APEC's Collective Seat at the WTO Table and What This Means for the Doha Development Agenda
"It is fair to say that after the major commitments made at the end of the APEC Leaders and Ministers Meetings in November 2005, we expected more progress," said Ambassador Tran Trong Toan, the APEC Secretariat's Executive Director.
However, Ambassador Toan also pointed out that, when put into perspective, the results of the Hong Kong meeting should not be seen as a total loss.
"When we look at the previous eight rounds of WTO negotiations under GATT, we can see that there were always difficulties even with the possibility of failure looming around the edges before success could be achieved. In fact, following the breakdown in discussions at the previous WTO meeting in Cancun, Mexico, in 2003, the fact that the Hong Kong meeting concluded with some gains is encouraging It shows that more needs to be done by APEC in order to achieve real outcomes in the DDA"
"Hong Kong achieved what could be described as a minimum outcome. We have a new deadline of April 30 for agreement on the full modalities relating to agriculture and non-agricultural market access. There is no doubt that this negotiation process will be tough. APEC is now working through its Geneva Caucus and at a bilateral level to move these WTO issues forward."
"Since the breakdown in Cancun, WTO Members in the Asia-Pacific sought to overcome differences in their approach to the Doha Round negotiations through the consensus-based approach of APEC. Over the past two years, the Geneva Caucus, made up of the trade representatives of APEC Member Economies in Geneva, has been reinvigorated.
"It is encouraging to see that, thanks to these persistent efforts within APEC, differences among WTO members in Asia - Pacific have narrowed to some extent, laying the groundwork for the common approach agreed by APEC Ministers and Leaders", Toan said.
In Busan, Korea, in November 2005, APEC Economic Leaders identified the key requirements for the successful conclusion of the Doha Round by the end of 2006.
Leaders called for WTO Members to break the impasse in agricultural negotiations, putting particular emphasis on export subsidies and market access, which they said would then unblock other key areas such as liberalization of non-agricultural products and services.
Unless progress is made in this area, Leaders announced in their Declaration, "we cannot make progress in the Round as a whole. Avoiding or compromising our ambition on this issue would mean that we would lower expectations for the Round as a whole."
In their Declaration, APEC Leaders also called for considerable progress in attending to the special needs of the least developed countries at the Hong Kong Ministerial. In fact, APEC has long expressed the need to assist developing economies to take greater advantage of the opportunities offered by the multilateral trading system.
Thus, a success that APEC saw at the Hong Kong meeting was the particularly strong stride in assisting developing countries with the agreement of duty-free and quota-free access to global markets for the 32 least-developed country members of the WTO.
"Although it is important to convince developing economies that huge benefits can be gained through fully engaging with the global economy, that is only half the story," said Ambassador Juan Carlos Capuñay, who was Chair of APEC's SOM Steering Committee on Economic and Technical Cooperation in 2005.
"The priority task is to help economies develop the capacity to take advantage of the changes in global trading rules. Although the Uruguay Round created many new opportunities, a number of developing economies were unable to benefit because they lacked the necessary skills and expertise. We must correct that."
Sharing this view, Ambassador Toan added that he also hopes that APEC 2006, under the leadership of Viet Nam, will offer important opportunities for APEC members to work together for the successful conclusion of DDA and to ensure the development dimension of trade and investment liberalization. "Development should be at the heart of any liberalization efforts," he stressed.
To contribute to the capacity of developing economies in both the APEC region and throughout the WTO membership, APEC has hosted a number of events. The "APEC/WTO Trade Facilitation Roundtable 2005" was organized by the APEC Committee on Trade and Investment in Geneva to share the experience of APEC Member Economies.
At the roundtable, then WTO Director-General, Supachai Panitchpakdi, described APEC as possessing "considerable experience on the benefits trade facilitation can produce in terms of an improved trading environment." He stressed that improved trade facilitation practices have the potential to contribute to increasing the volume of world trade.
Ambassador Toan said "whether the potential opportunities will be utilized or not depends on how ready a member is in terms of their institutions, rules of law, standards infrastructure, human resource and other vital areas. This prepares economies to narrow the development gap and ensure sustainable development for all."
Another event was the May, 2005, "APEC Workshop on Best Practices in Capacity Building for Trade Facilitation" organized by APEC's WTO Capacity Building Group. The workshop made recommendations for future capacity building activities within APEC and, equally important, served as a model for activities that can be pursued more broadly within the WTO.
Trade facilitation is a key element in the shared commitment in APEC to meet the Bogor Goals on open and free trade and investment. To this end, APEC Leaders and Ministers agreed to a range of measures at their meeting in 2005 intended to further open markets and facilitate trade.
Chris DeCure, Chair of APEC's Committee on Trade and Investment (CTI) said that "The results of the 2005 Stocktake of Progress Towards the Bogor Goals, show that APEC economies have achieved significant liberalization of trade and investment since APEC was established in 1989 with average tariffs across the APEC region dropping from around 17 percent in 1989 to 5.5 percent in 2004."
"Our business community is telling us that further tariff reductions are important but emphasize the need for APEC to continue to focus on other issues that impede business activity, including in the area of transaction costs. I am confident that APEC economies will meet the target set by Leaders in 2001 and achieve a 5 per cent reduction in business transaction costs by the end of this year. Work will also begin in the CTI in 2006 to cut transaction costs by a further 5 per cent by 2010," DeCure added.
"These efforts to reduce transaction costs include streamlining customs procedures, harmonizing international standards and removing immigration obstacles to business travel."
Another important impact of APEC's trade facilitation activities is to demonstrate to WTO members how trade facilitation serves both developed and developing economies. APEC's success in trade facilitation has been a model for WTO members and should strengthen the trade facilitation commitments to be made in the Doha Round.
Still another vital contribution of APEC is its integration of the business community into the trade liberalization process. ABAC, the APEC Business Advisory Council, has made important detailed recommendations in all areas being negotiated in the Doha Round. The "Trade Facilitation Action Plan Roadmap to 2006" will expand cooperation with the business sector, thus ensuring that trade facilitation efforts will be focused on the real needs of business throughout the region.
It is in the implementation of the directions set by the guardians of the APEC process, the Leaders and Ministers, where APEC has found a high level of success in improving the regional and global trading environment. APEC's leadership was the key factor in the WTO's adoption of the Information Technology Agreement in 1996 which was so critical to liberalization in the high tech area, and that leadership will provide similar invaluable impetus to ensure progress in the Doha Round.
With APEC's broad representation of developing and developed economies, all of which are either full WTO Members or in the process of gaining membership, APEC is an excellent barometer of sentiment in the WTO. Added to this is the sheer size of the economic area that APEC represents. Collectively APEC Member Economies account for almost one-half of world trade and three-fifths of global GDP, while APEC combines many of the world's most powerful economies with developing and emerging economic powerhouses. Thus, APEC's role in the WTO continues to be of major significance.