APEC finance chiefs meet amid global worries

BEIJING, China – The global economic recovery is beset by “downside risks”, China’s vice-premier told Asia-Pacific finance ministers Wednesday, October 22, a day after growth in the world’s second-largest economy hit a five-year low.

The meeting of ministers from the Asia-Pacific Economic Cooperation (APEC) forum in Beijing comes ahead of the group’s annual summit next month, when Chinese President Xi Jinping is expected to host counterparts including US President Barack Obama, Russian President Vladimir Putin and Japanese Prime Minister Shinzo Abe.

“Now global economic recovery remains difficult, with downside risks still existing,” China’s Vice-Premier Zhang Gaoli said in a speech formally starting the finance meeting.

The Asia-Pacific region faced challenges including what he described as “policy adjustment of major developed economies”, apparently a reference to the US Federal Reserve’s winding down of the vast bond purchase program it put in place to fight the global financial crisis.

His comments came a day after China, a major driver of global growth, announced that gross domestic product (GDP) expanded 7.3% in the third quarter, its slowest pace since the depths of the crisis.

APEC, established in 1989, groups 21 economies spanning Asia, Oceania and North and South America and includes giants the United States, China, Japan and Russia, emerging economies such as Mexico and Indonesia and small nations such as Brunei and Papua New Guinea.

“The Asia-Pacific region is the main driving force and engine for global economic growth,” Zhang said, stressing that the 21 APEC economies account for 40% of the world’s population, 70% of the global economy, and 46% of world trade.

Zhang said ministers would be discussing, among other issues, the global and regional economy, infrastructure investment and financing cooperation and fiscal and taxation policy.

The gathering was attended by Chinese finance minister Lou Jiwei, Japan’s Taro Aso and others, though US Treasury Secretary Jacob Lew skipped the event, instead sending Deputy Secretary Sarah Bloom Raskin.

Over its quarter-century history APEC, which is a consensus-based grouping, has made the pursuit of free trade among member economies a persistent goal.

Nowadays it says its main objective “is to support sustainable economic growth and prosperity in the Asia-Pacific region”.

Economically, rival free trade groupings championed by the US and China have split APEC members.

Politically, tensions within APEC include maritime territorial disputes between China, the Philippines and Vietnam as well as between Beijing and Tokyo. – Rappler.com