APEC Virtual Meet | 21 Nov 2020
Why in News
Recently, a virtual meeting of the 21-member Asia-Pacific Economic Cooperation (APEC) forum was held.
- The meeting was hosted by Malaysia. New Zealand will also host next year's APEC meetings virtually due to the pandemic.
Key Points
- With growth in the Asia-Pacific region expected to decline by 2.7% this year, from a 3.6% growth in 2019, APEC's focus was on accelerating economic recovery and developing an affordable vaccine.
- Focus Areas: Trade and investment, Digital Economy and Technology, Structural Reform, Economic and Technical Cooperation and Thematic and institutional matters.
- APEC leaders adopted the Putrajaya Vision 2040, a new 20-year growth vision to replace the Bogor Goals named after the Indonesian town where leaders agreed in 1994 to free and open trade and investment.
- Recognised the importance of a free, open, fair, non-discriminatory, transparent and predictable trade and investment environment to drive economic recovery at such a challenging time (Covid-19).
- Discussed the Free Trade Area of the Asia-Pacific (FTAAP) agenda and the APEC Internet and Digital Economy Roadmap (AIDER).
- China has become the main driving force behind the grouping after the United States began withdrawing from multilateral bodies during Trump's presidency.
- But Trump made the surprise decision to take part in this year's event, after not participating at APEC since 2017.
- China’s Stand:
- It vowed to keep its “super-sized” economy open for business and warned against protectionism as the world battles the Covid-19 pandemic. It needs to be noted that Trump’s "America First" policy has alienated trading partners.
- After the signing of the world’s largest trade pact ‘Regional Comprehensive Economic Partnership (RCEP)’, China is trying to set the agenda for global commerce.
- Although China is promoting openness in trade, its own actions go against it, for example:
- Australian exports of beef, wine and barley to China, their biggest market, have been restricted.
- It vowed to keep its “super-sized” economy open for business and warned against protectionism as the world battles the Covid-19 pandemic. It needs to be noted that Trump’s "America First" policy has alienated trading partners.
Asia-Pacific Economic Cooperation
- Established: 1989
- Members: 21
- India is not a Member.
- Member Nations: Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, Philippines, Russia, Singapore, Chinese Taipei, Thailand, Vietnam and the United States.
- Its 21 member economies are home to around 2.8 billion people and represented approximately 59% of world GDP and 49% of world trade in 2015.
India and APEC
- India had requested membership in APEC, and received initial support from the United States, Japan, Australia and Papua New Guinea. Officials have decided not to allow India to join as India does not border the Pacific Ocean, which all current members do.
- India was invited to be an observer for the first time in November 2011.
- Reasons for India to join APEC:
- India will be more integrated with the global economy since APEC economies constitute an important trading bloc in the world.
- It will help India bargain and negotiate a better deal with the countries of the Asia-Pacific region.
- Expected Benefits to APEC:
- In India, APEC will find an alternate market for labour, consumers and investments, and an additional counterweight to help check unilateral economic ambitions in the region.
- It will also help APEC embrace some notion of ‘Indo-Pacific’ and give it a renewed purpose in a renewed 21st century.