APEC Lecture
Can I acknowledge the traditional owners of the land upon which we meet and pay my respect to their elders past, present and future, as well.
And can I acknowledge you (the Hon Dr Craig Emerson) and the APEC study centre, and particularly acknowledge your contribution to public life in this country.
I was reading a little bit of your bio before I came on and it’s a wonderful Australian story. From very humble beginnings and some very challenging early beginnings to going on to be an economist and playing a major role in setting public policy, especially in the international relations space in this country and its terrific to be here with you.
I look forward to continuing to engage with you and thank you again for your contribution to public life in this country.
Australia is a trading nation.
We have long history of supporting trade liberalisation and a rules-based global trading system—and bodies like APEC and the World Trade Organisation are essential to support that system.
APEC is the preeminent forum for regional economic cooperation: it has encouraged regional prosperity and is an important stepping-stone to global economic reform.
It is also evidence of the role that countries like Australia can play on the international stage.
The establishment of APEC represents one of Australia’s biggest diplomatic coups and Craig was in Bob Hawke’s office when all this was forming and when APEC was starting. And to have you now in your role, Craig, I think is an incredibly important bookend to when all this started.
Binding the pivotal economic drivers – that is to say economies – of the twenty-first century, APEC is essential to the continued liberalisation and development of our region.
Implicit in Australia’s establishment and commitment to APEC is a broader view of multilateral institutions that recognises Australia’s national interest in broader economic architecture upholding the rules and norms upon which our prosperity rests.
Such a view is not political or partisan – there is a general view, no doubt shared by Craig– that this is Australia’s role.
Even still, it is hard to imagine Australia or other member economies having the impetus to establish an organisation like APEC today.
And I think that is a really important point, having something like APEC, we now have to treasure it.
Perhaps this is not surprising. APEC has had a difficult few years, with meetings cancelled or held online.
In this it is not alone among multilateral forums – the WTO, foremost among our global economic institutions, has ossified, making continued liberalisation extraordinarily difficult to achieve.
That these institutions have not performed as their founding members once envisaged is not, however, reason to neglect or draw back from them.
Rather, periods of relative underperformance present an opportunity for Australia to re-evaluate our role in multilateral institutions and remind ourselves why we committed to them in the first place.
When we do this, we see the strengths of APEC and the WTO.
Take the WTO, in concrete terms, we see the WTO at its best with the recent success of Australia’s action against Canada and their treatment of Australian wine.
Likewise, the WTO has established a dispute settlement panel, at Australia’s request, to resolve concerns about anti-dumping and countervailing duties imposed on Australian barley by China.
Perhaps most critically though, the WTO remains the only institution that develops, monitors, and enforces global trade rules.
APEC, another of our most important institutions, serves a very different, though no less important function.
Its informality and emphasis on voluntary action, including by subsets of its members, is a strength.
Its non-binding agreements have given members confidence that, as they reduced their trade barriers, regional neighbours would do the same.
We all know that peer pressure plays a role in motivating liberalising reforms.
Since APEC’s inception, the region has experienced massive changes, growing at an average of 3.7 percent per year, leading to rising average incomes and vast reductions in poverty and an expanding middle class.
APEC also provides a forum to consider a great range of economic issues: all the way from lowering tariffs to the recognition of professional qualifications.
Right from the start, one of APEC’s strengths has also been the active involvement of the business community in shaping its agenda.
Members of the APEC Business Advisory Council, ABAC, engage directly with leaders, and help shape APEC’s agenda.
No other regional forum provides this type of regular, institutional engagement for business.
APEC is also an incubator for regional ideas like the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
Because of these unique attributes, APEC is an institution for troubled times: from the early stages of the pandemic, APEC has been a strong voice for economic openness and the free flow of critical medical supplies, which supports work in broader multilateral forums.
APEC Trade Ministers last year worked together to reduce barriers for essential goods, helping to ensure PPE could get to countries in the region that needed them.
It is focussed on resisting vaccine protectionism and, with Australia’s leadership, facilitating the unhindered flow of services that support goods trade, ensuring critical supplies are fast-tracked across borders.
It has worked for us in a time of crisis, just as it has been working for thirty years.
A brief APEC highlights list includes:
- global-scale achievements, such as the Information Technology Agreement that boosted worldwide trade in computers and the 2012 agreement on cutting tariffs on environmental goods.
- reducing average tariff barriers since 1994 from 17 per cent to just over 5 per cent;
- creating an APEC Business Travel Card that enables express-lane immigration processing for more than 350,000 business travellers; and
- cutting the average time to start a small business, getting credit, and applying for permits in the APEC region by 11 per cent.
And, I’m going to add one more thing that Craig and I were discussing before we came on air:
- also, as a place for leaders, Trade Ministers, Foreign Ministers, and others have been able to have a quiet chat. Whether it be over a cup of tea or a glass of wine, informal meetings have led to the building of important relationships, which have gone a long way to making sure that the region which we live is a prosperous one.
In broad terms, APEC’s focus on trade facilitation has reduced the cost and time of doing business by over 20 per cent since 2005.
With this is mind, let me turn to the key priorities I’ll be pursuing with my counterparts.
The Biden Administration has made positive remarks about the US returning to a greater emphasis on multilateralism.
This gives us an opportunity to engage with the US at APEC, the World Trade Organisation, and, importantly, the CPTPP.
It’s very much in Australia’s interests if we can get the US to, once again, engage on the CPTPP.
Greater engagement with the USA through APEC will hopefully enable us to work constructively, and with respect to our principles, with China, as well.
There are three areas where APEC can work together to benefit all its members:
- One, supporting fast and equitable delivery of vaccines.
- Two, by ensuring ongoing support to services, contributing to COVID-19 recovery.
- And three, by supporting supply chain resilience.
Australia will also work to put APEC at the forefront of using trade and economic policies to support a sustainable environment.
APEC’s Environmental Goods List was a landmark achievement, reducing tariffs across APEC on environmental goods.
But it is now time to update and expand the List to reflect new technologies.
We also want to explore what we can do on environmental services – Australia would like to see liberalisation, and we welcome ABAC’s support here.
Australia is supportive of a practical transition to renewable energy options – like other APEC economies, we’re resolutely committed to the Paris Agreement.
We encourage APEC economies to consider initiatives that will create an environment conducive to investment and trade in renewable energy.
Another priority is to get APEC to address the longer-term implications of COVID through its structural reform agenda.
We’re very conscious that, without concerted action, COVID-19 may reverse hard-won gains on economic empowerment, resilience, and women’s health and safety.
APEC’s La Serena Roadmap for Women and Inclusive Growth sets out some of the key actions needed to remove barriers preventing women’s full economic participation.
Finally, upcoming APEC meetings are an opportunity to lay the groundwork for a successful WTO Ministerial Conference later this year.
A strong and ambitious statement by APEC Trade Ministers will send a positive signal about the WTO – and will help achieve meaningful outcomes at the Conference.
APEC can support the conclusion of WTO fisheries subsidies negotiations, initiatives on services and e-commerce, and agricultural trade reform.
On the last of these, Australia is particularly concerned that trade-distorting domestic support entitlements for agriculture could reach US $2 trillion by 2030 if left unchecked.
And that’s worth repeating, could reach US $2 trillion by 2030 if left unchecked. That’s trade distorting domestic supporting entitlements. We have so much to do at the WTO.
This is hurting our farmers, and rural communities around the world, at a time when poverty is on the rise.
We’ve been buoyed by working closely with our Kiwi counterparts this year as New Zealand hosts APEC in 2021.
In particular, we’ve welcomed New Zealand’s prioritisation in the APEC agenda of lowering the cost of vaccines for developing nations.
This is APEC at its best – responsive to the moment, and practical to its core. I can’t emphasise enough how important this is.
At times like these, we need more engagement with multilateral organisations, not less.
We need to better understand those who see differently to us.
We need places to agree, and places to agree to disagree.
Above all, as a country that relies on multilateralism, we need institutions that work.
APEC is all these, and we should be proud of our role in creating it.
Thank you very much.