Asian Pacific Economic Cooperation (APEC)

Asian Pacific Economic Cooperation (APEC)
Asian Pacific Economic Cooperation (APEC)

APEC is an organization that aims to promote free trade and economic cooperation throughout the Asia Pacific region. It was created in 1989 because of the growing interdependence of Asia-Pacific economies and the establishment of regional economic blocs such as the European Union and the North American Free Trade Agreement.

APEC intends to improve living standards and education levels through sustainable economic growth and to promote a sense of community and an appreciation of common values among Asia-Pacific countries. APEC’s membership includes 21 states, called “member economies.”

Of these, 12 are founding members—Australia, Brunei, Canada, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and the United States— while Chile, China, Hong Kong, Mexico, Papua New Guinea, Peru, Russia, Taiwan, and Vietnam joined at a later phase. APEC has no treaty obligations of its participants.

Decisions made within APEC are reached by consensus, and commitments are undertaken on a voluntary basis. APEC’s membership accounts for approximately 40 percent of the world’s population, approximately 56 percent of world GDP, and about 48 percent of world trade.

The first APEC Leaders’ Meeting occurred in 1993 and was organized by Bill Clinton in Blake Island, Washington. At its 1994 summit meeting in Bogor, Indonesia, APEC set an ambitious schedule to achieve free trade and raise the level of investments throughout the Asia-Pacific region by 2010 for members with developed economies and by 2020 for members with developing ones.

The Osaka Action Agenda was adopted a year later and was designed to implement APEC’s goals of liberalizing trade and investment, facilitating business activities, and promoting economic and technical cooperation. The procedure that all APEC’s decisions had to be taken by consensus and preferably passed unanimously limited the effectiveness of APEC.

In addition, although decisions can be taken in the absence of unanimity, they are not legally binding on member governments. In 1997 at the annual summit in Vancouver, Canada, police forces violently clashed with demonstrators objecting to the presence of Indonesian president Suharto.

APEC is organized into numerous committees, special task commissions, working groups, and a business advisory council. The committees meet twice per year. The working groups are led by experts and consider specific issues, including energy, tourism, fishing, transportation, and telecommunications.

Every year one of the member economies hosts an economic leaders’ meeting, selected ministerial meetings, senior officials meetings, the APEC Business Advisory Council and the APEC Study Centres Consortium, and also fills the executive director position at the APEC secretariat.

The deputy executive director changes every year, as the position is given to a senior diplomat of the country who will be the APEC chair the following year. The APEC secretariat, established in 1993 and based in Singapore, provides coordination as well as technical and advisory support for all the organization’s initiatives.