Statement by H. E. Rodolfo C. Severino,
Secretary-General of the Association of Southeast Asian Nations,
at the 13th General Meeting of the Pacific Economic Cooperation Council

As we try to discern APEC and its role and agenda in the 21 st century, or at least the beginning of that century, it might be good to look back at APEC's beginnings. APEC started out with the then six ASEAN members and their dialogue partners minus the European Union. China, Hong Kong and Taiwan came in 1991. In those days, ASEAN was truly at APEC's core.

In its first four years, APEC met annually at the ministerial level -- in 1989 in Canberra, in 1990 in Singapore, in 1991 in Seoul, and in 1992 in Bangkok. At those meetings, the ministers set a sensible and balanced course of cooperation in a few practical areas like energy, fisheries, telecommunications, transport and tourism. Much stress was given to research and development, human resource development, and technology transfer. Trade liberalization was an APEC objective from the start, but it was dealt with only in the context of the Uruguay Round then going on.

In 1993, however, President Clinton came up with the idea of, in effect, elevating APEC's main annual gathering to a summit. He invited APEC leaders to a "retreat" right after the annual ministerial meeting being hosted by Seattle. At the retreat on Blake Island off Seattle, the leaders issued their "economic vision statement," a document that was both farseeing and balanced.

Since then, the host of every APEC ministerial meeting has felt compelled to invite the leaders to a similar retreat. Such retreats followed more or less the same format as Seattle, down to the clothing native to the host-country, the line of leaders waving or linking arms for the photo opportunity, and the reading of the declaration by the host leader in the company of the others.

The participation of leaders has considerably raised the public profile of APEC, as hordes of media people, who otherwise would not have been interested in APEC at all, stream to the APEC city in anticipation of some dramatic development of a domestic, bilateral or international nature. Indeed, a major side benefit of the APEC leaders' meeting is that it has provided a venue for top-level bilateral discussions or multilateral caucuses on the burning issues of the day, some of them having to do with trade, others of purely political import.

It was made clear that the presence of the leaders, particularly of the American President, was intended to give impetus to the trade liberalization part of the APEC agenda. Agreements among APEC economies to liberalize trade among them were supposed to set an example -- establish the norm -- for the global liberalization of trade. They were expected, if not intended, to apply pressure on others in WTO negotiations to bring down barriers to trade in those sectors of interest to APEC. APEC consensus, although, strictly speaking, non-binding, was supposed to provide a critical mass for binding agreements in WTO.

Now, ASEAN countries, seven of which participate in APEC, remain committed to the liberalization of trade, within ASEAN and beyond. They have generally welcomed the impetus that APEC has given to the liberalization of world trade. This is why they signed on to the Bogor goals of free trade within APEC by 2010 for the developed members and 2020 for all, to be achieved through voluntary individual action plans and collective action plans.

However, since the national political leaders started participating in the annual APEC meetings, public discourse on APEC and media coverage of it, as well as much of the discussions within APEC itself, have tended to focus almost exclusively on the liberalization agenda and, within that agenda, on the products of particular interest to certain developed members. Thus, in 1996, it was information technology. In 1998, it was the products on the list for so-called Early Voluntary Sectoral Liberalization. The most heated debates in the APEC meetings were on these subjects. The media and other commentators viewed the success of a particular APEC leaders' meeting as depending on whether consensus could be achieved on these sectors. When the issues had to be elevated to the WTO, where they, in fact, belong and the only place where they could be resolved, the meeting was adjudged a failure.

ASEAN countries would like to see a greater balance. They would like to see the liberalization agenda encompass also the goods that are of interest to most of the APEC members. This is why, at the last APEC leaders' meeting, they supported the inclusion of tariffs on industrial goods, as well as agriculture and services, in the agenda of the next round of WTO negotiations. This is why they insisted that the round deal with all sectors together as a single package rather than conclude definitive agreements on each. This is also why they would not consent to starting the WTO round before they and other developing members were ready to negotiate.

ASEAN countries would also like to see the liberalization agenda balanced by the two other pillars of APEC -- trade and investment facilitation and economic and technical cooperation.

APEC -- and WTO -- agreements to liberalize trade in information technology and electronic commerce, for instance, would interest the developing countries more if the level of these countries' competitiveness were sufficiently raised through their acquisition of a certain degree of technical competence, which IT and e-commerce require. They would have to attain a certain level of capacity to build and manage the institutions and processes for operating in an open and globalized economy. Indeed, they would have to acquire - quickly -- the expertise needed to undertake the incredibly complex negotiations on trade liberalization, particularly in the services sector.

This is why ASEAN countries support the intention of Brunei Darussalam to emphasize, when it hosts the APEC meetings next year, human resource development, the acquisition of the ability to compete in and benefit from the knowledge-based industries, and small and medium enterprises. This would, to some extent, redress the growing imbalance in the APEC agenda.

The development of human resources, the capacity for knowledge based industries, and SNMs is obviously a long-term endeavor. It needs patience and perseverance. It is necessarily slow and gradual. It is not headline stuff. The media and, therefore, the politicians are not interested in it. In this sense, it is not susceptible to treatment in summits, with their carnival atmosphere and attendant media frenzy.

In this light, summits may, in fact, be a hindrance to progress in the less spectacular but equally important areas of APEC. The presence of political leaders raises expectations enormously and intensifies pressures for dramatic breakthroughs. This tendency, of course, is reinforced by the intensive coverage of the media hordes, coverage that top-level participation inevitably attracts. The presence of political leaders and their accompanying media also draws large groups pressing a broad variety of causes, providing further competition for media attention and for the resources of hosts and other participants. In 1996, it was the massive demonstrations against APEC itself. Political leaders must deal with the political issues of the moment, which further divert everyone's attention. In 1997, it was aspects of the financial crisis that APEC was not equipped or intended to address. In 1998, it was Anwar Ibrahim. In 1999, it was East Timor.

A summit may have been required in Seattle to give APEC prominence, in Bogor to make the political commitment to the goal of regional free trade by 201 0 and 2020, and in subsequent years to put pressure on the WTO process. However, at some future time, when global trade negotiations are well underway, and those negotiations no longer need as much pressure from APEC to gain momentum, APEC may find itself able to dispense with the annual summit and return to the system of its first four years, when the annual event was at ministerial level.

At that level, there would be less pressure for dramatic breakthroughs. The tendency to use the annual gathering merely to prod WTO would be reduced. Media and public expectations would diminish. So would political distractions. Greater balance might be restored to the APEC agenda.

Trade liberalization would continue to be important. The Bogor goals of free trade in the Asia-Pacific should continue to be pursued. But greater seriousness ought to be devoted to economic and technical cooperation.

This is vital for the developing economies. It is also vital for APEC. After all, the developing economies account for the majority of APEC's members, and its peoples make up the bulk of the region's population. APEC needs their support and commitment.

On a smaller scale, ASEAN is doing something to help its members cope with economic globalization and regional economic integration. Within ASEAN itself and in the ASEAN dialogue system, the focus of cooperation is shifting to the development of human resources and the building of institutions, particularly in its newer members. We know that this is the only way for ASEAN members to deal with the intensifying competition in a globalizing world and an integrating regional economy. The ASEAN Free Trade Area and the ASEAN Investment Area, in the end, will be fulfilled only when the human resources and the institutions are in place and working.

In this, the efforts of ASEAN and of APEC need to be coordinated. After all, all of ASEAN's dialogue partners, except India and the European Union, are members of APEC. At the same time, this raises the question: Why are Cambodia, Laos and Myanmar, all ASEAN members, not yet members of APEC, when APEC started out with ASEAN at its core?

There ought to be greater coordination between ASEAN and APEC in such areas as HRD, SMES, technology transfer, and information technology. This would, in turn, require a return of APEC to its first principles and original purposes.

Here, the role of PECC can be crucial as an advocate of a greater balance and more-long-term vision for APEC. Its tripartite composition can help it - and APEC -- retain objectivity and practical sense. PECC was a direct precursor of APEC and laid the ground for it. Its work can point the way to APEC's future and thus the future of the Asia-Pacific.