Chinese President Xi Jinping. Photo / AP
Jacinda Ardern presides over the Apec Leaders' meeting at a heady time in global affairs.
By the time she moves into a 28th floor studio at Wellington's Majestic Centre to host the Apec Leaders Retreat, politicians like Joe Biden will have returned from the G20 and COP 26 summits.
New Zealand has steered Apec to respond effectively to the biggest health crisis since the 1918 influenza pandemic and the largest economic collapse since the second World War.
Superpower clashes, riots, then finally a pandemic marred the three years leading up to New Zealand's turn as Apec host.
It could have been the ultimate hospital pass. Apec risked becoming moribund. But New Zealand leadership, from the Prime Minister down, has injected renewed momentum as 21 Apec leaders grappled with some of the most significant challenges of their political careers.
The Apec leaders are an unlikely bunch. On the face of it, they have very little in common. They include President Biden, in charge of the world's biggest and most powerful economy; President Xi Jinping who presides over the Chinese superpower; Russia is also a member of the Asia-Pacific Economic Co-operation (Apec).
But so are some of the world's smallest and poorest economies. Ordinarily, the one thing that binds them together is that they border the Pacific Ocean.
This year, they have something else in common. Covid-19 has been a huge wrecking ball on their economies. The pandemic will dominate Leaders week. But inclusive growth, sustainability and digital innovation will be substantive themes. An Implementation Plan for the Putrajaya Vision also has to be agreed by leaders.
By mid-2021, Apec's members had suffered their biggest contraction since the war: 81 million jobs lost, GDP shrunk but is expected to bounce back by 6 per cent.
The toll on human life has been devastating. Peru has had the world's highest Covid casualties per head of population. Other Latam economies like Mexico and Chile have been severely impacted. But even the US has a Covid death rate that exceeds that of Chile.
In July, Ardern called an informal Apec leaders retreat to build support for the region to navigate its way out of the pandemic.
Apec's power players were there. Biden and Russia's Vladimir Putin were on the virtual meeting; Xi sent a message via a pre-recorded video address. Ardern had plotted her moves carefully.
She had already had bilateral calls with four leaders. With Biden, Ardern raised the importance of strengthening the regional economic architecture post-Covid to facilitate greater trade and investment.
Canada's Justin Trudeau was focused on a green recovery. Indonesia's Joko "Jokowi" Widodo wanted greater global solidarity in tackling Covid.
Papua New Guinea's James Marape wanted support for smaller Pacific countries.
All three big players — Russia, the US and China — swung behind the agreed strategy.
Since June, 17 Apec economies have either lowered or completely removed tariffs on vaccines and related products. No new export restrictions have been imposed. Customs procedures for Covid-19 vaccines have been sped up from weeks to hours.
There are still discussions to be had on intellectual property restrictions. But leaders agreed to support global vaccine-sharing efforts, and encourage the voluntary transfer of vaccine production technologies on mutually agreed terms.
With border closures costing $US1.2 trillion per year. Ardern is also keen to see Apec play its part next week in getting more people moving across borders again. Trade and Export Growth Minister Damien O'Connor says it is important to keep momentum moving at a time when there is talk of onshoring and economies are looking to more resilient supply chains. As chair, Ardern will be in the box seat, building consensus among leaders.
An unexpected silver lining has emerged from the dark clouds of the crisis. Geostrategic tensions between China and the US have caused friction within Apec since 2018.
But the pandemic has served as a unifier for a polarised region and exposed the need for leaders to cooperate, not just to fight the virus, but also on trade rather than embracing protectionist instincts.
The disruptive trade war between China and the US has made free-trading countries like New Zealand concerned as it morphed into straight out geostrategic competition.
But said O'Connor, support within Apec for the rules-based multilateral trading system has been rebuilt. Apec has agreed on messages to go to the World Trade Organisation's 12th ministerial meeting in Geneva at the end of the month.
Several leaders such as Putin, Xi and Singapore's Lee Hsien Loong have been in charge of their economies for years. The Sultan of Brunei, Hassanal Bolkiah, has been Prime Minister since 1984. While not a club, they see each other several times a year on the summit circuit. Trudeau, Australia's Scott Morrison and Ardern have each chalked up several Apecs.
But there is a swing under way which may in time test cohesion.
Even before the pandemic broke out a marked shift towards centre-left and populist leaders and governments was under way in Latin America. The most recent was the election of Pedro Castillo, who won Peru's presidential runoff with an explicitly Marxist policy platform. His victory shook the political and business elite in a deeply polarised country hit hard by the pandemic with millions forced into poverty.
"We are not Chavistas, we are not communists, we are not extremists," Castillo said before being sworn in on July 28. He plans to increase mining taxes to fund public services, including education and health. Next week will be Castillo's Apec debut.
Other regional leaders may find their political power bases undermined due to the impact of the pandemic on health and economies.
The pandemic has sparked a marked shift to digital trade. US senior Apec official Manu Bhalla said last week the digital economy was at the forefront of the Biden administration's agenda as well as the Apec agenda.
In a virtual address to the G20, Xi announced China will apply to join the Digital Economy Partnership Agreement to strengthen international co-operation on digital regulation. The pact, known as DEPA, currently covers Singapore, New Zealand and Chile, while Canada has expressed an interest to join.
China has also announced it wants to join the Comprehensive and Progressive Agreement on Trans Pacific Partnership (CPTPP). There is renewed pressure in Washington DC for the Biden Administration to follow.
Officials will be hoping the competitive tensions between the two superpowers can be put to one side particularly when it comes to agreeing on the next hosts for Apec.
Thailand will begin its year as Apec host after the week concludes.
The US has put it hands up for 2023 and Peru for 2024. It will be up to Ardern to forge that consensus if it is not sorted before the leaders meet.
• Apec's 21 member economies are Australia, Brunei Darussalam, Canada, Chile, China, Hong Kong Indonesia, Japan; South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, The Philippines, Russian Federation, Singapore, Chinese Taipei (Taiwan), Thailand, the United States and Vietnam.
Who's coming to town (virtually)
President Joko Widodo
Indonesia
"Jokowi" as he is popularly known, presides over the Asia-Pacific region's most populous Muslim-majority country with approximately 231 million adherents. Indonesia has been heavily impacted by Covid-19: 4.24m cases resulting in more than 143,000 deaths. Widodo told Jacinda Ardern's informal leaders' retreat in July, he wanted countries to show greater global solidarity, encourage global vaccine output by diversifying production to developing countries and transferring the latest vaccine technology. Widodo was ranked among the world's top 20 most influential Muslim figures according to this year's The Muslim 500.
President Joe Biden
United States
Joe Biden is putting Trump isolationism behind the US to get it back into the global game (to Apec's great relief). Biden flew to the G20 in Italy last weekend and will be in Glasgow next week for COP 26.
For a sophisticated country, the US initially made a poor fist of combating the coronavirus pandemic. More the 49.9 million Americans have contracted Covid resulting in 746,000 deaths. Operation Warp Speed helped; the Pfizer vaccine was developed privately. Biden says it is important to invest in better global health security to be ready the next time we face a pandemic.
President Xi Jinping
China
Xi Jinping remains committed to the goal of a high-standard Free Trade Area of the Asia-Pacific which he staked out at the 2014 Beijing Apec.
A strict elimination programme has seen China with just 97,157 cases and 4636 deaths. But a recent Covid surge worries authorities.
Since the pandemic begun Xi has had made just one State visit to Myanmar in January 2020. He didn't go to the G20 and was not expected at the COP 26 climate talks. Ardern, as Apec host, will be hoping that Xi joins others in discussion at the leaders' virtual retreat next week. In July, a videoed address was played instead.
Prime Minister Scott Morrison
Australia
"Scomo", as the Australian Prime Minister is dubbed with varying degrees of affection, urged Apec leaders to ramp up production of mRNA vaccines such as Pfizer's at the July meeting Ardern called to discuss recovery from the Covid-19 pandemic. Australia has had 130,000 cases with 1448 deaths.
Morrison confirmed at the last moment he would attend COP 26, following pressure ostensibly from the UK and the US; even the Queen. He has said it is a critical time to build momentum for strengthening the multilateral trading system, and secure a sustainable and inclusive recovery.
Chancellor Angela Merkel
Germany
Angela Merkel is on her swan song as Germany's Chancellor after nearly 16 years in the role. She's recently chalked up attendance at an EU Summit and the G20 talks and will attend COP 26. "The EU without Merkel would be like Paris without the Eiffel Tower," an EU leader enthused. Merkel recently warned that the world was in danger of forgetting the lessons of the Second World Wa,r saying the existence of the EU can't be taken for granted. Merkel is worried the return of "a certain recklessness" has led to climbing Covid infections and deaths in Germany. She will take part in the Apec CEO Summit.
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