Senior business leaders from around the Asia-Pacific, meeting in Kuala Lumpur this week, expressed deep concern about the risks to continued prosperity from the current turbulent trade and economic environment.
“The storm clouds of trade war and protectionism are gathering,” said David Toua, Chair of the APEC Business Advisory Council. “After a period in the doldrums, we had finally been seeing more buoyant growth around the world. But the destructive forces of protectionism and unilateralism are a real threat to that trend.”
Toua noted that the International Monetary Fund was forecasting global GDP to expand by 3.9 per cent in 2018, but that it has also identified a rise in trade tensions as a significant downside risk.
“We have given a strong message to APEC Economic Leaders in our annual report about our support for the global rules-based trading system and the value we place on pressing ahead towards a Free Trade Area of the Asia-Pacific. These are fundamental to ensuring that our region will be seamless, dynamic, resilient and sustainable – and a place where everyone can enjoy the opportunities and benefits of regional economic integration,” said Toua.
“Trade barriers hurt jobs, especially those in small and medium enterprises participating in global value chains, and it hurts our communities and environment. Open and connected markets are not just better for business – they have advanced communities globally. We need to focus on reaching win-win outcomes.”
Toua added that a further core message to Leaders was around the importance of fully leveraging the digital age. “That means a future-ready workforce, infrastructure and the right policy settings to ensure data flows, privacy and security while not leaving some economies behind,” Toua explained. The APEC Business Advisory Council has also finalized letters to APEC Ministers for Finance, Energy and Small and Medium Enterprises, he continued.
On energy, Toua said that the APEC Business Advisory Council is committed to helping to realize the UN Sustainable Development Goal of access to affordable, reliable, sustainable and modern energy for all. “That demands a focus on improving energy infrastructure, shifting towards low-carbon and renewable energy, and tackling climate change,” he said.
“On finance, we recognize the central role that fintech plays in the digital economy and, accordingly, we have stressed the importance of coordination on policy, regulatory and institutional settings in that area,” Toua added. “As well, the vast infrastructure needs in the APEC region should be an urgent focus for investment and regulatory reform.”
Toua said that empowering micro, small and medium enterprises (MSMEs) and women remains a major priority. “It is critical that MSMEs, including women-led MSMEs, are able to realize their full potential – whether operating domestically or internationally. That requires access to finance and the digital economy, reducing structural impediments and trade barriers such as NTBs,” said Toua.
“There also needs to be an emphasis on the development of future-ready skills, more broadly throughout economies such as STEM education, and the right mindset in business and society that encourages and enables equal economic participation, including diversity in leadership roles. Without addressing these needs, we will struggle to deliver truly inclusive and sustainable growth,” concluded Toua.