China takes the reins…of APEC

The Asia Society organized this event APEC Briefing 2013-14: China Takes the Reins & I was there to attend.  The moderator Tom Nagorski was a no-show, but otherwise everyone else made it.  China’s year of taking over the reins of APEC has been anticipated because each change brings new priorities & potentially new partnerships.

Robert Wang brought the US diplomatic perspective.  Strong new Chinese leadership wants to work closely with the US.  They have 3 priorities:

1. regulate economic integration
2. promote innovative development
3. strengthen connectivity & infrastructure development

They held a 1-day symposium & wanted to discuss all 75 regional/free-trade agreements (FTA’s), how to work together, & FTAP, an FTA of the Asia/Pacific.

Ann Weeks of Underwriters Labs (UL) brought a standards orientation to the proceedings, which affects 80% of all trade as technical regulations have replace tariffs while improving public safety.  UL serves 65K manufacturers in 100 countries, of which 21 are in APEC.  40% of UL’s revenues come from outside the US.  They focus increasingly on food safety & green buildings.

Peter Petri zoomed in on the TransPacific Partnership (TPP), which includes APEC+China, the 12 countries which are in negotiations now to weave together the architecture of Latin America together with the Asia Pacific.  This is a crucial year to put this trade bill up for a vote.  There could be big benefits to both America & Asian economies as they create a template for future agreements.   China has held conferences on TPP but is not currently in negotiations.  This is generally changing, as China has changed lots of positions in the last 6 months.  The main issue is regional economic integration.  APEC is now just a forum to discuss issues-participants aren’t yet ready to make commitments, which can still play a useful role in negotiations, sharing, joint projects, etc. making TPP & FTAP now much more realistic.

Curtis Chin addressed how involved Barack Obama should be in this process.  He is on a large stage, but should he have left during the shutdown?  It matters, but not that much, since no major decisions were made.  No 1 event matters among many.  Abe was welcomed with open arms, but the engagement of the US is key.  How will China address the media?

• each host determines the capacity
• China’s focus is on supply chains with the goal of reducing costs by 25% by 2015
• they are doing peer reviews for fossil fuels
• they’ve set a goal to double renewables by 2030

Open Q&A

• Clinton raised this to the Head of State level
• China has been flexible in dealing with other APEC countries:  they’ve listened & changed.
• Lots of work has been done on HR development issues to address labor rights-it’s been a sea change.
• Work groups have been formed around small businesses, health, & food security
• China will actually hold an anti-bribery conference together with the OECD to enforce a code of ethics.
• Social media freedom is not yet a focus-it’s only being addressed on a bilateral basis.  The focus is still on building out internet infrastructure.
• TPP is down to landing zones, so they’re getting close, but since it requires trade promotion authority, there could be repercussions if fast track authority is not granted.  TPP is already absorbing rules on labor & the environment.