Background on Key Figures and Organizations
The Asia-Pacific Economic Cooperation (APEC) is a regional forum comprising 21 economies, including the United States, China, Mexico, and Japan. Established in 1989, APEC aims to promote free trade, investment, sustainable growth, digital innovation, and economic inclusion through government-private sector cooperation. The APEC Business Advisory Council (ABAC), created in 1995, serves as the primary voice of businesses within APEC. Each economy nominates three members to ABAC, which meets four times a year to prepare recommendations for APEC leaders.
APEC’s Call for Rules-Based Trade
On this particular day, the APEC private sector, represented by the ABAC, called for a renewed commitment to rules-based global trade that is open, predictable, stable, competitive, and non-discriminatory. This appeal comes amid rising tariffs worldwide, the second year of U.S. President Donald Trump’s administration, and accusations among countries regarding violations of the World Trade Organization (WTO) norms.
Context and Upcoming Events
The statement was released just nine days before the APEC Leaders’ Meeting in Gyeongju, South Korea, from October 31 to November 1, 2025. This meeting is expected to include a Trump-Xi Jinping (China’s president) encounter, adding geopolitical significance to the call for rules-based trade.
ABAC’s Principles for Achieving Trade Goals
The ABAC outlined several key principles to achieve ambitious trade goals, including:
- Reaffirming APEC’s foundational objective of free and open trade
- Reaffirming WTO’s fundamental principles of a rules-based order, including predictable and non-discriminatory trade
- Reducing tensions to create a more stable business environment
Additionally, ABAC emphasized the importance of preserving existing market access commitments to maintain a stable trading environment and avoid new measures that distort or restrict trade and violate treaty obligations.
APEC’s Role and Impact
As a regional forum, APEC fosters cooperation between governments and the private sector to strengthen prosperity in the Asia-Pacific region. Its members are Australia, Brunei Darussalam, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, the Philippines, Russia, Singapore, Taiwan, Thailand, the United States, and Vietnam.
Concerns Over Global Trade Volatility
In mid-May 2025, the ABAC expressed concern over growing global trade volatility. Increasing tariffs and various trade barriers contribute to an unstable cycle, posing significant downside risks for businesses and the global economy. The consequences affect supply chains, trade relations, and cascading impacts on global markets, business confidence, and the world economy.
Implications for the Multilateral Trading System
The ABAC is deeply concerned about the implications of these developments for the WTO-based rules-driven trading system. New tariffs raise questions about compliance with trade norms that have long supported business opportunities and economic prosperity.
Key Questions and Answers
- What is APEC? The Asia-Pacific Economic Cooperation (APEC) is a regional forum comprising 21 economies promoting free trade, investment, sustainable growth, digital innovation, and economic inclusion.
- Who is the APEC Business Advisory Council (ABAC)? The ABAC was created in 1995 to represent businesses within APEC, with each economy nominating three members who meet four times a year to prepare recommendations for APEC leaders.
- What concerns does the ABAC have regarding global trade? The ABAC is concerned about rising tariffs, growing global trade volatility, and the potential risks to businesses, employment, living standards, inclusion, and economic security.
- What principles does the ABAC advocate for achieving trade goals? The ABAC supports reaffirming APEC’s free and open trade objective, WTO’s rules-based order principles, and reducing tensions to create a stable business environment.
