Speech
10 November 2009, Singapore
Moving the APEC agenda forward: Defining its role in the region’s future
Introduction
Thank you very much, Tommy [Koh], for that introduction.
And thank you, Foreign Minister George Yeo, our APEC host, for inviting me to participate in this APEC 20th Anniversary Symposium.
Australia and Singapore have a strong, broad-based relationship based on our historical ties, similar strategic outlook and our contemporary, active roles in the Asia-Pacific.
Our relationship is an example of natural economic partnership in the region: Singapore is Australia’s fourth-largest trading partner, with total two-way trade valued at over $30 billion in 2008.
The Singapore-Australia Free Trade Agreement (FTA) is one of Australia’s most comprehensive FTAs.
In the APEC context we are both founding members and are both among its most committed proponents.
APEC reflects the active role that Australia has played in the region.
Australia has been present and played an important role at all stages of APEC’s development.
Australia has much to be proud of, both APEC’s initial establishment as a ministerial meeting in 1989, and in its elevation in 1993 to a Leaders-led organisation.
And of course, former Australian Prime Minister Bob Hawke – your previous presenter – was one of the key architects.
But we did not do this on our own. We worked closely with our friends in Asia and America, and later our friends in Latin America, to deliver prosperity to the region.
To address APEC’s role in the region’s future, I will first address how Australia sees our region, the Asia-Pacific.
This is the century of the Asia-Pacific. Economic, political, military and strategic influence is moving to the Asia-Pacific.
Some attribute it solely to the rise of China. Everyone sees the rise of China but the rise of India is still underappreciated, as is the rise of the ASEAN economies combined.
Some also seem implicitly to assume that the economic and strategic influence of the United States, the world’s largest economy and superpower, will somehow be eclipsed overnight.
And then there is Japan, still the second largest economy in the world and vital to peace and security and prosperity in our region.
With that context let’s look at the current Asia-Pacific architecture.
Since its foundation in 1967, as a group of five countries, ASEAN has become a hub of regional architecture.
Australia is a longstanding and strong supporter of ASEAN. In 1974, Australia became ASEAN’s first dialogue partner.
The stability, prosperity and regional cooperation ASEAN has fostered since its establishment is a singular achievement.
ASEAN works to accelerate economic growth, social progress and cultural development and to promote peace and stability in our region.
From it has grown the ASEAN Regional Forum, a forum of 27 participants, our region’s primary multilateral security forum, which first met in 1994.
The ‘ASEAN plus 3’ followed in 1997, and ASEAN plus 6, the East Asia Summit, in 2005.
APEC has also helped define the region.
APEC is an important trans-Pacific bridge, reflected by the fact that the Chilean Foreign Minister Fernandez is part of this panel and that we all travelled to Peru for the 2008 APEC Ministerial Meeting.
Australia regards APEC as the pre-eminent regional institution for our regional economic engagement and a driving force for prosperity in our region.
During the 20 years since its first Ministerial Meeting of 12 Ministers it has brought together key economies on both sides of the Pacific to address trade, economic growth and prosperity.
Now a Leaders meeting, APEC has been vital to building consensus around open markets, trade and investment.
The practical effects are many. Average tariffs within APEC have fallen from 17 per cent in 1989 to around 5 per cent in 2008.
APEC has made business cheaper and easier by removing or streamlining processes that inhibit the movement of goods, services and business people across borders.
It is progressing mutual recognition of professional qualifications such as the law.
The APEC Business Advisory Council has given regional business leaders an important voice in APEC.
It is clear that the developed economies of APEC will be able to report next year, as they undertook in the Bogor Declaration of 1994, that they have substantially achieved free and open trade.
APEC’s strength is that it provides a forum for high-level engagement by Leaders and Ministers about wider issues affecting our region.
It can help build a regional consensus on issues such as climate change, regional architecture, and disaster preparedness.
Historically, APEC Leaders have responded positively and constructively to: events in East Timor in 1999, by galvanising a cooperative regional and international response; the September 11, 2001 terrorist attacks, by cooperating on counter terrorism; SARS, avian influenza and the devastating Indian Ocean tsunami, by helping to develop emergency preparedness systems.
APEC’s Future
APEC must now show that it can still deliver.
APEC is in many ways a reflection of its evolution in terms of its agenda, its membership and its structures.
Twenty years on, APEC is making the natural and appropriate shift from “at-the-border” to “behind-the-border” issues.
This is important today and will be increasingly important in the years ahead.
APEC must look at ways it can play a role in implementing the G20 commitments.
To remain credible and relevant, it must make a meaningful response to the global economic crisis.
It must also reflect the changed nature of trade and investment in the region in recent years.
APEC is well placed to reinforce the G20’s agenda, and help entrench good economic policy globally, particularly in terms of structural reform to achieve balanced growth.
The links are natural: nine G20 members are also in APEC and APEC was an observer at the G20 Pittsburgh Summit.
APEC and the G20 have shared goal of economic growth and stability. Making them work together will be good for both organisations, good for the Asia-Pacific region, and good for the global economy.
APEC faces opportunities and challenges in 2010 when the current membership moratorium is due to expire.
APEC’s current membership does not reflect economic and strategic changes, above all the rise of India.
It’s no secret that Australia believes that India must be involved. India’s strategic and economic weight makes it a natural partner.
India’s membership would help ensure that APEC remains relevant to contemporary and emerging economic realities.
But the lifting of the moratorium also raises the question of how wide its membership should be expanded. Clearly, the more compact the organisation is, the more effective it will be. We must ask ourselves whether it would be in APEC’s interest to expand by a number of economies to include India?
This issue will require a great deal of thought and careful deliberation. Australia is willing to play its part in this discussion
Institutionally, APEC has 17 ad hoc or regular ministerial processes, and some 37 senior officials meetings, committees, working groups, task forces and industry dialogues.
These cover everything from marine conservation and life sciences innovation to market access and services, to counter-terrorism and emergency preparedness.
In APEC we often talk about economic integration, but we should also ask whether APEC’s structures are integrated to maximise APEC’s approach and achieve its highest priorities.
Australia is particularly keen to see finance issues better integrated as part of APEC’s core agenda.
We would like to see finance and economic ministers play a greater role as APEC’s work on inclusive growth and structural reform expands, and as regional economic integration work focuses increasingly on regulatory issues.
APEC must also make better use of the participation of foreign ministers.
Asia Pacific community
APEC arose from a vision twenty years ago of our region’s economic future, so we should look to the next 20 years and ask how we might shape that future.
Australia asks whether the regional architecture is right to enable all the key Asia Pacific players to have a conversation in the same room at the same time, both about trade and investment, but also about peace, stability and security.
APEC and ASEAN will have central roles to play into the future.
But we have to recognise the gaps that exist in our regional architecture and think about how we might address them.
APEC brings together a broad range of Asia- Pacific countries but India’s absence means that it does not include all the key players relevant to the region’s economic prospects and future security.
Likewise, the EAS is an increasingly productive forum of key regional countries with the potential to play a significant role in building a strong East Asian community. However, the absence of the United States – a critical contributor to regional security – limits the EAS.
As the Asia Pacific century unfolds, where the region’s economic, security, strategic, political and military influence is much more prominent than it has been in the past, what should our region’s architecture look like?
This question, which Australia and others are asking, has some very positive and productive responses across the region.
Australia is hosting a one and half track dialogue in Sydney in early December, where we have invited academics and representatives and officials from all around the Asia Pacific.
We believe this will be a very positive step forward, a positive contribution to the debate.
We look forward to many of you from the region joining us there.
Thank you.