Apec pledges to break non-tariff barriers

Ministers undertake to speed up the effort to remove a growing threat to international trade.

By Rod Oram

Business Herald editor

Apec ministers pledged yesterday to accelerate efforts to remove non-tariff barriers to trade, calling them a growing threat to international commerce.

As Apec's 21 economies have cut tariffs, non-tariff barriers such as unnecessary or arbitrary regulations have replaced them as ways to protect domestic businesses from imports, the ministers said.

Erecting such barricades was "deeply sub-optimal behaviour," Enterprise and Commerce Minister Max Bradford said.

They were particularly damaging to small businesses, which were "the engine of growth" for the Asia-Pacific region.

However, New Zealand was also guilty of the practice, as witnessed by the recent ban on imported trout, one business delegate told the two-day meeting of Apec ministers and business representatives.

The ministers, who had met to develop policy initiatives to foster small and medium-sized enterprises, said they would now urge all working parties within Apec to intensify their efforts to break down these non-tariff barriers.

A "substantial package of trade facilitation measures" was already underway to present to Apec ministerial meetings in Auckland later this year, the ministers said in their communique at the end of the meeting.

The communique presented initiatives on reducing trade barriers and compliance costs, improving capital markets and business education and enhancing e-commerce.

Senior officials from Apec will take on the task of shepherding the proposals, designed to strengthen markets, through Apec working parties and other ministerial meetings.

The proposals were welcomed by Bruce Irvine of accountancy firm Deloitte Touche Tohmatsu, who had chaired the 300-delegate business forum which met with the ministers.

Although the thrust of the proposals was for open markets and private rather than public sector activity, the language of the debate and communique was loose enough to allow governments to respond according to their own political style.

The only contentious issue in yesterday's session was a proposal from Thailand for an Apec-wide, government financed venture capital fund.

The suggestion was firmly squashed by ministers from countries such as the US, Canada and Australia, who all said the private sector should play such a venture capital role.

The proposals steered clear of favouring small and medium enterprises through, for example, preferential financing or trade deals with governments.

This was in sharp contrast to an agenda of interventionist initiatives for smaller business drawn up last year by the Apec Business Advisory Council.
Abac, made up of three government-appointed business representatives from each economy, was set up to give a business view to Apec leaders.