APEC's new vision(3)

China has a competitive advantage in infrastructure construction, and is willing to participate in international infrastructure projects and cooperation in connectivity, said Wang Zhenyu, an associate researcher with the China Institute of International Studies.

Right before the APEC Economic Leaders' Meeting, Chinese President Xi announced on November 9 that China will contribute $40 billion to set up a Silk Road Fund at a dialogue meeting on strengthening connectivity with China's neighboring countries. The goal of the new fund is to "break the bottleneck in Asian connectivity by building a financing platform."

The fund will be used to provide investment and financing support for carrying out infrastructure, resources, industrial cooperation, financial cooperation and other projects related to connectivity for those countries.

In terms of institutional connectivity, APEC economic leaders will strive to make progress in addressing issues of trade facilitation, structural and regulatory reforms, as well as facilitating transport and logistics.

In his opening remarks at the leaders' meeting, Xi announced that China will donate $10 million for institutional development and capacity building for APEC and provide 1,500 training locations for developing APEC member economies to build their capacity in trade and investment.

APEC economic leaders also pledged to facilitate the movement of people across borders and the exchange of innovative ideas.

They set the goals for people-to-people connectivity at achieving 1 million intra-APEC student exchanges per year by 2020 and increasing the number of student exchanges to developing economies, as well as 800 million APEC tourist arrivals by 2025.

At the APEC CEO Summit, US President Obama announced that China and the United States have agreed to implement a new arrangement for visas: Student visas will be extended to five years and business and tourist visas will be extended to 10 years. Currently, visas between the two countries last for only one year.

According to a 2013 report by the World Tourism Organization and the World Travel & Tourism Council, visa facilitation could bring APEC 38-57 million additional international tourist arrivals by 2016. The inflow of additional international tourism receipts generated by these additional arrivals could reach $62-89 billion. The total number of jobs created as a consequence of this increase is estimated to reach 1.8-2.6 million.

Wang believed that regional connectivity will become a new pillar, together with trade liberalization, investment facilitation and technological cooperation, to prop up the economic integration of APEC.

New driving forces

Amid the uneven recovery of the global economy, economic growth in the Asia-Pacific region has lost some steam. For the first half of 2014, the region's combined GDP growth only expanded by 3.9 percent, down from the 4.3-percent growth rate in the second half of 2013, according to a statement by Denis Hew, Director of the APEC Policy Support Unit, when releasing APEC's latest Economic Trends Analysis report at a news briefing in Beijing on November 6.

The slower growth happened in both developed and developing economies in the region, due to a number of factors including gradual recovery of developed economies, more subdued trade activities globally and domestic demand, said Hew.

In 2014, the Asia-Pacific region's GDP is estimated to grow 3.9 percent, 0.1 percentage point lower than that in 2013.

To achieve strong, sustainable, balanced and inclusive growth over the longer term, new sources of growth should be created.

APEC economic leaders reached an accord that the Asia-Pacific region should continue to deepen structural reform, strengthen innovative growth and promote closer cooperation in five pillars—economic reform, new economy, innovative growth, inclusive support and urbanization.

They agreed to convene a ministerial meeting on structural reform in 2015 to discuss issues including overcoming the middle-income trap.

Furthermore, they will to tap into the growth potential of emerging sectors such as the Internet economy.

Under this inclusive support pillar, they will strengthen cooperation on entrepreneurship and employment, the health sector, food security and safety, and sustainable agricultural development. Disaster prevention and mitigation, social responsibility, business ethics and anti-corruption efforts are also suggested, alongside an emphasis on the participation of women in the economy.