Facilitating Cross-Border Flows:

The True Measure of Liberalization

The issues at stake

For business in the Asia-Pacific region, the promise of reduced border restrictions represents the biggest benefit of APEC in the short term. Such restrictions continue to impede the conduct of business, limiting the movement of people, goods, services, information, and capital. These restrictions go well beyond tariffs and quotas, encompassing a range of non-transparent and complex customs, immigration, and other cross-border procedures that can, and do, lead to inefficiencies, increased business costs, and a loss of community welfare.

To facilitate cross-border flows, we have identified four flagship recommendations, which draw together components of the APEC trade and investment liberalization and facilitation process. We consider the creation of the APEC Business Visa and the establishment of APEC Business Immigration Lanes as priority measures that should be prompt deliverables upon endorsement by the Economic Leaders at their November 1996 Subic meeting.

Flagship Recommendations:
1.Endorse the creation of an APEC Business Visa and the establishment of APEC Business Immigration Lanes in ports of entry to facilitate business-related travel.

2.Endorse the establishment of an APEC Central Registry for Trademarks and Patents to promote investment and technology flows.

3.Develop and commit to adopt a set of common professional standards for business-related service providers in the region, to be developed by appropriate professional accreditation bodies, and supported by any needed legislative measures.

4.Adhere to 100% implementation of the Bogor trade and investment liberalization goals, with ABAC's continued aspirations to accelerate the process kept in view.

Recommendations

APEC Business Visa and APEC Business Immigration Lanes

Travel within the region has increased substantially in recent years. Economic growth has generated a significant increase in business opportunities, and advances in transportation have reduced the cost and time of travelling. Despite these advances, many unnecessary impediments to business travel remain. To address these problems, we ask the Economic Leaders to:
- Introduce starting in 1996 a minimum five-year APEC Business Visa allowing multiple entries for a minimum of 60 days per entry, and APEC Business Immigration Lanes in ports of entry.

- Introduce by 1996/97 expedited immigration processing for APEC Business Visa holders at major ports of entry.

We call on the Economic Leaders to endorse the principle of expedited entry and exit of business travelers in recognition of the very real economic costs entailed in unnecessary delays.
- Improve between 1997 and the year 1999 the parameters for the issuance and extension of business residency visas.

Delays that occur in the approval of business residency permits and in the extension of their validity constitute another barrier to time-efficient business operations. We call on the Economic Leaders to endorse the adoption of standards of service to ensure that applications for new business residency permits are processed within one month, and extensions of business residency visas are processed within one week, with automatic renewal for a period of up to three years.

An APEC Business Visa system: major concerns and potential solutions:

Following the examples of (a) the ASEAN Visa-Free Travel scheme, (b) the U.S. 10-year B1-B2 concept, (c) the Australian Computerized System for U.S. and Singaporean travelers, (d) the U.S. Visa Waiver and INSPASS system; and (e) the Schengen system in Europe, APEC could adopt a Business Visa system that addresses important concerns:
�  Start-up Pilot Project
APEC economies can adopt a machine-readable APEC Business Visa or a similar technology as a pilot project, and establish APEC Business Immigration Lanes in ports of entry. The pilot project should ideally involve all APEC economies. Alternately, economies willing to join the scheme could immediately do so.
�  Sovereignty Issues
The APEC Business Visa shall be issued only with the approval of each of the participating economies' governments. Final entry remains subject to the normal immigration rules and regulations at each port of entry.
�  Containment
During the pilot trial phase, the APEC Business Visa could be issued only to a reasonable number of business people in each economy. This will enable APEC to calibrate and perfect the system based on experience.
�  Qualification
The APEC Business Visa should be given to top executives and managers of firms including professionals and technicians who need greater mobility within APEC. The initial number of such visa holders should be spread out proportionately among small and large enterprises.
�  Selection Process
Business associations in APEC economies could undertake jointly with appropriate government bodies the pre-screening of the initial number of APEC Business Visa holders and develop the screening qualifications and processes.

The APEC Business Card
The APEC Business Visa could be implemented using one of several mechanisms currently under consideration . One such mechanism is the APEC Business Card currently being developed by Australia, which contains the following elements:
�  Single application within own economy for eligible, bona-fide business people
�  Eligibility determined by business associations, together with government
�  Authorized entry into every participating economy.
�  Multiple entry for 90 days per entry over a five-year period valid for all participating economies
�  Expedited processing on arrival through special APEC lanes
�  Each economy retains the sovereign right to exercise control over entry and exit of individuals.

ASEAN: Visa-Free Travel
This arrangement, for all ASEAN citizens, has been in use for some years now. It consists of waiving visa requirements for travel within ASEAN. In some special ports of entry, such as the Bangkok International Airport, special lanes have been set up for ASEAN passport holders. Some countries outside ASEAN, such as Laos, are extending the same privilege to ASEAN citizens.

Australia: Computerized Visas
Computerized visas have been introduced for U.S. and Singapore citizens traveling by air from Singapore to Australia. Upon acquiring the air ticket from a travel agent in Singapore, the passenger's name is introduced into the system. Once the passenger arrives in Australia, he or she is cleared for entry without requiring a stamp on the passport. Within the next two years, Australia intends to introduce this system for passengers coming from Japan, the United States, Great Britain and Germany.

United States: Visa Waiver Program and Speedy Entry System Five APEC member economies are already participants in the U.S. Visa Waiver Program (Canada, Brunei Darussalam, Japan, New Zealand and Australia), whose nationals do not need non-immigrant visas to enter the U.S. Non-immigrants from other APEC member economies are eligible to receive 10-year, multiple entry visas and visitors can stay in the U.S. for up to six months during each entry. The visa is renewable without leaving the country. The U.S. implements the INSPASS system at selected airports to expedite entry. Frequent business travelers who already hold U.S. visas can apply for machine-readable INSPASS cards that allow them to bypass congested lines.

APEC Central Registry for Trademarks and Patents
Inadequate protection of intellectual property rights hinders technology transfer, the development of high-technology industries, and investment. We call on the Economic Leaders to establish and implement mechanisms and procedures to ensure that these rights are adequately protected. Specifically, we ask them to:
- Endorse the establishment of an APEC Central Registry for Trademarks and Patents.
Such a Registry would be a mark of APEC's commitment to promote respect for the integrity of proprietary information. It would serve as a practical resource for businesses and governments throughout the region. It would enable governments to ensure that the use of intellectual property is being carried out in full compliance with the obligations due to registered holders of patents, trademarks and other forms of intellectual property.

- Establish a program of comprehensive cooperation on intellectual property rights.
This program should include the following components: (a) regular exchanges of information on border enforcement and on internal measures to combat the sale and distribution of violative material; (b) identification of member economies' resource needs to fully implement the Uruguay Round Agreement on Trade-Related Intellectual Property Rights (TRIPs) or equivalent obligations; and (c) the provision of technical assistance and training where necessary.
�  Implement the Uruguay Round TRIPs agreement � or equivalent obligations in the case of non-WTO signatories  in the shortest possible time.
This should also be accompanied by credible enforcement and the conduct of public education and awareness campaigns.

Common Professional Standards for Business-Related Service Providers
Trade in business-related professional services is an integral element of international business. The facilitation of such trade is needed for our enterprises to remain globally competitive. We perceive that the main barrier to trade in professional services is the lack of mutual recognition of professional credentials among member economies. To address this barrier, we call on the Economic Leaders to:
Endorse the establishment in 1997 of a set of common professional standards for APEC-wide recognition, to be developed by appropriate professional accreditation bodies, and supported by any necessary legislative measures.
A work program in common accounting standards already exists under the General Agreement on Trade in Services. However, the growth of APEC economies requires rapid movement towards common standards for business-related professions. We call on the Economic Leaders to support initiatives by professional associations to agree on mutual recognition and harmonization criteria and to commit to making needed policy changes. We urge the Economic Leaders to identify in 1997 a set of common standards for business-related professional services that can attain immediate APEC-wide recognition.

Adherence to 100% implementation of the Bogor liberalization goals
APEC governments have already committed themselves to realizing free and open trade and investment in the region no later than 2010 for industrialized economies and 2020 for developing economies, through a concerted voluntary process. APEC should devise a strategy in which governments acknowledge that each of their economies would benefit from cooperation to reduce impediments to international economic transactions; and devise effective ways to help each other overcome impediments. Continued concerted unilateral decisions by APEC governments to reduce trade barriers will in due course help others act correspondingly. We therefore ask the Economic Leaders to:
- Reaffirm the spirit of the Bogor liberalization goals by fully implementing free and open trade and investment no later than 2010/2020, with each APEC economy voluntarily undertaking unilateral efforts to accelerate the process as rapidly as its structural conditions would allow.

Customs Harmonization The simplification and harmonization of customs procedures constitute a key priority area. The rapid growth of cross-border trade has placed tremendous pressure on outmoded customs practices. While business people must pay for fair and due customs clearance, they are confronted with inefficiencies that add unreasonable costs to their operations. Customs procedures vary across economies. Rules of origin are emerging as major technical barriers to trade.

We welcome the substantial progress made in addressing these problems by the Customs Procedures Subcommittee of the APEC Committee on Trade and Investment, but see room for further improvement. Technology, as in the case of the electronic processing of entry documents, can be harnessed to overcome problems. Governments can move more quickly towards simplification and harmonization of customs procedures. APEC economies can accelerate the adoption of a common APEC customs code. They can participate actively in the General Agreement on Tariffs and Trade 1994 three-year program for the harmonization of non-preferential rules of origin.
In order to maintain APEC's momentum, we recommend that Economic Leaders endorse the complete implementation of all customs facilitation, harmonization and standardization measures by the year 2000, and establish the following intermediate milestones:
- Adhere to the Harmonized System and the World Trade Organization Customs Valuation Agreement by the end of 1997.
- Standardize and simplify customs documents and procedures by 1997.
- Implement fully an APEC-wide electronic customs processing system by 2000.
- Provide technical training to economies that require assistance, ensuring that adequate resources are devoted to such programs.
What it takes to effect an average international trade transaction today
- 27-30 different parties
- 40 documents
- 200 data elements (30 of which are repeated at least 30 times)
- re-keying of 60-70% of all data at least once

Standards and Conformance
Product standards differ widely among APEC member economies, creating barriers to the free flow of goods. These variations also increase business costs as product runs need to be adjusted to requirements of many individual economies. While legitimate reasons exist for economies to have differing requirements, there remains considerable potential for progress in harmonizing international product standards. To realize this potential, we call on Economic Leaders to:
- Align each member economy's standards in priority sectors with international standards by 1998.
- Adopt mutual recognition agreements in priority areas by 1998.
- Establish an internationally recognized Testing Authority.

Promotion of Subregional Growth Areas
Subregional growth areas have been established to maximize cross-border movements of goods, services, investment and human resources, and to exploit comparative advantages of geographical areas divided by political boundaries. In several of these areas, the business/private sector has established business councils to link business entities and other involved economic organizations, and to make representations to governments. Recognizing the important contribution of such arrangements to the expansion of cross-border flows, we call on the Economic Leaders to:
- Encourage the development of subregional growth areas among APEC member economies.
Subregional growth areas: demonstrating the benefits of freer cross-border flows
There are several sub-regional growth areas in the Asia-Pacific region. As a result of these arrangements, cross-border business has expanded in what were once economically isolated provinces.
�  Indonesia-Malaysia-Thailand Growth Triangle (IMT-GT):
A total of more than 100 investment projects have been identified. Among the joint ventures agreed upon are: the development by four consortia of the land bridge linking Penang and Songkhla on the South Thailand coast; a Malaysian-Indonesian joint venture for the production of motorcycles in Ipoh; and a consortium of Malaysian, Indonesian and Thai companies to set up the IMT-GT regional television service.

�  Brunei-Indonesia-Malaysia-Philippines East ASEAN Growth Area (BIMP-EAGA):
Among the joint venture projects recently formed were: a Malaysian-Philippine tuna canning and furniture-making project in Sabah; and a ferry service linking Zamboanga and Sandakan, which will also later be serving Tawau and Lahad Datu. Other projects being discussed for implementation are joint tourism development, expansion of maritime transport services, expansion of air linkages and a fisheries cooperation project.

�  Pacific Northwest Economic Region (PNWER):
Also known as Cascadia, the PNWER reflects a dynamic trading and cooperative relationship which has developed along the Pacific North West corridor between Canada and the United States.

�  South China/Macau/Hong Kong growth triangle:
Cross-border growth areas can also evolve naturally without explicit government recognition or promotion in response to shifting comparative advantage within a subregion, an example being the South China/Macau/Hong Kong growth triangle.


  ASEAN Visa proposed to increase regional tourism   [More.........>>]

  Facilitating Cross-Border Flows: The True Measure of Liberalization [More........>>]

  Thailand pushes for Asean visa [More........>>]

  ASEAN visa to curb terrorism [More........>>]
 

<TOP>