Transcript: U.S. APEC Coordinator Greenwood on American Embassy TV
(Brunei APEC meetings to focus on "new economy")This year's Asia-Pacific Economic Cooperation (APEC) meetings will focus on the "new economy," according to C. Lawrence Greenwood, Jr., U.S. Coordinator for APEC.
During an October 30 "Dialogue" program organized by the State Department's American Embassy TV, Greenwood explained that the "new economy" consists of ways to apply advances in information and communication technology "to the way we do business and to the way we do government in the region, in order to increase productivity, to increase jobs, to generate new income and spread prosperity in the region." Among the "new economy" initiatives that will be featured at the APEC meetings are assessing e-commerce readiness; providing training in information technology; and expanding the liberalization of services related to e-commerce, such as streamlined customs procedures, more efficient telecommunications services, and Open Skies agreements, according to Greenwood.
Greenwood stressed the importance of public-private partnerships in the area of e-commerce.
"APEC has been a pioneer in putting together a guide that helps economies in the region work together with their private sectors to identify those areas that need to be addressed in order to foster and promote and nurture e-commerce, both within their economies and also within the region," he said. "Currently all but two APEC economies have in fact undertaken an e-commerce readiness assessment with their private sectors, have identified areas that need to be addressed, or will soon do so."
Greenwood said he anticipates some public-private partnerships will soon establish pilot projects to address various areas of e-commerce "such as alternative dispute resolution, e-marketplaces, how will you trade energy for example over the Net, and many other areas."
Training in information technology (IT) is closely tied to e-commerce readiness, according to Greenwood.
IT training affects the ability "to spread the benefits of e-commerce as widely as possible throughout the region," he said. "There are a number of programs and initiatives available for both IT training as well as programs to enhance the access to the Internet ... [for] people living in remote areas, poor people, and ... populations that right now don't have necessarily adequate access to the Internet."
On the policy side, the United States will focus on issues such as trade and investment liberalization, market strengthening, enhancing competition policy, and pro-competitive regulatory reform, Greenwood said.
"These are the kind of policies that we'll be pressing," he said, "because only in a competitive, strong market can you have the entrepreneurship, can you have the kind of competitive services that underlie the new economy and the productivity increases that come from that."
Other topics of discussion at the APEC meetings will probably include a new World Trade Organization (WTO) round, regional free trade agreements, and lower oil prices, Greenwood said.
Following is a transcript of the program:
(begin transcript)
AMERICAN EMBASSY TV NETWORK "DIALOGUE"
UNITED STATES DEPARTMENT OF STATEOffice of Broadcast Services, Washington, D.C.
GUEST: C. Lawrence Greenwood, Jr., U.S. Senior Official for APEC
TOPIC: APEC Issues
POSTS: Hong Kong, Kuala Lumpur, Tokyo, Manila, Seoul
HOST: Judlyne Lilly
DATE: October 30, 2000
TIME: 20:00 - 21:00 EST
MS. LILLY: Hello, I'm Judlyne Lilly, and welcome to "Dialogue." Established in 1989, the APEC Forum was created to promote economic cooperation and integration in the Pacific region. APEC now has 21 member economies, and it has been focusing on implementing the Bogor goals of free trade and investment, by 2010 for developed economies and by 2020 for developing economies.
In November, APEC leaders and ministers will come together in Brunei Darussalam. Delegates are expected to focus their discussions on efforts under the new economy theme, looking to identify ways of assisting developing economies so that they can share equally in the benefits offered through the application of information technology.
In this edition of "Dialogue," we will explore the challenge of keeping APEC's liberalization agenda on track, while addressing technical cooperation needs with our guest, C. Lawrence Greenwood, Jr., U.S. Senior Official for APEC. Mr. Greenwood, thank you for joining us on "Dialogue."
MR. GREENWOOD: Thank you very much.
MS. LILLY: I understand you have an opening comment.
MR. GREENWOOD: Yes, very short. In recent years APEC leaders have focused on promoting trade liberalization in the region by helping build the consensus for an early launch of a new trade round, and also by pushing for sectoral liberalization. They've also been focused on helping Asian economies recover from the financial crisis of 1997 to '98, through efforts both to strengthen the financial architecture, and to strengthen financial systems or financial markets.
This year, while APEC will continue to work in those areas, very important areas for the sustained recovery of the region, APEC members are looking at a relatively new area for APEC's work, and that is in the area of the new economy. And by "new economy," what we mean is how we can apply advances in information and communications technology to the way we do business and to the way we do government in the region, in order to increase productivity, to increase jobs, to generate new income and spread prosperity in the region. This is the work that APEC is focused on this year and will be the feature of the leaders meeting in Brunei next month. And I look forward to answering your questions about it. Thank you.
MS. LILLY: Thank you, Mr. Greenwood. And now we turn to our participants in Hong Kong, Kuala Lumpur, Tokyo, Manila and Seoul. Hong Kong, welcome to the program. Your questions please?
Q: Hello. Hi, Mr. Greenwood, I am Christie Mopp (ph) in the Hong Kong Development Journal. Actually, as you mentioned that the APEC is really concerned about the development of new economies, I would like to know with the rate of development in e-commerce trade within the region, will there be any specific discussion in the coming APEC meeting about interregional cooperation on such fields? And what part will the United States take part in it?
MR. GREENWOOD: Yes, thanks for the question. The new economy features a number of actions and initiatives, and many of these will be featured in Brunei. One of the main areas -- and this is something that APEC has been working in already for about a year and a half -- is the area of e-commerce readiness. APEC has been a pioneer in putting together a guide that helps economies in the region work together with their private sectors to identify those areas that need to be addressed in order to foster and promote and nurture e-commerce, both within their economies and also within the region. Currently all but two APEC economies have in fact undertaken an e-commerce readiness assessment with their private sectors, have identified areas that need to be addressed, or will soon do so.
The next question now is how we move beyond that assessment stage to actually putting in place actions and reforms on the ground so that e-commerce can in fact move forward. And one of the things we have been talking about this year is how to do that. I think what we are going to be seeing is private-public partnerships between firms and economies that will put in place demonstration projects and pilot projects to address various areas of e-commerce, such as alternative dispute resolution, e-marketplaces, how will you trade energy for example over the Net, and many other areas.
Another area that APEC will be working on in the same area is how to increase IT training, how to spread the benefits of e-commerce as widely as possible throughout the region. And this is a capacity-building approach. There are a number of programs and initiatives available for both IT training as well as programs to enhance the access to the Internet, particularly of targeted groups, such as people living in remote areas, poor people, and women, youths, people who -- targeted populations that right now don't have necessarily adequate access to the Internet. We are bringing together programs that address those needs within APEC, and we will also be talking about that and announcing something in Brunei.
Q: Good morning, I am from Asian TV, Hong Kong. I want to know can you tell us is there any new star in next year's APEC summit, since there's a new president from the United States, any difference between this year or next year's APEC summit?
MR. GREENWOOD: Next year the APEC summit will take place in China, and we are of course very much now working hard to make sure that the Brunei summit next month is a success, and we all believe that it will be and are confident that it will be. And we are at the same time of course very much looking forward to the summit in Shanghai, which will take place in October.
As your question I think implies, the United States will be participating in that summit with a new president, and we look forward to that as well. It will almost certainly be the new president's first official visit to Asia, and almost certainly the first trip to China.
I don't anticipate that there will be much difference in the approach to APEC and the commitment to APEC, regardless of who wins the election next week. I think both candidates are strong supporters of APEC and are committed to it.
Q: Mr. Greenwood, this is Moira Fogarty (ph) from CNBC Asia in Hong Kong. Now, at the APEC's announced ministers meeting in September, world oil prices was an issue that was discussed there. Can you comment on the leaders meeting coming up? How important will that issue be on the agenda?
MR. GREENWOOD: It will be a very important issue on the agenda. It's been a matter of discussion among senior officials, and as you said among our finance ministers last September in Brunei. At that time there were expressions of concern about the possible impact of high oil prices on the economic recovery now underway in Asia, and also -- we have also since then discussed what kinds of measures and actions APEC could take to work in the medium and long term to reduce the vulnerability of APEC economies to oil price volatility. And in fact there was a very useful discussion of those issues in Peru last week with the energy working group. We are very pleased with the various actions we have been talking about, and again look forward to talking about those again in Brunei next month.
Q: Hello, Mr. Greenwood, I am a reporter with China Daily. I wonder will China's WTO entrance be a topic of the APEC meeting, and what kind of message will you bring to that APEC meeting on that topic? Thank you.
MR. GREENWOOD: APEC economies I think share the United States' hope that China will complete the procedures needed to enter WTO as quickly as possible, and so that in fact China can become a member of WTO and be a full-fledged member of the international trading system. APEC in the past has encouraged China in that quest, and I imagine will again do so at the leaders meeting. We are also encouraging the rapid accession of other APEC members who are not yet members of WTO, including Chinese Taipei, Vietnam and Russia.
Q: Yes -- (inaudible) -- from Hong Kong Commercial Radio. We know that last year in Seattle that the mass petition and the meeting -- (inaudible) -- and some leaders cannot join the meeting. So what does the APEC committee -- has any plan or any purpose to -- (inaudible) -- this meeting in its small condition so other leaders can join the meeting?
MR. GREENWOOD: We anticipate actually a very smooth meeting, and don't anticipate problems of that sort in Brunei. I think the more important issue is how do we address some of the concerns, the legitimate concerns -- some of the concerns expressed on the street are certainly not -- at least not expressed in a legitimate fashion. But those concerns that are legitimate, we need to address those -- address the concerns that have been raised about globalization. And in fact APEC is doing that. We are working in the areas of -- we are working to assure that with growth comes an enhancement of the quality of life of the citizens who live in APEC. And so we and other APEC members have been working on things like improving worker safety standards, eliminating abusive forms of child labor, working to improve basic universal education, working on basic health issues, establishing social safety nets so that for example during the crisis that there is some support for people when they lose their jobs or when they lose their livelihood. These are all issues that we have been working on for actually a number of years in APEC and which we will be featuring in this next meeting. So we are in fact addressing some of these concerns that are being expressed on the street.
Q: Mr. Greenwood, Suzanne Harrison (ph) with the South China Morning Post. You talk about oil prices being a major topic of discussion at the meeting. Could you outline the major issues you expect to be discussing other than oil prices?
MR. GREENWOOD: In addition to oil prices, I think two other areas kind of are writ large. One is of course the new economy. And the new economy will be the major theme. And under that heading we are going to be looking at a number of different policies and capacity-building programs. On the policy side we are going to be pushing for and discussing the basic fundamental policies that are necessary to benefit from the new economy. These are -- many of them are traditional APEC issues -- things like trade and investment liberalization, market strengthening that was the theme of New Zealand last year, enhancing competition policy, pro-competitive regulatory reform. These are the kind of policies that we'll be pressing, because only in a competitive, strong market can you have the entrepreneurship, can you have the kind of competitive services that underlie the new economy and the productivity increases that come from that.
Another area in the new economy scene will be, as I mentioned earlier, the increase enhancing programs for IT training and programs to enhance the access of all of our citizens to the Internet so that they can share in these benefits.
And, finally, we are going to be looking at expanding liberalization of services that are related to e-commerce. This involves services all the way from the first click of the mouse until the delivery of the product, and it means things like air cargo, it means streamlined customs procedures -- especially for express delivery. It means liberalization of the trucking services that deliver those products. And it means of course liberalization of telecommunications services so that the services can be inexpensive and efficient, so that more people can take advantage of them. And in this regard we are working now on an Open Skies arrangement within APEC that would -- it's still under negotiation and may or may not be completed by the time of the leaders meeting, but we are making very good progress in that Open Skies agreement as one way of improving these connections within the region.
And then, finally, I mentioned the two major areas outside of the new economy, and that is on the trade side. On the trade side we will have extensive discussion with regard to building a consensus to get the new WTO round off the ground. And I anticipate that the leaders will be calling for an early launch of the new WTO round. They will also be talking about regional free trade agreements and how we should be approaching them.
MS. LILLY: Thank you, Hong Kong. Now let's go to Kuala Lumpur for your questions. Go ahead please.
Q: Good morning, Mr. Greenwood. My name is -- (inaudible) -- I am from the -- (inaudible) -- Times in Malaysia. The question is there is still a lot of skepticism about APEC, especially among our developing members. The view is that the agenda is being led by the U.S. without due care being taken for the concerns of developing members. As a major player and a dominant partner in APEC, what is the U.S. doing to ensure that all concerns and voices heard in setting this agenda going forward?
MR. GREENWOOD: I guess I would start by saying that other APEC members need no encouragement or assistance from the United States to speak their minds in APEC. In fact, APEC is very much an organization of equals. We talk to each other as equals, and that is the way frankly that my colleagues, the other senior officials within APEC, treat this organization. So there is no hierarchy within APEC, and we have very open, frank discussions among equals.
I think part of your question does address the issues of how much we press for trade and investment liberalization and how much time we spend on economic cooperation technical assistance. And I want to stress that the United States supports both of those tools as very important to achieving what we are working for, which is shared prosperity in the region, both shared among economies and within economies to make sure that those benefits are shared as widely as possible. We think that can be done through a combination of free trade and investment, competitive markets, as well as capacity-building technical assistance to make sure there is a capacity for opening markets as well as a capacity to enjoy the fruits of that liberalization.
Q: Mr. Greenwood, my name is -- (inaudible) -- I am from Bernama, the national news agency in Malaysia. (Inaudible) -- in Auckland President Clinton made a strong call for the reform of the international financial architecture. He said it would be a big mistake to ignore the disruptive effects of -- (inaudible) -- short-term capital flows. To quote him further, he said, "I think that the real danger that I sense going of people to say, 'Well, things are fine now, we don't need to continue to do anything about the financial architecture.'" He says there should be a reform of global finance. So since Auckland, Mr. Greenwood, has anything been done by APEC to check the destructive effects of -- (inaudible) -- capital flows or to check global finance? Thank you.
MR. GREENWOOD: In fact there has been extensive work done within APEC, both in the area of strengthening the international financial architecture as well as to strengthen financial markets within the region. On the latter in particular, there is a number of initiatives underway in APEC right now, again all of these started by the financial ministers process. There are initiatives such as enhancing the accounting systems within the region so that there's more efficient and more modern accounting, there are programs for training financial supervisors, bank and securities industry supervisors. There are efforts to train bankers themselves so there's more efficient banking in the region. There are a number of other programs again to put in place the elements needed to make strong financial markets.
We have indeed looked at as well the issue of hedge funds and how they can work in the region -- this is related to APEC, not directly under APEC -- and looking in particular at increasing transparency so that the destabilizing impact is in fact -- if there is one to minimize that. Our assumption is of course that international financial flows are not by their nature destructive. Of course free international capital flows are very beneficial. But it is necessary that financial markets be strong, and that the international financial architecture is there to address problems, should they arise, in a timely and appropriate manner.
Q: (Inaudible) -- Mr. Greenwood. You spoke about oil prices earlier in answer to Hong Kong. But the question I had is that there are both producers and consumers represented within APEC, and the way the prices are moving up what can APEC do to ensure that both producers and consumers come to some sort of agreement to ensure that this does not derail the economic recovery or economic stability of the world, or even the member economies?
MR. GREENWOOD: I think you've answered the question better than I could. In fact, that's -- what we have been doing is in fact bringing together the common interests of producers and consumers in the sustained recovery of the region. And both producers and consumers are in fact concerned that current oil prices and the way they are heading could in fact undermine that stability. So there is in fact on that point no real difference between producers and consumers. That's the reason that the finance ministers' statement has focused on oil price volatility -- not on the specific levels, but in fact the volatility of price. And the question is again an interest shared by both producers and consumers, how to reduce the vulnerability of the region to oil price volatility.
Q: (Off mike) -- another financial crisis looming in Asia?
MR. GREENWOOD: I am sorry, could you repeat the question please? It got lost I think.
Q: (Off mike) -- is another financial crisis looming in Asia?
MR. GREENWOOD: No -- we don't think so. And we saw this in the financial ministers discussion. We do -- we must avoid complacency. Clearly the region is making important strides. The region has recovered from the financial crisis much more quickly than nearly all observers had anticipated, and the recovery is quite impressive in some economies. Some economies obviously still struggling. But it's overall actually a pretty good picture right now. And it's the result of good policies. The economies in the region have kept their markets open. They have kept their trade and investment markets open. They have not backtracked. In fact, they have moved forward. The Philippines is putting in place a quite important new regime for electric utility deregulation. Singapore has made some important strides in recent months to completely open its telecommunications market. Japan is moving forward in a number of areas to deregulate its economy. Korea has become one of the IT leaders in the region. So there is real progress.
But sustained recovery will require continued structural reform. The job of reform, particularly corporate and bank reform, still remains out there for the region. So it's something that we can't take for granted and we need to keep working on. And I believe that the commitment to work on it is there.
Q: You say that structural and financial reforms are required in the region, that thinking in the region, especially in Malaysia that financial and structural adjustments and amendments are also required of international financial architecture. What's your view on that? Will APEC -- will the U.S. be pushing for it in the coming meeting?
MR. GREENWOOD: We certainly agree that both reforms are necessary, that not only strengthening of financial markets, but strengthening the financial architecture, are necessary. And in the areas of exchange rate policy, the workings of the IMF, workings of the World Bank, we have been pressing for changes in the financial architecture, creating a new fund in the IMF for example to address some of these issues. And we support those changes and have been supporting them, and will continue to support them.
MS. LILLY: Thank you, Kuala Lumpur. Now let's invite Tokyo to join us. Go ahead, Tokyo.
Q: Hello, my name is -- (inaudible) -- from Nikkei. Last week the Japanese government has decided to begin free trade negotiations with Singapore. And, similarly, Japan is discussing the possibility of a free trade agreement with Korea and Mexico. It seems that Japan is changing its traditional trade policy. There are many other APEC members including the United States that had its bilateral or regional trade agreement. And do you think that these agreements are consistent with the goals of APEC?
MR. GREENWOOD: Free-trade arrangements in the region can definitely be a building block to the Bogor goals, as well as a building block to a stronger multinational or multilateral trading system. But they can only be that if in fact they are of a high quality. And high quality means comprehensive. It means no new barriers to non-members. And it means an open and transparent process. And as long as FTAs meet those criteria and are consistent of course both with WTO principles as well as consistent with reaching Bogor roles, which talks about of course free trade and investment in all sectors, not just some sectors, then we see this as a positive development.
Q: Good morning, this is -- (inaudible) -- Kyodo News. And my question is it seems that in the past several years APEC's effort for the trade liberalization seems to be losing momentum, and especially after rough years -- (inaudible) -- WTO meetings developing nations discontent with trade liberalization -- (inaudible) -- country growing widespread. So do you think that the APEC role in Asia Pacific nations' trade liberalization is changing, or even over?
MR. GREENWOOD: No, it's certainly not over. It perhaps is changing a little bit though. I think to date much of the emphasis has been on helping build the consensus for launching of the new round in particular. That's not going to change. We are going to continue to press for the new round, launch of a new round as early as possible. APEC has made some important contributions in this area. They pressed for example at the trade ministers meeting in Darwin for preparatory work on industrial tariffs and have been pressing that in Geneva. We have also extended a moratorium on duties on e-commerce in the APEC region. So APEC I think has been active in this region. And so APEC I think has been active in this area.
But APEC is also working on trade from a different angle, and that is from the bottom up. We are trying to build capacity in the region to make it -- to promote free trade. We are trying to convince policy makers that opening trade is not making -- is not a matter of making concessions, that opening trade means that you are benefiting yourself first, not just simply giving a gift to your trading partner. And that is -- that kind of work, building support for open trade in the region is something that APEC has been working on, but is particularly focused on right now at the same time that we focus on building the consensus for the new round.
Q: This is -- (inaudible) -- from Nikkei again. I have one more question on FTA. Do you think APEC should become the free trade area agreement in the future?
MR. GREENWOOD: APEC leaders have committed to free trade and investment in the region by 2010 for developed countries and 2020 for developing countries -- the Bogor goals that were mentioned at the beginning of this program. So in that sense we have already set the goals of free trade in the region. What exact shape that takes and what the mechanism is going to be is still being worked out, so whether it will be an APEC FTA or not is definitely open to question. But there is no question that we have committed to open trade and investment in the region.
Q: This is -- (inaudible) -- from Kyodo News once again. I have a question here, which is that recently we have seen some U.S. Congress very protectionist move to write and introduce in some bills to distribute antidumping tariff income to steel industries. And do you think this kind of protectionism move in the United States would affect the free trade momentum among APEC countries? Thank you.
MR. GREENWOOD: I think every country has to deal with elements within its borders who have a problem with increased imports. However, in this particular case we are talking about anti-dumping, which means it is being aimed at products which are being treated unfairly. And also of course we take our antidumping rules -- these actions consistent with the WTO disciplines that apply to that.
This administration has fought against protectionism successfully, and has had many successes, including concluding the Uruguay Round, getting it through Congress, concluding the NAFTA and getting that through Congress. We most recently concluded a free trade area with Jordan, and have a very strong record in the area of trade. So I think we have been able, despite the fact that we have a record trade deficit, to keep protectionism at bay. I am not saying it doesn't exist in America, because it exists everywhere -- but we have been very successful in keeping that at bay. I don't think anything that we are doing in that area is going to undermine free trade in the region.
Q: This is -- (inaudible) -- from Nikkei again. I understand that the U.S. government intends to propose a new plan for the information technology and e-commerce at the next APEC summit. Could you tell us the details of that proposal?
MR. GREENWOOD: We have been working on a number of areas throughout the year, and in addition we will be continuing that work into the next year as well.
Some areas in which we are working are, as I mentioned, the e-commerce readiness guide and moving beyond that into other areas, and to implement the results of those assessments; an IT training package to increase IT skills in the region. We have concluded -- and I say, we APEC has agreed to an initiative in which governments would work to prohibit the use of improperly licensed software in government offices, so that only properly licensed software would be used in government offices, so that they could serve as an example, again very important for the new economy.
We have worked on an initiative to ensure easier conformance for standards for computers and peripherals. We are moving to implement an MRA, a mutual recognition agreement, on telecommunications equipment. So there is a number of areas in which we are moving to put a base under the new economy.
In some areas we are beginning to have discussions -- for example about how we can move forward more quickly in terms of telecommunications service liberalization, the application of WTO disciplines to e-commerce for example is another area of importance.
Q: This is -- (inaudible) -- from Kyodo again. My question is: What kind of role can APEC play for an early start of the WTO new round?
MR. GREENWOOD: What role can the U.S. play or Japan play?
Q: Both.
MR. GREENWOOD: Both? That's actually a good way to frame the question, because in fact both nations have to be totally committed to the new round to make it work, to make it go. And we are working very closely with Japan on that.
Well, clearly we have to do a number of things. One of the areas that we are working on in the context of APEC is to help the nations, the economies within APEC, to develop the capacity to undertake liberalization. This is the so-called WTO capacity-building initiative. It's actually an initiative that the Japanese government has taken leadership on, and we praise them for that, and we have worked very closely with them on that initiative to again build capacity for trade liberalization in developing economies of APEC.
MS. LILLY: Thank you, Tokyo. And now, Manila, it's your turn. Please go ahead.
Q: Hi, good morning, Mr. Greenwood, from Manila. I am -- (inaudible) -- from ABSCBN News Channel. May I start off by asking just last week the Philippine government has decided to defer the tariff cuts on all goods that is scheduled in 2001 under the AFTA and WTO to provide relief for local industries that were battered by a weak domestic demand and foreign cuts, and rising production costs -- may I just know your view on this?
MR. GREENWOOD: I don't have a view specifically with regard to the recent decision by the Philippine government, because until now I was not aware of it. I would say just in general that delaying tariff cuts is generally -- not generally -- is never the answer if you want to have an efficient and competitive domestic industry. And assisting companies to deal with liberalization and competition is of course very important, and that effort should continue. Shielding them without the prospect for future measures I think will only be delaying the inevitable. But I make that as a general comment, and not a comment specifically to this particular decision, since I don't know what the background is.
Q: May I go to another topic? At present, the Philippines has been beset by current political and economic adversities. And may I know how can the framework of APEC help member nations to address issues of corruption and economic instability?
MR. GREENWOOD: Transparency is obviously an important part of creating an investment climate that is both stable and attractive to investors. And when I say "investors," I don't mean just foreign investors but domestic investors as well. Increasing the difference between the two has become virtually nonexistent. And so the same measures that would induce investment of course apply both equally to domestic and foreign investors.
Transparency and rule of law are necessary if countries are going to attract that kind of investment. And we in APEC have been working over the years to provide -- to promote, I should say -- that kind of transparency and good investment climates. One of the examples of the programs that are available in APEC is to bring in teams of experts that APEC can put together to help address problems in a particular sector so that in fact investments can start flowing into that sector.
The Philippines is a marvelous country and has marvelous potential. It happens to be the first country that I served in in the Foreign Service about 24 years ago. And it has wonderful potential to attract manufacturing investment because of its very highly trained work force. Realizing that potential of course means creating that stability and creating the transparency that would make investors feel assured to make that investment. Once that takes place the sky is the limit for a country like the Philippines, I believe.
Q: In regards to said transparency, are there any specific measures in APEC right now? The peso, the Philippine peso has been branded as the worst performing currency in the world, and I believe that all other regional currencies are all going down against the U.S. dollar. Are there any measures to try to arrest or combat this currency to at least promote currency stability?
MR. GREENWOOD: What we have been doing in APEC is to essentially encourage that stability through good domestic policies. We obviously have not been involved in the actual kind of workings between nations in terms of exchange rate stability, but instead working from within to promote the kinds of policies that would lead to strong competitive industries and economies that are in fact the basis for strong currencies.
Q: Seguing into intellectual property rights, the Philippines has consistently been -- fortunately been in the IPR watch list of the United States regarding the issue on software and music piracy. By any chance, where do we stand right now?
MR. GREENWOOD: I apologize, I didn't read up on that one before coming out. I am not that familiar with the details of the Philippine situation on IPR, so I perhaps best not answer that question.
Q: May I just go into local content? Just lately the U.S. has filed a complaint against the Philippines regarding our countries insistence in the use of local content in the auto industry. So we would like to know -- this is of course allegedly in violation of WTO rules. So we would just like to know what is the nature of this complaint?
MR. GREENWOOD: Again, in terms of the specifics of the WTO case, I won't get into that. Let me just say that more from an APEC point of view here that rules like local content rules -- and this of course is the reason we have WTO disciplines against local content rules -- actually act to put a break on investment. It makes the local economies less efficient. Those economies that have nurtured domestic industry through support, through technical assistance, and also by linking it with major suppliers overseas, have thrived. And auto parts of course is a wonderful area for closer cooperation between U.S. industries, Japanese industries and industries in Southeast Asia, because in fact there are so many potential opportunities. I am afraid that you are going to be doing harm to yourself through these kinds of restrictions, because the investments simply will not be there. You will not get the increases in quality and competitiveness that you really need.
In this area APEC actually has been working through their auto dialogue -- business people, in particular from Japan and the United States have been working with auto parts suppliers in the region to increase their quality, to allow them to get to ISO standards, and also giving them the expertise to be able to hook into the supply chains of large auto manufacturers.
Q: So what if the Philippines does insist on -- you say you don't know the specifics -- but what will happen if the Philippines does insist on the use of local content in that auto industry? What will be the U.S.'s next step for that matter?
MR. GREENWOOD: My guess is that there is going to be discussions of this issue, and we would, I certainly would hope, and I think that's a hope shared by the folks doing this at USTR, that in fact we can work this out without going that route.
MS. LILLY: Thank you, Manila. And now Seoul, thank you for waiting. Please begin your dialogue.
Q: Hello, this is -- (inaudible) -- Park from MBC Television. My first question is: What is the position of the U.S. on inviting North Korea to the APEC meetings? And is the U.S. considering accepting or admitting North Korea as a member country?
MR. GREENWOOD: We have no position at this stage on that issue. The issue has not come before senior officials, and so there has really been no discussion of it, no discussion at the senior official level.
Q: It has been said that if North Korea becomes part of the APEC members, then the leaders of the U.S., North Korea, South Korea and Japan, will meet on a regular basis. As a senior official of APEC, what is your position on this kind of a thing?
MR. GREENWOOD: Again, we have no position right now on whether North Korea will be a member of APEC or not. Clearly that is not a decision simply for the United States to make. It is one that would require the consensus of all of the APEC members.
I should add though that there is currently a moratorium on new APEC membership, which will last for another number of years yet. I believe it's 2008 when the moratorium would end. So there is no immediate prospects for new members, at least under the decision made a couple of years ago.
Q: Mr. Greenwood, is there any possibility of President Clinton visiting North Korea before or after the APEC meeting?
MR. GREENWOOD: As you know, the secretary of State just went to North Korea, and there were a number of issues discussed at that time. There is no decision that I am aware of on this, so I am not in a position to comment one way or the other.
Q: Hello, Mr. Greenwood, nice talking to you. My name is -- (inaudible) -- I am a reporter for the -- (inaudible) -- newspaper. My question also concerns oil prices. Last year's meeting of the energy working group there had been some discussion of exchanging oil between APEC countries to overcome oil shortages. Is there going to be any continuing discussion of this kind of exchange option?
MR. GREENWOOD: Most of the areas that APEC has looked at, and the energy working group has looked at in terms of how we deal with oil prices and how we reduce the vulnerability to oil price volatility, have been on the demand side; that is, things such as increased conservation, looking for alternative fuels, such as gas, and clean energy alternatives.
I think that -- however, we are looking at a couple of things on the supply side, and one of them is a program to help educate and promote stockpiling regimes in the region. And that is something that we think could play in fact a very positive and constructive role in reducing the vulnerability of APEC economies to oil price volatility.
Q: Another question is you have already mentioned there is a concern that there will be -- there might be a second economic crisis, including Korea and other Asian countries. As you probably are aware of, Sumtung (ph) Semiconductors, the foreign investment has been pulled out of the market, and recently the concern rises. What is your perspective on the second -- the possible second economic crisis in Korea?
MR. GREENWOOD: As I mentioned before, I think we have to avoid complacency. We are not predicting a second crisis in Korea or anywhere. Korea has taken some impressive and in many ways courageous steps to restructure its economy, and as a result has come out of the recession with stronger growth than many had anticipated back in '97, '98.
But indeed, as you suggest, there is always -- the marketplace is a hard task master, and it requires constant attention, it requires constant restructuring, constant movement to react to what's happening on the ground. There are structural reforms, adjustments, that need to be made in all of our economies, and I won't actually exclude America from that either. We are constantly making changes. So that is required.
I think if we move forward on structural change, if the economies in the region get stronger, if the Japanese economy in particular starts moving, it can start picking up some of the slack in demand that we are seeing now and move us through. So it is not time to panic, but it is also not time to be complacent.
Q: Okay, a barrier of reaching new round agreements in Seattle last year, many countries are turning towards bilateral trade discussions. As a primary corporate body in the Asia Pacific region, how does APEC view this transfer to bilateral trade agreements?
MR. GREENWOOD: We support the movement for free trade agreements as a building block to a stronger multilateral trading system. But two conditions are required. First, as I mentioned before, that you have to have FTA as a point of quality; that is, they need to be comprehensive and they need to avoid increasing restrictions on non-members.
But we also need to make sure that we launch the new round. FTAs can be a building block for a stronger multilateral trading system. But something -- it has to be a building block to something, and so you have to have a new round. You have to have increased stabilization happening at the global level if in fact FTAs are going to be a building block and not a stumbling block to stronger multilateral trading systems. And with those caveats we think this can be indeed building blocks. The largest regional free trade agreement is of course NAFTA, the one between the U.S., Mexico and Canada.
Q: There is growing resistance against globalization by civic groups and NGOs, as you are already aware of. What do you think about the criticism that globalization equals Americanization?
MR. GREENWOOD: I think it's -- given the fact that many of the opponents to globalization are in fact from the West, it strikes me as a bit of a strange interpretation. Currently there are concerns about globalization, both within the West and also to perhaps a little lesser degree in Asia. Some of those concerns are in fact overblown, but some of those concerns are legitimate, and they are ones that we need to address. We need to address the questions of how we translate growth into benefits for everyone, for all of our citizens, and that does require -- sometimes the marketplace itself cannot answer that question. It does require a government role to make sure that that happens. That means things like assuring that you have a strong universal basic education system, that you have basic health standards, that you have a safe workplace, that you are protecting the environment, and that growth will result in a cleaner environment. The evidence in fact points in that direction, but it's only with efforts by governments that we can assure that that's going to be achieved. APEC is working in all those areas to address the globalization concerns. We have very robust and vigorous programs in the environment, in green environment and conservation, in worker safety, in training small business and consumer advocacy and welfare, and in strengthening social safety nets.
MS. LILLY: Thank you, Manila. Now let's return to Hong Kong for more questions. Go ahead please.
Q: Mr. Greenwood, this is -- (inaudible) -- in Hong Kong again. Can you tell us some of the specific issues that the United States is finding it difficult to get consensus on among other APEC economies, and perhaps give us a hint as to which economies perhaps are not on the same wave length as the U.S. on the issue?
MR. GREENWOOD: We have been working in a number of areas in APEC. As I mentioned, we are working on the new economy, we are working on trade issues, we are working on the issue of the oil price problem. We are working on how to sustain the recovery through appropriate policies to strengthen financial markets. In fact, in all of those areas there is I would say remarkable consensus within the region of what needs to be done. There may be some differences in nuance and differences in detail, but I think in terms of the overall objectives that in fact there is a lot of consensus. Certainly on the new economy there is a strong interest in this theme on the part of both developed and developing economies.
One area here that I think is important to note is that there were some concerns expressed early on about how can the new economy really help some of us -- we don't have developed IT industries -- this is just an American thing. And the reply is -- and it wasn't just from us, but from Singapore and others -- the reply is that in fact the new economy is not about the IT industry per se; it's about the application of information technology to all sectors. It's the application of that technology to agriculture, to textiles, to steel, to all the services, to banking, to retail. So it's something that is relevant to all of the region and relative to all sectors. That appreciation has now very much sunk in in the region, and there is I think a strong appreciation for that and a strong desire in the region to move forward and do what needs to be done. And so this was an area -- I wouldn't call it of great conflict or confrontation, but in fact a difference of nuance. Those who for example want to have more assistance to help with their IT training may also be a little bit reluctant to take some of the hard policy stances that are necessary. Clearly both are necessary, and again overall there's not a strong disagreement on that.
MS. LILLY: Kuala Lumpur, you're up next -- but we need a short question and a short answer, Mr. Greenwood. Go ahead please.
Q: Thank you. APEC has been focusing on tariff reductions. But I wonder what APEC is doing to simplify and harmonize procedures in trade liberalization and help push the WTO forward?
MR. GREENWOOD: We have been working in a number of areas in terms of trying to push WTO forward. As I mentioned before, we are working with the Japanese on WTO capacity building. We are working to do preparatory work on industrial tariffs. We have done a region-wide moratorium on duties on electronically-delivered goods and services. We are advocating within APEC, again in consensus, the elimination of agricultural export subsidies in the new round. So APEC has been quite active, quite vigorous, in building the consensus to launch the new round as early as possible.
MS. LILLY: And with that our discussion must come to an end. Our thanks to Mr. C. Lawrence Greenwood for joining us today. Thank you, sir. And I would like to extend our appreciation to our participants in Hong Kong, Kuala Lumpur, Tokyo, Manila and Seoul. From Washington, I'm Judlyne Lilly in Washington for "Dialogue." Good day.
(end transcript)
(Distributed by the Office of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
Return to The United States and APEC.Return to IIP Home Page.