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Tuesday, May 10, 2016

Advancing Quality Growth through further Enhancing Inclusive Growth

Wayne Chen

Setting off from the commitment and achievement materialized at the Manila summit on 19 November, 2015,  APEC is continuing its Inclusive Growth agenda in 2016 under the leadership of Peru.

APEC 2015 Incorporated a Strong Inclusive Growth Chapter in the APEC Growth Strategy

APEC 2015 under the them of "Building Incisive Economies, Building a Better World", the Philippines attached great importance on social inclusiveness to the APEC growth strategy. As a result, in addition to the tradition priority area of Regional Economic Integration, Building Inclusive Economies; Fostering Micro, Small and Medium Enterprises' Participation in Regional and Global Markets; Building Sustainable and Resilient Communities, and; Investing in Human Capital Development, were highlighted in APEC Leaders' Declaration. APEC Leaders "acknowledged that inequality acts as a brake on economic growth and that reducing it is essential to spurring development and prosperity in the Asia-Pacific", and called for more intensive efforts for the reduction and eradication of poverty.

APEC 2016 Continues the Inclusiveness Centered Agenda and Focuses on Human Capital

Last November, Peru announced "Quality Growth and Human Development" as  the theme of APEC 2016, followed by 4 priority areas including Advancing Regional Economic Integration and Quality Growth; Enhancing Regional Food Market; Towards the Modernization MSMEs in the Asia Pacific, and; Developing Human Capital. The agenda setting accents inclusive growth, and for the very first time rests human capital as the theme for APEC.

One primary reason addressing human capital for the APEC development agenda is that education and labor skill are strong driving forces and decisive factors for a economy's economic performance and peoples' welfare. As shown by the UNDP Human Development Report that 1 additional year of schooling leads to significant increase in average annual growth in the long run for both developed and developing economies. It also explains developed economies where people receive longer education can maintain their competitiveness and advantage in the international economic arena. The average years of schooling of the US, Australia, New Zealand, and Canada are more that 12 years, while Indonesia, China, and Thailand are about 7 years, and the figure for Vietnam is below 6 years. Therefore, 70.5% of advanced APEC member economies, and 81.2% of emerging economies agree that Provision of Public Education at the Primary and Tertiary Levels is essential and priority work for enhancing inclusive growth as shown in the survey of What do you think are most important in promoting inclusive growth conducted by PECC for the report of State of the Region 2015.

In this light, for Developing Human Capital, APEC 2016 focuses on 3 work areas, including Higher and Technical Education, Employability & Skills for work, and Educational, Scientific, Technological and innovative capabilities. In the regard of Higher Education, APEC will work intensively on the promotion of cross-border educational cooperation, exchange of views on issues related to academic mobility, and the encouragement of public-private alliances for education and research. For Employability & Skills for work, promoting the development, qualification and mutual recognition of skills and knowledge in the Asia Pacific, strengthening a linkage between academia and the private sector, and the Development of Skills for the 21 Century, including hard and soft skills are the 3 main fields. Noticeably, the APEC Skills Development Capacity Building Alliance (ASD-CBA) proposed by Chinese Taipei will contribute to the skill set for the 21 century in this domain.  For Educational, Scientific, Technological and innovative capabilities, promoting research funding and training programs in S&T; promoting the use of information technology toward the attainment of an innovation network in APEC; fostering inter-university collaboration and technology transfer; Advancing APEC efforts to strengthen education and skill development for Science, Technology, Engineering, and Mathematics (STEM) careers, and; Facilitating the mobility of highly skilled human capital will be strengthened.

Food Market is another priority areas for the Peru year, in the aim to increase Peru's engagement in regional food chains and promote export of local agricultural products including avocado, asparagus, corn, coffee and a wide range of fish and fishery products. 4 thematic clusters of work are tabled including sustainability, market access, investment and infrastructure, and food production and trade related services. To enhance sustainability of food market, APEC needs to promote adaptation and mitigation actions for climate change, foster development of rural communities, and enhance blue economy, in particular to deter illegal, unregulated and unreported fishing (IUU). Food trade facilitation and trade facilitation action are two emerging issues this year and are expected to have some progress at the Food Security Ministerial meeting in September. The Multiyear Project to Reduce Food Losses in the Supply Chains, led by Chinese Taipei is crucial to food production and trade related services and will contribute to the realization of APEC Food Security Roadmap 2020 through promoting the use of technology for the good management and utilization of waste from the food industry.

To foster APEC MSMEs, the Boracay Action Agenda endorsed by the APEC Ministers will be further implemented through promoting innovation and SMEs connectivity; moving forward to integration and development through productive infrastructure, and; advancing Green SMEs integration into the global value chains.

2016 is also an check point for APEC regional economic integration chapter where the FTAAP Collective Strategic Study initiated by the Beijing Roadmap will be finalized for the realization of the FTAAP. Other undertakings of FTAAP tasks involves the realization of technical and high-level Dialogues on RTAs/FTAs topics, the Capacity Building Needs Initiative(CBNI) will also be carried forward this year. In addition, the Second Term Review of the Bogor Goals including a revised Individual Action Plan (IAP) report will sharpen the focus of reporting on non-tariff measures (NTMs).

In Sum, “Quality growth and Human development” as the main theme chosen by Peru for 2016 reflects that although  economy prosperity often refers to material flourish, knowledge and access to information is indeed essential ground to ensure the economic benefits will contribute to people centered societies. Following and for the realization of the new APEC Strategy for Strengthening Quality Growth adopted by the Leaders in Manila, Peru takes a socio+ approach to achieve the idea through promoting regional economic integration, human capital, MSMES and food market for APEC 2016.

(Wayne Chen is an associate research fellow at the Chinese Taipei APEC Study Center.)

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