International Economic Cooperation: Asia Pacific Economic Cooperation (APEC)
The APEC forum was established in 1989 to take advantage of the growing interdependence among Asia-Pacific economies, to facilitate economic growth for all participants and to enhance a sense of community. It aims to improve regional trade and economic performance and linkages for the prosperity of the people in the region.
In 2020, APEC launched the Putrajaya Vision 2040, an inspiration for a more open, dynamic, resilient, and peaceful Asia-Pacific community in the next 20 years. This new vision replaces the Bogor Goals that was announced in 1994 when APEC Leaders met in Bogor, Indonesia and adopted for the long-term goal of free and open trade and investment in the region.
APEC operates based on non-binding commitments. Unlike the World Trade Organization (WTO) or other multilateral trade bodies, APEC has no treaty obligations required of its participants. Commitments made under the APEC are undertaken on a voluntary basis.
APEC’s primary goal is to support sustainable economic growth and prosperity in the Asia-Pacific region. It is driven to build a dynamic and harmonious Asia-Pacific community by championing free and open trade and investment, promoting and accelerating regional economic integration, encouraging economic and technical cooperation, enhancing human security, and facilitating a favorable and sustainable business environment. APEC works in three broad areas to meet its overarching goals:
Trade and investment liberalization. APEC aims to reduce and eventually eliminate tariff and non-tariff barriers to trade and investment. Thus, APEC focuses on opening markets to increase trade and investment among economies, resulting in economic growth for APEC Member Economies and increased standards of living for all. This goal is also furthered by APEC's Regional Economic Integration agenda, which includes work on model measures for bilateral and regional trade agreements and an examination of the prospects for a Free Trade Area of the Asia-Pacific.
Business facilitation. This is aimed at reducing business and trade transaction costs. The reduction in the production costs leads to an increase in trade, investments, and business opportunities for the primary reason that goods and services become cheaper. This could result in more employment opportunities which contribute to the overall improvement in one’s economy.
Economic and Technical Cooperation (ECOTECH). ECOTECH provides training and cooperation to build capacities in all APEC Member Economies to take advantage of global trade. This area builds capacity at the institutional and personal level to assist APEC Member Economies and its people gain the necessary skills to meet their economic potential.
APEC has 21 member economies considering that the APEC cooperative process is predominantly concerned with trade and economic issues whereby members engage with one another as economic entities.
|Australia||1989||United States of America||1989|
|Brunei Darussalam||1989||Chinese Taipei||1991|
|Indonesia||1989||People's Republic of China||1991|
|Republic of Korea||1989||Papua New Guinea||1993|
|Thailand||1989|| || |
Public Awareness Campaigns. The BSP initiated outreach programs and continues to raise awareness on ASEAN and ASEAN integration, including the process and status of integration, benefits, and risks. The BSP conducts presentations in various symposiums and forums, provides inputs to news articles and publications, and participates in media interviews, on ASEAN financial integration issues.
APEC is guided by meetings of Economic Leaders for policy direction. Day-to-day management of most of APEC is overseen by Senior Officials from 21 member economies who collectively meet regularly at the Senior Officials’ Meeting (SOM). APEC has a Secretariat based in Singapore, headed by an Executive Director, which supports the operation of the organization. It also has a Policy Support Unit that provides economic research.
As a non-donor organization, APEC activities are centrally funded by annual contributions from member economies approximately totaling US$5 million. Member economies also provide voluntary contributions to support projects that advance APEC’s trade and investment liberalization and facilitation goals and to meet capacity-building needs.
The Philippines has been a member of APEC since November 1989. Under the Philippines’ APEC hosting in 2015, a major initiative under the Finance Ministers’ Process (FMP), led by the Department of Finance (DOF), is the Cebu Action Plan (CAP) which was launched on 11 September 2015 in Mactan, Cebu.
Proposed by the DOF as chair of the APEC FMP, the CAP is a multi-year plan which outlines the Philippines’ priorities and deliverables as host for 2015 under the FMP theme “Building Inclusive Economies, the Road to Financial Resilience”. Essentially, the CAP seeks to bring APEC economies towards harmonized or coordinated policies, rules and practices to support strong, sustainable, inclusive, and balanced growth throughout the region, and to pave the way for:
- Facilitating trade and investments in the region;
- Pursuing good governance and sound fiscal policies;
- Deepening financial markets that offer diversified financial instruments; advancing financial inclusion for all households and businesses (including those led by women); and enhancing financial resilience to global market volatility and natural disasters; and
- Mobilizing more financing for quality infrastructure development to sustain growth.
The Philippine APEC Study Center Network (PASCN), based in the Philippine Institute for Development Studies (PIDS), conducts research on APEC matters in collaboration with member institutions comprising academic and research institutions in the country.
The BSP participates in APEC through the FMP led by the DOF. In particular, the BSP attends policy dialogues and meetings, such as the Senior Finance Officials’ Meeting (SFOM) and Finance and Central Bank Deputies Meeting (FCBDM). The BSP also actively participates in interagency meetings to discuss national efforts towards APEC initiatives such as structural reform, trade and investment programs, and measures to address the global financial crisis, among others. The BSP likewise proposes project concept notes on topics that are aligned with its policy agenda, as well as participates in workshop with APEC member economies as proponents and virtual working groups.
The BSP also provides inputs and comments on various APEC initiatives, including but not limited to, the Philippine Individual Action Plan (IAP)1, CAP's deliverables under Pillar 1: Promoting Financial Integration, particularly on promoting an enabling financing environment for micro, small and medium enterprises (MSMEs), expanding financial inclusion and literacy, Financial Services Liberalization, and Capital Account Liberalization.
1The IAP is a report that records the actions taken in realizing the APEC Bogor Goals of free and open trade and investment in the APEC region by 2020 for developing economies. These actions were undertaken by APEC member economies on a voluntary and non-binding basis.