Services take spotlight during meeting of business leaders

Monday, April 27, 2015

By Cassandra Oaten

Officials in the APEC region recognise the importance of facilitating services trade and inter-border investment due to the business growth that comes from allowing a more open international services market that will enable opportunities for entrepreneurs and businesses on a global scale.

The opening and liberalisation of markets, free from restriction which limits foreign players will enable innovative ideas to spread to new markets and opportunities to become available for existing domestic providers. International competition in services that have been traditionally been met by domestic traders may result in productivity boosts, a raise in quality of received services and put downward pressure on costs of services as competition is introduced. New ideas and demands on new services will drive technological progress in e-commerce and service provision as companies figure out modes to reach new markets.

Last week business leaders representing their own economies from all member countries of the APEC region converged in Mexico for the 2nd ABAC Meeting of 2015. The ABAC (APEC Business Advisory Council) is the business arm of APEC with members being leading business figures who have been chosen by their country’s leader to represent their nation’s business community.

Thus this forum is working on reforms to recommend to leaders to address trade-related service restrictions. Trade in services has been a growing importance for ABAC who builds on the work of APEC who already has an APEC Group on Services (GOS) which has proposed an APEC Services Cooperation Framework (ASCF) as a recent initiative.

The ASCF proposal was discussed by leaders at the first APEC Senior Officials Meeting (SOM I) in February 2015. A revision of the proposal from the Philippines will be discussed in the second Senior Officials Meeting (SOM II) in May 2015. Other APEC services initiatives include the APEC Connectivity Blueprint 2015-2025 which aims to encourage future initiatives for more efficient flows of not just services but also tangible goods, capital and labour within the APEC region. This full leader’s declaration of this Blueprint can be assessed here.