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APEC pursues new approaches to reignite FTAAP

Antara | 7 March 2024

APEC pursues new approaches to reignite FTAAP

Jakarta (ANTARA) - APEC member economies are considering innovative and improved approaches to revitalize the Free-Trade Area of the Asia-Pacific (FTAAP) as a major instrument to further APEC’s regional economic integration agenda.

The FTAAP was envisioned by APEC Leaders in 2006 as a comprehensive free trade agreement built on regional undertakings. It was originally proposed by the APEC Business Advisory Council (ABAC) 20 years ago.

As host of APEC 2024, Peru is taking the lead to advance this agenda through a series of dialogues in which member economies will have the opportunity to share their views on how to reignite the FTAAP as a collective effort, envisioning a new vision—for how it may take shape, as noted in a written statement issued by the APEC Committee on Trade and Investment, received here on Thursday.

“Now as we came out of the pandemic, challenges, such as supply chain disruptions and economic fragmentation, persist and have put into question the viability of interconnected trade as an enabler for sustainable development,” Renato Reyes, Peru senior official for APEC, stated at a dialogue held in Lima.

“We feel there is a need to reset our approach to FTAAP as a collective aspiration, especially as we aim to make trade a relevant tool to foster social inclusion and sustainability,” Reyes added.

The dialogue, co-chaired by Peru and Australia, encouraged economies to update the list of what is called next-generation trade and investment issues, such as food security, corporate social responsibility, women, environment, and labor.

“Most of these next-generation issues have now become present-generation issues,” Reyes stated.

“There is a need for FTAAP to now factor in emerging challenges, such as economic fragmentation, protectionism, new subregional trade arrangements, and the evolution of all related political conversations that are taking place outside APEC, such as climate change discussions," he remarked.

Member economies shared their priorities for FTAAP and called for more focus on inclusivity in APEC’s trade work that includes gender equality, women’s economic empowerment, opportunities for indigenous people, opportunities for micro, small, and medium enterprises (MSMEs) and integrating them more into the global supply chains.

Sustainability and trade policy is another recurring theme in which member economies are keen to see more work, with some calling for the inclusion of corporate social responsibility and the need to embrace the opportunities presented by digital technologies and the digitalization of trade.

Providing insights to the dialogue, Alex Parle from ABAC highlighted how economies have experienced more than a decade of slow growth and more recently, severe disruptions to trade, as well as increasing pressures for economic fragmentation and economies turning inward.

“Given all of this, there has never been a more compelling need for FTAAP, as both have a shared aspiration and as a practical mechanism to deepen and broaden economic integration,” Parle affirmed.

"The deadline for FTAAP is 2040 but given current challenges, our businesses, our communities, and our planet do not have the luxury of waiting another 16 years for everything to fall into place," he added.

Recommendations from ABAC include identifying impediments to full free trade agreement (FTA) utilization and possible solutions, enabling more effective implementation and utilization supported by professional secretariat function, making use of the dispute settlement mechanisms of those agreements to ensure the rulebook is binding and enforceable, and leveraging other economic integration initiatives to help build a framework of rules and policies that are agile, responsive, and fit for purpose.

“We are committed to ensuring that goods, services, investment, and people move easily across borders by reducing impediments to trade and investment,” Chair of the APEC Committee on Trade and Investment Christopher Tan remarked.

“There are challenges and pressures around all of our economy, and it is important for us to share our views to advance the FTAAP agenda, at the same time staying true to our fundamentals, that is supporting the rules-based trading system and the World Trade Organization, supporting a more interconnected trading system as well as embracing APEC’s unique role as an incubator of ideas,” Tan concluded.

 source: Antara