[asia-apec 642] APEC Business Briefing (Spetember, 1998)

[PAN Asia Pacific]

>From the APEC Secretariat

What's Happening in APEC? 
Business Briefing  
Vol. 2 - September 1998 
 
Trade and Investment Liberalization 
 
APEC technical experts are continuing work on the terms of early trade liberalization in 15 
industrial and service sectors. Trade Ministers meeting in Kuching, Malaysia in June made progress 
on an initial set of nine sectors and expressed hope that they would reach final agreement on the 
package at their November meeting in Kuala Lumpur. A key issue is the degree of flexibility 
economies would be allowed in meeting the basic timetables for tariff cuts.  
 
Trade Ministers also urged continued APEC work on electronic commerce, taking into account 
private sector views. Next steps will include possible development of principles and practical 
cooperation to promote use of e-commerce, recommendations on capacity-building efforts, 
including for government use of e-commerce, and outreach programs. More information is 
available at the APEC E-Commerce Task Force's website, www.dfat.gov.au/apec/ecom. 
Meanwhile, an overview of APEC members' laws affecting electronic commerce is available at 
https://www.bakerinfo.com/apec. 
 
The Transport Working Group has completed a comprehensive report on More Competitive Air 
Services with Fair and Equitable Opportunity. It recommends various options for enhancing 
competition in the air transport operating environment for consideration by APEC Transport 
Ministers in 1999. 
 
Business Facilitation 
 
APEC Telecommunications Ministers meeting in Singapore in June approved a Mutual 
Recognition Agreement for conformity assessment of telecoms equipment. The MRA provides a 
mechanism whereby an exporter may designate conformity assessment bodies to test and/or certify 
telecoms equipment to the requirements of the importing economy. The agreement is expected to 
facilitate and expand telecoms trade flows in the APEC region, currently estimated at US$45 
billion. For more on TelMin-3, see www.mediacity.com.sg/apectelmin. 
 
In an effort to facilitate movement of business people, Trade Ministers endorsed plans to grant 
multiple-entry visas to regular business travelers from other APEC economies unless there are 
reasonable grounds in the case of specific travelers not to do so. 
 
Business people at the APEC Customs-Industry Dialogue in June in Kuala Lumpur pressed 
governments to adopt more information technology applications and ensure well-trained work 
forces in customs administration. They called for new mechanisms for cooperation with the private 
sector, and for integrity and transparency in such "smart partnerships" between business and 
customs authorities.  
 
The Trade Promotion Working Group's new APECNet website includes a search function for 
business opportunities and matching services. It also provides information on WG activities and 
links to member economies' homepages (www.apecnet.org.sg).  
 
Economic and Technical Cooperation 
 
Following recommendations from their Ecotech Subcommittee, Senior Officials have issued new 
guidance to all APEC fora to cooperate more closely with the business/private sector to ensure that 
ecotech activities are more results-oriented. SOM wants APEC sub-groups to work with business 
to develop their collective work programs and to involve business in all stages of the ecotech 
project cycle. 
 
The Human Resource Development Working Group (HRD) has endorsed the recommendations of 
its Task Force on the Human Resource and Social Impacts of the Financial Crisis, which held a 
symposium on this topic 15 June in Taipei. The team suggested that HRD: examine best practices 
in member economies on balancing market liberalization with labor market adjustment; cooperate 
with the Finance Ministers process to strengthen corporate governance and financial sector 
supervision and regulation, through support to training programs; develop closer links with business 
and civic groups to enable them to contribute to its activities; and that APEC work with 
international financial institutions to ensure that social needs of the affected economies are 
addressed. 
 
The fourth APEC Public-Business Sector Dialogue on Infrastructure Development, May 20-22 in 
Taipei, addressed the impact of the crisis on this key sector. The Dialogue's message was that the 
need for sound infrastructure was becoming more urgent, not less. Delegates called for a strong 
government role in the short run, in terms of both direct support to infrastructure and improving 
policy frameworks, while recognizing the long-term need to promote private investment. 
 
A new study by the Tourism Working Group and the World Travel & Tourism Council estimates 
APEC economies will spend US$2.1 trillion on travel and tourism this year, supporting almost 89 
million jobs in the region. The study confirms that the financial crisis has dampened short-term 
prospects but still forecasts average growth in industry receipts of 3.7 percent per year to 2010.  
 
Financial Cooperation 
 
APEC Finance Ministers met May 23-24 in Kananaskis, Canada. They reviewed the causes of the 
regional financial crisis, policies to restore stability and growth - including measures to cushion the 
impact on the poor, and ways to strengthen financial markets to reduce the chances of a 
recurrence. Ministers agreed to continue efforts over the next year in three priority areas:  
     Capital market development. Collaborative initiatives in such areas as pension reform, 
developing securitization activities and strengthening credit rating agencies will continue. 
     Ministers also launched a new initiative on developing domestic bond markets and asked the 
ADB to explore strategies to promote private financing for infrastructure over the medium term.  
     Capital account liberalization. Ministers pledged to continue developing a Voluntary Action 
Plan for Supporting the Freer and Stable Flow of Capital. Finance Deputies will work with the IMF 
and World Bank to study how to promote freer capital flows while maintaining macroeconomic 
and financial stability.  
     Strengthening financial systems. Ministers called for timely and comprehensive implementation 
of plans to improve training of bank supervisors and securities regulators, and welcomed an 
initiative by the APEC Financiers Group to create a private-sector training program. Ministers also 
launched an initiative to study ways to strengthen corporate governance in the APEC region. 
Australia will host a seminar with senior business people to identify priorities for reform in this 
area.  
 
Organizational News 
 
At its July 29-30 meeting in Singapore, the Budget and Administrative Committee endorsed, 
subject to SOM's and Ministers' approval, a 1999 administrative budget (support staff, travel, 
communications costs, etc.) for the APEC Secretariat of US$2.21 million, new Operational 
Account projects totaling $1.87 million, and new TILF Special Account projects totaling $4 
million.  BAC also endorsed new guidelines to strengthen project evaluation, pending SOM's 
approval.