The importance of APEC in the region

By Hadi Soesastro

JAKARTA (JP): Asia Pacific Economic Cooperation is a major experiment and it should be seen as such. A failure to appreciate this could jeopardize the still fragile process of community building in the Asia Pacific region.

This diverse region has no strong tradition of regionalism and only has had a short experience in developing a sense of regional identity. That is why, it still needs careful nurturing and cannot be taken for granted. At this stage APEC should be developed primarily to promote a sense of regional identity through confidence building. It should not be used as an instrument of economic diplomacy vis-a-vis other regions such as Europe. It should also not be used for domestic political purposes.

APEC has gone a long way in just five years. The view that APEC is only a talk shop is certainly wrong. But even if it were so, the very fact that this diverse group of countries comes together regularly is a major achievement. APEC is not yet a full-fledged organization in the traditional sense, but is already an institution to promote economic cooperation in the region.

The degree of APEC's institutionalization will continue to grow in accordance with the need. The past five years have shown that APEC members have been very pragmatic on this issue. And yet, it is felt in some quarters that unless participants agree on a blueprint or framework for APEC's institutional development, this process will not progress. This has not been ASEAN's experience.

There is the question of whether this process will be sustainable. The answer is a definite yes, because of APEC's importance and because there is no substitute for APEC. If APEC did not exist it would be in the interest of regional countries to form APEC. This has been the Pacific Economic Cooperation Council's view since the mid 1980s, if not earlier. From a regional perspective, APEC should be seen as an important -- perhaps the most important -- pillar of the regional architecture for peace and prosperity. Here lies its strategic importance. It is this pillar that is being built and strengthened.

Another pillar is the regional process in the political and security field which has recently been created in the form of the ASEAN Regional Forum (ARF). In addition to these inter- governmental processes there are other non-governmental efforts, the so-called "second track", such as PECC, PBEC (Pacific Basin Economic Council) and CSCAP (Council for Security Cooperation in the Asia Pacific Region), which could contribute to the creation of a meaningful regional architecture. Of these various efforts, APEC is the first inter-governmental experiment. Therefore, its success is crucial to community building in the region. In this region, processes appear to be more important than structures. The past five years have shown that the APEC process can produce substance.

The likelihood that an APEC economic leaders meeting will take place annually also adds to the sustainability and substance of the process. These informal APEC leaders meetings are not yet a part of the APEC process. The highest body in the APEC process is the APEC Ministers Meeting. However, as the Seattle leaders meeting has shown, the vision and ideas that emanate from the leaders meetings are likely to have a significant influence on APEC's development. Being outside the proper structure the leaders can be bold. But perhaps, leaders should also be discreet in airing and proposing initiatives during the leaders meeting itself. It would not help the process if ideas and counter-ideas are prematurely announced because leaders' statements will be taken seriously.

The creation of a group of independent personalities, such as the Eminent Persons Group (EPG) and the Pacific Business Forum (PBF), serves an important function in APEC's process. Such groups can produce even bolder ideas that can be openly and squarely discussed among the wider public. Both the EPG and the PBF have proposed the vision of free trade in the region to be achieved over a certain period in the not too distant future. It is likely that this vision will be endorsed by APEC Ministers and Leaders in their meeting in Indonesia. This is clearly a significant leap forward in APEC's development.

The next logical step is to begin to define what "free trade in the region" means and the modality for its achievement. It should be remembered, however, that APEC's strategic importance lies in its contribution to regional peace and prosperity. Free trade in the region is one means to that end and is not the end in itself. The task of defining modalities for regional cooperation, including the achievement of APEC's vision of free and open trade and investment in the region, is in itself an important part of the APEC process. This also should not be overlooked. It is imperative that the public actively participate in this effort because APEC is too important to be left to governments alone.