The Asia-Pacific Economic Cooperation (APEC) organization, established in 1989, has failed to become the premiere economic forum in the Asia-Pacific. In recent years, APEC meetings have received most of their news coverage for the leaders’ talent shows and photographs of leaders in the traditional or national dress of the host nation. The annual photo gallery is quite a hilarious collection of world leaders in elegant and funny outfits.
The most recent financial crisis, this one sweeping through the European Union and especially centered on Greece, is causing concern to all the world’s economies. Ironically, in the midst of this global financial crisis, Asian economies are doing quite well, presenting the image of Asia as a leading economic engine that may assist struggling old economic powers in the EU and the United States. As Asia rises as a result of its robust work ethic and continuous innovation in management, production, and technology, the African continent is also beginning to stir. It is as if Africa wants to be the new Asia, Asia plans to be the new Europe, old Europe struggles to stay alive, and America is in a mid-life crisis. Given current trends and the shifting of wealth and power to the Pacific, APEC may indeed turn out to be the premiere economic forum that it was originally intended to be.
At the APEC meetings in Honolulu, South Korea will be showcasing some of its innovative programs, showing how APEC can be used to advance development around the world. One is a program called “innovative and bold consulting” which helps small- and medium-sized Korean companies establish branch offices and factories in other developing economies of APEC, such as Indonesia, Peru, and Vietnam. In this program, the Korean government’s Small and Medium Business Administration and the Corporation of Small and Medium Business Promotion jointly offer free consulting to Korean companies who are planning to enter developing APEC countries. These consultations develop methods for raising the image and status of Korean products overseas, transferring appropriate technology to other countries to assist their economic growth, and the use Korean managerial tools to help local businesses. The fundamental assumption behind this effort is that the APEC region will not become an economic powerhouse if many member countries are struggling.
A second program that Korea will promote at APEC is one that supports Korean businesswomen in their rise to higher levels of business and corporate management. Korea is more business-friendly to women than most Southeast Asian countries but it lags far behind the United States and Japan in terms of women-owned businesses.
The third program is active promotion of a trans-Pacific free trade pact. Korea has already signed free trade agreements with the United States and Peru, and the current government in Seoul in generally supportive of free trade efforts.
In part because of its relative lack of concrete goals and results, the APEC gathering is an excellent counterweight to the painful meetings currently taking place in Europe at the G20 and among EU members. But it is not just costumes and talent shows that differentiate APEC from Western Europe. The Asia-Pacific region is currently the engine of the world economy and is set for further growth in the future. Europe will remain important, but the United States should pay more attention to the rising star, the Asia-Pacific region.
The prospect of the U.S. turning inward in its economic strategy means that China has freer rein to become the focal point of regional integration efforts. The U.S. appears as largely bereft of a constructive economic strategy towards the most dynamic region in the world.
U.S. failure to follow through on TPP is a huge blow to the credibility of its Asia policy with important economic and geopolitical repercussions. Other countries will move forward with RCEP [the Regional Comprehensive Economic Partnership] and American companies will be at a disadvantage.