Finance ministers from the Asia Pacific Economic Cooperation (APEC) finally approved the Cebu Action Plan (CAP) on Friday afternoon (September 11).
It’s a roadmap pointing the way to more inclusive economic growth.
The Cebu Action Plan, charts the next courses of action for the 21-member regional group, comprising some 40 percent of the world’s population.
“We hope the CAP emerges as the lasting legacy of the Philippines’ hosting,” said Finance Secretary Cesar Purisima. “With 21 economies, multilateral institutions, and private sector support behind it, we are optimistic the CAP can be taken in the next meetings as a living body of continuing work in our bid for a more prosperous, financially integrated, transparent, resilient, and connected Asia-Pacific.”
Over the past few months, APEC officials proposed initiatives in four key reform areas: financial integration, fiscal transparency, financial resiliency, and infrastructure development and financing.
At the core of these pillars is the growth and sustainability of small businesses.
These businesses account for over 97 percent of all enterprises. They employ more than half of the workforce in APEC economies and regional markets.
One example is the proposed Asia Region Funds Passport or ARPF. This allows small businesses to easily invest in mutual funds and other instruments in participating economies.
Six APEC members, namely the Philippines, Australia, South Korea, New Zealand, Thailand, and Japan entered a non-binding commitment to pursue the ARPF. It’s set to be launched middle of next year.
Microinsurance instruments were also mentioned as vital to achieving financial resiliency. They will be especially helpful to economies seeking to recover quickly from disasters.
According to World Bank Group Vice President and Special Envoy for Climate Change Rachel Kyte, what’s important is to bring insurance into the dialogue and look at the experiences of other countries to catastrophe risk, and educate the government to manage risks.
Representatives from multilateral organizations said that the reforms proposed in the Cebu Action Plan are realistic and are likely to benefit small businesses and vulnerable communities.
“I think just the mere setting of targets-and then having to account for them in a forum like this, even if it’s non-binding… I think that transparency and that commitment to particular results… That’s good in and of itself,” said Rogier van den Brink, lead economist of World Bank in the Philippines.
International Monetary Fund Director Odd Per Brekk, meanwhile, admitted that for both advanced and emerging markets, stimulating growth is a problem, both in the short and the long term. By focusing on pillars of CAP, the plan addresses risks.
Whether the Cebu Action Plan will enact real changes for small businesses and underserved communities in the region remains to be seen.
Plus, it still needs the APEC’s economic leaders’ approval come November, when the summit happens.
Source: CNN Philippines