A Postmortem on APEC
It's
over. They've left and the traffic and street dwellers are back. One
airline is facing a multi-million peso damage suit, another, millions
more in dollar-denominated unrecoverable losses. Kris has her tan and
her brother, his two-day Php 10 billion learning experience - a tax-paid
tuition the equivalent of capitalizing several world-class
universities.
According to one of the most
incisive international publications*, what might be the true value of
the Asia Pacific Economic Cooperation (APEC) meetings was not so much in
the joint declarations reached during each of its gatherings but in the
fact that the conferences drew together divergent if not competing
leaders in both the global economic and geopolitical arenas.
Substance-wise,
save for the debts incurred, the damage suits, lawyer's fees and
unrecoverable business losses, lost man-hours and squandered taxes, none
of anything set on paper from the shindig is binding, enforceable or
obligatory. Everything is as fleeting and skin-deep as Kris's sunburn.
Given
its long history against it’s short list of any substantial economic
development that can be directly attributed to APEC, including the
alleged focus on small and medium enterprises (SME) which was exactly
the very same the last time APEC was in town, very little has moved
forward save for a kitschy tradition of Kodak Moments in pre-tailored
native attire. While it hasn’t yet happened, imagine Vladimir Putin in a
bright fuschia, canary and chartreuse Balinese shirt worn over a shiny
woven grass skirt wrapped around his waist and a pair of boar's tooth
anklets around his bare feet and you might just understand what we mean.
The
Singaporean-published magazine was a tad harsher. The apparent
importance of the grand soiree was singularly in APEC’s attendance list.
Within an economic gathering, how does showing up constitute substance?
For
one, geopolitics has no place in APEC. Its focus is trade. The
geopolitical tensions in the South China Sea have not yet impeded on
large scale trade. Not yet.
For
another, the rules of the marketplace from supply and demand to
economies of scale operate more to catalyze trade among the APEC members
than did the declarations since APEC’s inception. A recent survey
showing that major businesses are largely unaware of these agreements
validates their non-utility and non-enforceability as international
pacts.
So,
if at the end of the day, APEC was merely a grand photo opportunity
costing us over Php 10 billion in direct expenses and perhaps billions
more in business disruption and litigation, what should the prognosis
be?
If the upsides are largely mirages, let us look at concrete downsides.
One,
APEC's brand of cooperation and its effective definition of supply
markets spawned competition where economies race to provide the lowest
paid, shortest term, contractually-compensated sweatshops.
Two,
APEC economies compete to provide the most fractured value chain inputs
and semi-manufactured products so that margins earned outside APEC's
less-developed economies are more prolific for the global corporations
that own the proprietary rights to these. Note how our mining sector
exports raw ore that we repurchase as finished metals. Note also how the
agro-agricultural sector pays virtual slave wages to induce exporting
lower-valued, generic and unbranded produce that we import back as
processed food at higher margins.
Three,
APEC cooperation ensures lower margins for supplier and service
economies such as ours. APEC-neutered, Filipino officials stupidly
reduced import tariffs prematurely, allowed smuggling to flourish, and
now, virtually bends over, raises its posterior, opens wide its orifices
and offers to pay for a foreign corporation's business losses.
The
victimization is undeniable. Agricultural productivity fell below 10%
of GDP. Manufacturing is about a fifth. We import more than we export,
including single-use toothpicks. We earn the lowest wages but pay the
highest utilities.
And then we spend over Php 10 billion for Aquino's learning experience and Kris's tan.
_______________
* The Economist, http://www.economist.com/news/asia/21678279-no-thriller-manila-apec-all-partners-except-china
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