By Nan-Hie In
Last year, with China as host nation of the annual Asia-Pacific Economic Cooperation (APEC) forum, the nation’s leader Xi Jinping and US President Barack Obama were among the heads of state speaking at the CEO Summit in Beijing. During the summit, Chinese President Xi pushed for the Free Trade Area of the Asia Pacific (FTAAP), a regional free trade framework endorsed by all 21 APEC economies. It was widely touted as one of the most effective proposals presented at the forum.
A series of meetings for 2015 comprising the high-profile economic forum is now under way in the Philippines. Few forums are watched more closely than those of APEC near the end of each year for which state officials and business leaders congregate to discuss initiatives aimed at driving economic growth and development within the 21-nation bloc (which includes Hong Kong, China, Russia, the United States among other member economies).
As often is the case, initiatives of previous years for APEC forums will shape the official agenda of the following year. The Philippines as the 2015 host nation will continue to advance the plan on FTAAP presented by China. Laura del Rosario, Undersecretary for Foreign Affairs, Philippines, who is also 2015 Chair of the APEC Senior Officials, said at a recent AmCham conference.
What are the other top priorities on the agenda for APEC 2015? The four key themes are: regional economic integration (including physical and institutional connectivity as well as connectivity through services), human capital development, small and medium enterprises, as well as building sustainable and resilient businesses and communities.
Interconnectivity & Service Trade
APEC will introduce a process to advance integration of the economies to facilitate trade within the region with better connectivity, which falls under the regional economic integration agenda. According to del Rosario, officials realize that the current Finance Ministers’ Process (FMP), an APEC platform for exchanging perspectives on macroeconomic and other financial policy items, is too broad and “unorganized” as any topics related to finance could be up for discussion.
The Cebu Action Plan, hence, was conceived to prioritize the ideas and priorities of FMP to cover the issues to be discussed among financial industry leaders. “It will have four pillars: financial integration, financial transparency, liberalization, and enhancing the [infrastructure for greater access and] receiving of finances,” del Rosario notes.
In addition, the services trade will be another topic at the upcoming meetings at APEC, including issues on policies to eliminate barriers in the sector. “The Philippines will go strong this year on services, which accounts for at least 54 percent of the nation’s GDP,” del Rosario says. It is noted that there will be a whole spectrum of the services covered in the so-called “Friends on Chair on Connectivity” events for an in-depth insight into the specific challenges and opportunities.
Other services-oriented events in the official program include the Public Private Dialogue on Services, to be held in May, which will focus on trade and manufacturing-related services. del Rosario also says that a regional conference on service industries will take place in Cebu later this year to further brainstorm on this topic with the involvement of the public and private sectors.
Doris Magsaysay Ho, President and CEO of Magsaysay Group of Companies and Chair of the 2015 APEC Business Advisory Council, calls for inclusive growth within the bloc of APEC economies. It’s also a key priority of the Working Group meetings at APEC.
“For 22 years, the reduction of barriers of trade has led to unprecedented expansion of economic growth and trade in the region and the single biggest factor in the reduction of poverty,” Ho explains. “But, despite these benefits, there is a widening gap, and we see it all over the world.”
Ho says the discontent brewing from such income disparity could threaten policies that promote growth in the region, and it is an important issue to be addressed this year. One strategy is to make recommendations on how to empower small and medium enterprises to participate in the region’s growth.
“We want to make sure they have access to markets, to ideas, to money,” she says. “A lot of our emphasis will focus on how to get more smaller businesses in the picture and bring a new surge of our participants that includes women, people with disabilities and others who don’t feel included in what is going on.”
Ho vows to bolster communication efforts so these insights reach the “man on the street.” An online course is now available for people to learn to be part of e-commerce. A publication is also in the works to cover case studies of companies that have engaged with their suppliers in a meaningful, value-driven way instead of merely giving them contracts.
“We have to build trust between leaders, the people and businesses,” she says.
CEO Roundtables & SMEs
For 2015, one may expect more opportunities for the business community to connect with government officials. Guillermo Luz, Private Sector Co-chairman of the Philippines National Competitiveness Council and alternate ABAC member in the Philippines, is planning sideline events in the run-up to APEC’s CEO Summit (which will be on November 16-18 in Manila), in an effort to foster greater dialogue between top state officials and leaders in the private business sector.
In the current APEC system, there are several private sector meetings embedded within the Senior Officials Meeting (SOM), plus trade ministerial meetings, which are close-door sessions amongst government ministers. “This is one area where we see great potential for interaction with the business community,” says Luz. “We have targeted eight ministerial meetings where we want to put a parallel CEO roundtable in the same venue, on the same day.”
The parallel CEO dialogue and joint meetings will take place alongside the ministerial meetings on trade, energy, transport, food security, life sciences, science and technology, science technology and innovation, plus disaster preparedness. The organizer says eight pairs of CEOs from various industries in the Philippines will participate in these events.
Also on the agenda at APEC Business Advisory Council are discussions on the “new worker” amid an evolutionary shift in the global labor force in recent times. “We are going to undertake a study on this [issue] and hopefully it will shape policy on things like services, mobility of people and work,” Luz points out.
Another theme is on livable cities by exploring what makes a destination a great place to live and work, he adds. “It opens possibilities for a deeper look at secondary cities that are not normally considered in such studies.” A number of APEC cities will be selected for a study in which mayors of these cities will discuss what makes a great workable, livable, sustainable and resilient metropolitan area.
SMEs and e-commerce are also to be part of the program of APEC meetings in 2015, including the core theme of inclusiveness by giving support to young and small companies. “I don’t think we can limit APEC to big business with big government. We have to look at how we bring SMEs into the global value chain and how to bring them into e-commerce and make it more inclusive,” Luz believes. “The inclusive business and growth is indeed at the heart of the APEC 2015.”