APEC more than insular views

DEPUTY Premier John Watkins provided dramatic proof of his ever-narrowing tunnel vision last month when he whined about the effects of the September meeting of Asia Pacific Economic Co-operation nations in Sydney.

With all the foresight of a provincial shire clerk, Watkins - mentor to the ALP's candidate for Bennelong, Maxine McKew - opined that the APEC Summit would be "an event that will bring disruption to the daily lives of hundreds of thousands of Sydneysiders with very little benefit to them".

"I would have much preferred if the invitation had been offered by Canberra and these world leaders were in our national capital, not here in Sydney," said Mr Watkins, who is also the state's Transport Minister, though given that there is little evidence the state has a transport plan, let alone a ministry, that is not saying a lot.

Even an individual as notoriously unworldly as Premier Morris Iemma, who apparently lived at home with his parents until his marriage at 35, has some inkling of the importance of APEC to NSW and Australia, and Bob Carr, the worldliest of recent Labor premiers, said the choice of Sydney was "a great vote of confidence". Indeed.

But APEC is more, much more than a tourist stopover for 21 world leaders, top business figures and senior public servants, let alone a photo opportunity in a funny shirt.

It will place Australia squarely in the role of Asia-Pacific powerbroker with a very serious business agenda that could set the agenda for major changes in the way the economies in this part of the world work.

Last year more than 900 foreign public servants met in Canberra to begin planning the way forward - not looking for one big hit but for many small, incremental changes that would facilitate business.

APEC's Business Council chairman Mark Johnson, a recently retired founding director of Macquarie Bank, who will also chair the business summit which will run simultaneously with the APEC leaders' meeting, spoke to me before leaving for Tokyo this week.

Almost apologetically, Johnson explained that many of the APEC initiatives don't sound "sexy" but will bring about major benefits to the countries involved.

These initiatives include the introduction of the "single window" to reduce the oceans of paperwork now needed to move containers around member nations to comply with the needs of the traditional bureaucracies in health, quarantine, customs and security areas.

Under the proposed change, all of the forms will be compressed into just one clearance, the STAR (Secure Trade APEC Region) certificate, saving billions a year for the shippers of the 3.5 million containers which cross the Pacific each year.

There is also an APEC nations business travel card which will act as a visa for preferential travel across the borders of 17 of the 21 APEC economies.

A system of APEC-wide standards is also being worked on to simplify trade, a huge step at a time when some member nations don't even have their own internal standards organisations.

"This may sound pretty mundane," Johnson said, "but consider that there is a natural gas working group looking at the specifications for natural gas, and look at the increasing volume of natural gas being moved across the region, and its importance is very clear."

There are also working groups looking at other aspects of the energy industry and at the chemical and automotive industries.

The APEC nations even consider it possible that their Sydney talks may help break the free trade stalemate that has deadlocked the Dohar rounds of talks, cutting red tape and producing a free trade area in the Asia-Pacific region. If Dohar falls over, or more realistically, when, APEC could be the essential basis for a free trade zone.

APEC is of course voluntary, operating on consensus, with no negotiating ability, though that might be something to be looked at in the longer term.

It also has a most critical capacity building role, helping nations within the region improve their economic structures, lifting their skill levels and improving their financial systems.

Australia, Japan, the US and Canada have played a lead role, for example, in training people from other nations for critical roles in their own economies.

Australia is the central point for a range of crucial skills in such areas as targeting money laundering and detecting terrorism financing, all being taught to others from APEC.

Vietnam, which is very keen to rapidly develop into a market economy, has put itself under scrutiny by other APEC countries.

"It is in our interests to share our skills and set the standards by which others can open their markets," Johnson said.

The alternative course of action is to leave the world's fiscal future to the gathered oafs at the UN.

Watkins should take note. He might even attend a few of the sessions and expand his tiny knowledge base.