Wheel has come full circle for APEC's rich members
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The Asia-Pacific Economic Cooperation (APEC) summit was held in Lima, Peru, last year soon after the global financial crisis broke out and the G20 summit over financial issues ended. Though the leaders did not have enough time to discuss the crisis thoroughly, APEC leaders agreed to and supported the common proposition of the G20 summit.
The global economic downturn has been arrested to certain extent and the world has seen some remarkable changes since the Lima summit. APEC leaders, who meet at an informal meeting in Singapore on Saturday, are expected to take stock of the changed backgrounds of the two meetings.
Let's see what those changes are. First, there has been a shift in world balance. The G8-plus-5, dominated by developed countries, has now truly evolved into G20, a platform for rich countries as well as emerging economies, which responds to global economic issues. Besides, the emerging economies today enjoy greater say. These changes are likely to be reflected at the Singapore APEC summit, which begins today.
Second, the primary task of this summit is to coordinate members' positions and work together to overcome the global crisis and resume economic growth. But the shadow of trade protectionism has already started raising its ugly head and, if not checked, could deal another severe blow to developing countries still smarting from the impact of the financial crisis. APEC leaders, especially those from the Association of Southeast Asian Nations (ASEAN), China and the Republic of Korea (ROK) are bound to ask other APEC members to commit themselves to the free trade doctrine. Developed countries know full well that protectionism will ultimately harm them, too. So the summit is expected to reach a consensus, with leaders taking a clear stance on the subject.
Third, the second informal meeting of APEC leaders in Indonesia in 1994 formulated the strategic objective of "liberalization and convenience of trade and investment". The Bogor Declaration said developed countries should complete "liberalization and convenience of trade and investment" by 2010 and developing countries, by 2020.
The next year, Japan hosted the annual summit and intended to draw up the "Osaka action program", with industrialized countries such as the US, Canada and Australia insisting that the provision, "all members should completely fulfill the target unconditionally", be written into the declaration. Some senior US officials continued to "enlighten" this writer (then an APEC official) with their glib talk about the benefits of trade and investment liberalization. But China, the ROK, Japan and many other members objected to it and demanded some "flexibility" because of the difficulties they faced. Ban Ki-moon, then senior ROK official and now UN secretary-general, and I cooperated closely and conducted six rounds of tough talks with representatives of the US, Canada and Australia. In the end, we succeeded in persuading them to compromise and grant developing countries some "flexibility".
Over the past decade and half, the developing countries in APEC have achieved remarkable economic growth. ASEAN has taken great strides in integration, the ASEAN-China Free Trade Area has been established and trade among China, the ROK and Japan has increased manyfold. The result: the developing countries are likely to achieve their Bogor targets before schedule.
It is time APEC's rich members finished their part of the job. But can they? The wheel has come full circle. So the developing nations will demand in Singapore that their developed counterparts fulfill their obligations and draw a practical "road map".
Since APEC is a negotiation platform that guides its members strategically and cultivates the "big family spirit", I believe the developing nations will be reasonable enough to agree if the rich countries seek some "flexibility" because they have difficulties in fulfilling their tasks.
But if the developed countries resort to protectionism and continue to adopt double standards on some pretext or the other, the developing countries will never compromise their position.
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