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APEC Calls for Conclusion of ITA Expansion Talks by mid-2013

Trade ministers from APEC’s 21 economies descended on the sprawling city of Surabaya in East Java this weekend in their annual discussions to promote trade and investment in the Asia-Pacific region. Though progress was achieved on a number of fronts, the tech community especially welcomed the clarion call issued by the ministers to conclude negotiations to expand the Information Technology Agreement (ITA) by the middle of this year, and that the outcome should be “commercially significant.”

This was included in the weekend’s Statement on Supporting the Multilateral Trading System and WTO 9th Ministerial Conference:

Building on the progress to date, APEC Ministers Responsible for Trade call on ITA participants to swiftly conclude negotiations to expand the product coverage of the WTO ITA by the middle of the year and seek expanded membership of the ITA. A final ITA expansion outcome should be commercially significant, credible, pragmatic, balanced, and reflective of the dynamic technological developments in the information technology sector over the last 16 years. Such an outcome would support several APEC objectives, including strengthening the multilateral trading system, promoting connectivity, supporting regional economic integration, and driving economic development throughout APEC economies.

Now accounting for 40 percent the world population, 54 percent of global GDP, and 44 percent world trade, APEC played a critical role in birthing the ITA in the mid-1990s. It’s only appropriate that APEC is actively engaged in taking the agreement to a whole new level through a significant expansion of products covered by the ITA.

Another round of ITA expansion talks kick off in Geneva on Monday. The APEC ministers’ supportive words should give the negotiators a good boost and a stronger mandate to get an ambitious outcome by the middle of this year.

Japan and the TPP

Another welcome development from APEC is the joint statement by the current members of the Trans-Pacific Partnership (TPP) talks. Japan’s pending entry gets strong play:

Ministers also confirmed that each TPP member has concluded bilateral consultations with Japan regarding Japan's interest in joining the TPP. Today, Ministers agreed by consensus to finalize with Japan the process for entry in a manner that allows the negotiations to continue expeditiously toward conclusion -- as was done with other members that joined the negotiations in progress. Japan can then join the TPP negotiations upon completion of current members' respective domestic processes.

In an interview posted today on the Wall Street Journal site, Acting USTR Demetrios Marantis underscored the importance of this progress:

Integrating Japan into the TPP does a number of things. One, it helps to realize the goal of TPP as being a platform for integration in the Asia-Pacific, and having Japan and the size of its economy and population increases the economic significance of the TPP not just to the U.S. but to all the TPP countries. It provides a huge market for exports and for the jobs that are supported by those exports. Bringing Japan in really just increases the economic significance of the TPP.

Japan’s entry in the TPP has epic implications both commercially and strategically. This endorsement by all 11 members of the TPP represents an important political step forward towards getting Japan into the negotiations expeditiously.

Local Content Requirements and Innovation

Two other useful data points were tucked into the official statement of the 2013 Meeting of APEC Ministers Responsible for Trade.

We welcome the trade policy dialogue to discuss the economic impact ways to avoid the use of local content requirements in promoting economic growth and employment. We take note of the initiative to continue discussion among officials aimed at enhancing better understanding of the issues and formulating a way forward.

Local content requirements are looming large on the global economic stage. They are massively disruptive to the same global supply chains the tech sector so heavily depends on. It is encouraging APEC’s work in this area is beginning to get traction, including presentations earlier this month by several experts at APEC’s Committee on Trade and Investment.

Finally, the trade ministers gave a decent nod in their official statement to ongoing work in APEC to promote effective innovation policy:

We reaffirm our commitment to promote effective and non-discriminatory innovation policy, including through developing and finalizing implementation practices by October 2013.

This gives a shot in the arm to on-going collaborative work between the tech sector and the U.S. government to lead an effort to convene a APEC conference on trade and innovation in late June in Medan, Indonesia. ITI has been heavily involved in this work.

Public Policy Tags: Trade & Investment, Forced Localization