APEC and the 1997 Summit in Vancouver
Publication Date: December 1997
Publisher(s): Library of Congress. Congressional Research Service
The Asia Pacific Economic Cooperation (APEC) forum is an association of 21 economies bordering the Pacific Ocean who are working cooperatively to reduce barriers to trade and investment; ease the exchange of goods, services, resources, and technical know-how; and strengthen economic and technical cooperation. The members include the United States, Canada, Mexico, Peru, Chile, Japan, Russia, South Korea, China, Taiwan, Hong Kong, Indonesia, Brunei, Malaysia, Singapore, Thailand, Vietnam, the Philippines, Australia, New Zealand, and Papua New Guinea. These members of APEC have declared their intention to establish free trade and investment in the region by the year 2010 for industrialized members and 2020 for the others.
On November 25, 1997, APEC held a Leaders Meeting (summit) in Vancouver, B.C., Canada to further pursue the APEC agenda where they endorsed a framework developed by their finance ministers to promote financial stability in the region and to supplement resources by the International Monetary Fund when necessary. The leaders agreed to other actions, including to liberalize trade in fifteen sectors (with work beginning on nine sectors), to work towards a successful conclusion of the World Trade Organization negotiations on financial services, and to harmonize and simplify customs clearances by the year 2000. They also welcomed Peru, Russia, and Vietnam as new members.
APEC has become the primary regional institution in the Asia-Pacific for promoting open trade and practical economic cooperation. It is of interest to Congress because (1) it is becoming a vehicle to pursue multilateral trade initiatives; (2) the APEC Leaders’ Meeting provides an opportunity for the U.S. President to raise and discuss issues with the heads of other APEC countries; (3) any concrete trade or investment measures developed under APEC that require a change in existing U.S. law and cannot be done by presidential proclamation will need legislative approval; (4) the United States can better influence the timing and contours of the trade and investment liberalization in the region if sufficient resources are devoted to the process now; (5) the APEC working groups are engaged in facilitating trade and investment that involves U.S. companies and industries, and (6) in view of the intense debate over approval of the North American Free-Trade Agreement (NAFTA) and provision of fast-track trade negotiating authority to the President, creating a free-trade arrangement that includes China, Japan, South Korea, Taiwan, Indonesia, and other Asian-Pacific nations is likely to be highly controversial. In its 1997 Trade Policy Agenda, the Clinton Administration hinted that it may seek fast-track negotiating authority to pursue bilateral trade agreements with individual members of APEC, such as Australia, New Zealand, and Singapore.
For the United States, APEC raises some fundamental questions. One is whether consensus can be achieved to enable the White House and/or Congress to pursue the APEC vision of free trade and investment in the Asia Pacific or whether future trade liberalization will be confined primarily to multilateral trade negotiations under the WTO? Another is whether provision of fast-track negotiating authority to the President should cover negotiations under APEC.