MICROCAPITAL STORY: Asia-Pacific Economic Cooperation Hosts Annual APEC Leaders Meeting in Lima, Peru and Pledges to Support Programs for Small and Medium Enterprise (SME) Development to Combat the Credit Crisis and Promote Regional Economic Integration

The Asia-Pacific Economic Cooperation (APEC), an organization of 21 countries on the Pacific Rim that focuses on trade, investment, and other regional economic considerations, held its annual Leaders Meeting in late November in Lima, Peru. The leaders of several member countries pledged to continue financial support for the development of small and medium enterprises (SMEs) in the region as a way to combat the credit crisis and to shore up economic growth. The summit was organized under the theme “A New Commitment to Asia-Pacific Development,” a phrase meant to inspire the reduction of the wealth gap between developing and developed nations.

In a joint statement, several APEC leaders said that member economies have in recent months taken steps to stabilize their respective financial sectors, promote domestic investment and consumption, and in general strengthen their respective economies. The leaders jointly pledged to support efforts by export credit agencies, international financing institutions and private banks meant to ensure that SMEs and other businesses obtain adequate capital. The APEC Business Advisory Council (ABAC) proposed additional SME programs to the APEC leaders that cover technological infrastructure, financing-capacity building, training, and other measures to sustain and promote SME employment and stability.

The statement echoed sentiments expressed at the APEC Business Advisory Council (ABAC) Summit held earlier in November, in which APEC Vice Admiral Luis Giampietri told over 1000 entrepreneurs from the organization’s 21 member nations that SMEs are the “engine of APEC economic deveopment as well as that of all countries in general.” The statement was also released with the explicit intention of reaffirming much the group’s 2009 work plan for the APEC Regional Economic Integration (REI) Agenda, a collection of the group’s economic and trade goals. In support of the agenda, APEC leaders committed to instituting numerous regional trade agreements written to ensure fairness, consistency, and coherence among the policies of trade partners, praising new plans to improve and study investment flows and investment agreements, supporting capacity building of capital markets, and creating legal mechanisms for protecting property rights.

In other ways, the summit statement served as a reaffirmation, vis-à-vis the credit crisis, of the progress made at the 15th APEC SME Ministerial Meeting held earlier this year, where several APEC Ministers agreed to promote policy, business, and regulatory environments that foster the establishment, growth, and development of microenterprises and SMEs. They discussed policies designed to support SME development and reduce poverty within local communities across a range of areas, including: sustainable environmental initiatives, corporate social responsibility, innovation management, public-private partnerships, and regional economic integration. Additionally, the APEC Small and Medium Enterprises Working Group, a steering sub-committee created specifically for strengthening SMEs, signed a new Strategic Plan for 2009 to 2012 that involves building member countries’ business environments; liberalizing markets; growing entrepreneurship; and focusing on reducing poverty among youth, women, and minorities.

Started in 1989 in Australia as an informal Ministerial-level dialogue group with 12 member nations, the Asia-Pacific Economic Cooperation (APEC) has since grown to become a forum for 21 Pacific Rim countries to discuss cooperation on trade and investment in the area. Now headquartered in Singapore, the organization annually holds an APEC Economic Leaders Meeting where by high-ranking officials from all member economies plan and discuss regional trade and investment developments. APEC activities are centrally funded by small annual contributions from APEC member economies that since 1999 have totaled approximately USD 3.3 million per year. After 2009, members’ contributions will increase by 30 percent to USD 5 million per year. These funds are used to compensate a Secretariat in Singapore and various projects in support of the group’s trade and investment goals. Please see the APEC project database for more information.

Additional Resources:

Asia-Pacific Economic Cooperation (APEC)

APEC: 2008 15th APEC Small and Medium Enterprises Joint Ministerial Statement: Sustainable Local Development to Foster SMEs Growth

APEC: Economic Leaders Meeting Statements from November 22 and November 23

APEC: How APEC Operates

APEC: Project Database

APEC: Small and Medium Enterprises Working Group

Balita: “PGMA to push for welfare of small entrepreneurs amid global crisis”

Balita: “APEC countries to continue support for SMEs”

LivingPeru: “Small and Medium Enterprises Foster APEC Economies’ Development”