It is impossible for any country today to achieve prosperity solely on its own. In the world of globalization, cooperation must be every country's first priority. Countries in the Asia-Pacific region realized this 18 years ago when they got together and established the Asia-Pacific Economic Cooperation (APEC). The formation of the premier forum for facilitating economic growth, cooperation, trade and investment marked a milestone in regional economic cooperation.

In early September, leaders from 21 APEC member economies met at the summit in Sydney to discuss the problems they face as a whole, such as climate change, and to debate the idea of creating a free trade area for the Asia-Pacific region.

This year's topics

The APEC meeting in Australia adopted the theme "Strengthening Our Community, Building a Sustainable Future" for its meetings on September 2-9. Ever since it was established, APEC's mission has been to reduce tariffs and other trade barriers across the Asia-Pacific region in order to boost domestic economies and increase exports. Through policy alignment and economic and technical cooperation, APEC wants to create an environment for the safe and efficient movement of goods, services and people across regional borders.

The summit consisted of the Concluding Senior Officials Meeting, Business Advisory Council Meeting, Ministerial Meeting and Economic Leaders Meeting. Besides climate change and a free trade area, participants also discussed energy security, human security, forestry recovery and APEC reform. They talked about ways to break the current deadlock on the World Trade Organization's (WTO) Doha round of negotiations. These talks aim to lower trade barriers around the world and permit free trade between countries of varying economic prosperity. The Doha Round has hit some roadblocks since it started in 2001.

One of the topics at the summit was climate change. According to information from the Australian APEC Study Center at Monash University, new research shows that strategies proposed by British Treasury economist Nicholas Stern to tackle climate change would cause severe economic damage to developing countries. Stern's report proposed deep global cuts in emissions, and estimated the cost for this to be no more than 1 percent of world economic growth.

That seems small, but the implications are not. Recent research published by the center shows that such a reduction in the global economy would reduce economic growth in China by 15 percent, in India by 13 percent, in member nations of the Association of Southeast Asian Nations by 12 percent and in the United States by 4 percent. Household expenditures of ordinary people in those countries would be cut even further, the article said. With more than 1 billion people still living on less than $1 a day, such a draconian strategy would be unacceptable to many countries, the center said.

At a press conference in Beijing prior to the APEC meeting, Chinese Assistant Foreign Minister Cui Tiankai said that the country hoped to see progress on climate change and clean energy development, the integration of the regional economy, multilateral trade and APEC reform. "China will make concerted efforts with concerned parties to achieve the objectives," he said.

Free trade area

The potential trade gains from more transparent and predictable trade regulations among APEC economies would be worth approximately $148 billion to the region, according to a World Bank report released at the meeting by Australian Minister for Trade Warren Truss. "Greater transparency and predictability boost trade and reduce costs to business and ultimately to the consumer," he said. The World Bank report is aimed at supporting APEC's work on trade facilitation and transparency.

The Business Advisory Council (ABAC) on September 5 called on APEC economic leaders to take measures to improve the flow of trade and investment in the region.