Dodwell in iSOM Jakarta - Post 5

December 07, 2012

After bludgeoning our way painfully through Jakarta’s teeming streets to meet with the Indonesian Foreign Minister at the historic Gedung Pancasila, the APEC bus cavalcade finally got back to the JW Marriott, home of all of the iSOM discussions, in time to start the day’s meetings at 10.00. The task ahead: to review in detail the three priorities for 2013 laid out in the Symposium the day before – getting the Bogor Goals done; sustainable and inclusive growth; and improving connectivity. Over the next four hours and in three separate sessions, these three priority areas were laid out and debated in detail in three separate sessions.

Bogor Goals: our Indonesian officials surprised many in Thursday’s symposium by arguing that, while we still needed to strive for the Bogor Goals, these were not enough; that much had changed in the region since the Bogor Goals were drawn up in 1994, and that a new initiative was needed to embrace this change; that a “Bali Blueprint for 2030” should be drawn up for leaders in October 2013 that addressed the behind-the border barriers to trade and investment, regulatory coherence, supply chain efficiency; that this blueprint should strive not just to reduce barriers to trade, but to move towards regional integration.

While most of the Senior Officials strongly endorsed Indonesia’s message of change, and shared their interest in borrowing best practice from ASEAN, there was surprising but substantial push-back on the need to lift eyes to the 2030 horizon. At least five substantial economies argued that we should do nothing to divert attention from achieving the Bogor Goals, and that the framework provided by the Bogor declaration gave leeway to address freely the “next generation” challenges beyond a mere reduction of border barriers to trade and investment. In light of such strong push-back, Indonesia may be hard-pressed to deliver on their “Bali Blueprint for 2030” idea.

During this discussion it became clear that 2013 could provide a rare opportunity to link regional and multilateral trade liberalization agendas: apparently, SOM2 in Surabaya will be held alongside a meeting of Ministers Responsible for Trade, and will lead to Bali hosting in December 2013 the WTO’s 9th Ministerial Conference aimed at securing a Doha Round agreement. Nobody in the room was suggesting that life was about to be breathed back into the Doha Round, but officials seemed attracted to the idea that this unusual convergence might enable APEC to extend its sights beyond purely regional initiatives, and put its work into a global context. Ideas seem embryonic so far, but for sure some interesting developments are simmering.

Sustainable Growth with Equity: this is intended to focus on four distinct areas: SMEs, Food Security, Financial inclusion, and Health, with elaborate action agendas laid out in all of these areas. Interesting details emerged in all areas:

  • The SME agenda is to be mixed with development of APEC’s women’s agenda, with a joint Ministerial planned for Bali in September.

  • The still-fragile Policy Partnership on Food Security is tasked to focus on the “blue economy” – sustainable development of our marine resources n their many forms – and on aligning farmers with the aims of achieving food security by 2020.

  • The Health agenda – which has barely ever attracted any attention from ABAC – is intended to focus on health financing, and the productivity benefits of maintaining a healthy workforce. There would be merit in ABAC devoting some thought to this area of important issues.

  • Financial inclusion is intended to reach into four areas: creditworthiness; financial education; access to finance; and financial regulation. ABAC has done interesting work in this area, but the Indonesian framework suggests we might take a fresh look at these aspects, and perhaps develop our ABAC work on financial inclusion.

Connectivity: Indonesia proposed focusing on three areas: physical infrastructure; education; and emergency preparedness. ABAC of course emphatically shares concern over the need to create a more encouraging framework for private sector investment in building public infrastructure – hence the creation of the Asia Pacific Infrastructure Partnership – but what was shocking out of this week’s Jakarta meetings was how widespread official ignorance was over ABAC’s APIP initiative. Much education is going to be needed.

Over the course of this long and detailed discussion, ABAC was able to engage energetically, with business inputs on a number of issues: Indonesia’s APEC hosts were encouraged to look to best-practice insights that can be drawn from ASEAN, emphasizing the potential value of APEC building on ABAC’s infrastructure funding task force initiative (APIP) to augment private sector engagement in infrastructure-building. ABAC expressed concern over the still-low priority being given to services liberalization, but won encouraging support from APEC members on the value of giving priority to liberalization in this area. John Larkin, the incoming chair of the Committee on Trade and Industry (which oversees the Group on Services) was in particular encouraging on liberalizing services trade, and met separately at the end of the day with ABAC members to explore possible 2013 initiatives. ABAC also emphasized its interest in – and concern over the appropriate development of our new “public-private” initiatives – the PPFS on food security, the PPSTI on innovation, and the Asia Pacific Financial Forum intended to facilitate growth of Asia’s capital markets.

Perhaps most important of all, ABAC was given the opportunity to present to senior officials on the Global Data Standards initiative first discussed in Kazan. The presentation was well received, and endorsed by a number of senior officials. ABAC has been tasked to flesh out its proposals and bring them for detailed consideration to the CTI meeting at SOM1 early in February 2013.

Last, but certainly not least, Peru’s energetic senior official made an almost passionate appeal for ABAC to engage with Ministers in a dialogue specifically on the Bogor Goals. In many respects, since a large proportion of ABAC’s energy is focused on initiatives linked with achieving the Bogor Goals, there must be questions about what such a Dialogue would achieve, but the appeal was so passionate and so specific that it must certainly receive detailed consideration.

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