The Asia Pacific Economic Cooperation (APEC) Ministers Responsible for Trade have highlighted the need for “specific focus” on the economic challenges resulting from COVID-19.
Key points:
- APEC regional growth down 2.7 per cent, regional economic loss of $3.2 trillion
- Specific focus needed on economic challenges stemming from COVID-19, particularly vulnerable developing economies;
- Transformational economic disruption will need greater development of digital economy; and
- Working to keep trading links open and increase resilience of supply chains.
In a statement after a sectoral meeting, APEC trade ministers said they recognised the unprecedented challenges posed by the COVID-19 pandemic and that the health and economic crises would have long-term adverse repercussions. It had particular concern for the impact on vulnerable developing economies.
“We acknowledge that while halting the spread of COVID-19 currently remains the top priority of every economy, remedying the economic challenges must also be accorded a specific focus.
The trade ministers said while seeing to mitigate the pandemic’s impact on international trade and investment, the economic disruption has been transformational.
“We recognise the importance of keeping our markets open and working together to deliver a free, fair, non-discriminatory, transparent, predictable and stable trade and investment environment, to ensure that trade and investment continue to flow in these trying times,” the statement said.
But how business is carried out will change, it said.
“Harnessing the opportunities of the digital economy and technologies, through utilisation of smart working solutions that enable seamless international business and cross border trade, is essential to alleviate the wide-range impact of the pandemic and further advance economic growth, as we embrace the future.”
$3.2 trillion loss
Last month, APEC Secretariat executive director Dr Rebecca Starts Maria said: “A crisis of unprecedented severity calls for a response of unprecedented scale”.
APEC said the region’s growth was expected to decline by 2.7 per cent, compared to 3.6 per cent growth in 2019. It will be the most significant drop since the near-zero growth rate recorded in 2009 during the global financial crisis.
That translates to an estimated loss of US$2.1 trillion (AU$3.26 trillion) due to the economic fallout from the pandemic, compounded by an additional 23 million people becoming unemployed in 2020.
It projects an economic rebound in 2021, with anticipated growth of 6.3 per cent, higher than the projected global economic growth of 5.8 per cent. But that is conditional on the effectiveness of member states’ containment mechanisms, it said.
The trade ministers said APEC would work to “facilitate the flow of essential goods and services to fight the pandemic including medicines, medical supplies and equipment, agriculture and food products and other supplies across borders, and minimise disruptions to the global supply chains.
“We will also ensure that trading links remain open and explore ways to facilitate essential movement of people across borders, without undermining the efforts to prevent the spread of the virus… We will work closely to identify and resolve any unnecessary barriers to trade.”
The ministers said returning workers to employment should be a high priority for all economies.
“We encourage economies to pursue facilitative measures that will expedite our economic rebound.
“We acknowledge the importance of strengthening regional connectivity by intensifying our efforts to make global supply chains more resilient and less vulnerable to shocks, to advance sustainable economic growth.”
The ministers agreed to strengthen APEC’s digital agenda, including electronic commerce and related services, with fresh perspectives and innovative means to navigate the new reality.
Earlier this week AUSVEG welcomed the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA), saying it would help vegetable exporters access the growing Indonesian market (Food & Drink Business, 12/05/2020).
