PACIFIC BASIN ECONOMIC COUNCIL
MAIN PAGE | CLIPS | 1998 | PBEC CHAIRMAN REFLECT ON APEC'S FUTURE

PBEC chairman reflects on APEC's future David Ibison South China Morning Post Friday, November 13, 1998 The chairman of the influential Pacific Basin Economic Council (PBEC) has strongly criticised the Asia Pacific Economic Cooperation (APEC) forum saying it is too politicised to function effectively and should be scrapped. Helmut Sohmen said the economic crisis had highlighted APEC's inherent weaknesses, widened existing differences between its members and underlined its lack of achievements to date. Mr. Sohmen, chairman and president of Hong Kong-based World Wide Shipping Group, said: "APEC provided inspirational targets but has managed to implement very few of them. "I say let's admit it has been a failure and consider other options. "If there are no substantive movements forward at APEC this time, then more voices should ask whether it is time to go back to the way things used to be done -- bilateral negotiation," he said. His comments came as senior officials met in Kuala Lumpur ahead of the annual APEC leaders Summit on November 17 -- expected to be one of the most challenging meetings in the forum's nine-year history. Relations between member nations have worsened as a result of the economic changes during the past 17 months which plunged most Asian nations into recession and led to social and political unrest. Mr. Sohmen said this year's cocktail of politics and economics would exacerbate existing faults within APEC but trade liberalisation would proceed if APEC disbanded. "Liberalisation would progress without APEC. The APEC process is that member economies take on a negotiation stance whereby they will not make concessions unless there is reciprocity," he said. "If we had had no APEC, many countries wou1d still have seen the benefits of making bilateral and multi-lateral concessions free of being forced into negotiating at APEC." A focus of this year's meeting is expected to be fears from APEC's Western members that Asian nations are moving towards protectionism to isolate their economies from foreign competition. A row has already erupted between Japan and the US over tariffs on fishing and for forestry imports, while the recent sacking and arrest of Malaysia's former deputy leader Anwar Ibrahim has added a political dimension to the gathering. "APEC was never designed as a crisis solver, but the crisis has shown its weaknesses and the fact that it is not capab1e of coming to terms with it," Mr. Sohmen said. He said the chances of APEC reaching consensus on moves to liberalise trade in nine key sectors -- the Early Voluntary Sector Liberalisation programme -- at this year's meeting were slim. "APEC has been very good at making pronouncements, but when it comes to implementing them, natural differences between members show up," he said. "I would say the plan behind APEC was too ambitious. It was worthy to try and accelerate liberalisation and remove barriers but the problem is that there is a gap between the ambition and reality. "The weakness is that there is no consensus when it comes to implementing the declarations they have all signed. The reality is that APEC has not shown much in terms of achievements." Formed in 1967, PBEC comprises senior business leaders from more than 1,100 top corporations in 20 countries around the Pacific with combined annual sales of over US$4 trillion and is an influential voice in regional trade issues. APEC's 18 members are Australia, Brunei, Canada, Chile, China, Indonesia, Japan, Hong Kong, South Korea, Ma1aysia, Mexico, New Zealand, Papua New Guinea, the Philippines, Singapore, Taiwan, Thailand and the US.