Policy: Backgrounder: Asia-Pacific Economic Cooperation (Apec)
The Asia-Pacific region has enormous potential, but it is also the region where U.S. exporters face the greatest challenges. More than 40 percent of U.S. trade is with Asia, and more than one-third of U.S. exports, supporting nearly 2.7 million American jobs, are destined for East Asian markets.
Since its inception in November 1989, APEC has grown from an informal dialogue of 12 Pacific Rim economies to a major regional initiative that coordinates and facilitates rapidly growing economic activity in the Asia-Pacific region, working to sustain economic growth.
Today, APEC member economies include Australia, Brunei Darussalam, Canada, Chile, China, Hong Kong, Indonesia, Japan, the Republic of Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, the Philippines, Singapore, Chinese Taipei, Thailand and the United States. Annual meetings of ministers have taken place in Canberra, Singapore, Seoul, Bangkok, Seattle, Jakarta and Osaka. The United States hosted the first APEC leaders meeting on Blake Island, outside Seattle, in 1993. Indonesia hosted the second in Bogor in November 1994, and Japan held a third in Osaka in November 1995. The Philippines currently holds the APEC chair and will host a ministerial and a leaders meeting in November 1996.
The Osaka meetings carried forward the market-opening process begun at President Clinton's initiative in the 1993 Blake Island leaders meeting, which continued with the leaders' 1994 pledge in Bogor to achieve free and open trade and investment in the Asia-Pacific region by 2010 for APEC's developed members and 2020 for its developing members. In Osaka, APEC leaders agreed on an Action Agenda -- a credible blueprint for implementing their commitment to free and open trade and investment. The Action Agenda applies to all sectors, ensures comparability among liberalization efforts, provides for consultation and review, and ensures that APEC's members will work toward liberalization goals by collective and individual actions. Detailed action plans for each APEC member economy will be reviewed at the 1996 meetings in the Philippines in November.
The United States sees APEC as an integral component of U.S. engagement in the Asia-Pacific region. When President Clinton addressed the G-7 summit in Tokyo in July 1993, he called APEC the most promising forum for achieving a more open regional economy, encouraging economic growth, and fostering prosperity and opportunity throughout the region. APEC remains America's primary vehicle for advancing both economic cooperation and trade and investment liberalization in the Asia-Pacific region.
All APEC activities and decisions are carried out on the basis of open dialogue and consensus-building among equal partners. The APEC chair, which rotates annually, is responsible for hosting the yearly meeting of foreign and economic ministers. Senior officials meet regularly between ministerial meetings to carry out the ministerial decisions and make recommendations to the ministers.
In 1992, APEC members established a permanent APEC secretariat in Singapore. The secretariat's budget ($2.9 million in 1996, $510,000 from the U.S.) supports its efforts and the work programs of APEC's three committees (Trade and Investment, Budget and Administrative, and Economic Trends and Issues) and ten sector-based working groups. (The ten groups are: Trade and Investment Data Review; Trade Promotion; Industrial Science and Technology; Human Resources Development; Regional Energy Cooperation; Marine Resources Conservation; Telecommunications; Transportation; Tourism; and Fisheries.)
APEC's priority is to encourage market-oriented solutions to the adjustment problems associated with quickly growing economies. APEC made significant contributions to the GATT Uruguay Round negotiations and continues to try to move beyond the Round in its quest for regional trade and investment liberalization.
APEC has an ambitious agenda for 1996 that is focused on five issues:
-- trade liberalization and facilitation;
-- preparing for the first World Trade Organization (WTO) ministerial in Singapore;
-- building the partnership between business and APEC officials;
-- economic and technical cooperation; and
-- providing APEC itself with a sharper focus.
The Clinton administration places a lot of importance on the third issue: building the partnership between business and APEC officials. The United States wants business to be fully engaged in all of the activities of APEC. There's a lot of dynamic economic activity taking place throughout the region, and APEC member governments can enact policies that will increase the velocity of that activity -- assuring that investment capital flows to where projects are, that human resources are available, that the member economy governments and businesses learn from the best practices of infrastructure projects around the region.
This year's APEC chair, the Philippines, has stressed the fifth area: APEC's focus. APEC has spent the past seven years getting itself up and running, and it has a number of noteworthy achievements to its credit. Today, however, APEC is operating across a wide spectrum, and its member economies want to bring some focus to its activities to make sure that the work of APEC's committees, working groups and expert groups follows the vision the leaders set at Blake Island, Bogor and Osaka.
"We have an opportunity," the leaders said at Blake Island, "to build a new economic foundation for the Asia-Pacific that harnesses the energy of our diverse economies, strengthens cooperation and promotes prosperity."
That vision continues to drive APEC -- and U.S. participation in APEC -- to this day.