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GM20_Kurt_Campbell_openingThe 20th General Meeting of the Pacific Economic Cooperation Council was held in Washington D.C. on September 29, 2011. The gathering of policy experts from business, government and the academia met under the theme of the "State of the Region". The meeting tackled critical issues to spurring sustainable growth including: how to make it easier to trade services which now are the largest part of most of the region's economies; how to make growth more inclusive to ensure no segments of society get left behind; and how to make progress on the TransPacific Partnership.

Also addressed in the meeting were some of the underlying structural issues in the Asia-Pacific economy: the risk of long-term unemployment and policy frameworks to create jobs; energy security issues; and the fundamental changes that have taken place in the trading system since the launch of the WTO Doha Round.

The meeting opened with a discussion on the latest economic forecasts from the International Monetary Fund (IMF) and the results of the annual State of the Region report issued by the PECC. Despite the gloomy outlook and rising pessimism, there is an opportunity over the coming 6 weeks for leaders to take concrete actions to restore confidence to global markets and the international system at the G20 summit in Cannes, the APEC leaders' meeting in Honolulu and the East Asia Summit (EAS) in Bali.

According to the annual survey conducted by the Pacific Economic Cooperation Council (PECC), 80% of the respondents, made up of about 430 opinion-leaders from the government, business, academia, and the media, expect slower growth in the next 12 months in the United States and the same for the European Union. The same survey placed investment in new tecnhologies and innovation systems as the top policy priority for achieving sustainable growth in the region.

While structural reforms and rebalancing must continue, the participants gathered at the 20th General Meeting of PECC agreed that the Pacific economies must invest in new technologies and innovation systems while actively looking for ways to enhance cooperation in areas such as the services trade, energy, and green growth. As the core of the global economic shifts to the Pacific Basin the world is looking increasing to the region for leadership. The report highlights APEC's ongoing agenda for economic integration and support for the global multilateral system as critical to the process of restoring confidence. Progress in these areas will send a strong signal to the business community that protectionism will not close off markets to their goods and services. Efforts to make the regulatory environment easier to navigate and less burdensome, especially for small and medium enterprises, need to bear fruit. Under Secretary of Commerce for International Trade, Francisco J. Sanchez highlighted how few small and medium enterprises are engaged in global trade so making it easier for them to do business across borders would open a huge new market for their products and services across the world. PECC' s survey findings show “behind-the-border” problems like regulatory impediments the most burdensome.

A special paper commissioned by PECC highlighted, however, that there was significant potential for transpacific energy trade and job creation in the energy sector with the recent discovery of shale gas deposits in the United States. Such developments would help ease the trade deficit problem with Asia for the US while it could also help Asian economies diversify their sources of supply and therefore improve energy security for the region as a whole.

Assistant Secretary of State for East Asian and Pacific Affairs, Kurt Campbell underscored the importance of continued strategic alliance with the Asian economies and reaffirmed the US’s commitment to the region at the opening address.

Youth delegates urged PECC to play a more active role in reaching out to the general public with the aim of bridging the information divide between the policy-makers and public about the many multilateral frameworks and institutions such as the Asia-Pacific Economic Cooperation (APEC), G20, and East Asia Summit (EAS). This is the fifth time that PECC invite a group of selected youth delegates from various economies to participate and interact with the members of PECC and other eminent individuals from the government, academia and the business community.


The 20th General Meeting of PECC was hosted by USAPC in Washington D.C. and was held back-to-back with the Standing Committee meeting of PECC (28 and 30 September 2011).

Program agenda with papers and presentations



Speakers' profile (59KB, pdf)

Three concurrent sessions at the General Meeting:
Session 1: Enabling 21st Century Services in the Asia-Pacific
Session 2: The Trans-Pacific Partnership (TPP): Views from the Inside and the Outside
Session 3: Paths to Inclusive Growth

Media reports related to the 20th General Meeting

2011_Noumea_Marine-ResourcesThe first of a series of three under the PECC International Project on marine resources (2011-2012), 'Oceans at Risk: Protection from the ocean to the coast, sharing marine resources' took place in Noumea, New Caledonia on 22-24 November 2011. The seminar brought together academics, scientists, policy-makers, and business executives to discuss and examine the consequences of climate change on oceans, exploitative versus responsible usage of marine resources as food, energy, and goods, treatment of solid and liquid waste in coastal areas, as well as ways to achieve sustainable management of biodiversity in and around the oceans. Case studies from different economies, best practices and innovative approaches were shared at this seminar.

The Chair of France Pacific Territories committee for PECC and former prime minister of France, Michel Rocard urged that it was important to reinforce the message to the international community that global warming is an imminent threat to international security and well-being. Scientists and academics gathered also agreed that it was desirable that research funding and investments on data-gathering be secured on a long-term basis and that more could be done to raise awareness through vigorous public education and local community outreach.

Key recommendations emanating from the seminar included the following:

- Increase solidarity among the Pacific economies - Taking into consideration compatibility with local communities as well as inter-governmental cooperation;
- Adopt a new form of governance to improve the management of coastal areas and marine resources - Responsible management and control of resources and clean water; increased cross-sectoral cooperation and transparency; better management of the competing interests of land and water usage;
- Enhance capacity-building with innovation and education - Appropriate technology transfer and knowledge-sharing (long-term funding, investments needed to deepen research and data-gathering capabilities);
- Diversify options for food security (e.g. aquaculture, freshwater and microalgae farming).

Seminar One: Oceans at Risk - Protection from the ocean to the coast, sharing marine resources (November 22-24, 2011 | Noumea, New Caledonia)
(Program agenda and presentations available for download)
Summary of discussions and recommendations 

Seminar Two: Oceans as a Source of Renewable Energy (March 26-28, 2012 | Hawaii, USA)

Seminar Three: Oceans as a Means of Communication and the Effects of Tourism (November 2012, TBC)

[photo: Singapore's Minister for Trade and Industry, Mr. Lim Hng Kiang delivers the keynote speech]

Singapore's Minister for Trade and Industry, Lim Hng Kiang delivers keynote speechPECC conference organized by the Singapore committee for PECC in partnership with USAPC (US Asia Pacific Council/ US member committee for PECC), "Growing APEC Economies: New Challenges and Approaches" took take place in Singapore on 29-30 June 2011. (Presentations and speeches are available for download.)

The conference served as an opportunity to share interim findings in the run up to the 20th PECC General Meeting hosted by USAPC in Washington D.C. in September 2011. The effort aimed to contribute to increasing more direct input to the APEC process by the regional experts in their respective fields. This year, the key motivation was to help APEC economies cope with external shocks such as the US Government's quantitative easing, and rebalance export-driven development model by identifying services as an alternative growth pillar. The conference addressed four main areas:

- Taking stock on the latest development amongst APEC economies in terms of sustainable and inclusive growth;

- Sharing experience in exploring how services can also be a pillar of growth for emerging economies

- Evaluation of how APEC economies can better cope with volatile capital flows;

- Re-examination of the effectiveness of APEC amidst the growing complexity in regional institutional architecture.

Focus on new growth strategies for Asia-Pacific economies

Unemployment, high inflation, and income inequality continue to be key concerns for Asia-Pacific economies. Natural disasters have taken a catastrophic toll.  Although the Asia-Pacific region has managed to overcome the worst from the economic crisis of 2008-2009, the recovery has been patchy and the growth trajectory is far from assured.

“While growth may have returned somewhat, the issue is the quality and composition of growth – creating jobs and ensuring resilience,” emphasized Dr. Charles E. Morrison, co-chair of PECC and President of East West Center. In November 2009, when Singapore hosted APEC at the height of the crisis, the Council had released a report, “Inclusive, Balanced, and Sustained Growth in the Asia-Pacific,” which outlined a set of policy objectives in the form of bold structural reforms for many of the region’s economies or sub-regions. Many of the report’s recommendations were echoed in APEC’s growth strategy.

Services liberalization one of the keys to drive growth

In addition to the green sector, PECC identified services trade as an area that could significantly contribute to rebalancing and reinvigorating growth in the region. Services account for 68% of economic output and 61% of jobs in the region.

Singapore’s Minister for Trade and Industry, Mr. Lim Hng Kiang stressed in his keynote speech that “the potential of the services as a source of growth is constantly growing” and that in order to tap on such growth, it is crucial for economies to liberalize their trade in services.

Services, traditionally perceived as non-tradable across the border are increasingly becoming significant yet there is inadequate data available on the real volume of trade in services as well as the impact of restrictions on services on trade and economic growth. With trade negotiations at the WTO stalled, mostly as a result of disagreements over industrial tariffs, environmental concerns and agriculture, trade in services has also not realized its full potential.

Professor Christopher Findlay (University of Adelaide), of the leadership group for PECC signature project on services, urges, “in order for us to move ahead from the stalling Doha Round, economies can make pre-commitments by pledging to implement reforms by a certain date in the future to liberalize trade in services.” They could also consider a ‘services-only approach’ in the WTO as proposed during the recent PECC-ADBI conference that took place in Hong Kong earlier this month. The challenges are having to deal with domestic regulations and implementing policies that address market failures without restricting competition. 

Managing the capital flow

A new challenge that the region is struggling with is the massive flows of hot money coming into the region as a result of the liquidity increases that came with the stimulus policies adopted by the US and European central banks in response to the crisis. While foreign direct investment is much needed, the Council warned of the dangers of hot money flows and the policy challenges they present. Many of the Asian economies remember the dangers of possible capital inflow reversals from the 1997-1998 financial crisis experience.  “The increase in capital flows that we’ve been seeing over the past 24 months comes with the risk of creating new asset bubbles. We have to think creatively about the best way to manage this situation,” said Prof. Tan Khee Giap, the Chair of Singapore National Committee for Pacific Economic Cooperation.

“Massive capital inflows can pose serious policy challenges to emerging Asia in terms of macroeconomic and financial system stability,” warned the Dean and CEO of Asian Development Bank Institute (ADBI), Dr. Masahiro Kawai. The best policy mix of fully flexible exchange rate, capital account openness, and low-inflationary monetary policy is appropriate for advanced economies with deep, liquid and broad financial markets. “Emerging economies would need a combination of prudent structural, macroeconomic, and macroprudential measures such as allowing adequate exchange rate appreciation, limiting credit growth, and using capital controls,” said Dr. Kawai.

Boosting social resilience

An important part of the rebalancing and structural reform agenda is the enhancement of social resilience. PECC established a project group last year to look at three core elements of social resilience: pensions, health/ medical care, and unemployment plus the macro-economic analysis. This project comes at a critical time for the region for two main reasons: a) the economic crisis has once put the spot-light on the ability of social security to provide support for our people when jobs are scarce; and b) the demographic profile of the region is rapidly changing (e.g. aging societies) putting pressure on existing systems. “APEC is more than a trade forum; the fact that it is focusing on inclusive growth and addressing income inequality in the region is an achievement worth noting,” added Amb. Yoshiji Nogami, chair of Japan committee for PECC and president of Japan Institute of International Affairs.

The project research findings indicate that the enhancement of social safety nets can make an important contribution to rebalancing and boosting economic growth in the region. Asia-Pacific economies need to consider what infrastructure we should establish to build resilience against economic crises. “Crisis management has been effectively handled by cooperative mechanisms such as G-20 but it is now time to focus on structural reforms that can buffer the region against such volatility and changing circumstances in the future,” said Mr. Jusuf Wanandi, co-chair of PECC (Board of Trustees, Centre for Strategic and International Studies, Jakarta).

Final program agenda

Press release

News reports from the press

Keynote speech by Singapore's Minister for Trade and Industry, Mr. Lim Hng Kiang

Opening speech by PECC Co-chair, Dr. Charles E. Morrison

20110712_SRworkshop_TokyoOver the last 20 years, economic crises have hit the region almost every ten years. There is a need to consider not only the short-term economic rescue policy, but also the resilient infrastructure against frequent economic crises in the long term.

The Japanese National Committee for Pacific Economic Cooperation (JANCPEC) launched Social Resilience research project in 2009. The project was the first attempt by the PECC members to discuss social policy in the Asia-Pacific region in depth. This year, the project members are examining the current status of social safety nets in Asian economies not addressed in last year's research and are pursuing horizontal research approach that sheds light on the overlapping areas and interactions between different social protection areas.

JANCPEC held PECC International Workshop on Social Resilience on 12 July 2011 in Tokyo to discuss measures to strengthen social safety nets in the Asia-Pacific region. The workshop consisted of four sessions including pension system, health care system, unemployment insurance scheme, and macroeconomic analysis. Experts presented situations and prospects of social securities in the region to discuss how to make the region's societies more robust and resilient against economic crises. Ambassador Kenji Hiramatsu, Director-General for Global Issues, made a keynote speech regarding sustainable growth and green economies. Attended by about 70 participants, the workshop served a good opportunity to share the progress of research and to re-emphasize on the importance of social safety nets in the Asia-Pacific region. The final outcome of this year's SR project is expected to be delivered towards the end of the year.

Program agenda with speeches, papers, and presentations for individual download (video streaming also available)

To learn more, please contact:

Ms Reiko Nakayama
Research Assistant
Secretariat of the Japan National Committee for Pacific Economic Cooperation (JANCPEC)
Tel:   +81-3-3503 7744
Fax:  +81-3-3503 6707
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

20110603_ServicesTrade_HongKong_group-photo'Services Trade: New Approaches for the 21st Century' conference was held on 1-3 June 2011 in Hong Kong, China in collaboration with the Asian Development Bank Institute (ADBI), the Economic Research Centre of the Hong Kong Institute of Asia-Pacific Studies (HKIAPS), and the Institute of Global Economics and Finance at the Chinese University of Hong Kong (CUHK).

Download program

View the opening addresses (via YouTube)

Download presentations and relevant research papers

Services are key to economic growth and competitiveness. The idea of fragmentation and complexity on global supply chains for services has not been adequately understood or studied. There is evidence that services firms, just like manufacturers, take a supply chain view of their business. The task of rebalancing the economies in the aftermath of the recent global financial crisis could be helped by clarifying the priorities for policy options in services reform, by reducing costs in the supply chain, and overall by designing innovative and effective services policies.

At the opening session during the conference in Hong Kong, PECC Co-chair Dr. Charles Morrison said that “service trade area is where we want to see how Asia Pacific countries not only promote liberalization, efficiency and delivery of services within the region, but also how we can promote global trade in services.” 

Dean of ADBI, Dr. Masahiro Kawai emphasized that offshore outsourcing has grown dramatically since the end of the 20th century and that outsourcing is no longer restricted to manufactured goods coming out of factories. Many services, even in highly specialized and technical areas, can now be delivered electronically by outsourcing.  “Like previous industrial revolutions and technology advances, offshore services are expected to deliver higher standards of living, raise productivity, and alleviate poverty in the developing world, especially in those economies that are ready to benefit because of their better education, adequate numbers of trained workers and access to advanced communications technology,” he added.

PECC-ADBI joint project aims to analyze the impact of services trade on economic growth, specialization, investment, human resource development, and regulatory policies as well as study how competitiveness and governance can be improved in the sector. 

More information on the project is available here


 

 20110602_ServicesTrade_HongKong_SherryStephenson

Short interviews with some of the speakers at the conference (accessible by YouTube):

Dale Andrew and Massimo Geloso Grosso
Gloria Pasadilla
Bob Vastine
Sherry Stephenson
Pascal Kerneis
Stewart Forbes
Kaaren Koomen
Julian Arkell

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Pacific Currents

Digital Technologies, Services and the Fourth Industrial Revolutions
Submitted by Jane Drake-Brockman, Christopher Findlay, Yose Rizal Damuri and Sherry Stephenson 


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