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A businessman holding a small globe uid 1460685The Singapore National Committee for Pacific Economic Cooperation (SINCPEC) and the Philippine Pacific Economic Cooperation Committee (PPECC) were the co-organizers of annual Singapore PECC conference, "Achieving Inclusive Economic Growth in the New Normal," in support of APEC 2015 chaired by the Philippines.

During the APEC Leaders’ Meeting held in Beijing in November 2014, key decisions were taken to make progress on key elements of the regional agenda, including on a Free Trade Area of the Asia-Pacific (FTAAP) and improving connectivity. The challenge is how regional economies can implement these plans to ensure that regional growth is not only sustainable but also inclusive.

The conference addressed the following themes through five plenary sessions:

1) Asia-Pacific Economic Cooperation in a Changing Global Context: Risks and Opportunities
2) Inclusive Growth: Building Capacity at Individual and Community Levels
3) Connectivity and Regional Economic Integration: Reaping the Benefits of Economic Integration
4) Financing Inclusive Growth
5) Making Regional Economic Integration More Inclusive

Laura Del Rosario, Chair of APEC Senior Officials' Meeting (SOM) 2015, and Emmanuel Esguerra, Deputy Director-General of Philippine National Economic and Development Authority delivered the opening speeches. Other speakers and panellists included:
• Roberto Tan, Treasurer of the Philippines;
• Arsenio Balisacan, Philippine Secretary of Socioeconomic Planning;
• Joey Salceda, Governor of Albay, Philippines;
• Narongchai Akrasanee, Thai Minister of Energy;
• Mari Pangestu, former Minister of Trade/ former Minister of Tourism and Creative Economy, Indonesia;
• Il-houng Lee, President of Korea Institute for International Economic Policy (KIEP); and
• Tan Sri Rastam Mohd Isa, Chairman, Institute of Strategic and International Studies (ISIS), Malaysia.

Program agenda and presentations for download

Media Roundtable 2The Philippines, as the host of APEC in 2015, held the APEC Informal Senior Officials' Meeting (ISOM) in Manila on 8-9 December 2014 in preparation for the following year's agenda under the main theme of inclusive economic growth. On this occasion, PECC organized a media roundtable over lunch on the 12th that gathered foreign correspondents and local media representatives covering economic and trade news to discuss some of the issues on the APEC 2015 agenda and to gauge media's interest. Fact sheets on Free Trade Area of the Asia-Pacific (FTAAP) and a glossary of trade terms frequently used by PECC and APEC were distributed at the roundtable cum briefing. Undersecretary Laura Del Rosario, the Philippine senior official for APEC and incoming SOM chair from the Department of Foreign Affairs delivered opening remarks as the guest-of-honor and informed the media of the prioritized issues that were raised during the ISOM.  

Ambassador Antonio Basilio (PPECC/ ABAC), Dr. Charles Morrison (USAPC/ President of East-West Center), and Eduardo Pedrosa (Secretary General of PECC) interacted with the 26 invited media participants over issues that covered free trade agreements, Philippine priorities, and regional economic integration during the two-hour event. The Foreign Correspondents Association of the Philippines assisted with the invitations.

Related news:

More prosperity, dampened by a growing inequality (op-ed by Eduardo Pedrosa)
Business World | 17 December 2014

PH to focus on inclusive growth in APEC 2015
ABS-CBN | 12 December 2014

Industrial pipesTaking into consideration global needs for new sources of energy to meet the growing industrial and household demands in the midst of rising energy costs and diminishing fossil fuels, it is imperative that PECC economies invest more in developing and optimizing new types of energy. It is one of top priorities for PECC economies to explore the most efficient ways of ensuring smooth transition from fossil fuels to renewable and sustainable energy. Lessons can be learnt by sharing how PECC economies are transitioning from being high energy consumers to becoming more eco-friendly and energy-efficient.


The project aims to design the framework for new economic models that will make way for smooth energy transition; it will bring together the energy-exporting and importing economies, energy producers or distributors as well as energy-related policymakers. It will put into perspective new initiatives and strategies designed to facilitate energy transition that will be critical to achieving sustainable living environment.


Several PECC economies are more advanced than others in rolling out forward-looking energy transition policies, in providing funding and implementing environmental regulations conducive to such transition. Based on extensive discussions and exchange of views gathered at the seminar, policy recommendations for facilitating energy transition using renewable and sustainable energy will be produced.


This project was implemented in a series of three seminars, led by FPTPEC in partnership with other PECC committees:

Seminar 1: Victoria, Canada, November 2013

Seminar 2: Santiago, Chile | June 24-25, 2014

Seminar 3. Nouméa, New-Caledonia | November 26-28, 2014 (download presentations)

Download program agenda (PDF, 170kb)

 

Session 1. Policies for renewable energies in the Pacific islands and coastal areas

Session 2. Economic models and financing policies for energy transition in the Pacific and coastal areas

Session 3. Technological challenges: Energy storage and efficiency, integration to existing networks

Session 4: Towards greater energy efficiency in coastal areas and Pacific islands

Photo 1State of the Region 2014-2015 report was released on the 7th November 2014 during the APEC Leaders' Week in Beijing through a press conference. The briefing was given by: Mr. Eduardo Pedrosa, Secretary General of PECC and Coordinator of the Report; Mr. Jusuf Wanandi (Indonesia), co-chair of PECC; and Ambassador Don Campbell (Canada), co-chair of PECC.

The State of the Region report is the flagship annual publication of PECC. It includes a survey of opinion-leaders on the priorities for Asia-Pacific cooperation and this year, 602 participated in the survey. A special chapter was dedicated to study the different pathways underway towards the creation of an FTAAP (Free Trade Area of the Asia-Pacific) including the Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP), and their relationship to APEC membership.

Related press releases

Related news reports 

 

 

State of the Region 2014-2015

SOTR 2014-2015 cover

Executive Summary

The Asia-Pacific region is forecast to grow at around 3.8 percent over the next two years before moderating to around 3.5 percent in 2018-2019. While far from the heady rates of above 5 percent growth during the pre-Global Economic Crisis period it represents a steady if unremarkable recovery from the depths of dark days of the 2008-2009.

The challenge ahead is whether the region can do better. While growth has become more balanced in the region, it has also become slower. Moreover, some of the growth remains supported by extraordinary stimulus that cannot be sustained over the medium term.

Regional economies will need to identify alternative growth engines if they are to achieve the objective of sustainable high quality growth. Two areas hold promise in this regard –innovation and middle class consumption. Providing an environment that facilitates their growth should be a priority.

According to PECC’s annual survey of opinion-leaders from the policy community, the top five issues that APEC Leaders should discuss are:

1. Progress towards a Free Trade Area of the Asia-Pacific (FTAAP)
2. Innovative development, economic reform and growth
3. The APEC Growth Strategy
4. Reducing the income inequality in the region
5. Attaining the Bogor Goals of free and open trade and investment

Of concern should be the fact that opinion-leaders selected a lack of political leadership as the second highest risk to growth. It stands as a stark observation if not a rebuke to politicians at a time when leadership is badly needed. The third highest risk, possible failure to implement structural reforms, also suggests considerable anxiety about the political ability of leaders to address an important domestic and regional agenda.

Out of a list of 10 possible drivers of growth, technological innovation was ranked as the most important followed by policy reform and then exports to emerging markets.

In 2010 APEC member economies adopted a new growth strategy; however, tangible results from the strategy are difficult to see. The adoption of clear targets focused on innovation – especially skills development will help to focus efforts in this area.

While respondents did not rank trade liberalization as a top factor for growth in their individual economies, it was the second most important factor for growth in the region as a whole. Indeed, progress on the FTAAP was ranked as the most important issue for APEC Leaders to discuss in Beijing.

As the region and the world struggle with slower growth, the estimated economic benefits of Asia-Pacific wide integration are large at 2.3 percent of world GDP in 2025 or US$2.4 trillion. But even the current negotiations on the Trans-Pacific Partnership (TPP) and Regional Comprehensive Economic Partnership (RCEP) would generate substantial gains.

Potential gains increase sharply with the scale of integration—for example, expanding the TPP with 12 members to an FTAAP with 17 members would triple global benefits from $223.4 billion to $1,908.0 billion in 2025. The benefits would grow further to $2,358.5 billion if Hong Kong (China), Chinese Taipei, Papua New Guinea, and most importantly, Russia were added based on APEC membership, and still larger benefits could be achieved if India, Cambodia, Laos, and Myanmar were added to form FTAAP-25.

While the RCEP and the TPP are critical—and arguably indispensable—steps toward FTAAP, they will not guarantee its realization. They will promote economic integration among members, but neither will offer comprehensive regional coverage or, at first, broadly acceptable rules. At worst, they could establish conflicting standards that are difficult to reconcile and would make the “noodle bowl” of overlapping trade agreements more intractable. A clear vision of FTAAP will minimize the possibility of adverse outcomes. Hence the time is right for analyzing how an FTAAP might be structured and how the current regional negotiations could become, as economists hope, stepping stones rather than stumbling blocks on the path toward it.

Opinion-leaders showed no clear-cut preference for either route – the TPP or the RCEP - and prefer the more agreeable but nebulous concept of building on various agreements including the TPP, RCEP and the Pacific Alliance.

An umbrella agreement will be needed if neither RCEP nor TPP can attract FTAAP-wide membership. This agreement will then have to be separate from RCEP and the TPP, although it should be shaped by their provisions. Since the two smaller agreements will differ, FTAAP will need to formulate positions on issues that are absent from at least one of the agreements as well as harmonize provisions that are included in both.

Under the FTAAP umbrella, members could converge to higher standards. Precedents for an evolutionary approach to standards are offered by ASEAN’s upgrading of the ASEAN Free Trade Area and some ASEAN-plus-one partnerships. NAFTA is itself an umbrella agreement built around the Canada-US free trade agreement and has been upgraded over time. The TPP is also envisioned to be a “living agreement” to be adjusted in the future.

RCEP and the TPP provide way-stations for experimenting with and adjusting to deeper integration. This is important for the large trade flows that connect the United States, China and Japan with each other and other partners. Asian and trans-Pacific regional negotiations are moving forward, despite business cycles, elections, geopolitics, and political controversy.

Deeper economic integration in the Asia-Pacific is likely to produce large economic gains and could help minimize dangerous geopolitical tensions. Yet agreements that foster integration will be very difficult. Lengthy and complex negotiations are required and much opposition is bound to emerge from special interests throughout the region. Asia-Pacific integration will depend on exceptional, collaborative leadership, not least from the region’s largest economies.

The economic integration of the Asia-Pacific region has rebounded since the Global Financial Crisis according to PECC’s index of regional economic integration. The index measures the degree of integration taking place in the Asia-Pacific region based on intra-regional flows of: goods; investment; and tourists and five measures of convergence: GDP per capita; share of non-agriculture to GDP; the urban resident ratio; life expectancy; and share of education expenditure. While the region has become more integrated through increased flows of goods, people and capital, the index shows that there is a long way to go in terms of closing development gaps. Integration is not an end in itself but a means to ensuring that all citizens can achieve their potential.

 

 

2014-09-Beijing FTAAP seminarIn 2010, after three years of internal study and debate by officials and ministers, APEC leaders committed to taking 'concrete steps toward realization of a Free Trade Area of the Asia-Pacific (FTAAP).' Furthermore, they stated that 'an FTAAP should be pursued as a comprehensive free trade agreement by developing and building on ongoing regional undertakings, such as ASEAN+3, ASEAN+6, and the Trans-Pacific Partnership (TPP), among others.' China, as the host for APEC has chosen the goal of advancing regional economic integration as one of its major themes for 2014.

In conjunction with the 22nd General Meeting held in Beijing, PECC organized a high-level roundtable on the topic. The purpose of this workshop was to discuss the current literature on global value chains (GVCs) and regional trade agreements and how these might lead to shaping the future development of an FTAAP.

Keynote speech was delivered by Dr. Bayu Krishnamurti, Vice Minister of Trade of Indonesia. Mr. Chen Chao, the Director of APEC Division at the Ministry of Commerce of China briefed the participants of the ongoing APEC work on regional economic integration. Other speakers at the roundtable included: Dr. Patrick Low, Vice President of Research at Fung Global Institute; Dr. Shujiro Urata, Professor of Economics at Waseda University; Professor Lin Guijun, University of International Business and Economics, China; and Professor Inn Won Park, Korea University.

Click here for the program agenda and presentation slides

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