From talk­ing shop to ac­tion The ‘APEC ef­fect’ shows China is play­ing a key role in pro­pel­ling greater re­gional co­op­er­a­tion and global eco­nomic de­vel­op­ment

China Daily (Canada) - - COMMENT -

InNovem­ber, Beijing suc­cess­fully hosted two big events: the Asia-Pa­cific Eco­nomic Co­op­er­a­tion Eco­nomic Lead­ers’Meet­ing and the sum­mit be­tween Chi­nese Pres­i­dent Xi Jin­ping andUS Pres­i­dent Barack Obama. The bet­ter-than-ex­pected achieve­ments that re­sulted have given rise to a pow­er­ful “APEC ef­fect,” which will be of great sig­nif­i­cance to the re­gion and the world as a whole.

The Beijing meet­ing helped lift APEC out of its per­sis­tent dol­drums. Be­fore the meet­ing, APEC had been la­beled a talk­ing shop, be­cause the or­ga­ni­za­tion failed to make sub­stan­tive con­tri­bu­tions to push­ing for­ward Asia-Pa­cific re­gional co­op­er­a­tion. The en­thu­si­asm among its mem­bers to par­tic­i­pate in rel­e­vant agen­das was also wan­ing. Fur­ther­more, the Trans-Pa­cific Part­ner­ship Agree­ment and Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship mech­a­nisms, which have emerged in the past three years, posed big chal­lenges to the in­flu­ence of APEC.

The un­prece­dented Beijing meet­ing, how­ever, put for­ward ini­tia­tives such as the Free Trade Area of the Asia-Pa­cific, the Blue­print on Con­nec­tiv­ity and the global value chains, which will jointly play a lead­ing role in driv­ing in­ter­con­nected and dy­namic growth. The meet­ing and the ini­tia­tives will help re­ju­ve­nate and speed up Asia-Pa­cific eco­nomic in­te­gra­tion, while in­ject­ing newim­pe­tus and pur­pose into APEC, whose role had be­come ob­scure in the past fewyears. It is no ex­ag­ger­a­tion to de­scribe the Beijing meet­ing as a “turn­ing point” for APEC, mark­ing the end to its wan­ing role and the be­gin­ning of a re­bound.

The suc­cess of the meet­ing was thanks to colos­sal in­put from the host. China’s goal is to share the fruits of its eco­nomic de­vel­op­ment with all mem­ber economies, not just seek its own in­ter­ests. To en­sure the com­plete suc­cess of the APEC meet­ing, China made great ef­forts and in­vested an enor­mous amount of money. Dur­ing the meet­ing, China made com­mit­ments to do­nate $10 mil­lion to support APEC in­sti­tu­tional and ca­pac­ity build­ing, and in­vested $40 bil­lion to es­tab­lish the Silk Road Fund, which will pro­vide in­vest­ment and fi­nanc­ing support for coun­tries along the Silk Road Eco­nomic Belt and the 21st Cen­tury Mar­itime Silk Road to un­der­take in­fra­struc­ture projects. At the meet­ing, more than half of the ini­tia­tives that were fi­nally adopted were pro­posed by China. This is a clear in­di­ca­tion that China is both will­ing and ca­pa­ble to serve and as­sist Asia-Pa­cific co­op­er­a­tion, and can play an ad­mirable role in the global econ­omy and pol­i­tics.

Some coun­tries, how­ever, are con­cerned about China’s grow­ing in­flu­ence and strength, fear­ing that China will seize the cen­tral po­si­tion in re­gional eco­nomic co­op­er­a­tion and seek to max­i­mize its in­ter­ests through in­ter­na­tion­al­iza­tion of the ren­minbi and the “go­ing global” moves of Chi­nese com­pa­nies. It is only nat­u­ral for some neigh­bor­ing coun­tries to ex­press their con­cerns. But China’s de­ter­mi­na­tion in pro­mot­ing re­gional co­op­er­a­tion should not wa­ver. In im­ple­ment­ing projects agreed upon dur­ing the APEC meet­ing, it’s time for China to bet­ter ex­plain its in­ten­tions to neigh­bor­ing coun­tries and show its com­mit­ment to re­gional de­vel­op­ment so as to dis­pel their con­cerns and let the “APEC ef­fect” bear fruit.

The “APEC ef­fect” is sig­nif­i­cant be­cause it will serve Asia-Pa­cific re­gional co­op­er­a­tion and global eco­nomic de­vel­op­ment.

First, the rejuvenated APEC is ex­pected to op­ti­mize the free trade pat­tern in the Asia-Pa­cific re­gion. Ac­cord­ing to the Asian De­vel­op­ment Bank, the num­ber of FTAs in Asia had in­creased to 109 by the end of 2013 from 36 in 2002, and 148 more are still un­der ne­go­ti­a­tion – a num­ber far ex­ceed­ing any other re­gion in the world. The re­gion has many coun­tries with greatly vary­ing lev­els of de­vel­op­ment. This leads to FTAs with com­pli­cated rules and stan­dards and “frag­mented” de­vel­op­ment pat­terns.

How­ever, the in­te­gra­tion process of the Asia-Pa­cific re­gion has pro­gressed at a slow pace, and the process of the TPP and RCEP has also been stalled since the be­gin­ning of this year. If coun­tries in the re­gion con­tinue with bi­lat­eral or small­er­scale mul­ti­lat­eral FTA talks, the sit­u­a­tion will fur­ther worsen and the trend of “frag­men­ta­tion” will ac­cel­er­ate re­sult­ing in a “spaghetti bowl ef­fect”. But, if they don’t do so, they might be left be­hind amid the faste­volv­ing en­vi­ron­ment and their economies might suf­fer.

In such cir­cum­stances, a new di­rec­tion and vi­sion for Asia-Pa­cific co­op­er­a­tion was ur­gently needed. The FTAAP ad­vo­cated by China pro­vides a newop­por­tu­nity for speed­ing up re­gional eco­nomic in­te­gra­tion within the APEC frame­work. It will be con­ducive to co­or­di­nat­ing and uni­fy­ing the rules and stan­dards within the re­gion, and will help ease and pre­vent the “frag­men­ta­tion” in eco­nomic co­op­er­a­tion in the re­gion. This will be an im­por­tant step in build­ing a more open and lib­eral Asia-Pa­cific eco­nomic pat­tern.

Sec­ond, China has a role to play in driv­ing and re­vi­tal­iz­ing the stag­nant global econ­omy. At present, the eu­ro­zone is still strug­gling on the road of re­cov­ery and some of its economies are on the verge of plung­ing into re­ces­sion again. The global econ­omy as a whole faces grow­ing risks of a slow­down, so new growth en­gines are needed to shore up the econ­omy. The Asia-Pa­cific re­gion, which is the en­gine for the global econ­omy, shoul­ders the re­spon­si­bil­ity of help­ing lift it out of re­ces­sion.

Ac­cord­ing to es­ti­mates by the Pa­cific Eco­nomic Co­op­er­a­tion Coun­cil, the high-level FTAAP, which would en­com­pass ev­ery Asia-Pa­cific econ­omy, is ex­pected to con­trib­ute about $2.4 tril­lion in out­put value to the global econ­omy. In com­par­i­son, it is es­ti­mated the TPP will be able to make a con­tri­bu­tion of only $223 bil­lion. The re­al­iza­tion of fur­ther trade and in­vest­ment fa­cil­i­ta­tion and lib­er­al­iza­tion in the Asia-Pa­cific re­gion holds the key to eco­nomic growth, and the FTAAP will be­come an im­por­tant driv­ing force for growth of the global econ­omy.

The APEC Beijing meet­ing came to a suc­cess­ful end, with a roadmap and blue­print charted; it is now the time for ac­tion and im­ple­men­ta­tion. De­spite the pres­sure and dif­fi­cul­ties, all APEC mem­ber economies should be fully con­fi­dent of build­ing an open and lib­eral eco­nomic and trade en­vi­ron­ment in the re­gion. Just as Pres­i­dent Xi said in his clos­ing re­marks at the APEC Eco­nomic Lead­ers’Meet­ing: “Later, when we look back at the his­tory made here to­day at Yanqi Lake, we can say with pride that we did the right thing.” The au­thor is a re­searcher with the In­sti­tute ofWorld Po­lit­i­cal Stud­ies, China In­sti­tutes of Con­tem­po­rary In­ter­na­tional Re­la­tions. Cour­tesy: chin­aus­fo­cus.com

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.