The APEC Finance Ministers' Process (FMP) provides an annual forum for APEC member economies to exchange views and information on regional macroeconomic and financial developments and on national and regional policy priorities.
Partners in the FMP process include the World Bank, the International Monetary Fund (IMF), the Asian Development Bank, the Inter-American Development Bank, and the APEC Business Advisory Council.
At the 17th APEC Finance Ministers' meeting held in Kyoto, Japan on 5-6 November 2010, Finance Ministers and representatives of key international financial institutions (IFIs) discussed the economic outlook in the Asia-Pacific region; fiscal management and economic growth; and finance for economic growth.
The Joint Ministerial Statement issued by the meeting includes:
- Emphasis on the importance for APEC members to take policy measures to achieve stronger, more sustainable and more balanced growth in the region.
- The submission of The Kyoto Report on Growth Strategy and Finance to APEC Leaders as a key contribution to discussion of the APEC Leaders' Growth Strategy. In the report, Finance Ministers identified priorities for securing future growth: namely, rebalancing and strengthening global demand; pursuing sound fiscal management; and enhancing finance to key sectors such as infrastructure, small and medium enterprises, households and green investment.
- Continued support for emerging APEC economies in the implementation of Public-Private-Partnership (PPP) infrastructure projects, including a new mentoring program to be launched in 2011.
- The launch of an “APEC Financial Inclusion Initiative” to identify concrete actions that financial policy makers can take to expand the reach of financial services to the underserved.
- Recognition of the importance of the “APEC Green Growth Initiative” that seeks to share best practices in the region and to produce recommendations to strengthen green growth. It also includes efforts to facilitate cross-border marketing of fund management services within the Asia-Pacific to create more open and integrated financial markets in the region.
To progress the goals of the FMP, a number of workshops and seminars took place in 2010:
A SOM-SFOM Workshop on the APEC Growth Strategy was held in Sapporo, Japan in June 2010. The workshop provided an opportunity for APEC's Senior Officials and Senior Finance Officials to further develop the APEC Growth Strategy and to discuss issues such as rebalancing and financing for growth. Other issues considered included green finance, infrastructure finance and innovation finance.
The "APEC Study Group on Structural Reforms" was formed in response to the Finance Ministers' direction to identify priority areas for structural reform, develop modalities to share best practices and expertise, and connect reform needs with expertise and resources from member economies, the IMF, MDBs and the private sector. The findings of the study group were delivered at the 17th APEC Finance Ministers' Meeting in Japan in November 2010.
The "APEC Infrastructure Pathfinder Initiative" was a practical response to the directive of Finance Ministers to develop common approaches towards private infrastructure investment across APEC economies. A set of recommendations from the initiative was delivered to Finance Ministers at the 17th APEC Finance Ministers' Meeting in Japan in November 2010.
The "Improving Strategies for Fiscal Sustainability and Economic Recovery" project aimed to assist economies to improve their strategies to maintain medium- to long-term fiscal sustainability policies while undertaking measures to restore growth and confidence during the economic recovery period. Two workshops were held under this activity: one in Kuala Lumpur, Malaysia in December 2009 and a second one in Bangkok, Thailand in March 2010.
The "Implementing of Financial System Regulatory Reforms in the Region Following the Global Financial Crisis" project targeted senior- and mid-level officials from the region's banking regulatory agencies and aimed to inform them on major proposals and reforms to financial system regulatory and supervisory approaches now under consideration, and their impact and application. A training program was held in Shanghai, China in June 2010.
The “APEC Financial Regulators Training" series aimed at strengthening the training programs for staff at supervisory and regulatory agencies in the region and to improve coordination of regional and international training programs. Seminars were delivered in 2010 for banking and securities supervisors and regulators on topics such as: bank analysis and examination; regulation of new products; risk management; and market supervision.
The “Seventh Annual Meeting of APEC Financial Institutions Dealing with SMEs" was convened in July 2010 in Kuala Lumpur, Malaysia. The meeting was followed by a one-day conference on “SME Development and Financing at the Threshold of the Next Decade – Review, Re-strategize, Revamp”.
APEC Finance Deputies met in San Francisco, California in February 2011 to discuss the economic outlook and policy challenges for the APEC region; trends in capital flows to the Asia-Pacific and policy implications; and rebalancing in the APEC region (with special focus on investment). APEC Senior Finance Officials then met in Washington, D.C. in June 2011. In addition to receiving updates on the economic outlook and policy challenges for the APEC region, Senior Finance Officials discussed actions by the United States to reduce the fiscal deficit and debt, as well as APEC initiatives on green growth, financial inclusion and infrastructure financing.
Additional FMP activities being implemented in 2011 include:
- The “APEC Financial Inclusion Initiative” (APEC FII) aims to deliver concrete and practical guidance for policy makers on government action and leadership in order to expand the provision and usage of financial services by households, individuals and self-employed entrepreneurs, including those at the bottom of economic pyramid. Workshops under the APEC FII have been held in San Francisco in February 2011 and in Bangkok in July 2011.
- The "Accelerating Financial Inclusion in Asia and the Pacific: An Operational Dialogue on Innovative Financial Inclusion Policies" project aims to implement APEC Leaders' instructions to build capacity and map strategies and programs on financial inclusion. The dialogue, which was held in Honolulu in September 2011, offered an opportunity to promote inclusive finance given that large segments of the region's economies still lack access to financial services, particularly access to formal finance by micro, small and medium enterprises through development finance institutions.
- A conference on "The Framework and Options for Public and Private Financing of Infrastructure" was held in Washington, D.C., in June 2011. The conference examined forms of financing available for infrastructure investment and provided an opportunity for infrastructure experts in APEC economies to increase cooperation and coordination.
- The “APEC Pilot PPP Mentoring Scheme” which is a practical activity designed to address the lack of impartial expertise in public-private partnership (PPP) delivery. The mentoring program operates through the deployment of technical experts who provide unbiased advice and assistance to help break particular bottlenecks.
- The "Green Finance for Green Growth" project will investigate how the finance sector can facilitate green growth. An expert group will consider the role of banks, capital markets, other market-based instruments, and subsidies and tax policies in facilitating green growth. The results with be reported back to Finance Ministers.
- The "Contributing to Efforts for Greater Financial Markets Stability in APEC Economies" project aims to promote greater financial markets stability and integration in APEC economies. Research will be undertaken to determine the conditions that foster financial market stability and the factors that help better integrate markets across the region. A two-day workshop was held in Yogyakarta, Indonesia in May 2011 to disseminate the research findings and to draft policy recommendations to address the impediments to financial markets stability and integration.
- The "Developing Capacity for Cross-Border Recognition of Equivalent Regulatory Regimes for Issuing and Trading Financial Products and Services" project aims to raise the capacity of developing economies in APEC to develop their potential to participate in cross-border recognition arrangements, in respect of the regulatory regimes for marketing and trading of funds. It has included a series of policy dialogues and technical workshops to explore ideas and strategies for establishing an Asia Region Funds Management Passport. The “Eighth Annual Meeting of APEC Financial Institutions Dealing with SMEs” was convened in Mexico in July 2011 and was followed by a conference on “Challenges and Current Trends in Financial Programs for SME’s”.
Andrey BOKAREV (Mr)
Chair of the Senior Finance Officials' Meeting
Director of the Department for International Financial Affairs
Ministry of Finance of the Russian Federation
Email:
Andrew O’SULLIVAN (Mr)
Program Director
APEC Secretariat
Email: