The Asia-Pacific Economic Cooperation is not a multinational organization established to implement a binding multilateral treaty. Rather, APEC serves as an intergovernmental forum for facilitating economic growth, cooperation, trade and investment in the Asia-Pacific region. The group works to build consensus on free-trade practices through policy alignment and economic and technical cooperation.
Goals. APEC is essentially a mechanism for multilateral dialogue to promote free trade, and provide safety, security and efficiency in trade, in goods and services in the Asia-Pacific region. APEC summarizes it goals as follows:
Free and open trade and investment helps economies to grow, creates jobs and provides greater opportunities for international trade and investment. In contrast, protectionism keeps prices high and fosters inefficiencies in certain industries. Free and open trade helps to lower the costs of production and thus reduces the prices of goods and services – a direct benefit to all.
Scope. APEC has 21 members – referred to as “Member Economies” since they include Taiwan and Hong Kong – which account for approximately 40% of the world’s population, approximately 54% of world GDP and about 43% of world trade.
Member Economies. APEC’s 21 Member Economies are Australia; Brunei Darussalam; Canada; Chile; People’s Republic of China; Hong Kong, China; Indonesia; Japan; Republic of Korea; Malaysia; Mexico; New Zealand; Papua New Guinea; Peru; The Republic of the Philippines; The Russian Federation; Singapore; Chinese Taipei; Thailand; United States of America; Viet Nam.
Role in Developing Governmental Infrastructure for Global Sourcing. While other multilateral organizations (such as the EU and the WTO) enforce binding conventions, the APEC role is more limited. It therefore does not become a source of binding law imposing compliance requirements on governments or participants in global trade in goods or services.
Rather, it funds projects, which may be implemented by the private sector, universities and government, for information exchange to assist business with trade and investment and for providing information technology training in developing economies. The form of such projects may include seminars and symposium, short-term training courses, surveys or analysis and research and development of databases and public websites. Such projects have included:
- a capacity-building project to strengthen the economic legal infrastructure in the Asian Pacific Region. Viet Nam has been a major beneficiary of such capacity building, where APEC helped it move forward to market-oriented economic reform.
- A project to train governments on progressive liberalization of trade regulation in the services economy, since such trade accelerates economic integration and economic development.
Role in Global Outsourcing. APEC has no direct impact on the contract law or other regulation of trade in services. However, it promotes trade in services through development of legal regulatory frameworks that enable reliance by the parties on legally enforceable rights in trade and investment.
Further reading:
APEC website: www.apec.org