Fact Check
APEC must step up regional reconnection
By Lan Xinzhen  ·  2022-05-27  ·   Source: No.22 JUNE 2, 2022

The 2022 Asia-Pacific Economic Cooperation (APEC) Ministers Responsible for Trade Meeting concluded in Bangkok, Thailand, on May 22. Themed Open, Connect, Balance, the meeting's discussions focused on three topics: open trade and investment opportunities, restoring connectivity in all dimensions and promoting balance, sustainability and inclusivity. The ministers also planned to prepare for the annual APEC Economic Leaders' Meeting this November.

However, the ministers failed to reach a consensus on all of the agenda's 24 articles. This failure reveals the organization's great division regarding the development of the APEC free trade area and APEC at large, leaving the November APEC leaders' meeting an uncertainty.

As an important economic cooperation mechanism, APEC was established to boost economic growth and interdependence between members by reducing barriers in regional trade and investment and shoring up the open multilateral trade system. Both the leaders' and trade ministers' meetings are designed to address regional and global economic matters, such as trade and investment liberalization, as well as regional economic integration and connectivity. Members are expected to respect the function of this forum by concentrating on economic topics.

The global economy today is still reeling from the pandemic; the restoration of economic growth is the priority for all APEC members. What the region must do right now is join hands and ride out the storm together. 

APEC members account for 40 percent of the global population; their combined GDP accounts for 56 percent of the world's total. According to a report released on May 20 by the APEC Policy Support Unit, the policy research and analysis arm of APEC, due to pandemic resurgences and disrupted supply chains, economic growth for the Asia-Pacific region is forecast to slow down to 3.2 percent in 2022 from 5.9 percent in 2021. The spread of the COVID-19 Omicron variant has severely dragged down the region's economic rebound by jamming up global supply chains and further pushing up food and energy prices. The report further revealed that the average inflation rate for the 21 APEC economies had grown to 3 percent in 2021 from 1.5 percent in 2020, marking a grim economic outlook for the whole region.

At the Economic Leaders' Meeting in 2021, APEC launched the Aotearoa Plan of Action which aims for an "open, dynamic, resilient and peaceful Asia-Pacific community by 2040." This means all members need to advance regional economic integration and work toward the early realization of the Free Trade Area of the Asia-Pacific.

In early 2022, the Regional Comprehensive Economic Partnership came into force. China is now trying hard to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and Digital Economy Partnership Agreement. These mechanisms are important channels to ramp up tangible cooperation in regional trade and investment cooperation. As President Xi Jinping pointed out at the APEC Economic Leaders' Meeting in 2021, "We need to practice true multilateralism, stick to dialogue rather than confrontation, inclusiveness rather than exclusion, and integration rather than decoupling."

Lowering tariffs, speeding up the flow of logistics, and realizing efficient, liberal and convenient trade will greatly help the region's economic recovery and long-term development.

Copyedited by Elsbeth van Paridon 

Comments to lanxinzhen@cicgamericas.com 

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