By Monica Whaley
APEC has always operated differently than most international bodies and frankly, it is run in a way that is not naturally suited to business – it operates by consensus, there are no treaties or legal frameworks, and sometimes the parameters of discussions are unclear. But APEC’s focus on the complex fabric of commercial and economic relationships within its membership is reflected in its core principles and even its vocabulary: members are “economies” not “governments” headed by “Economic Leaders” rather than heads of state. In addition, the private sector has long had an active role and seat at the table that are unparalleled in other global fora. APEC’s focus on the regional economic and trade agenda has kept business at the table and engaged. For private sector pragmatists, APEC delivers enough in terms of both results and the “upside potential” to keep business coming back for more.
Readers have seen the stats before – within its 21 member economies APEC represents more than half of global GDP, nearly half of world trade and a third of the world’s population. For U.S. companies, the case for APEC is even more compelling: APEC is home to 4 of the 5 largest export markets for U.S. goods and services, and our APEC trading partners purchase 61% of U.S. goods exports. Crucially, the Asia-Pacific economies are growing economies – when U.S. companies look to the future, no region in the world can match the promise of the Asia-Pacific.
From its founding, APEC has been committed to drawing on input from the private sector. In the early years, this input was provided by groups of assembled ‘thought leaders’ like the APEC Eminent Persons Group (1992-94) and the Pacific Business Forum (1993-94). Both groups strongly endorsed the idea of APEC making an institutional commitment to private sector engagement in APEC. At the Osaka APEC meetings in 1995, APEC Leaders responded to this by creating the APEC Business Advisory Council (ABAC) to serve as the Leaders’ permanent advisory body from business in each of the 21 economies.
ABAC has been an incubator of ideas, and APEC’s unique structure has offered opportunities for initiatives to rise organically from conversations between business and government. U.S. business people began to see ABAC as an important avenue for advancing business issues in a substantive way in APEC. Initiatives like the Auto Dialogue, APEC Food System, Life Sciences Innovation Forum, APEC Data Privacy Principles, Financial Inclusion Initiative, and a variety of trade facilitation demonstration projects were all conceived and executed under the leadership of the business community through the ABAC.
APEC has achieved real progress as a result of ABAC’s interventions on a range of issues: the creation of the APEC Business Travel Card to address the priority business mobility issues; support for APEC’s Multilateral Air Services agreement; improved customs facilitation through adoption of a “single window” approach; and importantly, the adoption of a “Free Trade Area of the Asia Pacific” as a long-term goal of APEC. The business community has found ABAC a very effective forum for getting new issues on the table, for making real and steady progress on thorny and persistent problems, and for generating innovative thinking on the “21st Century trade issues” reflected now in negotiations for the APEC-inspired Trans-Pacific Partnership (TPP).
The annual APEC CEO Summit is a sort of “board of directors” meeting for the Asia-Pacific that coincides with the annual APEC Economic Leaders’ Summit each fall. The summit sets out the broader vision of the region’s future through a business lens – leading CEO’s, intellectuals, Ministers and Leaders from all 21 APEC economies meet with one another and have the chance to interact in a meaningful way. No other international forum provides the private sector with greater opportunities for direct interaction with a greater number of world leaders. As the Asia-Pacific has continued to shine as one of the true bright spots in the global economy – and it is expected to do so for the foreseeable future — the APEC CEO Summit has drawn ever greater attention from global media and thought leaders as a generator of provocative ideas, visionary thinking and genuine dialogue between business and government leaders.
After nearly 20 years working to bring the private sector into the APEC process, the National Center for APEC has been approached by regional groups in other parts of the world to discuss how they too might create an “ABAC” or “CEO Summit” for their own region. APEC’s private sector engagement process – the formats for discussions, frameworks for policy development and opportunities for interaction – continues to evolve each year, constantly improving the depth and breadth of business’ voice and consultations in the APEC process. It takes persistence, patience and perseverance, but business derives great value both from APEC’s policy process and opportunities for engagement.