HKCPEC/Inf/7/12 5 October 2012 MEMORANDUM FOR THE HONG KONG COMMITTEE FOR PACIFIC ECONOMIC COOPERATION (HKCPEC) Asia-Pacific Economic Cooperation (APEC): Outcome of the Twentieth Economic Leaders Meeting and the Twenty-fourth Ministerial Meeting SUMMARY The Financial Secretary of the Hong Kong Special Administrative Region attended the Twentieth APEC Economic Leaders Meeting (AELM) held in Vladivostok, Russia on 8 and 9 September 2012. The meeting was preceded by the Twenty-fourth APEC Ministerial Meeting (AMM) on 5 and 6 September 2012, and the Concluding Senior Officials Meeting (CSOM) on 2 and 3 September 2012. The Secretary for Commerce and Economic Development and the Director-General of Trade and Industry led the Hong Kong, China (HKC) delegation to the AMM and CSOM respectively. This note informs Members of the gist of the outcome of these meetings. 2. Major issues discussed at the meetings included supporting the multilateral trading system, trade and investment liberalisation, regional economic integration, strengthening food security, establishing reliable supply chains, intensive cooperation to foster innovative growth, and enhancing emergency preparedness. 3. The APEC Economic Leaders Declaration, and its five annexes on (i) Towards Innovative Growth, (ii) Strengthening APEC Energy Security, (iii) APEC List of Environmental Goods, (iv) Promoting Cross-Border Education Cooperation, and (v) Fighting Corruption and Ensuring Transparency are at Appendix 1. The Ministerial Statement and its five Annexes are at Appendix 2.
- 2 - DETAILS Supporting the Multilateral Trading System 4. Leaders reaffirmed their commitment to strengthen the multilateral trading system as embodied in the World Trade Organisation (WTO) and their instructions to officials in Geneva to continue exploring different, fresh and credible negotiating approaches to work towards the successful conclusion of the Doha Development Round. Leaders remained firmly committed to advancing the technical discussions on trade facilitation and other development-related issues as mandated by the 8 th WTO Ministerial Conference. They directed Ministers to review the progress achieved in the WTO by the next meeting of APEC Ministers Responsible for Trade in 2013. 5. Leaders reaffirmed their pledge to refrain through the end of 2015 from raising new barriers to investment or to trade in goods and services, imposing new export restrictions, or implementing WTO-inconsistent measures in all areas. They reaffirmed their commitment to rollback protectionist measures and continue exercising maximum restraint in implementing WTO-consistent measures with a significant protectionist effect. WTO Information Technology Agreement 6. Leaders welcomed the ongoing work to expand the product coverage and membership of the WTO Information Technology Agreement and instructed officials to work to swiftly achieve a good outcome. Trade and Investment Liberalisation, Regional Economic Integration Bogor Goals and Free Trade Area of the Asia-Pacific 7. Leaders underlined the importance of the Bogor Goals, and recognised that Free Trade Area of the Asia-Pacific (FTAAP) was a major instrument to further APEC s regional economic integration agenda. Taking note of various regional undertakings that could be developed and built upon as a way towards an eventual FTAAP, Leaders directed Ministers to continue to facilitate APEC s role as an incubator of an FTAAP and to explore ways forward towards its realisation by providing leadership and intellectual input into the process of its development. Next Generation Trade and Investment Issue 8. Leaders welcomed addressing in 2012 transparency as a new next generation trade and investment issue, and the endorsement of the APEC Model Chapter on Transparency for Regional Trade Agreements/Free Trade Agreements to be used as a guide by APEC economies. Regulatory Coherence and Good Regulatory Practices 9. Leaders recognised the importance of addressing unnecessary barriers to trade by advancing regulatory convergence and coherence to ensuring product safety, supply chain integrity, and environmental protection.
- 3 - They reaffirmed their commitment to strengthen implementation of good regulatory practices, including through capacity-building. Investment Facilitation 10. Ministers confirmed the importance of improving the investment climate including through continued implementation of the APEC Investment Facilitation Action Plan, and welcomed development of a framework for measuring the progress. Ministers instructed officials to explore further steps to enhance mechanisms for the prevention and prompt resolution of investment disputes. They welcomed the public-private dialogue on investment and instructed officials to hold similar dialogues on a regular basis. APEC List of Environmental Goods 11. Leaders welcomed and endorsed the APEC List of Environmental Goods that directly and positively contribute to the green growth and sustainable development objectives. They reaffirmed their commitment to reduce the applied tariff rates to five percent or less on these environmental goods by the end of 2015, taking into account economies economic circumstances without prejudice to their positions in the WTO. Trade in Services 12. Ministers supported the Action Plan on Statistics on Trade in Services and welcomed the expansion of the APEC Services Trade Access Requirements Database. They also welcomed the development of other tools and indicators to assess the level of liberalisation in the services sector, including voluntary liberalisation. Sustainable Management and Conservation of Wildlife 13. Leaders committed to strengthening efforts to combat illegal trade in wildlife, timber, and associated products, to implement measures to ensure sustainable marine and forest ecosystems management, and to facilitate sustainable, open, and fair trade of non-timber forest products. They would also promote sustainable management and conservation of wildlife populations while addressing both the illegal supply and demand for endangered and protected wildlife, through capacity building, cooperation, increased enforcement, and other mechanisms. Cross-Border Flows of Information 14. Leaders reaffirmed cooperation among stakeholders to expand and strengthen information infrastructure in the region and to enhance security in the use of information and communications technology (ICT). They also encouraged cooperation among member economies to improve disaster preparedness, response and recovery through the development of ICT.
- 4 - Strengthening Energy Security 15. Leaders would further promote energy efficiency and cleaner energy supplies as a priority to boost both sustainable development and energy security, and reduce carbon emissions. APEC s New Strategy for Structural Reform 16. Leaders instructed officials to conduct a mid-term assessment in 2013 to track progress towards APEC s New Strategy for Structural Reform and encouraged collaboration and capacity-building to expedite achievement of the objectives. Strengthening Food Security 17. Leaders were committed to increasing sustainable agricultural production and productivity. They recognised the positive role of public-private partnerships in investment as well as foreign direct investment. Leaders agreed to strengthen domestic and international agricultural research systems and to facilitate better coordination, interaction and capacity-building among research institutes and innovation centres. They also encouraged dissemination and utilisation of innovative technologies and would look for ways to mitigate the effects of agriculture on climate change and support efficient and sustainable use of agricultural and natural resources. 18. Recognising the crucial role of open and transparent agricultural trading system, and the potential price volatility caused by export restrictions on food, Leaders reiterated their pledge against protectionism. They were committed to developing food markets infrastructure and reducing post-harvest losses along the entire food supply chain. 19. Welcoming the progress of implementing the Asia-Pacific Food Security Information Platform (APIP), Leaders supported cooperation between APIP, the Agricultural Market Information System and the Rapid Response Forum launched by the G20. They were also pleased with the establishment of the Policy Partnership on Food Security and the outcomes of its meeting in 2012. 20. Leaders also agreed to support the work of the Food Safety Cooperation Forum; encourage further cooperation and dialogue among the economies on capacity building regarding the benefits of harmonising domestic regulations on food safety and quality with international standards consistent with the WTO agreements; implement preventive control measures, build information sharing networks, build regional capacity; improve access to food for vulnerable groups; exchange best practices, strengthen sustainable social protection; enhance cooperation to combat illegal fishing and associated trade; work towards sustainable management of marine ecosystems; improve capture fisheries management and sustainable aquaculture practices; and facilitate sustainable, open and fair trade in products of fisheries and aquaculture.
- 5 - Establishing Reliable Supply Chains 21. Leaders reaffirmed their commitment to achieving an APEC-wide target of a ten percent improvement in supply-chain performance by 2015, in terms of reduction of time, cost, and uncertainty of moving goods and services through the Asia-Pacific region, taking into consideration individual economy s circumstances. They welcomed the adoption of a more systematic approach to addressing existing chokepoints in supply chains through targeted capacity-building and concrete steps towards making supply chains more reliable, resilient, safe, efficient, transparent, diversified and intelligent, and directed officials to advance this work in 2012 to be completed by 2014. 22. Leaders encouraged continued discussion with the relevant stakeholders on the diversification of transportation routes in the region and resiliency planning; as well as continued work to streamline customs procedures. 23. Leaders agreed to advance the discussion on the technological enhancement of supply chains. They supported continued discussion with the relevant stakeholders on Authorised Economic Operators programmes and on improving supply chain performance, coordination and visibility through information sharing, capacity building of logistics sub-providers, development of early warning systems, wider implementation of tracking technologies and better control of the movement of bulk cargo, dangerous goods and hazardous materials. They welcomed work on services liberalisation and innovation to facilitate global supply chain connectivity and enhance economies capacity. 24. To make regional commerce more secure, efficient, and resilient, Leaders reaffirmed their commitment to implement the APEC Consolidated Counter-Terrorism and Secure Trade Strategy, and supported deeper cooperation and capacity-building across the Strategy s priority areas of secure trade, travel, finance and infrastructure. Intensive Cooperation to Foster Innovative Growth 25. To intensify the cooperation among APEC economies in fostering innovative growth, Leaders agreed to transform the APEC Industrial Science and Technology Working Group into the Policy Partnership on Science, Technology and Innovation (PPSTI) to bring together the business, government, and academia to address common challenges and enhance innovation capacity. The PPSTI would organise Innovation Technology Dialogues (ITDs), a mechanism to explore how emerging innovative technologies and related policies could address current challenges. Leaders welcomed the results of the first ever ITD on nanotechnology for energy efficiency. 26. Recognising the role of small, medium and micro-sized enterprises (SMMEs) in driving innovation, Leaders committed to assisting SMMEs internationalisation, supporting export-oriented SMMEs, strengthening SMMEs access to markets and financing, and promoting innovation as a key competitive advantage for SMMEs.
- 6-27. Leaders supported the implementation of the Young Entrepreneurs Network and APEC Start-up Accelerator Initiative. They encouraged collaboration among firms to foster their intellectual capital, optimise their core competencies, and minimise potential disputes. 28. Underscoring education as an essential driver of innovative growth, Leaders supported pursuing practical and sustainable cooperation in this field. They articulated the efforts to enhance the mobility of students, researchers, and education providers within APEC through the development of higher education cooperation. 29. Leaders also welcomed the outcomes of the APEC Women and the Economy Forum and reaffirmed their commitment to take concrete actions to enhance women s participation and empowerment in the economy. Enhancing Emergency Preparedness 30. Noting that APEC economies are vulnerable to natural disasters, Leaders reaffirmed the importance of enhancing preventive measures, emergency preparedness, disaster resiliency and fostering of scientific and technical cooperation in APEC. They recognised the importance of easing the mobility of relief assistance in the aftermath of disaster. Leaders also supported promoting and facilitating business continuity and resiliency planning especially among SMMEs; fostering public-private partnerships; establishing common standards for early warning systems in cross-border transportation; furthering the development of an operational trade recovery communications mechanism and developing cooperation for emergency management and disaster response preparedness among Crisis Management Centres. 31. In view of the high economic cost arising from natural catastrophes in the region in recent years, Leaders noted the importance of developing disaster risk management strategies. They recognised that integrated disaster risk financing policies were part of overall disaster response preparedness and therefore appreciated the relevant knowledge exchange within APEC and beyond. COMMENT 32. In the face of the uncertainties in the global economy, we are pleased that Leaders remain committed to the value and centrality of the multilateral trading system as embodied in the WTO. We are also glad that Leaders have reaffirmed their instructions to their officials in Geneva to continue exploring different, fresh and credible negotiating approaches to take forward the Doha Round negotiations and their commitment to combat protectionism. 33. We also welcome endorsement of the APEC list of environmental goods for which applied tariffs would be reduced to five percent or less by 2015 which is an encouraging move providing fresh impetus towards the achievement of the Bogor Goals through voluntary tariff reduction.
- 7-34. As the Lead of the Committee on Trade and Investment Friends of the Chair group on Supply Chain Connectivity Initiative, HKC will continue to work constructively with member economies to achieve APEC s overall target of achieving an APEC-wide ten percent improvement in supply chain performance by 2015. 35. We are delighted that Leaders recognised the potential price volatility caused by export bans and restrictions on food trade, and reiterated their pledge against protectionism. This is particularly relevant for economies like Hong Kong that rely heavily on imports of staple foodstuffs. ADVICE SOUGHT 36. Members are invited to note the content of this memorandum. Hong Kong Committee for Pacific Economic Cooperation Secretariat Ref: EIC 1016/10/4/3 2012