Talking Trade blog
When business sits at the table in APEC
Published 20 May 2015
Boracay, Philippines—One complaint frequently expressed by business is that governments keep making trade policy decisions without sufficient input from companies. Government officials often remark that businesses are not providing sufficient feedback into the policy process.
Asia Pacific Economic Cooperation (APEC) is supposed to help sort out these issues by deliberately providing seats at the table for both business and government. APEC does this in multiple ways. Two prominent examples are the use of the APEC Business Advisory Council (ABAC) and providing opportunities for companies to participate in the myriad meetings and sideline events attached to different APEC officials meetings.
ABAC meets four times per year in shifting locations around the world and provides its’ own recommendations to the leaders of the 21 APEC member economies at the end of each year. APEC officials gather in the host country for three rounds of senior officials meetings, plus the final jamboree of leaders and trade ministers towards the end of the year.
I have now attended several different meetings of these sorts and I can clearly see the difficulties that both sides have in communicating with one another. I believe I have gone to enough events and spoken to sufficient numbers of people about their own experiences to draw some preliminary conclusions about the process, but not so many that I have become an insider.
APEC is an extraordinarily complex animal. There is not, as far as I know, an organizational chart that maps out the various working groups, committees, consultative mechanisms, and projects that are underway at any given time. If there were such a chart, it would be so jammed up with lines and boxes that it may not make sense.
The institution comes with its own jargon. This is a terribly complex mix of trade terms, language drawn from business, and a set of acronyms that would make any military proud. It can be so complicated that even long-time participants in the system cannot recall the meaning of all the abbreviations without looking them up.
Of course, lots of different organizations use specific jargon. Yet the closest equivalent body I can think of—the World Trade Organization (WTO)—doesn’t seem to have quite the same level of jargon plus acronyms plus often detailed technical content under discussion. I sometimes found the WTO to be impenetrable, until I sat in on these APEC meetings. Now I feel particular fondness for conversations in Geneva at the WTO.
If I am struggling with managing the information and APEC-speak, I can only guess at the challenges that face the business leader that pitches up an APEC meeting. With no one to put things into context and what appears to be an inability to translate some of the worst acronyms into normal language, I suspect that many extremely capable business leaders are mostly lost. Everything is in English, which does not help. Even most of the slides that were presented at the events I attended were not helpful—too small to read, whipping by at too fast a speed to comprehend, and without hard copies (or downloadable files) always available.
The next set of barriers to communication could be put down to meeting formats. Business leaders expect (or at least hope to achieve) clear and crisp meetings with specific action items identified. This format does not exactly appear compatible with APEC (or maybe government meetings in general?). In any case, the objectives of meetings are not always clear. The deliverables may not be spelled out. Or, they might be obvious to someone who has attended multiple meetings and understands the unspoken subtext of the meeting. But I could certainly imagine frustration by some businesses about the loss of a whole day or more in a meandering, apparently pointless set of meetings.
One mechanism for including business has been to invite business leaders to serve as speakers. This approach also has drawbacks. Absent clear instructions about what is supposed to be accomplished by the speaker, many firms show up and basically give a short infomercial about their company. (Before I upset anyone, I should note that this complaint was made frequently about presenters at meetings I did not attend.)
If feedback is needed on policy documents, the materials have to be circulated sufficiently far in advance. Then some guidance should be given to help businesses understand the context for the materials as well as specific areas of focus. An open ended, “Please give us your feedback” is probably not going to solicit helpful remarks. Asking for reactions to technical briefings from the business community on the spot are also not likely to yield much in the way of truly useful comment. Firms can provide ample input, but need time and structure to do so effectively.
Public-private partnership models of all sorts seem to be currently in vogue. However, businesses seem extremely unclear about what sorts of inputs they are expected to provide to these projects and meetings. Without meaningful solicitation of ideas and a format or structure that aligns with their company interests, firms will simply stop attending.
Attendance problems are compounded when APEC meetings are held in locations that are not easy to reach. For SOMII (the second Senior Officials Meeting of the year), the Philippine hosts selected Boracay as the venue. Boracay is a challenge to reach. Most participants flew into Manila and then changed planes. The island of Boracay is serviced by two different airports. One is 2 hours away from the ferry terminal by car. The other airport is closer, but in both cases, participants had to be loaded onto boats for the short crossing to the island. From there, participants were sorted into vans. While Boracay has lots of hotels, none are big enough to host the number of delegates needed. Participants have been spread across the whole of the island in a variety of venues. All need to be shuttled between hotels all day long.
Thus a business leader that wanted to attend one meeting would have to give up at least 3 days to do so. For that kind of commitment, business expects to at least get some clear outcome and see progress being made. This is, as even many APEC groupies admit, not always obvious.
Smaller companies are unable to attend at all. Between the time commitment and the costs of getting to places like Boracay, small firms simply give the whole process a miss. The only way to encourage small and medium sized (SME) firms to participate is to hold carefully structured meetings (with no jargon or APEC-speak allowed) in locations like capital cities where SMEs congregate.
Getting businesses to sit at the table may not be so difficult. Firms understand the potential power of APEC to shape the economic environment in a key part of the world. They want to be engaged. They are often eager to attend. The real challenge is getting business leaders to attend more than once. For meaningful engagement between government and business, APEC has to keep people coming and provide them with all with clear, helpful and constructive roles to play.
*** Two other points worth noting here related to trade:
The Senate last week voted to start the debate about Trade Promotion Authority (TPA). This was not, as some people thought, the same thing as approving TPA. The fight in DC has been over which amendments to the TPA bill will be allowed before the final vote. Of critical importance is limiting the number of amendments, since the Senate bill was written to match similar legislation in the House of Representatives. If there are differences between the two bills, these have to be reconciled.
Again, if the fight were merely about TPA, timing would not matter so much. But negotiators are sitting in Guam right now trying to iron out the remaining differences in the Trans-Pacific Partnership (TPP) negotiations. Trade ministers are planning to leave Boracay and join them next week. Absent TPA, it may prove to be a long, tiring trip for little purpose since most are not willing to put final offers on the table unless and until the Americans are ready.
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