First Senior Officials Meeting

SUMMARY CONCLUSIONS OF

THE FIRST SENIOR OFFICIALS MEETING

FOR THE NINTH APEC MINISTERIAL MEETING

VICTORIA, CANADA, 27-28 JANUARY 1997

1.The First Senior Officials Meeting (SOM) for the Ninth APEC Ministerial Meeting was attended by officials from Australia, Brunei Darussalam, Canada, Chile, the People’s Republic of China, Hong Kong, Indonesia, Japan, the Republic of Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, the Republic of the Philippines, Singapore, Chinese Taipei, Thailand and the United States of America. The Chairs of the CTI and EC were also present. The APEC Secretariat also attended. Representatives from PECC, SPF, and ASEAN Secretariat were present as observers. The list of delegates appears as Annex A.

2.The meeting was chaired by Mr. Leonard J. Edwards, Assistant Deputy Minister, Trade and Economic Policy, Department of Foreign Affairs and International Trade Canada.

OPENING REMARKS

3.The Chair opened the meeting by welcoming SOM delegates to Victoria. He thanked the SOM for the stimulating and productive informal consultations of the previous two days at Dunsmuir Lodge, noting that these off-the-record discussions had helped focus the SOM agenda and move key issues forward. He referred to the thought-provoking presentation set out by the guest speaker, Dr. Sylvia Ostry which appears as Annex B. He introduced the Secretary of State for Asia-Pacific, the Honourable Raymond Chan, who officially opened the meeting. Mr. Chan welcomed delegates on behalf of the Government of Canada, and outlined Canada's initial thinking on directions for APEC in 1997. He stressed the importance which Canada attaches to advancing trade and investment liberalization in harmony with APEC's important work on economic and technical cooperation and business facilitation. He noted that Leaders had urged APEC to focus its activities in support of economic and technical cooperation in order to achieve the objective of sustainable economic growth and equitable development in the region. He added that the Chair intended to develop several key themes throughout the five sectoral Ministerial meetings to be hosted by Canada this year, including infrastructure, trade facilitation, and sustainable development. Full participation by business, particularly small and medium-sized enterprises, youth and women were also flagged as priorities of the Chair.

4.The Chair commended the impressive legacy established by the outgoing SOM Chair, Dr. Federico Macaranas, and indicated that Canada would build on the Philippines' work, striving to bring an approach which was focussed, disciplined, results-orientated and transparent. He urged Senior Officials to emphasize quality of work, rather than quantity, in advancing APEC's activities. He raised the question of APEC's expansion and growth, particularly in the light of the limited resources existing in capitals and in the APEC Secretariat, and underlined the need for APEC to focus its activities and to ensure that they provided value. Management and priority setting were highlighted as key issues for APEC this year. The Chair also encouraged SOM to reflect on instructions from Leaders and Ministers to think broadly about APEC issues, viewing activities in a cross-cutting context and focusing on integration. The Chair ended his remarks by expressing the wish that the meeting recognize clearly the important role of Ministers and Leaders in advancing APEC's work plans. He urged Senior Officials to be bold and creative in order to continue the momentum in 1997. Opening statements by Secretary Chan and the Chair appear as Annex C and D, respectively.

I.ADOPTION OF THE AGENDA

5.The draft provisional agenda was provided according to the discussion of Senior Officials. The revised agenda was approved and is attached as Annex E.

II.BUSINESS ARRANGEMENTS

6.The Chair informed the SOM of the schedule and arrangements for the Senior Officials’ Meetings.

III.IMPLEMENTATION OF APEC ECONOMIC LEADERS DECLARATION FOR ACTION (MANILA DECLARATION) AND THE 1996 JOINT MINISTERIAL STATEMENT

A.Review of General Directions Provided by Leaders and Ministers

7.The SOM welcomed the document (97/SOM1/007) circulated by the SOM Chair to Senior Officials which summarizes the major points of instruction set out in the 8th Joint Ministerial Statement and the 4th Economic Leaders’ Declaration.

8.The document set out, on a preliminary basis, which APEC forum might take the lead in advancing these instructions. The SOM took note of these instructions and agreed that the SOM Chair would revise the document in light of comments received by economies. It was noted that economic leaders and ministers affirmed the deepening of the spirit of community in accordance with the APEC approach.

9.The SOM was informed of two Leader's initiatives advanced by China on a network of science and technology industrial parks and an environmental protection centre, expressed support, and agreed to ensure that appropriate APEC fora are informed of these initiatives to facilitate their implementation.

B.Trade and Investment Liberalization (TILF)

(i)Individual Action Plans

10.The SOM discussed the 1997 work program and objectives, in response to Ministers' and Leaders' instructions to review and improve IAPs.

11.On the basis of a report provided by SOM, Ministers will review the implementation of the IAPs in Vancouver at the end of this year. The SOM requested that CTI review the agreed IAP format guidelines to further enhance transparency and to report to SOM on this issue at the next meeting in Quebec City.

12.The SOM agreed that the work on implementing and improving IAPs was a continuous process and that ensuring transparency and comparability was a necessary step in improving IAPs. The SOM discussed extensively ways to assess the comparability of IAPs. They agreed that comparability should be defined and pursued as a process rather than an end product. The SOM further agreed on overall approach to assessing comparability rather than a sector-by-sector approach. It was agreed that SOM would be directly responsible and accountable for all aspects of the review exercise and that the subject should form part of the regular business of SOM. The meeting agreed that it would be desirable for member economies to conduct self-assessments and that the New Zealand proposal, attached as Annex F, for monitoring the updating of IAPs would be adopted with the APEC Secretariat taking a lead role in administering the process. The SOM also noted that member economies may conduct consultations among themselves for purposes of improving their IAPs. Some economies indicated the need for early consultations, preferably by the Trade Ministerial Meetings in May, as a means to assist in the improvement of their IAPs. A proposal to hold plurilateral consultations was deferred for later consideration by SOM.

13.In response to the direction of Economic Leaders and Ministers for private-sector input in the review progress, the SOM further agreed that outside resources and expertise would be useful in this exercise. In this connection, it was agreed that views of ABAC and PECC might be drawn upon for SOM's consideration. The SOM Chair informed the meeting that it would write to the ABAC Chair seeking comments on the matter, and would receive any views which the PECC or other private sector interests might wish to offer. In addition, economies highlighted the importance of seeking comments from their respective private sectors on their IAPs. It was agreed that initial inputs would be sought for April, and would be provided to the SOM Chair.

14.The meeting agreed that the SOM Chair would report on the progress with respect to the implementation, comparability and improvement of the IAPs to the Meeting of APEC Ministers Responsible for Trade in Montreal in May, 1997, as an initial step in the review exercise. To this end, members were requested to consider reformatting their IAPs where necessary to make them as consistent as possible with existing agreed guidelines, and to inform the SOM Chair on a voluntary basis by mid-April on the nature and scope of their IAP revisions.

(ii)Collective Action Plans

15. The SOM endorsed the 1997 work programme of the CTI. There was broad support to enhance and highlight trade facilitation work and identify deliverables to Ministers in Vancouver at the end of this year. The SOM directed the CTI to coordinate this work and requested other APEC fora, in particular those with TILF-related activities, to provide reports on facilitation measures to be collated for discussion at the Trade Ministers Meeting in May 1997.

16.In response to Leaders' instructions, the SOM agreed that there was a need to intensify the work on simplification of customs clearance procedures; effective implementation of IPRs; harmonization of customs valuation; facilitation of comprehensive trade in services; and enhancing the environment for investments. The meeting agreed to consider this issue in more detail at the next SOM meeting in Quebec City. In recognition of the fact that investment issues overlap the activities of various APEC fora, the SOM requested the CTI Investment Experts Group (IEG) to liaise with relevant APEC fora and with the Finance Ministers process. The SOM also suggested that the IEG might wish to undertake further studies on investment flows in the region and look into enhancing transparency in investment regimes.

17.With regard to the Economic Leaders' instructions to Ministers to identify sectors for early voluntary liberalization, it was pointed out that relevant tasks for tariffs and non-tariff measures were being undertaken collectively by the CTI following the Osaka Action Agenda and were scheduled for completion in 1999. The SOM asked the CTI to assist in advancing this work.

18.The SOM agreed that voluntary sectoral liberalization need not be limited to tariff and non-tariff measures, but could also include areas of facilitation and economic and technical cooperation. The SOM noted that any sectoral liberalization process would need to seek a balance in the broad interests of members, be subject to wide business/private sector support, and support the principle of comprehensiveness and mutual benefit. It was agreed that views from the private sector of member economies, as well as ABAC, could be taken into account in identifying the relevant sectors. The SOM requested the CTI to conduct further work on developing an approach and methodology to fulfil Leaders' instructions, as part of the SOM Chair's report to the Trade Ministers Meeting in May 1997.

C.Economic and Technical Cooperation

19.The SOM welcomed the presentation from the Chair of the Economic Committee(EC) on the overall direction and planned activities for economic and technical cooperation for 1997 and approved the EC's work plan for 1997. Reflecting the Leaders' Declaration in Subic, SOM reaffirmed that economic and technical cooperation was an essential component of APEC's agenda and agreed to increase its efforts to bring coherence and establish clear priorities for activities in this area in 1997.

(i)Economic Cooperation and Development

20.The SOM recalled the Declaration of a Framework for Economic and Development Cooperation which Leaders had endorsed at Subic and reaffirmed the high priority Leaders had assigned to the following areas of cooperation: developing human capital; fostering safe, efficient capital markets; strengthening economic infrastructure; harnessing technologies of the future; promoting environmentally sustainable growth; and encouraging the growth of SMEs. As instructed by Leaders, SOM agreed to apply these six themes as organizing principles for the activities of all APEC fora in the economic and technical cooperation agenda. After extensive discussion, the SOM agreed that coordination and management of APEC activities to implement the Framework would be the responsibility of the SOM. SOM further agreed that a special committee of the whole would be constituted on a temporary basis by the SOM Chair, in consultation with Senior Officials, to manage this priority issue during 1997, and to assist in preparing deliverables for the Leaders' Meeting in Vancouver. The SOM concluded that the first meeting of this committee would take place at the next SOM and would include Lead Shepherds of APEC working groups. Long-term management of the issue will be addressed by SOM at a later date.

21.At the Singapore meeting in February, the SOM Chair will underline the importance of this priority-setting and results-oriented exercise to the Lead Shepherds of the Working groups and other APEC fora. The SOM Chair will further assist Working Groups and other APEC fora as required in advancing their work in these priority areas in accordance with Leaders' instructions, including by ensuring they are aware of complementary activities underway elsewhere in APEC.

22.The APEC Secretariat will work with the SOM Chair to compile a report on all the economic and technical activities currently being undertaken by APEC fora addressing the six themes, and will make an initial report at the Singapore meeting.

23.In implementing activities in these priority areas, the SOM agreed, as directed by Leaders to work directly with the private sector. In this respect, the SOM Chair will send a letter to ABAC outlining this decision and requesting their support.

(ii)Economic Outlook

24.The SOM welcomed the presentation by Korea which provided an update on its plans to develop the Economic Outlook for 1997, the theme of which is the Impact of Trade Liberalization on APEC economies. Korea confirmed to the SOM that the Outlook would be in two sections: a chapter on the Macroeconomic Review and Outlook, which would include retrospective and prospective material on each economy, and a structural chapter focussing on Trade Liberalization. The first chapter would provide information about the medium-term trends in the region as a whole, as well as on individual economies. The second chapter would have four points: structural analysis; options for trade liberalization; theoretical links between trade and well-being; and patterns of trade and investment flows.

25.SOM agreed that the theme of trade liberalization was a very useful and timely focus for the Outlook, and emphasized the importance of consultation with the relevant Economic Committee task forces and other APEC fora to ensure issues of a cross-cutting nature are included, as appropriate.

(iii)Food, Energy, Environment , Economic Development and Population (FEEEP)

26.The SOM reaffirmed the importance of addressing the Leaders’ initiative on the impact of rapid economic development and population growth on food, energy and the environment (FEEEP). The SOM further affirmed that an interim report would be made to Leaders in November 1997, drawing on the work of relevant APEC fora. The SOM agreed that APEC fora should contribute to the process of developing a framework in which to analyze the inter-linkages related to FEEEP, and agreed that a symposium to be conducted in Saskatoon, Canada in early September 1997 will be an important opportunity to address the relationships among the various elements.

27.The SOM recognized the importance of the activities which have been conducted to date by the Task Force on Food led by Japan and Australia to address issues related to food supply and demand. In view of the policy implications of the elements of the FEEEP study, the SOM requested that it be given the opportunity to comment on the draft study at an early stage.

(iv)Infrastructure

28.The SOM welcomed the report by Indonesia on the Work Program for Economic Infrastructure for 1997 and took note of the Public Private Sector Roundtable Dialogue to be held in Los Cabos, B.C.S., Mexico from June 4-6. Referring to the Leaders Declaration in Subic, the SOM underlined the importance of providing the appropriate financial, economic, commercial and regulatory environment, and working with the private sector to meet the significant infrastructure requirements of the region. SOM noted Chile's announcement of its intention to host a Ministerial Meeting on infrastructure in June 1997. Although this meeting is not an APEC event, Chile noted its desire to solicit participation by member economies. Japan reported on the development of export credit agency (ECA) cooperation, suggesting that a small group meeting of member economy ECAs be held, and announced its proposal to develop an infrastructure development information system which would provide information on infrastructure activities and services to all APEC economies. It was noted that further discussions would be required to develop the theme of infrastructure as a likely focus of the November AELM. SOM further recalled the need to respond to ABAC recommendations on this key area of cooperation.

IV.PLANNING FOR THE SINGAPORE MEETING OF LEAD SHEPHERDS, ETC.

29.The SOM Chair recalled the recommendation of the Task Force on Management Issues and endorsement by Ministers in Manila that a meeting of Committee Chairs (CTI, EC and BAC), Lead Shepherds, the SOM Chair and the APEC Secretariat be convened in early 1997 to discuss priorities for the year, including directions from Leaders and Ministers and issues of coordination among APEC fora. In this regard, the SOM noted that the proposed APEC Joint Fora Meeting would be held on 17-19 February 1997 in Singapore.