Corey Wallace
Teaching Fellow, Political Studies, University of Auckland, New Zealand
Youth delegate GM XIX 2010

Keen observers of Asia-Pacific regional integration will not have missed the development of an interesting dynamic in recent years - that of geopolitical competition driving the economic liberalization agenda. The politicization of economic relations and interconnections is of course nothing new. The opening of the American market after World War II to Germany and Japan was a critical part of early US Cold War strategy, as was encouraging Japan to limit its trading relationship with the People’s Republic of China and other Communist governments in Asia. The Soviet Union attempted to forge its own economic bloc through Council of Mutual Economic Assistance (COMECON) at the same time. This was the logic of the Cold War: superpower competition and containment. Geopolitical competition, far from dividing the Pacific, is now having the opposite effect in the post-Cold War era however. While geopolitical considerations have never truly been out of the picture, and indeed the formation of APEC itself was propelled by (often differing) political as well as economic motivations, the last one to two years has seen geopolitical considerations playing a much more explicit role in the decisions that economies have taken regarding the joining of and commitment to various trade pacts and economic frameworks. Read more…

Nam Duck-woo, a founding member of PECC and first chair of KOPEC (Korea committee for Pacific Economic Cooperation) passed away on May 18th, 2013 in Seoul at the age of 89. Dr. Nam earned a doctorate in economics at Oklahoma State University and was teaching at Sogang University when in 1969 he was recruited by then President Park Chung-hee to serve as the finance minister. He remained in the position till 1974 and from 1974 to 1978, he served as the deputy prime minister in charge of economic policies at the height of Korea’s industrial development. Under the next president, Chun Doo-hwan, he served as the prime minister from 1980 to 1982.

Dr. Nam held the position of KOPEC chair from 1982 to 1993. During the earlier part of his chairmanship, he fervently supported the rationale and aims of PECC as such:

“I think the Pacific Economic Cooperation Council (PECC), a tripartite body with representatives from business, academic and government circles, provides an excellent example of how the various interest groups can work together to establish an effective mechanism for Pacific Cooperation. I would like to suggest that the regional countries should take advantage of the opportunity offered by the PECC, and use it as a model for future institutionalized forms of cooperation. In particular, the PECC can be extremely beneficial as a kind of information clearinghouse from which the countries in the Pacific Basin can obtain information on the policies, economies and strategies of their neighbors. This in itself will go a long way towards improving cooperation, especially in terms of economic and industrial policies, in the Pacific.” (July 1983)

At the 25th anniversary celebration of PECC held in Seoul in September 1995, Dr. Nam fondly recalled that “PECC had created the political will among the regional governments to launch APEC,” and that “PECC’s another highly significant achievement during the 1980s was the formulation and advocacy of the so-called ‘open-regionalism.’” He congratulated PECC for serving as the “guiding principle of the APEC” and reiterated that PECC’s value was not just on the traditional issues of tariffs but “also on many other, often less transparent, impediments to mutually beneficial economic integration in the Pacific.”

He is survived by his wife and three children. Please leave your personal comments here.

Theresa Robles

Associate Research Fellow with the Centre for Multilateralism Studies, S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore

Synopsis

Abe’s recent announcement of Japan’s intention to join the TPP is seen not only as an important vehicle to expand trade and investment opportunities but also as a way to reposition the country as a major regional power.

Commentary

THE ANNOUNCEMENT by Prime Minister Shinzo Abe on 15 March 2013 of Japan’s intention to join the Trans-Pacific Partnership (TPP) has stepped up the momentum of negotiations for the trans-oceanic trade and investment arrangement. The prospective entry of the world’s third largest economy will significantly broaden the TPP’s reach and impact on the Asia-Pacific trading system. Read more…

Barry Desker

Dean of the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore

Synopsis

The WTO Doha Round of negotiations is deadlocked and adrift amid increasing global protectionism. The profusion of bilateral and plurilateral free trade agreements is adding to the confusion. A global solution is necessary for global problems.

Commentary

SINGAPORE recently played host to the 16th round of the Trans-Pacific Partnership (TPP) membership talks. Soon after, Japan announced plans to join the TPP. The next round of talks in May will be held in Peru and optimistic negotiators say that member countries are on track to reach an accord by the end of the year. Read more…

Hugh Stephens
Vice Chair, CANCPEC (Canadian National Committee for Pacific Economic Cooperation)
Fellow, Canadian Defence & Foreign Affairs Institute (CDFAI)

On April 24-25, 2013 the Association of Southeast Asian Nations (ASEAN) will hold its 22nd Leaders’ Summit in Brunei Darussalam. ASEAN, comprised of ten nations in the heart of Asia (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam) has been around since 1967 but it is only in recent years that it has taken on its role as the linchpin of economic growth and trade in the region. With a market of 600 million people, ASEAN covers the spectrum of development from advanced service economies like Singapore (per capita GDP about US$50,000, roughly the same as Canada) to economies just emerging from decades of mismanagement like Laos and Myanmar (per capita GDPs of $1303 and $1144 respectively—all figures from UN) to mixed but growing economies like Indonesia, Thailand, Vietnam and Malaysia. Read more…

Dr. Manfred Wilhelmy
Chairman
CHILPEC (Chilean National Committee for Pacific Economic Cooperation)

The Pacific Alliance (PA) was established in Lima, Peru in April 2011. The founding members were Peru, Mexico, Colombia and Chile, represented by their Presidents Alan García, Felipe Calderón, Juan Manuel Santos, and Sebastián Piñera, respectively. The new Mexican President, Enrique Peña Nieto, has given his full support to the initiative.

Observers to the PA include Panama (which may become a full member), Costa Rica, Uruguay and Guatemala, among Latin American economies. Outside of Latin America, Canada, Australia, New Zealand, and Japan are important Pacific nations that have joined as observers.

Spain is a European observer, and during the Latin American-European Summit (CELAC-EU) held in Santiago in late January, German Federal Chancellor Angela Merkel expressed support for the PA. Read more…

Message sent on behalf of Dr. David S. Hong, Chair, CTPECC

Sent to: All PECC Standing Committee Members
PECC Member Committee Secretariats

Dear PECC Colleagues,

I am deeply saddened to announce the passing of Dr. Jeffrey L.S. Koo, former Chair of CTPECC. Jeffrey passed away December 6 at the Memorial Sloan-Kettering Cancer Center in New York surrounded by family members. Jeffrey will always be remembered as a distinguished financier, a prominent envoy, an eminent scholar, and a great person. Please keep Jeffrey’s family in our prayers and give them the strength to overcome the great loss.

David Hong
CTPECC Chair

Mr. Ian Buchanan
Chairman
AusPECC (Australian Pacific Economic Cooperation Committee)

“Those who cannot remember the past are condemned to repeat it,” said philosopher George Santayana. The aim of this paper is to draw lessons from Asia’s supposed “growth miracle” by disaggregating when, where—and why—growth occurred to better understand the roles of exogenous factors versus domestic policy choices.

Our thesis is that the post-World War II “miracle” growth shared by many regional economies was a result of a unique set of circumstances linked not to their “Asian-ness”—but to exogenous, geo-political, developments and, in particular, to the Cold War. Read more…

Rubén Calderón
Portfolio Manager, Fidelity Asset Management, Global Asset Allocation
This article is part of Fidelity Asset Management’s ‘Leadership Series’ and appears here with the express permission of the author

The economic malaise in the aftermath of the global credit crisis has called for extraordinary monetary policy responses, especially in the form of quantitative easing (QE). While central banks have focused on the unique circumstances of their own nations, the collective magnitude of QE has had unintended consequences beyond the borders of their constituencies. This paper will discuss the consequences of QE outside of developed markets—where most of the QE has taken place—and its effects on emerging markets. Specifically, it will highlight the massive liquidity pouring into emerging markets, identify the primary source and reason for the excess liquidity, and provide specific examples of how QE has inadvertently disrupted emerging-market currencies, exports, inflation levels and more.

Key takeaways

• In recent years, central banks of developed markets have used quantitative easing (QE) in an attempt to stimulate their economies,
• increase bank lending, and encourage spending.
• To date, however, the greater availability of credit in developed markets has not been offset by demand, resulting in an abundance of
• excess liquidity.
• Much of this surplus capital has flowed into emerging markets, which has had adverse effects on their currency exchange rates, inflation levels, export competitiveness, and more.
• Nevertheless, we believe emerging markets continue to offer compelling investment opportunities. Investment-grade emerging market debt appears attractive in the near term, while equities may face more volatility.

Read more…

Ippei Yamazawa
Professor Emeritus, Hitotsubashi University, Japan

APEC 2012 Meetings were successfully held in Vladivostok in September and we have got in recess for a while. The new IAPs by all 21 economies, together with Policy Support Unit’s Progress Reports and Dashboards have been published on the APEC’s website.

At 2010 APEC Yokohama, APEC Leaders conducted the mid-term review of their efforts for achieving the Bogor Goals and renewed their commitment for all 21 economies to continue their IAP process toward its final goals in 2020. We would like to call my fellow experts’ attention to this renewed IAP process and encourage you to closely monitor this process. We believe it is the role for us academics to monitor and advise our senior officials and their staffs to implement the IAPs effectively. Read more…