Does Apec risk running out of steam?

The virtual summit thawed out some frigid relationships, giving this venerable institution a new lease of life, but challenges still remain.

New Zealand has just completed the world’s largest-ever suite of virtual meetings, 300 events over the last year, covering everything from trade to health to agriculture, nearly 1000 hours of meetings.

It has agreed a carefully drafted leaders’ statement and an action plan to work on. Yet well-organised meetings and an aspirational plan are not the real achievements. The big achievement is that the governments of more than half the world’s economies have signed up to working for a strong Covid recovery.

Before this year that could not be taken for granted: The omens had not been good for our hosting. Apec has been running for many years, but this venerable institution was at risk of running out of steam for a range of reasons.

Donald Trump’s aggressive diplomacy and Xi Jinping’s assertive response meant that power relations had become frigid around the virtual meeting tables.

When big powers disagree, it is very hard to get consensus, and a lack of

consensus in Apec means nothing progresses. In addition, it was getting difficult to get leaders’ attention – within the last month alone, there have been competing G20, East Asian and COP26 leaders’ summits. But it was not just the big powers. Support for globalisation has been waning. Apec has helped bring a billion people out of poverty, a stunning achievement, but the New Zealand Government knew it could not assume there would be continued support for trade-driven growth.

And then Covid struck. Technologies like Zoom already existed, but diplomats had a cultural aversion to virtual meetings.

Early on, when New Zealand announced Apec would go virtual, some partner economies said that would be impossible. Now we have succeeded in changing the face of international diplomatic meetings for the future. As a result, by some measures Apec 2021 has been the lowest-cost, greenest and most inclusive Apec year ever.

So what did the Apec year actually achieve?

Amid the Covid crisis, New Zealand used the economic recovery from Apec as a rallying call. Ministers talked about improving health supply chains and reducing trade barriers to health equipment. The vast majority of Apec economies have now reduced or abolished tariffs on Covid-related supplies and reduced intellectual property barriers.

Last week, the leaders’ meeting agreed an ‘‘Aotearoa Action Plan’’ to guide Apec work for the next few decades. There are 78 specific collective actions proposed, a huge body of work.

Apec is a voluntary association of economies, so we should not expect legally binding agreement on these actions. Rather Apec is the place to incubate new ideas, to try them out amongst willing economies, and later to embed them into formal bodies like trade agreements, the WTO or the COP meetings.

What has been the downside this year? Twenty thousand Apec visitors could not visit Aotearoa and understand what makes our country. No doubt the year of trade tensions and Covid will continue to be difficult.

On the personal front, there are some very tired Apec officials due to the exigencies of globe-wide virtual meetings – the prime minister began her leaders’ meeting last week at 3.30am!

After a weekend of sports disappointments, it was a relief to hear the plaudits for New Zealand’s hosting.

But Apec is a long-distance event not a sprint, and 78 collective actions is only a start: There is a long way still to go.

When big powers disagree, it is very hard to get consensus, and a lack of consensus in Apec means nothing progresses.