APEC still on track toward Bogor goals

APEC still on track toward Bogor goals

Dian Triansyah Djani and I.B. Made Bimantara, Jakarta

Many have questioned the achievements of the Asia Pacific
Economic Cooperation (APEC) to date. It has been more than 10
years since the Bogor Goals were declared by the leaders of APEC.
In essence, the goals were made to achieve free and open trade
and investment in the Asia-Pacific region: 2010 for
industrialized economies and 2020 for developing economies.

Analysis of economic data, compiled extensively and
scrutinized thoroughly by independent experts has concluded that
APEC is "on track" to achieving the Bogor Goals. However, APEC
economies should not be complacent, as formidable challenges lie
ahead.

The first test is meeting the 2010 goals for industrialized
economies. At stake is the credibility of APEC. Fulfilling the
commitment of comprehensively reducing barriers to trade in the
region would boost its international stature, provide a fresh
outlook and renew APEC's energy. Conversely, the failure to
achieve those goals would slide APEC into economic cooperation
irrelevance and would open APEC's floodgates to even more
discussions and initiatives far beyond the economic field.

A symposium held recently in Korea to assess APEC's progress
underlined the importance of individual and collective action
plans to open markets.

Two independent studies conducted by the Project Team Experts
Report and the Center for International Economics reflected the
main accomplishments of the APEC economies and to some extent,
Indonesia.

It was found that trade and investment barriers across the
APEC region fell from 16.6 percent in 1988 to 6.4 percent in
2004. Foreign direct investment inflow increased by more than 50
percent, while outflow more than doubled.

Furthermore APEC economies have also come closer to attaining
the UN Millennium Development Goals than other nations.

According to independent experts commissioned by APEC to
review its progress, Indonesia has passed the halfway mark on the
road to achieving the Bogor Goals, and in some cases has gone
beyond the World Trade Organization (WTO) commitments.

Unquestionably, progress has been made, but many difficult
questions remain unanswered.

First, barriers remain in key sectors, particularly in
textiles, clothing and footwear, motor vehicles and agriculture.
These sectors are the most labor-intensive ones, and agriculture
represents a politically sensitive industry.

Second, for the high-income APEC economies striving to meet
the 2010 deadline, a crucial issue here is whether they will be
able to address a number of lingering issues, i.e. sectors with
significant levels of protection.

Third, although APEC has proved to be helpful in shaping
constructive responses to issues such as communicable diseases
and terrorism, on the other hand, such engagements have to draw
upon APEC's limited resources. APEC, by its original design, was
intended as an economic forum. Policy consultations extending
beyond the economic field, however relevant they are to the
current world situation, divert the focus of APEC from its core
business.

The APEC Ministers Responsible for Trade (MRT) recently
concluded a meeting on Jeju Island, Korea, with the main agenda
of ensuring APEC's continued support for the WTO/Doha Development
Agenda (DDA) round of negotiations and to review the progress
made toward the Bogor Goals.

The former agenda is the key to attaining the Bogor goals,
particularly to resolving difficult and sensitive issues that
cannot solely be addressed through APEC. Whilst the latter
ensures that APEC is indeed on the right track and recommends a
number of adjustments as necessary.

Accordingly, it is fitting that APEC's theme for 2005 is "to
meet the challenge and make the change."

One of the priorities for this year is to take stock of
achievements made in the fields of liberalization and
facilitation as well as the difficulties in realizing them.

APEC is on the right path and can be proud of its achievements
thus far. Nevertheless, APEC should remain cautiously optimistic.

The writers are officials at the Directorate of Asia-Pacific
and African Intra-Regional Cooperation at the Indonesian Foreign
Ministry. The views expressed in this article are solely those of
the authors and do not necessarily reflect the views of the
ministry.