Australia And APEC Essay, Research Paper

When the ?Asian-Pacific Economic Cooperation? (APEC) was established in 1989

in response to the growing interdependence among Asia-Pacific economies, its

goal was to advance Asia-Pacific economic dynamism and sense of community. When

the cooperation was established, there were 12 founding member economies, namely

Australia, Brunei Darussalam, Canada, Indonesia, Japan, Republic of Korea,

Malaysia, New Zealand, Republic of the Philippines, Singapore, Thailand and the

United States. Since then there has been more countries/economies joining APEC.

APEC has come a long way since 1989. It has built steadily on the efforts of the

past and looks forward to further positive progress. The initial years of APEC

were focused largely on exchange of views and project based initiatives. As

needs of the member economies has evolved into a forum of higher purpose: to

build the Asia-Pacific community through achieving economic growth and

development through trade and economic cooperation. In the Osaka meeting in

1994, APEC leaders adopted the Osaka Action Agenda, which firmly established

three pillars of APEC activities: Trade and investment liberalization, business

facilitation and economic-technical cooperation. Its main objective is to

develop a region-wide, free trade and investment regime by the year 2000. APEC

operates by consensus. In 1991, members committed themselves to conducting their

activities and work programs on the basis of open dialogue with equal respect

for the views of all participants. The APEC chair, which rotates annually among

members, is responsible for hosting the annual ministerial meeting of foreign

and economic ministers. At the 1989 Canberra Ministerial Meeting, it was agreed

that it would be appropriate that every alternative ministerial meeting be held

in an ASEAN economy/country. Senior Official Meeting (SOM) are held regularly

prior to every ministerial meeting. APEC senior officials make recommendations

to the ministers and carry out their decisions. They oversee and coordinate,

with approval from Ministers, the budgets and work programs of the APEC for a.

Mr. Fischer, Deputy Prime Minister and Minister for Trade, said Australia?s

IAP (Individual Action Plan) would address the main trade liberalization issues

of tariffs, non- tariffs, investment and services, although the 1996 IAP would

not pre-judge the outcomes of the existing and previously announced reviews into

the passenger motor vehicle, textile clothing and footwear and sugar sectors.

Other elements of the IAP deal wit the important trade facilitation issues such

as standards and customs procedures, intellectual property rights, competition

policy, and mobility of business people and deregulation. ?Australia?s plan

is fully consistent with the general principals of the Osaka Action Agenda

agreed by that leaders in November 1995, including comprehensives,? Mr.

Fischer said. ?Australia?s done a great deal to liberalize our market

consistent with APEC goals, and we expect others to match our record. The

government will pursue vigorously Australian trade and investment priorities

within APEC,? Mr. Fischer stated. Australia?s IAP address the objectives and

guidelines of the Osaka Action Plan in a comprehensive manner: Tariffs

Australia?s IAP includes reduction in applied tariffs to the year 2000. Table:

Tariff Reductions in the APEC region Simple Average Applied Tariff 1988 1993

1997 Australia * 15.6 7.0 5.3 Brunei 3.9 3.9 2.0 Canada (*) 3.7 2.4 1.3^ Chile

19.9 11 11 China 39.5 37.5 17 Hong Kong 0 0 0 Indonesia 18.1 17 11.7 Japan * 4.3

3.4 4.6 Korea 19.2 11.6 7.9^ Malaysia 13.6 12.8 7.8^ Mexico * 10.5 12.6 9.8^ New

Zealand 14.9 8.5 5.2 PNG NA NA 23^ Philippines 27.9 23.5 12.1 Singapore 0.3 0.4

0 Chinese Taipei 12.6 8.9 8.6 Thailand 31.2 37.8 17 United States (*) 4.2 4.2

3.4^ Note: Does not include calculation of non-ad valorum tariffs 

Indicates trade-weighted advantage  ^1996 data Source: http://www.aph.gov.au/library/pubs/cib/1998-99/c99cib05.htm

Australia?s applied simple tariff has fallen from 15.6% in 1998 to 6.1% in

1996 and will reduce further to 4.5% by the year 2000. Australia is also hoping

to have tariffs reduced to zero in numerous sectors of our economy by the year

2000. Sectors Selected for Early Voluntary Sectoral Liberalism Sector EVSL

Proposal Toys Progressive reduction to zero of tariffs on toys, preferably by

2000. Elimination of unjustified non-tariff barriers. Economic and technical

cooperation Gems and jewelry Elimination of trade-restrictive measures on these

products (phased out by 2005), which include pearls, diamonds, silver, gold,

platinum, jewelry, goldsmiths? and silversmiths? wares. Environmental Goods

and Services Elimination of tariffs by 2003 on environmental goods and

liberalization of environmental services. Work on non-tariffs barriers. Economic

and technical cooperation. Food Further impetus to trade facilitation work on

food. Studies on market prospects on sugar, processed food. Tariff

liberalization by 2004 for fruit and vegetables, processed food and beverages.

Energy Removal of tariffs on coal, gas, electricity, and energy related

equipment by 2004. Work on non-tariff measures, services, government

procurement, and facilitation. Fish/fish products Elimination of tariffs by the

end of 2005. Elimination of non-tariff measures. Work on subsides, sanity and

phytosantitary measures. Forest products Elimination of tariffs on paper and

wood products by 2000 and 2002 respectively. Work on non-tariff measures.

Detailed provisions applying to building codes. Oilseeds/oilseed Products

Elimination of all tariffs, non-tariff barriers, exports subsidies, quotas and

other trade-distorting measures by 2002. Chemicals Tariff harmonization by

2001/2004 inline with the Chemicals Tariff Harmonization Agreement and eventual

elimination of tariffs. Telecommunications Development of Mutual Arrangement.

Aims to allow parties to test and certify equipment to an importing economy?s

mandatory technical requirements. Rubber Reduction/elimination of tariff and

phasing out of unjustifiable non-tariff measures. Fertilizers Elimination of

tariffs by 2002/2004. Work on non-tariff measures. Automotive Products

Private-public sector automotive dialogue. Harmonization of standards. Work on

customs issues. Identify barriers to trade and investment. Medical Equipment

Tariffs on medical equipment and instruments to be eliminated by 2001. Work on

non-tariff measures. Civil Aircraft Elimination on tariffs on civil aircraft and

related equipment by 200 and 2002 respectively. Trade facilitation. Source:

http://www.aph.gov.au/library/pubs/cib/1998-99/99cib05.htm Non-Tariff Measures

Australia will abolish export controls and certain mineral products (coal,

mineral sand liquefied natural gas, bauxite and aluminum). Services Australia is

committed to further liberalize the business services, communication, transport,

financial services and energy sectors including to: Telecommunications:

Introduce full and open competition from 1 July and privatize 1/3 of Telstra

with 35% of the float available to foreign investors. Transport: Windback

maratime cabotage protection by year 2000 and discontinue schemes which provide

financial incentives for certain Australian vessels. In aviation, Australia will

progressively liberalize access to the market for freight and passengers and

ensure airlines are free to set fares in response to market conditions. There

are many other IAP?s in Australia?s list, however these were some of the

main IAP?s. Why is APEC important? APEC is taking on strategic significance

internationally for a number of reasons:  It acts as a forum between

Asia and the Americans. The 18 countries of PAEC represent 56% of the world?s

gross national product and 46% of all trade. Historically, contention between

Japan and the United States over Asia cumulated in the outbreak of the Second

World War in the pacific.  APEC is gaining momentum as one of the

world?s centers for trade and liberalization discussions.  All three

Chinas (Taiwan, Hong Kong and the people?s republic) are participants in APEC.

The reversion of Hong Kong to China in 1997 is a historic change, which brought

regional stability within APEC.  Asian immigration to Canada has been

increasing in recent years. The growing population of Asian descent in Canada,

particularly in Vancouver, means heightened awareness and interest in

Asian-Pacific affairs. The international called APEC is a great force in

today?s business. It is a thriving force, which will be around for many years

to come. The effectiveness of this organization is extremely great, as it will

benefit many people throughout the world, in all areas of business.