Under these circumstances, the efficiency and effectiveness of the numerous free trade agreements in the Asia-Pacific region have yet to be tested. The China-ASEAN Free Trade Agreement, for instance, was initiated in 2010. However, only 35 percent of Chinese enterprises can fully utilize it for trade transactions, Shen Minghui said.
Moreover, China has not reached free trade agreement with some major trading partners of China in the region, such as the United States, Japan and Australia.
"If APEC can build FTAAP, then all member economies will benefit from it," Shen Minghui said. But he admitted, given the large economic development gap between the 21 APEC member economies, it is difficult to cater to all tastes.
"FTAAP is a long-term prospect for APEC member economies. For now, all parties should take concrete steps to reach consensus on exerting efforts toward the goal," Shen Minghui said.
Focus on global trade
Global value chain and supply chain discussions highlighted the APEC Ministers Responsible for Trade Meeting in Qingdao, east China's Shandong Province, on May 17-18.
The meeting passed two important proposals: the APEC Strategic Blueprint for Promoting Global Value Chains Development and Cooperation, and the Strategic Framework on Measurement of APEC TiVA Under Global Value Chains.
Today, economic globalization has entered into an era of global value chains, trade and investment between APEC economies, and production networks in the Asia-Pacific region have become an important part of the global value chains, said spokesman Shen Danyang in an interview with Chinese media outlets.
The scope of trade has been not limited to goods, as service is accounting for an increasing proportion in trade of many developed economies. Moreover, trade has been more and more complicated to calculate because many economies are likely to be involved in a product from its design to production and sale, according to Shen Danyang.
He took the iPhone as an example to showcase the complexity of trade: The operating system is designed in the United States, its chip is produced in Japan, some components are produced in South Korea, and it is assembled in China and exported to the rest of the world.
"In the past, the large trade surplus came with large income. But it is less so today. The global value chain includes trade, service and investment. The measurement is helpful for economies to know its position in the global value chain," he said.
China has long been called the world's factory, and the large scale of trade often makes China a target for trade disputes. Shen Danyang pointed out, with measurements of the global value chain, it will be easy to find that China's trade surplus in fact does not really belong to it.
In addition, supply chain management is a new task for APEC in recent years. The production and trade chain between Asia-Pacific economies has reached a high level of integration. If the supply chain cannot be improved, it will bottleneck regional economic development, Wang from the CIIS said.
With the two framework agreements, APEC hopes to establish a cooperation mechanism on global value chains and promote it to the rest of the world, Wang said.
Developing the Blueprint for Connectivity is a major task for this year's AELM, China's APEC senior official Tan Jian said at the APEC Studies Center Consortium Conference on May 11 in Qingdao.
Connectivity has three pillars: physical or hard connectivity, which includes transport (land, maritime and air), telecommunications and information and communication technology, and energy infrastructure; institutional or soft connectivity, which includes customs, supply chains, financial spheres, regulatory coherence and structural reform; and people-to-people connectivity, which includes business mobility, student and researcher mobility, tourism facilitation, labor and professional mobility, and cross-border education.