Apec food 'minefield' is ripe for reform

By Yoke Har Lee

Private sector representatives in Apec countries are keen that specific funds be set aside to study the affects of genetically-modified organisms on food.

Genetic engineering is touted as a quick way of improving world food production. But manufacturers have faced increasing consumer opposition from consumers fearing GE effects on food.

The Apec Business Advisory Council's proposal for an Apec Food System was last week presented to the Prime Minister, Jenny Shipley, who is the current Apec chairwoman.

In tackling one of Apec's political minefields - that of pursuing liberalisation of the region's food trade - Abac has taken a comprehensive approach, promoting the concept that such liberalisation cannot stand in isolation.

Its proposal covers a spectrum of socio-economic agendas that has to precede or accompany any move to free up trade in food.

Fran Wilde, chief executive of the New Zealand Trade Development Board and one of the three New Zealand Abac members, said: "This approach is far more comprehensive than anything that has been put in place. It encompasses the intellectual input from business people and academics from Apec countries."

It is significant that all private sector representatives (usually three from each Apec country) back the proposal. This includes the Japanese, the Americans and Koreans where, domestically, agriculture is sacrosanct.

Academics from Korea and Japan, in their input into Abac's own exploration work, highlighted the need for Apec to reflect the multiple roles food plays in the respective economies and a need for flexibility.

The Japanese pointed to the international food market's desire to balance food supply and food purchasing power. It was not aimed at eliminating hunger, even though one-seventh, or more than 800 million, of the world's population do not have enough to eat.

The pillars of the Apec Food System are in its recommendations dealing with complex and sensitive issues such as food security, food safety and the economic role of agriculture in rural societies.

The most hardline approach calls for the abolition by 2001 of any limitation of food supply to other members for political or economic reasons and the elimination of export restrictions as a Food System commitment.

This requires members to eschew export embargoes, export taxes and other restraints on food trade.

The Food System also recommends formation of an export subsidy free zone within Apec.

It also proposes the building of food production capacity in developing economies within the Apec region through "a culture of food technology," setting up a food investment code and focusing on rural development strategy based on an Apec-Pacific Economic Cooperation Council project called Rural Integration for Sustainable Economy.

Realising the limitations of pure food trade liberalisation, Abac wants public sector policies to aid the development of physical and financial infrastructures and to promote sustainable development of rural economies.

To help developing Apec economies deal with food safety issues (in an effort to enhance their ability to produce and trade food), members could draw on each other's expertise, and those of international agencies, to establish transparent and internationally-based sanitary systems/checks.

Appropriate technologies should be applied to introduce a competitive, safe and environmentally-friendly system of food production within the Apec region.

Abac recommends that each country create alliances to pick and apply the best examples of technology transfer.

Abac chairman Philip Burdon is optimistic Apec leaders will adopt the proposals.

While he was careful not to speculate on whether there would be political difficulties associated with Abac's proposals, at least two academics are hopeful Apec can generate the momentum for freeing up trade in food.

Tim Josling of Stanford University in the United States and Song Yoocheul from the Korea Institute for International Economic Policy said in a paper written for the Pacific Basin Food and Agriculture Strategy Conference in March this year that large regional blocs such as Apec provided a quicker forum to deal with agricultural issues than traditional platforms such as the World Trade Organisation.

Their view is that "while a grouping such as Apec might not solve the problems of protection in agriculture markets, the political calculus might change enough for some serious liberalisation to occur in agriculture markets as a result of such blocs."