MANILA, NOVEMBER 17, 2010 (STAR) Ho-hum FIRST PERSON By Alex Magno - Like the G20 meeting in Seoul a few days before, the APEC meeting in Yokohama did not draw rave reviews.
The G20 meeting fell short of censuring the US for monetary policies that will likely cause the dollar to depreciate. The communiqué issued after that meeting was long on platitudes and short on specifics.
The APEC meeting, for its part, reaffirmed the commitment of the 21 nations of the Pacific Rim to evolve the world's largest free trade area sometime in the future. That goal, it must be mentioned, is APEC's reason for being. In the same breath, the summit meeting acknowledged that present economic conditions pose serious obstacles to the achievement of that goal.
There was no firm condemnation of the rising incidence of protectionism in the face of volatility in the global market. There was no clear resolution of the currency spat between the US and China. There was no near-term plan offered to help the community of economies better deal with the uncertain and uneven recovery of the global economy.
British Prime Minister David Cameron, who is parenting a newborn and obviously dealing with sleep deprivation, joked that he flew over to Seoul to catch some sleep. The joke was the most honest evaluation of the summit meeting.
No one dared crack the same type of joke after the conclusion of the APEC meeting in Yokohama. The same comment as Cameron's might have been appropriate as well.
Routinely, the APEC leaders' meeting is preceded by a lot of hard work. The APEC Business Council meets a week before the summit. Then a ministerial-level meeting happens where the substantive business of the group is threshed out for the leaders to sign on formally. By the time the heads of state assemble, it is largely for the photo-ops and for the pomp of it.
If the summit turns out short of expectation, the blame goes entirely to the government ministers who should work out the agreements ahead of the leaders' meeting. At this juncture, however, there could be very little material for any dramatic agreement — hard as the ministers might work to put out something more substantial.
When the global economy is bullish, the APEC communiqué is likewise buoyant. It tends to be optimistic and far-sighted, bold and forthright. It is not a good sign that the APEC communiqué this time is about as vacant as the G20 closing statement.
There is much for the APEC economies to disagree about at this time.
The most visible disagreement is about currency. For years, the US has been pressuring China to revalue its currency.
Working on the theory that China enjoys humungous balance of trade surpluses because it has kept its currency undervalued, the US wants the Asian giant to revalue its currency. That seems to be the only American strategy on the table to cure excessive importation and weak exports. This causes the high unemployment persisting in the American economy.
At one point, Washington appeared on the verge of calling China a "currency manipulator." That might have irreparably damaged relations between the two giant economies of APEC.
The smaller APEC economies face price volatilities in their home economies because of massive "hot money" flows. These flows are abetted by what is perceived to be dollar-weakening policies adopted by the Americans. As a form of self-defense, several emerging economies have adopted capital controls.
One prominent American economist in fact argues for capital controls to reduce short-term migration of speculative money. Washington, however, sees capital controls as hindrance to the efficient movement of capital across borders. This is a major point of disagreement among APEC countries that is left unresolved in the wake of the last leaders' meeting.
Nothing was said about how the APEC economies could cooperate to mitigate global warming, human trafficking and demographic imbalances that could induce even more labor migration. I suspect that the technicians at APEC see the utility of the forum in the narrowest economistic sense.
But by looking just at the terms of trade and the behavior of currencies, the vast potential of this regional forum might be stymied. A lot of the challenges facing this group of economies in the coming years have to do with the demographic, the ecological and the social dimensions of cooperation.
I suspect that the Yokohama meeting did not produce anything dramatic was the narrowed vision of what the APEC should be all about.
In its first few years, a conscious decision was taken to avoid the murky questions that float outside what might be called the strictly economic. That was on the assumption that much agreement might be won on the strictly economic issues. Because of that, the APEC might become a viable arena for cooperation.
But the reverse has happened. The economic policy issues have become intractable. There is so much national interest invested in, say, the currency policy of a member economy to allow consensus in the forum like this one.
On the other hand, there is much agreement on reducing carbon footprints, exchanging technologies and investments for alternative energy projects, opening borders for the free exchange of skilled labor. On these issues, Pacific Rim cooperation might become more substantial.
The hypothesis on which APEC was established appears to have been overtaken by changing realities. The reason the last leaders' meeting seems such a ho-hum event is that the forum itself has become narrowly concerned with precisely the dimension where unanimity has become rarer.
APEC must consider putting the shoe on the other foot.
Chief News Editor: Sol Jose Vanzi
© Copyright, 2009 by PHILIPPINE HEADLINE NEWS ONLINE
All rights reserved
PHILIPPINE HEADLINE NEWS ONLINE [PHNO] WEBSITE
[Non-text portions of this message have been removed]
------------------------------------
-------------------------------------------------------------
Follow us on Twitter: http://twitter.com/phnotweet
This is the PHILIPPINE HEADLINE NEWS ONLINE (PHNO) Mailing List.
To stop receiving our news items, please send a blank e-mail addressed to: phno-unsubscribe@yahoogroups.com
Please visit our homepage at: http://www.newsflash.org/
(c) Copyright 2009. All rights reserved.
-------------------------------------------------------------Yahoo! Groups Links
<*> To visit your group on the web, go to:
http://groups.yahoo.com/group/phno/
<*> Your email settings:
Individual Email | Traditional
<*> To change settings online go to:
http://groups.yahoo.com/group/phno/join
(Yahoo! ID required)
<*> To change settings via email:
phno-digest@yahoogroups.com
phno-fullfeatured@yahoogroups.com
<*> To unsubscribe from this group, send an email to:
phno-unsubscribe@yahoogroups.com
<*> Your use of Yahoo! Groups is subject to:
http://docs.yahoo.com/info/terms/
