Underdeveloped areas of APEC policy provide opportunities to enhance Japan’s leadership in the Asia Pacific.<\/b>
\nAuthor: Toshiya Takahashi, Shoin University
The 2018 APEC summit in Port Moresby foreshadows an uncertain future for the forum. Due to disagreement between the United States and China, the meeting concluded without a joint communique \u2014 something unprecedented in APEC history. Without leadership, APEC risks becoming little more than a regional showcase for US\u2013China rivalry.
Japan was and remains a key player in economic cooperation in the Asia Pacific. It was vital in rescuing the Trans-Pacific Partnership (TPP) and forming its replacement, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Although Japanese leadership was absent in Port Moresby, the country has the potential to lead APEC in underdeveloped policy areas.
Japan was an active supporter of Australian prime minister Bob Hawke\u2019s proposal for multilateral economic cooperation in the Asia Pacific in the 1980s. And since the establishment of APEC in 1989, Japan has played a leading role in its development. Japan has hosted APEC twice, and the 1995 Osaka Action Agenda became the roadmap for meeting the 1994 Bogor Goals \u2014\u00a0a set of targeted goals outlined by APEC member countries for realising free and open trade in the Asia Pacific. For Japan in the 1990s, APEC was the key mechanism for facilitating trade and investment liberalisation and economic development in the region.
While Japan\u2019s commitment to economic cooperation has not changed, its approach to trade liberalisation has gradually shifted away from APEC. In the 2010s, domestic policy voices presented the TPP as a promising vehicle for Japan\u2019s future economic prosperity. The Japanese government supported this perspective and pursued the TPP\u2019s realisation despite strong domestic opposition, particularly from the agricultural sector.
For a period, debate on trade liberalisation in Japan was polarised between pro and anti-TPP groups. Although divided, this debate steered policy focus towards the TPP and helped the agreement became the leading symbol of trade liberalisation in Japan. Recognition of APEC as a way to enhance trade liberalisation gradually weakened as a result.
Is the marginalisation of APEC in Japanese trade policy debate reversible? The answer is hopefully yes, but this depends upon Japan\u2019s political will to find and use the opportunities that APEC provides \u2014 particularly for Japan\u2019s declining regional leadership role.
Japan should recognise that APEC\u2019s comprehensive framework \u2014 beyond the trade and investment liberalisation and facilitation (TILF) project \u2014 provides possibilities for the reinvigoration of Japanese leadership. In some policy areas such as small and medium enterprise (SME) growth, human resource development and labour mobility, Japan has the advantage of prior experience. Developing these policy areas would also serve Japan\u2019s present economic needs.
Japan has extensive experience in the development of SMEs. The majority of Japanese workers are employed by SMEs \u2014 a fact that has not changed since the early period of Japan\u2019s economic development. The country is well positioned to provide the necessary knowledge and skills for the development and regulation of SMEs in the region.
While human resource development and labour mobility are engines for economic development in the region, they are also among Japan\u2019s present economic concerns. The country needs foreign workers and immigrants to maintain its current economic and social welfare standards. Japan\u2019s contribution to these policy areas would also help to stabilise APEC leadership and balance against great power rivalry over the TILF agenda.
Japan should also become active in revitalising civil society participation in APEC working groups (WGs). The political impact of WGs may not be strong enough to change APEC at the moment, but WG meetings are useful for creating policy debates at the non-governmental level. Strengthening this framework would not only ease consensus-building on APEC policies between national governments and their populations, but also help to reform APEC from the grass-roots level with revised agendas in new policy areas.
Japanese civil society groups\u2019 participation in APEC WGs is limited, and the government should encourage their participation and leadership. Civil society participation will enhance Japanese domestic support for APEC activities. And more importantly, Japan\u2019s successful post-war experience with democracy puts it in the best position to promote civil society participation in APEC to non-Western members.
Japanese policy debates are moving towards an emphasis on rules-based trade and investment liberalisation rather than consensus-based APEC schemes. But APEC\u2019s role is not limited to these schemes. Policy areas such as SME growth, human resource development and labour mobility may be secondary to trade liberalisation, but they provide the necessary foundations for a lasting liberalisation process.
The rise of China and the roadblock of US\u2013China tensions are gradually eclipsing Japan\u2019s \u2018natural\u2019 leadership in Asia Pacific economic cooperation. But by building on its strengths in economic policy and long-standing commitment to multilateralism, Japan can reinvigorate its position and APEC in the process.
Toshiya Takahashi is Associate Professor at Shoin University, Japan and a member of the APEC Study Centre in Japan.
This essay is dedicated to Professor\u00a0Ippei Yamazawa, long-time inspiration to and father of the study of APEC in Japan. Professor Yamazawa passed away in Tokyo on 16 November. He will be missed by his many friends across the APEC region.<\/p>\n