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The Asia-Pacific Economic Integration Forebodes a Bright Future

2016/11/16

(Zhang Jun, Director-General of the Department of International Economic Affairs at Ministry of Foreign Affairs,PRC South China Morning Post,16 November 2016)

The APEC Economic Leaders shall meet in Lima, Peru on November 19 and 20 to work on programs of vital importance, namely the economic cooperation in the Asia-Pacific. With both economic globalization and regional economic integration at a critical juncture, the forthcoming meeting has been the focus of attention from various parties.

Today, Brexit and the rising populism have given rise to the voices of “anti-globalization”. With protectionism on the rise, trade and investment are losing momentum as a driving force of economic globalization. Under such circumstances, where should the regional economic integration of the Asia-Pacific be heading for? How shall we avert the risks of the economic globalization running in reverse gear? As the most important institution for economic cooperation in the Asia-Pacific, how should APEC play its leading role?

The difficulties arising from economic globalization and regional economic integration should not be denied. However, in the long run, economic globalization will not stop here. Rather, it will gear up and enter into a new stage. As a region with the greatest development potential and vitality in the world, the general trend of the Asia-Pacific regional economic integration has remained unchanged and still holds a bright future.

The development of economic globalization has bonded various economies increasingly closer. Opening-up makes for progress while enclosure leads to backwardness. As trade and investment cooperation is no zero-sum game, various economies are all beneficiaries therefrom on the whole. At the G20 Summit held in Hangzhou in September, various parties unanimously committed themselves to continuing their efforts for building an open world economy, opposing protectionism and promoting global trade and investment. At the same time, they have also ensured that the economic growth in the economically globalized world should provide opportunities to benefit more people and, thus, gain the universal public support. As the most vigorous region for growth in the world, the Asia-Pacific is obliged to hold high the banner of promoting inclusive economic globalization.

APEC came into being towards the end of the cold war and the rise of the economic globalization with the regional economic integration as its soul and unfading theme. APEC will have no excuse but to brave the waves of anti-globalization as the flagship. Going along with the trends of the development in the past 27 years since its inception, APEC has committed itself to leading the economic globalization and deepening regional economic integration. APEC has promoted regional trade and investment liberalization and facilitation through advancing and enforcing the Bogor Goals, thus leading to an initial formation of a common Asia-Pacific market. APEC’s grand objective to establish a Free Trade Area of the Asia-Pacific (FTAAP) has ushered in a new era of regional economic integration. APEC has laid a solid foundation for integration through advocating cooperation in physical, institutional and people-to-people connectivities and issuing of the APEC Business Travel Cards (ABTC). APEC has supported the Multilateral Trading System, committed to relinquishing any new trade and investment barriers and opposed protectionism in whatever forms. APEC has taken a positive role in leading the world economic advances through promoting cooperation in global value chains and supply chains, concluding the Information Technology Agreement (ITA), pushing for the list of environmental goods and focusing on the next generation trade and investment issues.

APEC has featured sufficient diversity as a regional organization by gathering major developed and developing members at the same time with different stages of development and at various levels of opening in the Asia-Pacific. Refraining from resorting to negotiations and sovereignty transfer, APEC has carried forward its agenda by way of voluntary and non-binding cooperation featuring consultative consensus through a bottom-up and step-by-step approach. Respecting the special needs of its members, nurturing the communal consciousness and awareness of being locked in a community with shared destiny in the Asia-Pacific, and maintaining a favorable and harmonious environment for cooperation, APEC has made itself a role model in regional economic integration jointly promoted by economies at vastly different stages of development. APEC is committed to common development through vigorous implementation of economic and technical cooperation and assistance to developing members in capacity building so as to ensure that no party is left behind by the tide of economic globalization.

APEC will capitalize on the opportunity of the Lima meetings this year to push forward the FTAAP process in a comprehensive and systemic way. The process of FTAAP shall serve as a rebuff to anti-globalization and a toolkit to strengthen Asia-Pacific regional integration. On the one hand, FTAAP, being highly inclusive, can embrace economies at different levels of development and fully accommodate their development needs and comfortability, and once established, will deliver economic gains dwarfing any existing regional FTAs. On the other hand, FTAAP will chart the course of integrating various trade arrangements in the region, meeting the challenge of the fragmentation in regional cooperation, and furthering the regional economic integration in the Asia-Pacific.

In face of the grim situation that the growth of global trade in 2016 may drop to a new low since the 2008 financial crisis, various parties in the Asia-Pacific hold high expectations on the significance of FTAAP to maintain the economic development and steady economic growth. A recent survey by an internationally renowned think-tank among relevant leaders of major economies in the Asia-Pacific region has shown that 80% of the surveyed maintained that the FTAAP should be initiated as early as possible so as to help lift the Asia-Pacific economy out of difficulties

Along with the world economic development and convergence, approaches to regional economic integration are no longer limited to trade and investment liberalization and facilitation. Connectivity has become another key driver. As a Chinese saying goes, build road first if you want to become rich. This suffices to illustrate the significance of connectivity to economic development and trade promotion. The APEC Connectivity Blueprint for 2015-2025 adopted at the Beijing APEC Economic Leaders meeting in 2014, established the visionary goal of building a seamless and comprehensively connected and integrated Asia-Pacific. At present, with the implementation of the Blueprint in full swing, positive progress has been achieved in the physical, institutional and people-to-people connectivity. APEC will avail itself of the opportunity of holding the meetings in Latin America to deepen the inclusive participation by the economies along both sides of the Pacific to strengthen the implementation of the Blueprint and beef up connectivity cooperation in depth and breadth.

We have reasons to believe that the flagship of the Asia-Pacific economic integration will embark on a course of smooth sailing towards common development, prosperity and progress of the Asia-Pacific. China stands ready to work together with various parties concerned and will contribute its share to the building of an open Asia-Pacific economy, and the realization of the “Asia-Pacific dream” of common development, prosperity and progress.

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