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6  Summary

The Asia-Pacific region is a major engine for global growth, comprising 57% of world GDP (US$20.7 trillion) and 46% of world trade (US$7 trillion) (APEC Secretariat, 2004). However, there is a growing body of evidence which suggests that the APEC region is not realising the full benefits of income convergence due to remaining barriers at the border as well as behind-the-border barriers to economic growth and regional economic integration. While outward-orientation and strong growth performances have resulted in a catch-up process in some economies, progress across the APEC region has been patchy. Consequently there is a growing consensus that, as a complement to the trade and investment liberalisation and facilitation agenda, focus in the APEC context should also be given to structural policies.

While the benefits of structural policy reform are becoming increasingly well understood, there are of course significant challenges to undertaking structural reform. While the most appropriate policy responses will differ across economies, the literature identifies a number of challenges and strategies for managing structural change. These can be conceptualised as increasing the set of desirable and feasible reforms by making progress across the three dimensions of policy dialogue, capacity building and awareness raising.

APEC provides New Zealand and other member economies with a forum to promote improvements in economies’ domestic structural policies. Where APEC and the Economic Committee can add value to the work being undertaken by other international organisations, such as the OECD and World Bank, is by providing a forum for the discussion and sharing of experiences on good practice principles and practical lessons on policy implementation, as well as technical assistance where necessary. Structural policy change is a long-term process, which complements the trade and investment liberalisation and facilitation agenda. It will take concerted input, particularly from developed APEC economies, to deliver on APEC’s structural reform work.

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