"CEAC Commentary" introduces news analyses andopinions in Japan on topics related to regional
cooperation and integration in East Asia, but they donot represent the views of CEAC as an institution.

December 26, 2013

The Achievements of APEC in Indonesia 2013
By YAMAZAWA Ippei
The APEC Bali Summit in Indonesia in early October was eclipsed by theannouncement that US President Obama would not attend the meeting. At least, this is thecommon understanding among Japanese newspapers. APEC itself is an opportunity toadvance ongoing TPP talks as leaders of participating nations gather together, and it wasexpected that President Obama would come to the meeting to lead difficult negotiation
processes to settle the deal by the end of this year. However, since Obama did not attend thesummit, the trade liberalization talk stalled, and media attention to the APEC Summit
cooled down. Despite that, the APEC Summit was held without Obama, and leaders at thesummit commemorated the achievement of the Bogor Declaration launched by late
President Suharto nineteen years ago, and they swore to make sustained efforts to deepen
regional economic integration. For this objective, APEC articulated to endorse US-led TPP
and ASEAN-led RCEP in parallel, and it will play the role of an incubator for free trade.
Nevertheless, I am critically concerned whether the media and the public understand therole of APEC properly. I would like to promote better understandings of APEC, and callattentions to watch how these declarations are implemented from now on.

Let me review the Leaders’ Declaration and the Ministerial Statement of the APEC thisyear. At the beginning of the Leaders’ Declaration, it is stated that the Asia Pacific region servesin the role of driving world economic growth through efforts to achieve the goal set by theBogor Declaration, and expressed determination towards further economic integration to foundthe FTAAP (Free Trade Agreement of the Asia Pacific). For this objective, as mentioned in theYokohama Vision in 2010, the declaration says that APEC will help its members found regional
FTAs to advance economic integration, through endorsing information sharing, capacity
building, and policy dialogues. Meanwhile, both the Leaders’ Declaration and the Ministerial
Statement do not refer to the names of the TPP (Trans‐Pacific Partnership) and the RCEP
(Regional Comprehensive Economic Partnership) themselves. The Ministerial Statement
approves the annual report of the CTI (Committee on Trade and Investment) as an action planfrom now on, through reviewing currently ongoing APEC activities, and taking note of the“remaining areas” mentioned in the midterm assessment in 2010. Though the media did notcover the CTI Report, it can be downloaded from the APEC’s website. The CTI Report mentions

liberalization and facilitation of economic activities during 2013; summarizes current stage ofthe taskforce of each area under the CTI’s responsibility, including market access, service,investment, standard assessment, intellectual property right, business people movement, etc.;
and details action agendas for 2014. The fourth paragraph of this report suggests improvementof the IAP (Individual Action Plan) announcement process; supplement of standard assessment
to Dashboards of the PSU (Policy Support Unit); and necessity of further effort in service,investment, and non‐tariff barriers. All of these objectives were proclaimed at the Bogor Goals
Workshop in Medan on June 30, 2013, and the report advises that they be preceded at biannual
Bogor Goals Progress Review next year. Last year, I examined the IAP 2012 with my young
colleagues to evaluate the achievements of the Bogor goals of all 21 economies, and publishedan article to point out key areas to achieve the goal towards 2020. We made a presentation of it
by invitation to the CTI workshop, and we were encouraged to see most of ourrecommendations were accepted at the session.

The APEC has been tackling to facilitate liberalization programs in fourteen areas
based on the Osaka Action Agenda in order to implement goals of the Bogor Declaration in 1994.
It is difficult to liberalize sensitive areas like agriculture and heavy industry due to thevoluntary non‐binding modality of the IAP. But regarding standard assessment, customs
clearance, business people movement, and intellectual property right, trade and investment
facilitation among APEC economies has made progress steadily, thanks to setting andpromoting common practices and supporting capacity building under the CAP (CollectiveAction Plan). This is the foundation of prosperous APEC and the engine of world economicgrowth. After the Asian Financial Crisis hit APEC members in Asia, some economies were notsatisfied with stagnant liberalization of the APEC, which led to the movement to pursue a “highstandard of liberalization” for current TPP negotiations, and provoked the Asian side to initiate
ASEAN‐led RCEP talks. Those trade negotiations are intended to make binding agreements
unlike the APEC, and TPP talks target many areas of facilitation. The APEC has facilitated tradeand investment among member economies, which will be helpful to provide foundation toimplement those agreements.
It is not clear whether the agreement towards the TPP will be reached by the end of
this year, but it will be reached sooner or later, which will provoke the RCEP to be concluded,and FTAAP negotiations will start as stated in the Yokohama Vision. The TPP will be on thehigh track of liberalization, while the RCEP will be on the lower track, but both negotiations
will be founded on high level of liberalization by the APEC. Then, we should take measures
to converge the TPP and the RCEP with the FTAAP. The APEC is not just a provider ofarenas for information exchange and policy dialogue, but a de facto incubator of the Asia

Pacific Economic Community. We should understand APEC Leaders’ Declaration this year inthis way, and it is the role of us, stakeholders to watch whether the IAP will be strengthened
next year as intended.

(This is an English translation of the article written by Dr. YAMAZAWA Ippei, Professor
Emeritus of Hitotsubashi University, which originally appeared on the e-forum“Hyakka-Somei” of CEAC on October 18, 2013.)