As had been expected, the recent Asia-Pacific Economic Cooperation (APEC) Leaders Meeting in Beijing agreed on November 11 to establish a roadmap towards an eventual realization of the proposed Free Trade Area of the Asia Pacific (FTAAP).

The vision for the FTAAP was first set out in 2004, but it was in 2010 in Japan and again in Bali in 2013 that APEC Leaders proposed the FTAAP as a comprehensive, high quality agreement that would build on existing regional trade agreement (RTA) and bilateral free trade agreement (FTA) talks in the Asia Pacific.

These include the framework of the Association of Southeast Asian Nations (ASEAN) Economic Community, the Pacific Alliance, the proposed United States-led Trans-Pacific Partnership, and the negotiations for a Regional Comprehensive Economic Partnership between ASEAN and its six FTA partners (South Korea, Australia, New Zealand, China, India, and Japan), in which China is particularly involved.

"We need to intensify regional economic integration and foster an open environment that is conducive to long-term development," explained China's President Xi Jinping, in his opening remarks. "We should vigorously promote the development of the FTAAP by identifying targets and laying out directions and roadmaps. This will help realize, at an early date, the vision of a highly open integration arrangement that spans across the Pacific Ocean."

In Beijing, the Leaders therefore reaffirmed their commitment to the realization of an eventual FTAAP as soon as possible "by building on ongoing regional undertakings."

In particular, they welcomed the establishment of a Committee on Trade and Investment (CTI) Friends of the Chair Group on Strengthening Regional Economic Integration and Advancing FTAAP, and agreed that the CTI should "launch a collective strategic study on issues related to the realization of the FTAAP, and instruct officials to undertake the study, consult stakeholders and report the result by the end of 2016."

It was noted that, amongst other things, "the strategic study will build on and update existing studies and past work, provide an analysis of potential economic and social benefits and costs, perform a stock-take of RTAs/FTAs in force in the region, analyze the various pathways towards the FTAAP, identify trade and investment barriers, and consider any recommendations based on the study's findings."

In addition, as further support for FTAAP's realization, the Leaders looked to increase the transparency of tariffs within existing and recently concluded RTAs/FTAs, by advancing work under the APEC Information Sharing Mechanism.

Finally, they also confirmed an extension, from the end of 2016 to the end of 2018, to APEC's existing tariff standstill commitment, and pledged their continuing commitment to reduce non-tariff barriers to investment and to trade in goods and services.

Source: Tax News

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