Wed, Aug 30, 2006 - Page 8 News List

Take an alternative look at APEC

By Darson Chiu 邱達生

While the media have been placing great emphasis on the campaign against President Chen Shui-bian (陳水扁), life goes on and APEC moves on. The 2006 APEC Leaders' Meeting will be held in Hanoi, Vietnam, from Nov. 18 to Nov. 19. Put aside the question of who will represent Chen at the meeting; of more interest is a look at APEC from the perspective of its organizational structure and functions.

Technology is essential for an organization's sustainable development and operation. For a profit-driven organization, technology is an important component for optimizing output and maximizing profit. Technology is also a very important factor for nonprofit organizations; however, identifying inputs, outputs and the relationship between them is not as easy.

The inputs and outputs of nonprofit organizations do not necessarily have market values, but technology is still needed to transform inputs into outputs.

APEC is a nonprofit, intergovernmental and regional organization. The technology embedded and adopted in APEC is related to its interplay with member economies and other organizations. There exist intra-relationships between APEC and its member economies as well as interrelations between APEC and other organizations.

The intra-relationships and interrelationships of APEC are influenced by its core and enabling technologies. In addition, the relevant technologies are closely related to APEC's organizational structure.

APEC is not only an organization but also a forum that operates based on open dialogue among governments with consensus as the decision-making mechanism. APEC is also a non-binding organization, which means that there are no compulsory obligations for APEC member economies.

Fulfilling the interests of APEC member economies is in accordance with APEC's mission, which is referred to and categorized as three pillars: trade and investment liberalization, business facilitation, and economic and technical cooperation.

The first pillar reduces and eliminates tariff and non-tariff barriers that hinder regional trade and investment.

The second pillar reduces business transaction costs by improving access to information related to regional trade, and coordinating relevant policies and strategies to smooth the progress of economic growth.

The third pillar brings together APEC member economies and builds the basic capacities for promoting regional trade, whereas developed economies are encouraged to provide technological assistance to developing economies.

Tremendous gaps exist in economic development among APEC economies. There are no 100 percent service-oriented or manufacturing-oriented economies in the APEC region because economic structures have evolved in response to internal and external needs. The internal and external needs demand a mixture of outputs of services and manufacturing goods.

A service-oriented economy must focus more on human resource development because humans, or labor, are the most important input for a service-oriented economy.

Instead of treating labor as a fixed input, like most economists do, a service-oriented economy needs to stress the importance of human relations-focused natural systems to add value to outputs.

The technology used by a service-oriented economy is the technological activity of human resource capacity building. A manufacturing economy considers labor to be simply one of the inputs, like capital and machinery. The technology required by a manufacturing economy efficiently processes all inputs to generate maximum or optimal outputs.

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