012. The Dialogue brought together APEC economies to share information, policies and best practice principles regarding advertising standards. The CTI will be expected to review the outcomes and recommendations from the Dialogue in 2013.
John LARKIN (Mr)
Department of Foreign Affairs and Trade
Tel: +61-2 6261 3535
Catherine WONG (Ms)
Special Assistant to CTI Chair