The Challenge Ahead for APEC 2004 - Opinion article by Ambassador Mario Artaza published in the La Tercera newspaper in Chile (English translation)
In the year 2004 Chile will host several meetings that will be attended by the 21 "economies" of the APEC (Asia Pacific Economic Cooperation) forum including the annual Leaders summit. This intergovernmental consultative forum includes most of the economies of both shores of the Pacific, a region of dynamic growth and expanded trade. APEC represents approximately 50% of the world-wide GDP, more than 47% of the global commerce and almost has half of the population of the globe. Around 55% of the Chilean exports are directed to the members of the APEC. Of Chile's 15 largest markets, seven are APEC economies and represent 87% of our exports.
By the end of the 1980's, the largest economies of the world had shown a strong interest in extending their markets. The European Community announced a single market, while the U.S.A. and its neighbors were looking at possibility of establishing a free trade area. The Asian and oceanic economies (New Zealand and Australia), worried that these agreements represented barriers for the trade of their products, met in Canberra, in 1989, as an initiative of prime minister of Australia, Bob Hawke. This was the first official forum of the 12 economies of APEC. In the nine following years, a further nine economies joined APEC including Chile it in 1994.
In the 1991 summit, hosted by Seoul, the objectives of APEC were established as:
a. To maintain regional economic growth and development with the goal of contributing to the growth and development of the world economy.b. To accentuate the regional and international gains derived from increasing economic interdependence through the flow of goods, services, capital and technology.c. To develop and fortify the system of multilateral commerce that is in the interest of all the economies of Asia Pacific.d. To reduce trade barriers for goods, services and investment between APEC members. These are what has become known as the "Three Pillars of APEC." The liberalization of commerce and investment; the facilitation of commerce and investment, and economic and technical cooperation.
The meetings between government minister and officials, and the annual meeting of the leaders of all APEC economies are the most important elements of the APEC process. They allow a flexible and informal dialogue that facilitates agreements and understandings. APEC has become a very valuable community for Chile, as we open our borders to global trade.
The periodic meetings have importance for ministers from each of the diverse APEC economies come together as part of a complex network of shared interests. There is special importance in the annual meeting of Finance Ministers to which the highest representatives of regional finance ministries meet. The officials given the task of implementing the APEC process are the senior public officials from each economy who implement the instructions endorsed at the annual Leaders Meeting and the ministerial meetings. These senior public officials coordinate APEC related tasks in each economy. Coordination and representation of Chile in the APEC process is the responsibility of the Ministry of Foreign Affairs.
A permanent APEC Secretariat with a small number of professionals is based in Singapore. This serves as an information exchange centre and support facility for the different APEC forums. Management of the APEC Secretariat is the responsibility of the Executive Director and the Deputy Executive Director. Both positions are appointed by the member economy that will host of the Summit of the current year and the economy that will be host in the following year.
An important APEC body is the private enterprise consultative forum of APEC called the APEC Business Advisory Council or ABAC. This is made up of three leading business people from each member economy. ABAC is a demonstration of the interest APEC leaders place in creating an effective avenue for cooperation with the business community in the interregional process.
As an intergovernmental consultative forum APEC is a new model of international cooperation. Flexibility and informality are two of APEC's fundamental characteristics as decisions are adopted by consensus. Some observers define APEC as an intergovernmental mechanism directed to fortify commercial liberalization and investments in the region Asia Pacific. Others identify APEC as a process by which the concept of a regional "community" of the economies can be established. In Bogor, Indonesia, an agreement was reached to establish free and open trade and investment by 2010 for industrialized economies and by 2020 for developing economies. In Summits at Osaka and Manila in the years after Bogor, agreements were adopted in which the process of liberalization would be overseen through "coordinated operations" and through individual action and collective plans. In the process of its progressive elimination, Chile made a series of commitments that includes: a unilateral reduction of tariffs to 0% by year 2010; reciprocal and balanced conditions for trade in most of products; the detailed and transparent description of the restrictions that face service and investment restrictions in Chile; and, the provisions of clear descriptions of the existing non-tariff measures in place in Chile.
Chile will face a great challenge in 2004 as the host of some of the most important and dynamic economies in our region. After having successfully completed negotiations with the EU and the U.S.A., our eyes must go through the Pacific to these partners in APEC, with which we have been creating an increasing community in the last eight years. That challenge falls on numerous organizations, both public and private sectors, to coordinate activities in order to present our best face.