In January, Kiwi economist Dr Alan Bollard returned to Wellington from Singapore, after completing two terms as the executive director of the Asia-Pacific Economic Cooperation Secretariat. He spoke to the Asia Media Centre about the changes he witnessed during his six years there, and what the future of APEC might look like.
You were the first APEC director to serve two terms. Was it hard to leave it all behind?
Not really. It’s quite a testing job – you’re travelling a lot. I’d also seen the APEC organisation go through some big changes. I arrived at the tail end of the time when APEC had been part of a very big increase in trade across the Asia-Pacific. It was a period when large numbers of people had been helped out of poverty. But it was also the time when the Global Financial Crisis had happened, and we were starting to understand some of the bigger implications of all that.
During your six years in Singapore, what’s something interesting you learned about the region?
In the civil service, we used to do quite a bit of work comparing New Zealand and Singapore. I guess having lived there, I don’t really know why we would do that, because they are so different. What I learned is that New Zealand has an economy that is still rooted in primary resource production, which people say is a great resource. You go to Singapore and people say, “look, we have no resource here at all”. But that’s not true – they’ve got the resource of incredible location. If you draw a circle of about 1500km radius around New Zealand, there’s nobody. If you do the same around Singapore, there’s nearly a billion people. If you handle that right, that’s a huge resource.
What were some of the major changes to trade you witnessed?
We’re still seeing growth in traditional merchandise trade, but at a slower level. We’re seeing intense urbanisation, and big growth in middle classes. We’ve seen ageing populations, and some big technical disruption. Partly in response to all of that, APEC has had to change what it’s doing. We were traditionally focusing on things like border barriers, tariff barriers, non-tariff barriers at the border, customs officers. Now the focus is on behind-the-border barriers, which tends to mean regulatory harmonisation.
In the last couple of years, there’s also been a big focus on services trade. That can mean a whole lot of things, from telecommunications to tourism to financial and government services. Integration of services trade hasn’t achieved a very high level in the Asia-Pacific. But it’s now growing much faster and there’s a number of policies underway to try and promote that.
In addition, there’s a big focus on digital trade. It’s changing supply chains and products and making it possible to do a lot of things that weren’t done in the past. But it’s also not clear how it will all work out, because there’s so much technological change still underway.
"It can be quite difficult to predict just who in an economy is going to benefit from or be harmed by globalisation policies."
What was a personal highlight of your time there?
We’ve seen some very practical things like the APEC Business Travel Cards, which let businesspeople get through immigration very efficiently. One of the longer term things I think was very important but hasn’t really happened yet is the move towards a free trade area for Asia and the Pacific. There’s about 150 regional or bilateral trade agreements underway or signed in the APEC region. One of the things APEC is doing was trying to make sure those all converge, rather than going off in different directions. The umbrella policy is called Free Trade Area of the Asia-Pacific.
What was the biggest challenge?
The new US Administration brought up this whole issue of anti-globalisation. It’s made us focus much more on who’s benefiting or not benefiting from globalisation. In the past, there’s been a general assumption that when you open up economies, it’s probably going to be economically beneficial overall. But we do understand that it doesn’t necessarily help everybody within every country, and there can be specific groups who are, or feel they are, disadvantaged. It can be quite difficult to predict just who in an economy is going to benefit from or be harmed by globalisation policies.
What will APEC look like in the future?
An exercise is now underway looking at where APEC should go beyond 2020 – should it change what’s it doing, or should it go back to its core operations. I suspect it will probably keep focusing on cross-border issues. But now, cross-border issues are not just goods in containers on ships; they’re much more likely to involve data and services and other intangibles.
What can we expect from APEC 2021, which NZ is hosting?
APEC is hosted by a different economy every year. This is a big job because there will be about 250 meetings over the year, involving 20,000 people visiting the host country, and something like 80 technical groups working away on different aspects. It will start at the end of next year and run through to November 2021 when leaders will arrive for meetings, presumably in Auckland. That’s the bit you’ll hear about. But leaders can say all sorts of things, and they won’t happen unless you get all the technical working groups lined up and working away at the practical implications of the policies and technologies. We’ll have to work on helping New Zealanders understand what APEC is and appreciate that it isn’t just a bunch of traffic jams in Auckland.
Interview and editing by Siobhan Downes.
- Asia Media Centre