Immediately after the G20 summit in Seoul, President Dmitry Medvedev headed to Yokohama, Japan, for a meeting of the 21 nations of the Asia Pacific Economic Cooperation forum. APEC summits are nothing like G20 summits. The Group of Twenty leading economies come together to discuss how they can grow without harming one another, for example, by artificially driving down the value of their currencies. The annual summits of APEC are more like a holiday. They are purely ceremonial.
Where the WTO fails, APEC excels
APEC summits never produce unexpected results. They are never a scene of intense political clashes. Rather, they are meant only to give final approval to programs and ideas elaborated over the preceding year by APEC's complex and capable machinery. The annual summit is a way to generate publicity for APEC, to show that it is a serious organization that is accomplishing in the Asia-Pacific region what the European Union is struggling to accomplish in Europe.
APEC, like the EU, is building a common economic space. In Europe, the integration process involves developed nations adopting strict standards. In the Asia-Pacific region, however, countries like Canada are integrating with countries like Brunei and Vietnam, and all without any binding decisions. APEC is entirely voluntary.
Case in point: There is a very simple chart on APEC's website, which shows that the average customs tariff in the region stood at 16.9% in 1989. By 2008, it was down to 6.6%. While the benefits of this decline are clear to almost everyone now, many were apprehensive in the beginning that APEC could work. How can there be free trade between U.S. corporations and the Thai market?
In 1994, during a meeting in Bogor, Indonesia, APEC adopted the so-called Bogor Goals, which called for the establishment of a free trade zone in the Asia-Pacific region by 2010. This has not been achieved, as tariffs fall under the jurisdiction of the WTO. APEC has been contending with the suspicion its weak nations have of the stronger nations for 20 years now, and establishing a common space has always been the ultimate goal. Lowering tariffs has been a side issue.
Ideas and proposals
For anyone who has followed the work of APEC's commissions throughout the year, there is no doubt about the ideas that will find their way into the final documents of this year's summit. Here are some of the most interesting. The APEC Economic Committee has prepared a report on corporate governance, including issues such as shareholders' rights. The report contains no guidelines, but it provides good reference material for future deliberations on the effectiveness of various rules. The Senior Officials' Meeting has advised all member states to voluntarily extend the moratorium on increasing customs duties, which came into effect in 2008. At an October meeting of telecommunications and IT ministers in Okinawa, participants discussed the development of broadband infrastructure in such critical areas as education, healthcare, energy and environmental protection. Finally, a meeting on food security addressed the need to clamp down on speculators who sow panic on food markets.
APEC's machinery would function well without the annual summit. Without the summit, however, the organization's work would go unrecognized. The first order of business at the summit is to coordinate a joint statement. In Yokohama, finance ministers have already done this. The document includes a laundry list of 57 issues, among them food security and shareholders' rights, as I've mentioned. The document is essentially a short summary of APEC's progress over the year, which will take final shape in the decisions of the 21 governments... Well, not necessarily all of them. Again, APEC nations are free to choose which policies they will adopt. However, a neighbor's example could prove contagious.
APEC has proven that the Europeans' fondness for detailed and binding standards is not the only way for countries to integrate. To each his own.
Returning to APEC's machinery: After the finance ministers have laid the groundwork, the political leaders convene for the summit, where they adopt a shorter declaration, which contains more or less the same ideas. It will be called the new growth strategy for the Asia-Pacific region. Again, the strategy is based on ideas developed over the course of the preceding year.
The CEO Summit, a gathering of the region's top executives, is held at the same time as the APEC summit. Presidents and prime ministers sometimes address this summit as guest speakers. This is where new ideas are born. After Davos, it is perhaps the most important international forum. The CEO Summit generates the intellectual momentum that carries APEC through the next year.
Next year's summit will be held in the United States. The host city has yet to be determined. It will be held in Vladivostok a year later.
Hosting the summit is more than just a logistical challenge. Whether they like it or not, host countries have to come up with a big new idea for APEC that can be encapsulated in a catchy phrase in English. Japan's concept for 2010 was this: APEC has become the center of global economic growth, and as such it needs to improve conditions for businesses, develop a sustainable economic model based on technology and innovation, and ensure the security of individuals, in all senses of the word. These issues defined the conversation in APEC over the past year.
What will Russia propose? A modernization alliance in the Asia-Pacific region? And why not? This would certainly benefit all APEC nations. In fact, APEC is already working to modernize its weaker economies, which is evident from Japan's concept for 2010.
To become the intellectual leader of APEC, even for just a year, Russia will have to break out of its role as a peripheral, secondary country in the Asia-Pacific region. It will have to clearly define what it expects to gain from this region and what it expects to contribute. Russia's policy in the Asia-Pacific region has remained almost unchanged for the past decade. To be sure, issues like regional security and disaster relief are important. But now Russia needs to develop fresh ideas and revisit old ones. It will get its chance soon enough.
The views expressed in this article are the author's and do not necessarily represent those of RIA Novosti.
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