APEC agenda set for trade and investment facilitation
By Vincent Lingga
BEIJING (JP): After the meaty subject of trade liberalization, measures of trade and investment facilitation rank as the second most important topic of discussions related to APEC cooperation program.
The trade and investment facilitation agenda involves the most important, comprehensive recommendations submitted by APEC's Eminent Persons Group, the Pacific Business Forum and the Pacific Economic Cooperation Council to the mid-November summit of APEC leaders in Osaka.
The strongest argument for the recommendations is that trade liberalization alone will not be able to significantly promote economic cooperation.
As suggested by Mari Pangestu, a senior economist and a member of the Indonesian delegation to the PECC meeting here, progress in trade and investment facilitation can bring about mutual benefits to APEC members much sooner than trade liberalization.
The recommendations call for measures, initiatives or agreements to achieve greater consistency or mutual recognition of policies as well as standards and procedures to facilitate trade and investment flows to help reduce transaction costs and technical obstacles.
Some of the needed measures are related to investment principles, harmonization of standards and conformance with customs procedures, transparency and discipline in the use of anti-dumping measures, rules of origin, visa requirements and trade (procurement) and competition policies.
APEC has started work on several of the measures such as the adoption last year of non-binding investment principles which cover transparency, non-discrimination, expropriation, settlement of disputes, transfer of funds, capital movements, incentives, national treatment and performance requirements.
Several of the World Trade Organization's agreements have also covered the issue. Among them are the agreements on Trade Related Investment Measures, Trade Related Aspects of Intellectual Property Rights and Anti-Dumping Measures.
Divergences
However, as PECC asserts in its recommendations to APEC leaders, wide divergences in domestic regulations, policies and administrative procedures have been raising the costs of trade and investment and other economic transactions among APEC member economies.
"These problems, in addition to traditional trade barriers, are now strategic obstacles to the mutually beneficial economic integration of the Asia-Pacific region," a PECC statement points out.
The APEC Eminent Persons Group points out in its third report to APEC leaders that periodic abuse of the anti-dumping instrument has been threatening to close some of the markets that APEC is trying to open.
"Almost 75 percent of all anti-dumping actions notified to the WTO involve APEC members and three of the four principal users of anti-dumping actions are in APEC," the Eminent Persons Group says.
APEC therefore has a special responsibility to address the issue, otherwise it could affect international transactions and consequently hinder growth, the group notes.
The group also sees competition policy as highly salient to APEC because, besides anti-dumping measures, such practices as monopoly, abuse of market power and other abusive business practices are the main cause of major trade disputes between APEC members.
The eminent persons group therefore calls for urgent measures of trade and investment facilitation in view of the fact that despite the commitment of its leaders to creating a community of Asia-Pacific economies, several of APEC members are involved in so many trade disputes.
The Pacific Business Forum, in its latest report to APEC leaders entitled The Osaka Action Plan: A road map to realizing the APEC Vision, goes farther in recommending more concrete measures to facilitate trade and investment.
The forum, which was set up at the first APEC summit in Seattle in November, 1993, calls for a one-stop investment agency in each member, multi-entry business visa, easier procedures for obtaining business residency visas, simplification and harmonization of customs procedures and of government policies in respect to product standards and procurements.
"Today, investment flows have joined trade flows to become the driving forces behind regional growth. But restrictive barriers such as lack of clearly defined and enforceable laws and regulations in a number of APEC economies are inhibiting regional growth and cooperation," the forum points out.
The eminent persons groups considers competition policy so vital that a failure to adopt such a policy could frustrate the basic objective of free, open trade and investment as stipulated in the Bogor Declaration of APEC leaders last November.