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APEC
THOUGHT LEADERSHIP
WELCOME: WISHNU WARDHANA
Food: A World of Adundance
Cybersecurity: Public Data
Trade: Trans Pacific Partnership
The APEC Publication 2013
INSIDE APEC
theapecceosummit.com
CATCOMPANYInc Publications
Nusa Dua/Bali Indonesia October 2013
SPONSORED BY
waters.com
The development of new, ground-breaking medicines that make us
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Higher standards for a cleaner environment. It all begins with the
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To discover whats possible in your world, visit waters.com.
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2013 Waters Corporation. Waters and The Science of Whats Possible are registered trademarks of Waters Corporation.
The APEC Publication 2013
Contents & Contributors
04 theapecceosummit.com
CATCOMPANYInc
Masthead
Features
02 Waters Corporation
05 Westin Nusa Dua
06 BKPM
09 Accenture
11 Garuda Airlines
15 Grand Hyatt Bali
17 CAT Company & CGcreate Design
18 Heifer International
29 University of Washington
34 Becamex
43 Tufts University
46 Invest in Turkey
57 ICC Indonesia
58 Imirus
59 ICC G20 Advisory Group
65 Caterpillar Inc
66 RCCL
69 RCCL
71 United Airlines
72 Caterpillar Inc
74 McGraw Hill
77 Bali Toll Marathon
79 Bali Tourism
80 Soneva Fushi Resort
89 Ettinger
93 Diplomatic Courier
94 Brisbane Economic Development Board
98 Nusa Dua Beach Hotel & Spa
100 Korean Airlines
Advertisers Index
26
52
68 / Support for Good Regulatory Practices in APEC will Foster Growth
By Irvina Falah
70 / APEC Economies are Improving Border Entry for Air Travelers
By Irvina Falah
75 / Opening the Services Sector Ofers Big Gains, Say APEC Ofcials
By Irvina Falah
News
October 2013
COVER STORY:
26 / PACIFIC SUNRISE: A FOCUS TOWARDS ASIA VIA TRADE
After the often failed attempts of reaching a consensus
on the Doha Rounds, a new free trade pact, called the
Trans Pacic Partnership, has emerged.
By Oscar Montealegre
20 / Moscows Mayoral Elections: A Win Win for Putin
By Andrew Tytarenko
32 / Colombias Future as it Masters Renewable Energy
By Bryce Bytheway
40 / Resilience: Growth with STEM Innovation
By Edie Fraser
47 / Foreign Investment in Georgia: Opportunities Abound
By Alexander Botting
52 / A World of Abundance
By Dr. Scott T. Massey
54 / Russias Energy Policy
By Dr. Richard Rousseau
60 / APEC and Small, Medium and Micro Enterprises
By Manny Menendez
62 / Rushing Backwards: Why Hastening the Trans Pacifc
Partnership Agreement Will Hurt Us
By Akela Lacy
82 / All along the Watchtower:
Our data is public, should we get over it?
By Akela Lacy
86 / Why do people protest?
By Vahram Ayvazyan
90 / The Oil Crisis in Nigeria
By Dr. Orji Uzor Kalu
96 / The U.S., China, and the Trans Pacifc Partnership
By Ryan Burkhart
12 / BKPM: BKPMs Mission
24 / Soneva Thailand: Soneva Kiri Resort
30 / Korean Airlines: Leading the way in Business Travel
36 / Becamex: Becamex ICC Corporation
38 / Intel: Improving lives, communities and
economies through technology
50 / Soneva Maldives: Soneva Fushi Resort
76 / Bali Tourism: Welcome to Paradise
Sponsored Features
86
APEC THOUGHT LEADERSHIP Nusa Dua / Bali. Indonesia October 2013











The APEC Publication 2013
APEC
THOUGHT LEADERSHIP
WELCOME: WISHNU WARDHANA
Food: A World of Adundance
Cybersecurity: Public Data
Trade: Trans Pacific Partnership
The APEC Publication 2013
INSIDE APEC
theapecceosummit.com
CATCOMPANYInc Publications
Nusa Dua/Bali Indonesia October 2013
SPONSORED BY
Publisher:
Chris Atkins
Editor-in-Chief:
Ana C. Rold
Managing Editor:
Chrisella Sagers Herzog
Creative Director:
Christian Gilliham
christian@cgcreate.co.uk
T: (+44) 7951 722265
WELCOME NOTES:
Publishers Note
By Chris Atkins
Editors Note
By Ana C. Rold
Welcome by
Wishnu Wardhana,
APEC CEO Summit 2013 Chair
Yu Jinzhen
Vice Chairman, CCPIT
Contributors:
Vahram Ayvazyan; Alexander Botting;
Ryan Burkhart; Bryce Bytheway;
Edie Fraser; Dr. Orji Uzor Kalu;
Akela Lacy; Dr. Scott T. Massey;
Manny Menendez; Oscar Montealegre;
Dr. Richard Rousseau; Andrew Tytarenko
Publishing Firm:
The CAT Company, Inc.
Chris Atkins, President
Global Advisory Group:
Chris Atkins, Peter Atkins
Jennifer Latchman,
Manuel C. Menendez III
(Chairman & Strategic Advisor)
Keith Foote Nyborg
(United States Ambassador (Ret.)
President of Sales:
Mike Nyborg
Sales Executives:
Ray Baker, Guy Furl, Tony Royle,
Juan Hierro, Amelia de La Cruz,
Don Stauber
Special thanks:
Diplomatic Courier for their
editorial direction and strategy
To contact the editors
please email us at:
editors@diplomaticourier.org
BALI INTERNATIONAL
CONVENTION CENTRE
The APEC Publication 2013
Welcome
08 theapecceosummit.com
Wishnu Wardhana
APEC CEO Summit 2013 Chair
Dear Leaders
Salam sejahtera from Indonesia.
ON BEHALF of the Indonesian business
community, Indonesia is delighted to be
hosting APEC once again, at a time when
the global economy is at a pivotal juncture,
almost 20 years on from the Bogor
Goals when the leaders of Asia-Pacic
rst envisioned free and open trade and
investment.
The aim of the Summit is to create a
unique platform to discuss the future of the
Asia-Pacic and to contribute to achieving
sustainable inclusive growth globally. As a
key stakeholder in our future, I invite you
to join us to work together towards a more
resilient world and to build bridges to growth
to create more opportunities for trade and
investment for the benet of the people in
our economies.
The Summit program will be exceptional
and will include the Presidents and Prime
Ministers of the Asia-Pacicsome of whom
are new, CEOs of global corporations, as well
as thought leaders in a dynamic interactive
format. Through the discussions on stage,
and through the high quality networking, we
want to ensure that you will gain the latest
insight and perspectives on the issues that
matter most to your business and the region.
I am condent that with your support,
THE AIM OF THE SUMMIT IS
TO CREATE A UNIQUE PLATFORM
TO DISCUSS THE FUTURE OF THE
ASIA-PACIFIC AND TO CONTRIBUTE
TO ACHIEVING SUSTAINABLE
INCLUSIVE GROWTH GLOBALLY.
we can reshape our future to make our
economies more resilient and fully open
for business. At the same time, there is
no better chance to discover emerging
Indonesiaprojected to be the 7th largest
economy in the world in the next 20
years while enjoying the beauty and
serenity of Bali.
I look forward to welcoming you to the
Summit. Selamat datang to Indonesia.
Yours sincerely,
Wishnu Wardhana
APEC CEO Summit 2013 Chair
The APEC Publication 2013
Welcome
10 theapecceosummit.com
Yu Jinzhen
Vice Chairman, CCPIT
Dear Government ofcials, Business & Industry leaders and Friends
WE WARMLY WELCOME you to attend the 2014 APEC Summit
to be held in Beijing, the Peoples Republic of China.

The APEC Summit will offer an unparalleled opportunity to showcase
Chinas and our fellow APEC member economies and the strength of
our cooperation. The APEC 21-member economies are home to nearly
half of the worlds population, 55% of the worlds GDP, and 45%
of the worlds trade.

Our goal must be to strengthen our relationship, deepen our
understanding with each other while respecting our differences
and in doing so we maintain stability, peace and national prosperity.
We welcome you to Beijing in 2014.
Best Wishes,
Yu Jinzhen
Vice Chairman, CCPIT
THE APEC SUMMIT WILL OFFER
AN UNPARALLELED OPPORTUNITY TO
SHOWCASE CHINAS AND OUR FELLOW
APEC MEMBER ECONOMIES AND THE
STRENGTH OF OUR COOPERATION.
China Council For The Promotion Of International Trade
12 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / BKPM
Indonesias immense and growing consumer
market, macro-sustainability and fantastic
demographic dividend were some of the reasons
why we chose to invest in Indonesia, says Seung
Hwa Suh, Vice Chairman and CEO at Hankook Tire.
Hankook is just one of many global players that
has seen the potential of investing in Indonesia. It
is one of the fastest-growing tire companies in the
world, and its US$1.1 billion investment in Indonesia
will cement that position. But it wasnt just the
market potential that convinced Hankook.
We were also extremely encouraged by the
Indonesian governments support and
commitment during our initial fact-finding and
feasibility stage, says Seung. BKPM advised us
through every step of our investment decision
process, which gave us the confidence to make
the final decision to invest in Indonesia.
BKPMs Mission
Indonesian government has mandated BKPM
to seek out and encourage both local and regional
investors as well as major corporations looking at
investing in Indonesias growing markets. It must
be a proactive advocate for investments and a
matchmaker for investors. BKPM is also tasked
with making sure a conducive and reassuring
investment climate helps convince potential
investors that Indonesia is the place to be in
Southeast Asia. BKPM is more than an advisory
board; it was given ministerial status in 2009, with
its Chairman reporting directly to the president of
Indonesia. Its results are as strong as its mandate.
Through cooperation and coordination
between BKPM, other ministries and local
governments, investment services are going to be
improved continuously and significantly, says M.
Chatib Basri, Minister of Finance. The Q2 Domestic
Direct Investment (DDI) and Foreign Direct
Investment (FDI) realization figures for 2013 bear
this out. Investment realization in Q2 (April-June)
2013 was US$96.8 billion (Rp99.8 trillion), an
increase of almost 30% compared to the same
period in 2012. Taken from January 2013 right
through to June 2013, the figures are even more
impressive, with a 30.2% increase. More than
two-thirds of that came from FDI alone.
Chatib notes that new regulations are being
introduced to simplify investment. [Using] new
investment regulation, the realization of foreign
and domestic investment will increase and will
support and contribute to the national economic
growth target of 6.3% this year,. He also says that
currently Japan is the number one FDI contributor
in Indonesia, followed by Singapore and South
Korea respectively in second and third position in
terms of overall FDI value.

More than Money
Beside looking for investor and help them to
establish their business in Indonesia, BKPM
has an additional role to seek sustainable
investment that improves social equality
and reduces unemployment.
It promotes and reinforces Indonesian
government development goals, which have
been stated as pro-poor, pro-growth, pro-jobs
and pro-environment. Indonesia needs long-term
and value added investment, or smart capital
investment, says Chatib.
Transport is one of the sectors that the
Indonesian government has targeted for
The Indonesian Investment Coordinating Board (BKPM) with its long and successful experiences
as the primary interface between business and government has an important role to boost
domestic and foreign direct investment in Indonesia to help maximize benefits and returns for
businesses, consumers and investors.
BKPMs mission
THOUGHT LEADERSHIP
investment, says Herry Bakti S. Gumay, Director
General of Air Transport at the Transportation
Ministry. He notes that the plan to build 24 new
airports across the country by 2017 will not only
extend the countrys infrastructure and assist the
aviation industry, but will also promote business
and tourism.
Last year 12 new airports were completed at
locations as diverse as Jambi, Maluku, Papua, West
Sulawesi and Bengkulu, each with a minimum
investment of US$21 million (Rp200 billion).
High-Tech Focus
BKPM has already scored some big successes
in the infrastructure, consumables and raw
materials markets. But one area that is still worthy
of attention is the high-tech sector. According to a
report from International Data Corporation (IDC),
the value of Indonesias broadband market could
double this year, reaching US$1.16 billion, up from a
mere US$650 million last year.
Sudev Bangah, Associate Research Director and
Head of Operations at IDC Indonesia, estimates
that subscriber numbers are set to rise by 28% this
year, on top of an 80% rise (to 31 million users in
total) last year. Given the number of potential
subscribers, this is low. Bangah suggests that a
primary reason could be higher utilization rates
among existing users, rather than growth in
penetration, because broadband availability is
relatively poor in Indonesia. To remedy this low
penetration and to take advantage of the potential
market, chip-maker Intel has teamed up with
state-owned telecom company PT Telekomunikasi
Indonesia Tbk (Telkom) to boost broadband
subscriber numbers. Together, they will ofer
notebooks and laptop package discounts along
with low-cost Internet services provided by Telkom.
By bringing down the cost of Internet access, both
Telkom and Intel hope to expand market share. To
further help boost market opportunities, the
government has prioritized broadband expansion
as part of its long-term economic master plan. One
of the central elements of this is the US$1.5 billion
fiber-optic broadband network Palapa Ring. The
exponential growth of Internet users and
proliferation of smart mobile communication
devices are driving strong demand for data center
services in Indonesia, said Marina Budiman,
President Director of PT Data Center Infrastructure
Indonesia. Partnerships with the public sector as
well as local private companies will provide future
opportunities for foreign players to tap into
this growth
Solid figures
Corporations arent the only ones that are bullish
about Indonesias investment prospects. The
recent Asian Development Outlook (ADO) report
published by the Asian Development Bank (ADB)
estimates Indonesias economy will grow by a
significant 6.4% in 2013 and 6.6% in 2014. Both
these figures are the highest in the Southeast
Asian region. In the report, the ADB says robust
private consumption and improving investment
performance are the key factors for Indonesia to
reach its predicted growth levels. The ADB points
principally to private consumption as a wealth
generator, fueled by rising employment, wage
increases and a boost to disposable incomes. In
addition, investment will continue to expand, says
the ADB, in parallel with improved ratings from
credit agencies, lower interest rates, increased
government infrastructure spending and
continued overall growth. According to a 2012
report from the McKinsey Global Institute,
Unleashing Indonesias Potential, this positive
investment environment is likely to continue in the
future. The report states that Indonesian business
could benefit by up to US$1.8 trillion by 2030, with
significant market opportunities in consumer
services, agriculture and fisheries, resources and
education. With an additional 90 million
consumers expected, consumer spend in urban
areas could increase at 7.7% a year to become a
US$1.1 trillion business opportunity by 2030, it
states. McKinsey estimates that with agriculture
and fisheries providing another US$450 billion,
and a surge in resources to US$270 billion (also by
2030), the workforce will rise to the challenge with
a near doubling of skilled workers to 27 million.
The report sums up by describing Indonesia as
being on the cusp of a new era of sustained
growth with the advantage of a following wind
from major domestic and international trends.
The ADB is likewise positive about long-term
trends in Indonesia. On the back of robust
consumption, rising investment and increased
intraregional trade, Southeast Asias growth
momentum continues. Indonesia is on a more
sustained path of long-term growth, says Jon D.
Lindborg, ADB Country Director for Indonesia.
Under BKPMs stewardship, Indonesia has seen
continuing gains in direct investment over the past
yearsand it is not just a recent blip that has made
the figures look good. DDI realization in Q2 2012
increased by 10.1% compared to the same period
in 2011, while FDI realization increased by an
impressive 30.2% compared to the same period in
2011. And as Chatib says, with better coordination
among ministries and institutions, the provinces
and districts will likely see a much wider and
bigger distribution of investment in the future.
wSo it is not surprising that some investors
describe their ventures into the Indonesian
investment sector as world class.
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 13
BKPM
HAS ALREADY
SCORED SOME BIG
SUCCESSES IN THE
INFRASTRUCTURE,
CONSUMABLES
AND RAW
MATERIALS
MARKETS.
The APEC Publication 2013
Editors Note
14 theapecceosummit.com
Towards Resilience and Growth
FOR THOSE OF YOU ATTENDING the 2013 APEC CEO Summit in Indonesia
this autumn, welcome! Our editorial and production team is honored to
be part of this signicant gathering for the third year in a row.
As the world continues to face challenges in the nancial realm, the
APEC bloc has managed to stay strong and the business community is
at the helm of this resilience and growth.
This year the Summit features several of the APEC nations leaders as well
as CEOs of global corporations and innovative thought leaders. The way with
which the business community and the policy community have joined forces
is a testament to the role that public private partnerships have played and
continue to play in improving trade relationships and relations in general.
As Ive said at the onset of this publication, APECs major strengths of building
capacity through the sharing of experiences and best practices is a plus in the
next wave of trade reforms. APECs main strength is that it is voluntary and
non-binding and its unique approach enables smaller groups of like-minded
economies ready and willing to undertake reforms to go ahead rst, allowing
others to join later when they are ready. If APEC leaders continue with this
approach, the bloc will continue to record concrete achievements,
year after year.
APEC leaders can take pride in what their countries have achieved.
Cooperation between APEC members has resulted in more goods, services,
capital, and people moving freely around the regionmore so than ever before.
Border barriers, tariffs, and customs measures have been streamlined to give
way to practical procedures that save billions for businesses and economies.
The fact that the Summit takes place in an emerging Indonesia is particularly
important.In a world of increasing nancial uncertainty, Indonesia has enjoyed
unprecedented growth and stability and is a model for the group and the region.
This autumn more than 1200 leaders will be attending the Summit and they
will discuss their business priorities directly with decision makers, lending a
hand to the solutions that will shape the future of the region. We will monitor
as always and look forward to recording their achievements and debating their
issues well after the meeting has ended.
We hope you enjoy the selection of articles and thoughtful opinion editorials
in this annual edition of the APEC CEO Summit magazine, and we hope you
will share your thoughts or questions with us at any time.
Sincerely,
Ana C. Rold
Editor-in-Chief
Ana C. Rold
Editor-in-Chief
Tropical Beauty. Natural Splendour.
Graceful Elegance. Lasting Impressions.
Hyatt. Youre More Than Welcome.
Grandeur
HYATT name, design and related marks are trademarks of Hyatt Hotels Corporation. 2013 Hyatt Hotels Corporation. All rights reserved.
The APEC Publication 2013
Publishers Note
16 theapecceosummit.com
Dear Heads of State, global business leaders,
and distinguished guests welcome to the APEC CEO Summit.
We are thrilled to be part of this signicant gathering, doing our part to
enhance the dialogue between leaders for regional and global solutions.
The third annual APEC CEO magazine provides a unique forum for thought
leaders, journalists, and opinion makers to air important issues connecting the
region and the group. Well after the summit has ended, this platform will
continue to serve and connect these thought leaders. We are proud to be a
part of the platform.
I would like to take this opportunity to thank all those involved in producing
yet another rst class informative publication. The CAT Company is the only
enduring publishing company in the eld of high-level summit publications,
having been publisher and consultant to the G8 Summit magazines, the
G20 Business Summit magazinesthe ofcial publication for the ICC G20
Advisory Group. CAT Company was the rst publisher to be recognized as
the Ofcial Publisher for the APEC CEO Summit in 2010, a distinction
we are very proud of.
I wish Mr. Wishnu Wardhana all the best in chairing this years APEC CEO
Summit. I sincerely hope business leaders convening at this event can come
to together and help to improve the AsiaPacic regions trade relations and
consequently achieve sustainable inclusive growth globally.
We look forward to seeing everyone next year in China.
Christopher Atkins
Publisher and Founder
Cat Company, Inc.
THE THIRD ANNUAL APEC CEO
MAGAZINE PROVIDES A UNIQUE
FORUM FOR THOUGHT LEADERS,
JOURNALISTS, AND OPINION
MAKERS TO AIR IMPORTANT ISSUES
CONNECTING THE REGION AND
THE GROUP.
Please go to the
APP Store to download.
The CAT Company looks
forward in working with CCPIT
for APEC CEO Summit 2014
The CAT Company Inc. Contact: Chris Atkins on 1-801-783-5120 catkins@thecatcompanyinc.net
The CAT company is the proud publisher of the G8 Summit
publication and the ofcial G20 Summit publication for the
international Chamber of Commerce G20 Advisory Group.
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ctober 2013











T
he A
P
E
C
Pu
blication
20
13
APEC
THOUGHT LEADERSHIP
WELCOME: WISHNU WARDHANA
Food: A World of Adundance
Cybersecurity: Public Data
Trade: Trans Pacific Partnership
The APEC Publication 2013
INSIDE APEC
theapecceosummit.com
CATCOMPANYInc Publications
Nusa Dua/Bali Indonesia October 2013
SPONSORED BY
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The APEC Publication 2013
Feature / Moscows Mayoral Elections
Editorial by: Andrew Tytarenko, Diplomatic Courier Guest Contributor
20 theapecceosummit.com
Moscows Mayoral Elections:
The APEC Publication 2013
THOUGHT LEADERSHIP
GEORGIA CURRENTLY RANKS 9TH
OUT OF 185 COUNTRIES IN THE WORLD
BANKS EASE OF DOING BUSINESS
RANKINGS AHEAD OF ALL BUT 3
MEMBERS OF THE G20.
B
Y APRIL 2013, the population of
Moscow had surpassed 12 million
people, adding 500,000 since 2010
and 2 million since 2002. Another 1.5
million commute to Moscow for work every
day, and yet almost 10 percent of all Russians
live or work in in the capital today. Moscow has
changed since the moment the curtain on the
USSR dropped, with the sounds of
Tchaikovskys Swan Lake on all four existing
TV channels during the 1991 coup. The Red
Square, the Kremlin, and vivid colors of the
Saint Basils Cathedral are still the calling card
of Moscow for foreigners, but the real Moscow
is much more than that. Only five miles away
from Kremlin one finds the new business
districtMoskva City, with 19 skyscrapers built
in 17 years. Among them, the Mercury City
Tower is the tallest in Europe; the Federation
Tower will take the lead upon completion.
It is only five miles from Moskva City to the
Kremlin, but good luck making it in twenty
minutes, even at low-traffic times of the day.
Traffic is terrible; it is a by-product of the way
new Moscow was built. The building permits
were handed out by a corrupt Moscow
government, regardless of the inability of the citys
infrastructure to sustain the added load, and the
city could not cope with the new demands.
Moskva City and many other smaller construction
projects throughout Moscow were built mostly by
migrant workers, many of them illegal.
Labor migration is still the driving force of the
Moscows population growth: last year Moscows
population increased by 123,000 people, which
includes 107,000 migrants. Migrants are not just
general laborers or construction workers. Some
areas of Moscows life are controlled by
non-Russian diasporas, and some of these
diasporas are very wealthy and very well
connected. The influence of the Dagestani
diaspora goes all the way to Prime Minister
Medvedevs office, according to Russian press.
Georgian expatriates dominate Moscows
organized criminal underground. On the criminal
side, the entire megalopolis is divided into zones
of the criminal control based on ethnicity. The
by-products of the massive labor and business
migration to Moscow are ethnic tensions, which
from time to time escalate to open violence.
Moscow is as different from the rest of
Russia (except maybe for Saint Petersburg) as
New York is from the rest of the United States.
It was this way during Soviet times, and it
remains this way now, even after Russia entered
the new brave world of the free market
economy. >
A Win-Win for Putin
Nusa Dua / Bali. Indonesia 2013 21
The APEC Publication 2013
Feature / Moscows Mayoral Elections
22 theapecceosummit.com
>The divide is natural: according to Mercers
2013 survey of the cost of living for expatriate
employees, Moscow surpassed Tokyo, and took
second place worldwide, trailing only Luanda,
Angola. Russians do not face the high costs
which foreigners have to pay, but still wages
in Moscow are about four times higher than
in the north Caucasus republics. The average
wage in Moscow is roughly $1900 (about
56,000 rubles) per month, while university-
educated professionals can expect to be
paid $3000 to $5000 per month. This
immediately places Moscow apart from
the rest of Russia.
Deep down inside many Muscovites
despise the rest of the country, and even
casually use the term zamkadie (which
translates to The Land beyond the Beltway);
the rest of Russia reciprocates this feeling.
Nevertheless, everything in Russia must be
processed through Moscow. There is no regional
business or political clan which can exist
without having their man, or better, their
lobby, somewhere in the Moscow corridors of
power; even purchase orders for Gazprom
divisions in west Siberia are approved by
Gazproms Moscow office.
The situation is the same with Russian
politics. All of the essential politicking is done in
Moscow, and Moscow politics reverberate
across all nine time zones of Russia. The
Russian system of power is corrupt and
ineffective, so this reverberation is often
more sound than action, but it is only the
sound that matters.
All one needs to get involved in practical
politics in Russia is to get plugged into Moscow
elites; however, if you want to know what
Russians think and feel, you need to leave
Moscow and travel across the country. (This is
the secret of Vladimir Putins support: he did
not get the real majority in the capital in the
2012 elections, but still won the presidency
because of the support of the silent majority of
Russians.) The Russian government appreciates
the importance of Moscow and Muscovites for
political stability in Russia, and spends about
seven times more per capita in Moscow then in
a Siberian city like Irkutsk or Novosibirsk. Yet
the government still faces the strongest
opposition in Moscow. Needless to say that
massive budget spending in Moscow widens
the gap between the capital and the rest
of the country, both materially and emotionally.
This is the backdrop to the upcoming
Moscow mayoral elections. The vote will take
place on September 8, 2013, following the June
2013 decision of Moscow Mayor Sergey
Sobyanin to resign his position and to run for
the job in democratic elections. Vladimir Putin
supported this decision. It is, in fact, Putins
move to win MoscowSobyanin is reliably the
Putins man, and is among contenders for the
succession of Dmitry Medvedev as prime
minister, but as a serial political appointee, he
has never been elected to any office, including
the position of the mayor of Moscow. He needs
public exposure, while Putin needs to deal with
claims about an undemocratic power grab,
loudest in Moscow. Nevertheless, a voluntary
resignation and running in democratic elections
is a very bold move for a Russian politician.
The elections will not necessarily be truly
democratic, and timing is carefully chosen:
the city is melting from summer heat, voters
are either on vacation or at their dachas
(rural cottages), and there will be no time for
the opponents to prepare. If Sobyanin wins,
the ultimate goal of winning the support of
Moscow will be accomplished by Putin.
Meanwhile there is a side effect of Sobyanins
move: Putins opponents jumped at the
opportunity to run in open elections. The
Moscow elections are an event of national
significance, so exposure is also nationwide.
So far (according to semi-independent Levada-
Centre polls in May 2013) only 41 percent of
Russians know of the Western darling,
Yale-trained opposition figure candidate Alexy
Navalny, and only 6 percent of those support
him. Government-funded WCIOM data is more
favorable for him: 53 percent of Russians know
who Navalny is, while veteran opposition leader
Boris Nemtsov is known among 78 percent of
Russians. Running for Moscows mayor gives
the opposition an opportunity to break out of
the confining political circles of Moscow and
Saint Petersburg, and get Russians to know
them better.
Leading opposition candidate Alexy Navalny
had built his reputation on the fight against
corruption (a kind of a Sisyphusian task in
Russia, which is only the fifth priority for most
politicians). In 2007 he was expelled from the
opposition party Yabloko for nationalism. He
later denied his nationalist views, but his
TV appearances and some speeches tell a
different story.
At the time when the 2013 mayoral election
was announced, he was being prosecuted for
corruption and embezzelment, but he decided
to run anyway. He was nominated by the
Russian right-wing party RPR-PARNAS >
MOSCOW IS AS DIFFERENT FROM
THE REST OF RUSSIA (EXCEPT MAYBE
FOR SAINT PETERSBURG) AS NEW
YORK IS FROM THE REST OF THE
UNITED STATES.
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 23
THOUGHT LEADERSHIP
>(Republican Party of RussiaPeoples Freedom
Party) and started to collect signatures in his
support on June 14th. This is when odd things
started to happen. In order to become the
official candidate, the nominee has to present
73,000 endorsements by the regular citizens,
and more than 110 endorsements by the
members of the Moscow legislature. Navalny
did well with the regular folks, but failed to
get enough endorsements from the legislature
members; other candidates besides Sobyanin
found themselves in the similar situation.
Sobyanin (surely cleared by Putin to do so)
came to the rescue and convinced the United
Russia faction in the Moscow legislature to
support his opponents. With no hesitation,
Navalny accepted help from United Russia, a
party he has referred to as the Party of Crooks
and a Thieves. He got his registration
documents on July 17th, but was sentenced
to six years of hard labor on July 18th. He was
arrested immediately. The next day the state
prosecutors office protested the arrest and
Navalny was released, but a written order not
to leave Russia remains in force. Such a catch
and release game is very unusual, where the
judicial branch is de-facto controlled by the
Kremlin. It does not really matter whether it
was the result of behind-the-scenes political
fights or whether it was a planned action by
Putin directly. What matters is that Putin came
out as the unbiased arbitrator who kept
Navalny in the game. Later Putin commented
on the excessive sentence for the opposition
candidate. Navalny continues his campaign,
and is likely to have a decent showing in
September.
In the case that Navalny (or another
opposition candidate) will not win, Sobyanin
wins as the clean, democratically-elected mayor
with a public mandate to govern, and as the
one who did all in his power to level the playing
field and keep elections fair. Putin comes out as
a supporter of fair democratic elections, while
the lack of the public support for the opposition
will be demonstrated in elections. A bonus for
Putin is a squabble among the opposition which
will take years to heal.
At the same time, a built in feature of fair
elections is that sometimes the underdog wins.
Navalnys campaign is going well and
unopposed by the establishment, so he has a
theoretical chance to become such an underdog.
However, Navalnys only experience in the
executive branch was the role of the adviser to
the governor, which almost landed him in jail.
As a winner he would take on the responsibility
for the management of a city of 12 million,
which has a decades, if not centuries, long
tradition of corruption. His job will be not to
criticize the United Russia and Putin, but to
keep the lights on, water running, sewer system
working, and streets clean. This is an
impossible task to do without cheap migrant
laborand Navalny has promised to deport all
illegals. There is a very slim chance that if
elected Navalny will become a successful
mayor, and a very solid chance that he will fail,
or will become a part of the corruption. In any
case, it will be a heavy blow to the opposition,
and Putin wins again.
This win-win situation for Putin is the
result of 13 years of a managed democracy
policy in Russia, which has left a scorched
field for the opposition. There is simply no
suitable mid-level figure available to assume
the role of mayor of a city like Moscow
or Saint Petersburg.
24 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Soneva Kiri
slopes in the rainforest, gazing across the sea
have been built with sustainable materials,
including local timbers, in keeping with the Soneva
SLOW LIFE philosophy. They ofer complete
privacy, every possible five-star comfort and luxury
and are among the most spacious in all South
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and generous grounds for reading, relaxing,
sunbathing or simply gazing out to sea. Several
have private spa areas and each has its own
dedicated private butler or Mr/Ms Friday.
Each villa comes complete with its own electric
Soneva Kiri epitomises the Soneva concept of
intelligent luxury. Only an hours flight in the
resorts private plane from Bangkok, it feels a
million miles from the real world. The sense of
tranquillity, seclusion and harmony with nature is
second to none. Far away from the beaten track
and well-trodden tourist attractions this is Thailand
as it used to be thirty or even fifty years ago,
genteel and untainted. And also just one hour by
boat from the wonders of Cambodia.
Twenty-seven villas and eight private
residences - sitting either on the beach or sunny
buggy, as well as bicycles, to make getting around
the extensive resort easier. That might be to the Six
Senses Spa, where expert therapists perform a
wide range of wellness, holistic, rejuvenating and
relaxing treatments. Or to the manta ray shaped
Den, to drop of the children into their own private
fantasy world overseen by experienced
child-minders.
Then there are the idyllic beaches, with snorkelling,
diving, sailing, wind-surfing and boat trips on the ultra
glamorous, Riva-inspired motor launch, Aquasense.
The Beach, a stretch of palm-fringed white sand as
fine as any in Thailand, has its own Snack Bar
complete with wood fired ovens, pit cooking and
seats sunk into the cool sand.
Food is always a Soneva highlight. At Soneva
Kiri it reaches new heights, quite literally in the
Remote yet accessible, Soneva Kiri sits on Thailands fourth largest but least populated island,
Koh Kood, in the Gulf of Siam. Surrounded by lush, vibrant tropical vegetation and white
beaches, fringed with palm trees, the resort has been tastefully and cleverly designed to
complement the landscape and blends seamlessly into the outstanding natural beauty.
Soneva Kiri
Ancient Siam meets privacy and intelligent luxury on
Koh Kood, an untamed island far beyond the tourist trail.
THOUGHT LEADERSHIP
Treetop Dining Pod, a cant-miss experience in
which diners are hoisted high into the jungle
canopy to enjoy a view that lives up to the finest
dishes. Authentic Thai cuisine is available too. Khun
Benz, a gifted cook, runs a restaurant built on stilts
over a mangrove forest, lit by torches and fireflies
each evening. Accessible (mainly) by boat she
serves arguably the best Thai food in Thailand,
made from ingredients personally selected every
day at market.
The View is the fine dining option, with a
changing daily menu reflecting the tradition of
slow-food and organic ingredients grown or
caught locally. The Dining Room, with relaxed day
beds and jaw-dropping views, serves dishes freshly
baked in its tandoor, wood-fired, or hot and cold
smoke ovens.
So Delicious has an extraordinary range of cold
cuts, cheeses and other deli oferings ideal for a
restorative glass of wine. Even cooler is the Ice
Cream Parlour with over sixty diferent flavours,
while the Chocolate Room ofers every chocolatey
treat imaginable from brownies to bon-bons and,
for sophisticated chocoholics, irresistible slivers of
chocolate from 95% cocoa slabs.
Good food needs great drinks. The
subterranean, climatically controlled wine cellar
has over five hundred labels, with a sommelier to
help your choice and ofer tastings. There are also
numerous bars in which to sample a sundowner
complete with unrivalled views across the Gulf.
After dinner theres usually time for stargazing
at the Observatory or watching stars of the silver
screen at Cinema Paradiso where classic movies
are shown outdoors, only the moon and stars
above for company.
And all the time a sense that Thailand, the real
Thailand of remote fishing villages, colourful boats,
epic waterfalls for swimming and gourmet picnics,
beguiling smiles and indomitable spirituality is right
there, just around the bay, willing you to uncover
its ancient secrets. Cambodia is also on the
doorstop with temples galore for exploring.
Barefoot Intelligent Luxury at its best. No news,
no shoes, Thai style.
Soneva Kiri is committed to the
Soneva Groups SLOW LIFE philosophy:
Sustainable-Local-Organic-Wellness
Learning-Inspiring-Fun-Experiences.
TWENTY-SEVEN VILLAS AND EIGHT PRIVATE
RESIDENCES - SITTING EITHER ON THE BEACH
OR SUNNY SLOPES IN THE RAINFOREST, GAZING
ACROSS THE SEA.
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 25
Contact Information: Reservations-kiri@soneva.com www.soneva.com
The APEC Publication 2013
Cover Story / Trans Pacifc Partnership
Editorial by: Oscar Montealegre
26 theapecceosummit.com
Afer the ofen failed attempts of reaching a consensus on the Doha Rounds, a new free
trade pact, called the Trans Pacifc Partnership, has emerged, bridging U.S. economic
infuence to Asia, with the possibility of boosting exports and raising not only U.S. GDP,
but also the worlds GDP. The TPP is on the cusp of being something special, harboring
tremendous economic and political implications for the 21st century.
The APEC Publication 2012
Nusa Dua / Bali. Indonesia 2013 27
THOUGHT LEADERSHIP
A
FTER THE OFTEN
failed attempts of
reaching an a consensus
on the Doha Rounds, a
new free trade pact,
called the Trans Pacific
Partnership, has
emerged, bridging U.S.
economic influence to Asia, with the possibility
of boosting exports and raising not only U.S.
GDP, but also the worlds GDP. The TPP is on
the cusp of being something special, harboring
tremendous economic and political implications
for the 21st century.
In November 2011, Former Secretary of State
Hillary Clinton wrote an op-ed piece for Foreign
Policy Magazine declaring that the future of
politics will be decided in Asia, not the Middle
East, thus declaring it imperative that the U.S.
pivot its economic, political, diplomatic and
strategic resources and investments to the
Asia-Pacific region. If this transformation of
policy and perspective should come to fruition,
then the negotiated Trans Pacific Partnership
(TPP)-essentially a free trade agreement-is not
only fundamental, but virtually necessary if the
U.S. were to succeed in cementing its presence
not only in the East, but also the Pacific region.
As emerging markets have become the
hottest flavor of the month-or the 21st century-
the concentration of these new booming
developing markets are undoubtedly in Asia.
For what its worth, Latin America can be
considered a distant second in categorizing
popular emerging market destination, but it still
pales in comparison to Asia when evaluating
economic strength, education and innovation.
The TPP has presence in both aforementioned
regions and beyond, facing many geographic
trade flows, covering extensive land and
penetrating an array of diverse markets. As of
now, it consists of 11 members: Australia,
Brunei, Chile, Canada, Malaysia, Mexico, New
Zealand, Peru, Singapore, U.S. and Vietnam.
With this current roster, it has a market of
approximately $25 trillion and encompassing
roughly 800 million people. However, in
Mid-April 2013, a politically and economically
powerful participant has joined the fold at the
table of the TPP negotiationsJapan. >
The APEC Publication 2013
Cover Story / Trans Pacifc Partnership
28 theapecceosummit.com
existing members saw the potential and the
rest is history. The goal of the TPP is to remove
all tariffs on trade between member states,
and focus on new emerging trade spheres of
influence such as investment, labor and
environmental standards, government
procurement, agriculture, intellectual property
and state-owned businesses. The trade bloc has
aroused interest from many other countries,
such as Colombia, Costa Rica, Laos, Taiwan and
the Philippines. Just imagine if they all were to
join, the implications would be outstanding,
outmaneuvering BRICS-Brazil, Russia, India,
China and South Africa-with an extra incentive
to either participate directly or indirectly, or
either expedite their solidarity and quickly
implement real institutions and reforms. To
make matters more appealing, after the
inclusion of Japan, experts predict South Korea
can soon express interest in joining the TPP.
In short, free trade among nations is still a
robust want and need, rebutting the notion
that protectionism remains a viable alternative.
However, the TPP does face many obstacles
abroad and in the U.S. For instance, in the U.S.
there must be a strategic plan by the executive
administration and the private sphere to win
over certain domestic opposition. In addition, it
is important that trade leaders address domestic
critics (and abroad if possible) on intellectual
property demands. Right now, the interpretation
of the limited information that the public has is
that the TPP will enforce policy that will make it
a criminal act if copyright and patent laws were
violated. Moreover, transparency of the
negotiation process has been under attack by
the U.S. congressional and Senatorial leaders,
not to mention the public, arguing that the TPP
summits are held in secrecy with minimal
information leaked to the public. It must be
noted, that absolutely no trade deal in the U.S.
or abroad is enacted without much resistance,
i.e. NAFTA and the 2012 Free Trade Agreements
between the U.S. and Colombia and South
Korea. Thus, albeit they are major obstacles, it
shouldnt be enough of a deterrent to erode the
execution of the TPP.
Ironically the TPP is seldom debated and
discusses in the news media cycle. Many have
pinpointed this lack of attention to President
Obamas administration lack of importance
towards trade and influence in Asia and Latin
America. For example, Senator McCain has
described President Obamas record on trade as
shameful and too slow, especially with the
TPP, Taiwan and India. Although under
President Obama, trade pacts with Colombia,
South Korea and Panama were finalized, the
majority of the credit is given to former
President Bush, who ignited the free trade
agreements. However, as mentioned in the
introduction, pivoting U.S. attention to Asia
and away from the Middle East and Europe is
through and through an Obama initiative,
shouldering the likelihood of determining his
foreign policy legacy. Moreover, President
Obama has focused his attention to free trade,
exerting extra energy to the TPP and beginning
the talks to a potential unprecedented U.S.-
EU trade liberalization.
But for President Obama and the U.S., the
stakes are higher. The TPP opens the door to
dramatically increase exports to Asia, especially
to tariff ridden Japan. As a result, more jobs
can be created and politically speaking, it can
reinvigorate U.S. influence in the Asian and
Latin American region, ridding the thorns of the
often spoken U.S. decline. Also, the TPP can be
introduced as a re-vindication of free market
capitalism, countering the growth and
increasing influence of state-run capitalism
spearheaded by China. In short, the TPP is a
game changer for all the member states,
harnessing the recipe of the beingthe most
transcending free trade pact of the 21st
century, especially for the U.S.
>Currently Japan is the worlds third largest
economy and its GDP exceeds the amount of
the combined total of all the other TPP nations,
not including the U.S. Now, if Japan were to be
approved admittance by all existing members
(the U.S. has okay its participation in the
negotiation process), the TPP bloc would
account for almost 40 percent of global GDP
and one-third of world trade. As Japanese Prime
Minister Shinzo Abe suggested, Japan could
either be part of a global trend towards more
open trade, or it could retreat into isolation.
Recent actions have indicated that Japan has
opted for the former, with an added
presupposed motive that Japan perceives the
TPP as a vehicle to counteract Chinas
economic rise and influence in the region.
What exactly is the TPP? To start, the TPP
was originally concocted by New Zealand,
Chile, Singapore and Brunei in 2005, calling it
the Trans-Pacific Strategic Economic Partnership
Agreement. Fast-forward to 2008, the U.S.
requested and eventually became an official
participant in the negotiations with the
founding members, and after that, the other
THE GOAL OF THE TPP IS TO
REMOVE ALL TARIFFS ON TRADE
BETWEEN MEMBER STATES, AND
FOCUS ON NEW EMERGING TRADE
SPHERES OF INFLUENCE.
uw.edu
Todays students are part of an increasingly interconnected society. More than ever, they need
an education that prepares them to become globally minded, engaged citizens and leaders.
At the University of Washington, we provide educational opportunitiesin and out of the
classroom, both in the U.S. and abroadthat empower UW students to expand their
worldviews. Whether working with communities across the street or around the globe,
UW students are actively pursuing a better tomorrow.
Global Leaders
CREATING FUTURE GENERATIONS OF
30 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Korean Air
Comfort In The Skies
Korean Airs Kosmo Suites in First Class brings
passengers an ultra-luxurious journey where they
experience a living room, ofice, bedroom and
cinema all in one space. Privacy is ensured for all
passengers whether they are working or resting
with the seat that converts into a very spacious
79 bed, with an electronic privacy cocoon and
complimentary Gianfranco Ferre pyjamas for a
sound sleep.
For those looking to take a break from working
inflight, Korean Air ofers cutting-edge personal
entertainment systems. Kosmo Suites seats
feature large 23 inch screens and passengers can
pick from more than 60 movies, 40 short features,
300 CDs, 40 games and 15 audiobooks to keep
them entertained.
With the sky ofice Prestige Sleeper Seat,
business travelers can experience maximum
comfort and a convenient business environment
throughout their flight. All Prestige Class
passengers can also enjoy 180-degree full flat
seats which previously were only available for
First Class passengers.
To further enhance the business travelers
experience, Korean Air ofers delectable in-flight
cuisine. Delicious and healthy meals are served
on Wedgwood China with elegant place settings,
synonymous with the quiet beauty of Korea.
Repeatedly awarded with the prestigious Mercury
Award for its in-flight meals, including its signature
dish, Bibimbap (a nutritious rice, vegetable and
beef medley), Korean Air has a team of culinary
experts to create meals that reflect the tastes of
travelers from many regions of the world.
Wind down after a session of working inflight
with the finest wines from around the world
including France, the USA, Italy, Australia, New
Zealand and South Africa selected by Korean Airs
celebrated sommelier. The airline has a worldwide
reputation as having one of the best Cellars in the
Sky, as well as numerous international awards.
Meanwhile, Korean Air has partnered with
DAVI, the skincare branch of the world renowned
Mondavi wine family, for its inflight amenity kit
featuring DAVIs unique cosmetic products for
men and women. The cosmetics are made of
grape and wine extracts from Californias Napa
Valley, and include a variety of natural extracts.
When Korean Air launched its A380 service in
2011, it added further sophistication to inflight
comfort. Configured in a three-class layout with
just 407 seats in total, the lowest configuration of
any A380 operator so far, Korean Airs double-
decker A380s feature cutting-edge amenities, with
12 ultra-luxurious First Class Kosmo Suites and 301
In todays business climate of globalization, business travel is more important than ever and
business travelers today expect plenty of room in which to work, relax and play. Korean Air with
excellent service, comfort and convenience in mind, is now one of the worlds leading global
airlines, ofering customers a premium flying service.
Korean Air: Leading the
way in Business Travel
THOUGHT LEADERSHIP
Economy Class seats on the first floor, and 94
full-flat Prestige Sleeper seats in Prestige Class
(business class) upstairs.
Korean Air is the first airline in the industry to
have a Duty Free Showcase on its A380 aircraft.
Featuring a great variety of duty-free products,
such as cosmetics, perfumes, liquor and
accessories, with a dedicated cabin crew member
on hand to assist and advise passengers with all
their shopping needs. Also onboard is a bar and
lounge area which ofers the premium class flyers
the ultimate in in-flight style and relaxation. The
Celestial Bar, a dedicated lounge, located at the
rear of the upper deck, is a unique mix of Asian
aesthetic and functionality and is equipped with a
stafed bar serving a range of signature cocktails
exclusively created for Korean Air.
Flexibility At Your Finger Tips
For those whose travel schedule demands
flexibility and comfort, Korean Airs Private Jet
Service is the ideal choice. Business travelers can
enjoy a premium ofice and home experience
on the go for the best utilization of travelers time.
Korean Air is regarded as one of the leading pioneer
airlines in the private jet market, credited for its
unique oferings such as adding the state- of-the-art
Boeing Business Jet to its fleet in 2010.
One of the few full-service carriers tapping into
global private jet charter market, Korean Air ofers
a wide range of premium aircraft and services that
have been catering for diferent travelers needs.
The notable Korean Air fleet includes the
state-of-the-art Boeing Business Jet (BBJ) which
carries the distinctive luxury and spacious features
of a customized version of the B737, with a total
capacity of sixteen to twenty eight passengers for
long-distance flights under 12 hours. The Global
Express XRS, equipped with wireless internet, iPads
and comfortable sofa-beds, is a good choice for
journeys up to six thousand miles non-stop from
an Asian hub to Europe or the United States.
Alternatively a Sikorsky 76C+ can empower
business travelers with high mobility for travel
within South Korea. The personalized jet charter
service efectively reduces transit time allowing
business travelers to enjoy ultimate privacy to
long-haul destinations where direct flights
are not available.
Furthermore, Korean Airs Flexjet Connect
Service significantly increases customer travel
flexibility and reduces flight distances by
connecting passengers from Korean Airs 115
weekly transpacific flights with a private jet
service, and more than 5,000 jet terminals in the
United States, Central America and South America.
Korean Air, known as one of the worlds top 20
airlines, has diferentiated itself by integrating the
best practices of its renowned premium service
into its private jet service ofering. Passengers of
its private jet charter service are well served by a
dedicated crew and care service from check-in to
landing and are ofering a privileged flexible travel
schedule, exclusive terminals which allow access
to more airports and other airlines VIP lounges
in ultimate privacy and comfort.
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 31
KOREAN AIR IS
THE FIRST AIRLINE
IN THE INDUSTRY
TO HAVE A DUTY
FREE SHOWCASE
ON ITS A380
AIRCRAFT.
The APEC Publication 2013
Feature / Trans Pacifc Partnership
Editorial by: Bryce Bytheway , Diplomatic Courier Contributor_Photos: Gordon Dam and Jepirachi from WikiMedia
32 theapecceosummit.com
Colombias oil boom could prove to be the means for the
country to gain world recognition, as well as provide the boost
that its economy needs in the fght to overcome poverty.
W
HAT WILL PAVE the road to
Colombias future? The country
has been experiencing what
some are calling an oil bonanza,
its oil production having surged 80 percent in
the past seven years. It is estimated that the
country will be extracting upwards of 1.6
million barrels of crude oil per day by 2016.
Colombias oil boom could prove to be the
means for the country to gain world recognition,
as well as provide the boost that its economy
needs in the fight to overcome poverty.
Short-term investors will discover Colombia
to be fairly lucrative; but it is not oil that will
pave the road to Colombias prosperous future.
As concerns about the environment rise
around the globe, many countries are looking to
abandon fossil fuels in favor of clean, renewable
energy sources. The Obama Administration in
the United States has been preaching clean
energy since day one, and many steps have
been taken in the US, as well as in many other
first world countries, to reduce their carbon
footprint. It is Colombia however, that could
have the brightest future concerning
renewable energy.
Colombias Energy Sector
According to a recent study by The World
Bank, 70 percent of Colombias power
generation is through hydropower. Even
though hydropower is the most popular
power source in the country, it remains
largely untapped. The total hydropower
potential within Colombia is estimated at
93GW, enough to generate sufficient power
to meet the national demand 7 times over.
The current hydropower usage sits at 9GW.
It is important to note however, that the
potential for that much hydropower faces
difficulties. Many of the best areas that could
support dams and hydropower plants have
already been developed, and the social and
environmental costs associated with
hydroelectric power are increasing.
Colombias other power sources include
natural gas which provides 26 percent,
coal at 3 percent, and other/wind power
at 1 percent.
The Future of Wind Power
Colombias wind power remains largely
untouched, and yet its wind power that
could have the greatest potential. Of all South
America, Colombia has the best geological
conditions to provide stable wind power.
Off shore regions of northern Colombia have
been classified with class seven winds
(winds over nine meters per second). The
only other region in South America that has
such potential is the Patagonia region of
Chile and Argentina.
The Guajira Peninsula on the north-eastern
tip of the country alone has the potential to
generate 21 GW, enough power to provide for
the country two times over. However, even
with this rare wind potential Colombia has an
installed capacity of only 19.5MW, a measly
0.4 percent of Guajiras potential.
Why all the hype about wind power? It is
arguably one of the most effective renewable
energy sources; it is completely renewable by
Mother Nature alone and can never be depleted.
It is cost competitive to other fuel sources, such
as natural gas, and is the least expensive of all
renewable energy sources. Once erected, wind
energy systems require very minimal
maintenance, and general up-keep on the
turbines is incredibly cost effective.
Environmentally speaking; wind energy is
clean. Wind turbines dont pollute the air or
emit other harmful pollutants like fossil fuels.
Just one wind turbine can displace over
two thousand tons of carbon dioxide each
year, the equivalent amount of one square
mile of forest.
Needless to say, Colombia could have a very
bright future with hydro and wind power.
Colombias
Future as
it Masters
Renewable
Energy
The APEC Publication 2013
THOUGHT LEADERSHIP
ACCORDING
TO A RECENT
STUDY BY THE
WORLD BANK,
70 PERCENT OF
COLOMBIAS POWER
GENERATION
IS THROUGH
HYDROPOWER.
Colombias Future as it
Masters Renewable Energy
Using solely hydro and wind power Colombia
could supply the energy necessary to provide
for itself, as well as many of its neighbors in
South and Central America. As Colombia
taps into its unique natural resources its
economy will receive a much needed long
term boost, and its GDP has the potential
to rise significantly. Renewable energy is t
he key for outside investors interested
in Colombia.
Renewable energy is also the key for the
Colombian people. As the government invests
in renewable energy the country will have the
means it needs to finally prosper. Once all of
Colombias citizens have uninterrupted access
to reliable energy, their economy will boost
significantly and they will be well on their
way to defeat poverty. With Colombia as an
example, its neighbors which seem to be
endlessly locked in political unease will also
reap the benefits. Colombias growing economy
will quickly cross borders. Reliable energy will
finally bring light and knowledge to those who
have never had access, and citizens will gain a
better sense of their world identity.
Colombia could become a world power; not
through its current oil boom, but rather by
mastering their renewable energy sources.
Nusa Dua / Bali. Indonesia 2013 33
VIT NAM
BECAMEX IDC CORP
INTEGRATED AND SELF-CONTAINED INDUSTRIAL CITY
With strategic location contiguous to National Highway 13 and My Phuoc - Tan Van Expressway, My Phuoc Industrial Park
is uniquely built with the concept of Integrated & Self-contained Industrial City to welcome not only the manufacturing
projects but commercial & residential activities as well. Along with the investment & development of complete, sufficient,
modern infrastructure and facilities (Industrial hardware) to host domestic and foreign investors, Becamex IDC Corp., as a
main Developer, also focuses in building infrastructure for social welfare & communities, carrying out lots of favourable
policies and programs with respect to the material and spiritual improvement for the laborers in the park. My Phuoc Industrial
City is also being seen as a Model Industrial Park for its environmental-friendly, green, clean and nice -looking features.
Come to My Phuoc Industrial Park, investors will find confidence for a long term & sustainable development.
INVESTMENT AND INDUSTRIAL DEVELOPMENT CORPORATION (BECAMEX IDC CORP).
230 Binh Duong Boulevard, Thu Dau Mot town, Binh Duong Province
Tel: + 84650-3777777, Fax: + 84650-3811666, Email: vninvest@becamex.vn, Website : http://www.becamex.com.vn
Contact person:
Mr. Vo Son Dien (Steve Vo): +84 90 3 903804 Email: vsdien@becamex.com.vn (English)
MY PHUOC
INDUSTRIAL CITY
36 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Becamex
Company Facts:
Established: 1976
Key area: Investment and development of
industrial, residential, urban and transportation
infrastructure.
Subsidiaries: 28 sole and joint eforts covering
areas of securities, finance, insurance, banking,
construction, trading, real estate, services,
telecommunication - information technology ,
concrete production, construction materials,
mining, pharmaceuticals, healthcare and
education
Charter Capital : 5.500 Billion VND
Total Business Capital: 100.000 Billion VND
Total employees: Approx 4,000 of which
Management stafs: 230, Engineers: 90, Foreign
experts: 30 people
Main fields of operation:
Investment in construction and trading
infrastructure of industrial parks
Investment, development and sales of
residential areas
Real Estate trading
Civil Construction, industry and transportation
Investment in infrastructure in the form of B.O.T,
and other mechanisms
Mega-Project
Becamex Industrial Investment and Development
Corporation (Becamex IDC) has invested in Binh
Duong New City. The project has been under
construction for nearly 3 years creating a modern
urban area with comfortable, convenient facilities
for learning, working, and entertaining. Along with
investing in complete infrastructure ranging from
trafic, water, electricity, telecommunication to
parks, ecological lakes, waterfalls, Becamex as an
investor also pays much attention to constructing
universities, high schools, kindergartens,
commercial and sports areas, convention and
event centers, low cost housing and many other
Becamex IDC Corp. is Vietnams largest industrial park developer/operator, Vietnams largest
infrastructure company and one of the countrys largest real estate firms. Binh Duong province
has currently over 2,000 foreign - invested projects with a total capital investment of nearly
USD 15bn and over 13,000 domestic enterprises under operation with total investment of VND
95,000bn (USD 4.5bn). Major investment countries include Japan, Korea, Singapore, Thailand
plus growing investment by North American and European companies.
Becamex IDC Corporation
VISION:
To create a prosperous, efcient and sustainable
Binh Duong that through our companys hard
work, innovation and teamwork, enhances the
lives and the livelihood of Binh Duong citizens
and makes Binh Duong the ideal place in
Vietnam and Southeast Asia to live, work.
learn and play.
MISSION:
Provide opportunity through proper planning,
infrastructure and modern technology for the
province and Binh Duong New City and help to
set the standard for other cities in Vietnam
MANDATE:
one person, one district, one city,
one province at a time
THOUGHT LEADERSHIP
facilities in order to meet the diverse demands of
residents. The project will contribute to the
sustainable development of Binh Duong province
which is a short drive northeast of Ho Chi Minh
City. Upon completion, the city will become the
new economic and political center of Binh Duong
and have 125,000 residents and 400,000 migrant
laborers.
New University and Hospital
Eastern International University is one of Vietnams
newest and most modern and well laid out
Universities. EIU which now has over 10 buildings
in a landscaped campus of over 26 hectares is a
US$100 million project new with teaching
classrooms, dormitories, administrative and
support buildings that would not look out of place
in Singapore, the U.S. or Europe. The University
also supports additional Universities by providing
facilities and other services.
Eastern International General Hospital in Binh
Duong Province is part of the Binh Duongs New
City mega-project, run and built by Becamex IDC.
The project development costs are estimated at
over US$ 74 millions on a 12 ha site (5 phases),
which is part of a 52 ha urban development. This
modern Vietnamese hospital which is substantially
constructed at this point, meeting international
standards, is aimed for both domestic patients as
well as expatriates and other patients from
neighboring countries.
Social Housing Project
Becamex believe corporate and social
responsibility can through innovation also be
good business and lead to a happier and more
productive community. As part of this, Becamex is
building or will build within next 5 years through
out Binh Duong province ( phase 1) 64,700
housing units in 37 locations ( for about 164,000
residents) at an investment of USD 500 million.
Vietnamese banks have agreed to finance
purchase on terms for up to 15 years by new
tenants. Every location has approx. 2,000 units.
Currently, more than 5,000 units have been
constructed and more than 1,300 have been
delivered. General design is a block of 5-stories
with no elevator. Price is from ~ 5,000 USD/
unit of 30 sqm.
Becamex Tokyo Garden City
Becamex Tokyu Co. Ltd. is building a US$1.2 billion
property project to build a New International
Garden City on about 71.5 hectares in the southern
province of Binh Duong, marking the involvement
of a first Japanese firm in urban development in
Vietnam. The joint venture between Japans Tokyu
Corp. and Vietnams Becamex IDC Corp. has
financial support from the Bank of Tokyo
Mitsubishi UFJ.
The project will develop about 7,500
apartments and houses, plus recreational and
service facilities, and ofices for lease.
Toshiaki Koshimura, Chairman of Tokyu
Corporation noted, Tokyu was the first Japanese
company to export expertise and technology for
urban development into Vietnam. We will try our
best to build a multi-functional and high quality city
to be abreast with the development of Binh Duong
Province when becoming the Metropolitan City in
2020. The town will be built in a Japanese style,
so it will be environmentally friendly. Nguyen Van
Hung, Becamex Chairman and CEO responded,
With experience and financial potential from the
two corporations, beside Tokyu Binh Duong
Garden City, we will weigh developing other
projects to meet the expansion needs of this City
in the coming years. Becamex and Tokyu,
continue to explore the possibility of developing
satellite urban areas in the provinces industrial
development zones. The two companies are also
studying public transportation work such as bus
and metro routes to connect the transportation
networks of Binh Duong, HCMC and other cities in
the Southern Key Economic Zone.
For more information:
T: +84 650 3 777777
F: +84 650 3 811666
M: +84 1222 666 777
E: vninvest@becamex.vn
www.becamex.com.vn
BINH DUONG PROVINCE, VIETNAM
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 37
38 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Intel

Technology has improved the lives of so many
people on our planetfrom quality education and
health care to energy and water conservation and
management. Policy that enables the internet to
reach people around the globe has been at the
forefront of advancing these and countless other
benefits of technology.
A decade ago, Intel created the mobile
computing category with its large investments
in a wireless infrastructure and its Pentium M
processors paired with Wi-Fi connectivity through
the companys Centrino mobile technology. The
result has been a wireless computing revolution,
with almost ubiquitous availability of Wi-Fi
connectivity and the creation of new mobility
solutions built for low energy consumption and
high performance.
Today, our computing platforms supporting the
digital economy are used in a wide range of
applications, such as PCs (including Ultrabook,
detachable, and convertible systems), servers,
tablets, smartphones, automobiles, automated
factory systems and medical devices. We also
develop software and services primarily focused
on security and technology integration.
Enhancing Productivity and
Innovation in All Economic Sectors
The use of information and communication
technology (ICT) products and services can
dramatically enhance productivity and innovation
in many industrial sectors. Governments should
work to remove trade barriers that prevent people
from obtaining the best ICT products at the lowest
cost possible. For example, expanding the WTO
Information Technology Agreement (ITA) so that it
covers new ICT products developed since the ITA
became efective in 1997 could remove tarifs on
an additional $800 billion in global two-way ICT
trade a 20 percent increase over the $4 trillion in
annual trade under existing ITA product coverage.
Inspiring the Next Generation
through Education Transformation
The rising generations success in todays
innovation economy depends on access to a
quality education, which is more easily achieved
by the use of technology. Technology enables an
unprecedented opportunity to advance student
achievement. Intel brings the expertise,
technology and a robust ecosystem that can
provide the foundation for educators and
governments to transform education. Powerful
and energy-eficient Intel-based PCs and servers,
combined with software and fast internet access,
help students acquire 21st century skills and help
educators teach more efectively. Through the
Intel World Ahead Program, Intel has worked with
more than 70 countries on programs aimed at
making technology more available, afordable and
understandable to first -time users. Intel-funded PC
purchase programs enable governments to
provide computers at a more afordable price,
At Intel, we strive to make the best silicon and technology products in the world, and through
their application, to create a better future for all. We believe that technology plays a fundamental
role in finding solutions to the worlds great challenges. We know that embedding corporate
responsibility and sustainability into our vision and strategy helps us make better, more secure
products and create value for Intel, our customers and society.
Improving lives, communities and
economies through technology
THOUGHT LEADERSHIP
allowing thousands of teachers and students
access for the first time.
Intel also works with telecommunications
providers to connect millions of people to the
internet with high-speed wireless technologies.
Government policies that encourage the
deployment of wireless and wired broadband
services play a significant role in supporting
student and teacher development worldwide.
Driving Innovation across Healthcare
Efective use of ICT products and services in
healthcare saves lives. Technology improves
access and quality of care, reduces costs and
improves satisfaction among both patients and
providers. Intel is making great progress,
collaborating with healthcare providers, other
companies and policymakers on innovative new
products and solutions aimed at improving global
access to quality, afordable healthcare. The
Citizen Telecare Service System (CTCS) used in
Chinese Taipei, where 600,000 seniors with
chronic conditions are remotely monitored
through technology to help them reduce their
blood pressure, showed a significant decrease
blood pressure and helped them maintain healthy
levels. CTCS uses biometric measurement,
hypertension risk assessment, video
communication, education programs, and other
tools to change the behavior of high-risk seniors
so they maintain their wellness.
The technological tools that improve care
delivery continue to advance at a steady rate.
But in most countries, the development and
implementation of policies to govern the use of
these technologies in healthcare lags behind.
It is more often policy barriers, rather than
technological barriers, that stand in the way of
greater progress in e-Health. Interoperability
standards among data systems and between
technologies will help reduce these barriers, while
assuring privacy and security of online health data.
Closing the Digital Divide
Policies that expand the allocation of universal
service/access funds to include broadband
internet access, especially in remote regions where
broadband has previously been cost-prohibitive,
are key to bridging the digital divide. In India,
Intel contributed to the creation of the National
Digital Literacy Mission, which seeks to proliferate
digital literacy across the country. As a result, the
Indian government announced an ambitious
information technology (IT) policy mandating that
one citizen per household be digitally literate by
2020. The success of this program depends not
only on the availability of cutting edge products
available at the lowest cost possible, but also on
widespread broadband penetration.
We have an ambitious vision for the next
decade: Create and extend computing
technology to connect and enrich the lives of
every person on earth. Policy makers around
the world are in a unique position to facilitate
innovation and afect change by allowing broad
dissemination of ICT goods and ICT-enabled
services.
KEY LINKS:
Intel Policy Web Site: http://www.intel.com/
about/companyinfo/policy/index.htm
Intel Policy Blog: http://blogs.intel.com/policy/
Corporate Responsibility at Intel Web Site:
www.intel.com/go/responsibility
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 39
The APEC Publication 2013
Feature / STEM Innovation
Editorial by: Edie Fraser, Founder and CEO, STEMconnector
40 theapecceosummit.com
New jobs need trained workers supported by advanced
technology and an increasing focus on low-cost technology
requires participation from a workforce with broader skills.
Resilience:
Growth with STEM
Innovation, Technology
and Job Creation
The APEC Publication 2013
THOUGHT LEADERSHIP
INNOVATION
CONTINUES TO
PLAY A CRUCIAL
ROLE IN BOTH
THE WORLD
ECONOMY AND
THE ECONOMIES
OF APEC
MEMBERS.
T
HIS YEARS APEC SUMMIT will
provide critical recommendations
regarding how the Asia-Pacific Region
will continue to secure sustainable
growth, development and innovation given
a growing world population. The focus is on
innovation, technology, economic development
and job creation supporting economic
prosperity, all of which are central to global
development. New jobs need trained workers
supported by advanced technology and an
increasing focus on low-cost technology
requires participation from a workforce
with broader skills.
Innovation continues to play a crucial role
in both the world economy and the economies
of APEC members. In the past few years,
China, Japan, and Korea have shown their
commitment to innovation by spending 1.7%,
3.36%, and 3.74% of their yearly GDP
respectively on Research and Development.
In 2011, there were 415,829 patent applications
in China, 287,580 in Japan, and 138,034 in
Korea, another strong indicator of their interest
in innovation. As major corporations and
economies are investing in R&D and technology,
they focus on STEM job creation in Asia-Pacific.
APECs Industrial Science and Technology
Working Group (ISTWG) contributes best
practices in the collaboration of global
economies in the development of STEM
human capital. As the ISTWG pointed out, our
countries will have to work together to build
R&D environments adapted to our increasingly
globalized world by supporting the overseas
work of STEM researchers and establishing/
enforcing rules for intellectual property
protection.
While Asia-Pacific is facing serious
challenges, such as a Chinas more than $17
trillion in debt, there are also several reasons
for optimism. One positive example in China,
Science and Industrial parks are key venues for
high tech research and development (R&D) and
54 parks. The IT industry is a cornerstone in the
parks. Firms are required to create or apply
technology in high tech fields, committing
to a minimum 3% of gross revenues to R&D,
employing at least 30% of college degreed
workers. The data are cleartechnology,
engineering and economic growth is often led
by APEC countries, and not just in the APEC
region. The world is global and Asian nations
are playing a key role in world investment. Last
year, China invested around $6 billion in the
U.S, $11 billion in Latin America, $12 billion in
Europe, and Chinas Commerce Minister, Chen
Deming, in summer, 2012, said the number
exceeded $14.7 billion, up 60% from 2009
and the estimates are even higher.
STEM Innovation leadership for us is driven
by economics and strong human capital success
with strong jobs in technology and science,
engineering and math. Economies in markets
around the world are expanding and maturing,
with technology and innovation acting as a
catalysts to fuel growth. Countries need to
prioritize their investments to create a
workforce that has the requisite technology
skills and innovation capabilities, in addition
to cultural competencies to compete in a
global economy states Balaji Ganapathy,
Head of Workforce Effectiveness, North
America, Tata Consultancy Services (TCS).
We need skilled workers and they need to
be tech-savvy. Two strong statements from
STEMconnectors 100 CEO Leaders in STEM
report follow. John Chambers, CEO of Cisco,
states it clearly: I believe the Internet and
education are the two greatest equalizers in life.
With access to technology and the right skills
and training, the next killer app could come
from San Antonio, Texas, or Shanghai, China.
It could come from Peru or Palestine. There are
pockets of innovation around the world, and the
countries that best capture the talent and
ingenuity of their people will lead in the 21st
century. As the global leader in innovation
R&D, the United States has a strong interest
in the APEC members increased contributions
to global R&D.
As the CEO of Caterpillar, Douglas
Oberhelman, comments, Our world is more
competitive than ever. Today there are more
than 100 Chinese companies looking to be the
next Caterpillar. And thats just one country.
Caterpillar is competing with these companies
not just for customers, but also for talent. We
want the best talent in the world working at our
global R&D headquarters near Peoria as well as
at our design centers around the world. We
have to innovate to be competitive and that
takes the best people. Many companies
especially those operating on the forefront of
technological innovationare concerned with
the need to focus on skilled talented workers
and that it takes commitment. He says, Get
involved. Collaborations are essential.
Corporations emphasize the importance of
innovation to their business in the APEC region.
Jean Spence, the Executive Vice President for
Research, Development & Quality at Mondelz
Internationals, recently outlined the importance
of innovation by claiming that Mondelz is
already investing in our Suzhou R&D Center to
increase its capacitystrengthening our biscuit
innovation and technology capabilities for Asia
Pacific and adding new labs to drive innovation
and technology platforms in China.
Investments like this one in Suzhou behind
our Power Brands and global technology
platforms Spence explained will drive
profitable growth at Mondelz International
for many years to come.
Major corporations from TCS to Cisco,
or growing ones such as UST Global, will
ultimately drive significant job growth in the
APEC region. Sajan Pillai, USTs CEO, conveys
passion to be a part of the explosive growth in
the Asia-Pacific. Furthermore, Pillai announced
that we are committed to the region and will
continue to invest in it to show our
commitment, pointing to USTs offices in
Malaysia and Taiwan in addition to its plans to
open offices in Singapore in the near future.
USTs APEC offices are delivering IT and BPO
services for the local economies, while creating
jobs and fostering innovation. Pillai also
expressed USTs commitment to change
Asia-Pacifics role as an exporter of goods but an
importer of technology expertise by focusing on
building up local knowledgeable teams that can
service the technology needs locally. Echoing
the ISTWGs findings, Pillai called on the global
business community to come together, share
their vision and work together to achieve
common goals in APECs economic growth.
STEMconnector is focused on the global
development of human capital in STEM. As
the chair of our STEMconnectors Innovation
Task Force, PepsiCos SVP, R&D, Dr. Heidi
Kleinbach-Sauter, pointed out, the global
business community should prioritize the>
Nusa Dua / Bali. Indonesia 2013 41
The APEC Publication 2013
Feature / STEM Innovation
42 theapecceosummit.com
>preparedness of the upcoming young talent
pipeline in STEM scientific fields as well as in
Innovation Excellence, demonstrating
entrepreneurial attitude and culture, cross
border talent mobility, alignment of education
with the needs of business and the public sector
and visibility of our young talent in pathways
into well-paid jobs. By raising awareness
around these priorities, we will create a more
talented and productive global STEM
community.
Wal-Marts Vice-President of International
Integrations, Fumbi Chima, also highlighted the
role of developing human capital in the global
STEM community as it catalyzes innovation,
saying STEM knowledge gives our business a
competitive edge by finding new and innovative
ways to grow our business and continue serving
customers around the globe. Our technology
investments have improved the shopping
experience for our customers. We owe these
accomplishments to the people that work
for our company. On the importance of
internationalizing human capital, Chima added,
while we want to be leaders in the retail
industry and develop our people internally,
our international operations position the
company to support STEM initiatives for
people around the world.
Its a matter of engagement and partnership.
John Veihmeyer, KPMG Chairman & CEO,
shares a strong message: Get involved. When
business collaborates with academia on STEM,
we can identify and help build the skills that are
most needed in an increasingly STEM focused
global economy.
At STEMconnector, we are deeply invested
in these issues, as demonstrated by our
strategic partnership with the Global Action
Platform of Cumberland Center in systemic
work to create abundance through innovation
in food, health, and prosperity around the
world. As the business leaders featured in
this piece attest, STEM is at the heart of the
global community and will play a pivotal
role in any conversation on global growth
and development. Success requires
Resilience coupled with growth
through STEM Innovation, technology
and new job creation.
Edie Fraser is CEO of STEMconnector.
(Thanks for support on this article from
summer intern, Oliver Paprin).
MAJOR CORPORATIONS FROM TCS
TO CISCO, OR GROWING ONES SUCH AS
UST GLOBAL, WILL ULTIMATELY DRIVE
SIGNIFICANT JOB GROWTH IN THE
APEC REGION.
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44 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Turkey
to access markets in the Middle East, North Africa,
Central Asia and the Caucasus, surrounding
Turkey. However, geographic location by itself is
not enough. The local qualities and capabilities in
Turkey are also very important. In this regard, the
political and economic stability has been securing
confidence in Turkey. Moreover, Turkey is also
actively supporting and encouraging companies
of the APEC member countries to invest in Turkey.
To this end, the Investment Support and
Promotion Agency of Turkey has its resident
country advisors in Tokyo, Seoul, Beijing, Moscow,
Toronto, New York and San Francisco serving and
assisting the investors from the APEC member
countries.
Companies from APEC are investing in Turkey
Investors from the APEC member countries
should not miss important trends taking place in
Turkey. Actually they have already started to
benefit from ample opportunities in Turkey. Today,
in Turkey, there are around 4,200 companies from
the APEC member countries and they been
increasing their investments in Turkey in recent
years, investing around USD 22 billion as of the
Turkey is now focused on achieving an ambitious
set of goals by 2023, set out by Prime Minister
Recep Tayyip Erdoans administration. These
targets include expanding the economy to rank
among the global top ten; securing full European
Union membership; installing new energy facilities
nationwide; rolling out enhanced rail, road and port
networks; providing a universal healthcare system;
and becoming the worlds fifth most visited
tourism destination.
Turkey has undergone a transformation into a
fast-growing, free-market economy in recent years.
While agriculture remains an important employer,
industry and services account for the bulk of
output and export earnings. The Turkish economy
has tripled in size since 2002, and exports have
grown fourfold in the same period. The most
spectacular figure is the amount of FDI that has
flowed in the country in the last decade: USD 123
billion -- eight times the total Turkey had received
in the previous eight decades. According to A.T.
Kearney Foreign Direct Investment Confidence
Index, Turkey ranked 13th worldwide for FDI as of
2012. More than 70 percent of Turkeys FDI
originates from EU neighbors, which is well ahead
of the Middle East and the APEC member countries.
The Investment Support and Promotion
Agency of Turkey (ISPAT) provides assistance to
investors before, during and after their entry into
Turkey and welcomes the APEC member
countries to invest in Turkey.
Access to Multiple Markets
Like investors from the other countries, investors
from the APEC member countries are also using
Turkey as a hub for their investments and
business operations in the region. While they are
impressed with Turkeys robust domestic market,
economic growth, young and dynamic population,
they are also using Turkeys geostrategic location
In 2013, Turkey will mark its 90th anniversary as a demographic and secular nation. Over the
last nine decades, the country has grown to become the 16th largest economy in the world, and
its location at the crossroads of Europe and Asia has long made Turkey a bridge between the
continents and an important regional point. Today, it is home to 76 million people.
Turkey: An Attractive
Investment Destination for
APEC member countries
THOUGHT LEADERSHIP
manufacturing computers for the global IT giant
HP, has recently inaugurated a facility in Turkey.
The site will produce more than 2 million
computers for HP in Turkey, while HP will export
those computers to the markets in the Middle
East, North Africa and other markets in the
region. Toyota has been another successful
example in Turkey. With a USD 1.5 billion
investment, today it employs around 3,000
people. Similarly, with an annual production
capacity of 150,000 motor vehicles, Toyota
Turkey is one of the ten largest overseas
manufacturing operations of Toyota, and one of
the biggest manufacturing companies of Turkey.
Toyota is an excellent example of using Turkey as
a hub to access surrounding markets, as around
90 percent of Toyotas production in Turkey is
being exported to diferent markets around
Turkey. Toyotas success is a clear indicator of
Turkeys unique advantages from qualified labor
to technological skills. Turkey combines low-cost
large-scale production, good use of technology to
ofer the highest quality. As such, the Turkish
automotive sector has been creating a
benchmark for quality.
end of 2012, constituting 12 percent of the whole
FDI stock in Turkey. For example, very recently,
Bank of Tokyo-Mitsubishi UFJ, Japans largest
bank, has decided to establish a subsidiary in
Turkey, seeking to take advantage of Turkeys
booming economy to strengthen its global
presence. Many global companies are using
Turkey as an investment platform to grow
globally. Companies from the APEC member
countries are more than welcome to invest in
Turkey. We will be at their disposal at every stage
of their investments.
Free Trade Opportunities
Since foreign investors are coming to Turkey
both for domestic market and surrounding
markets, it is important to have a liberal trade
policy. To this end, Turkey has signed a customs
union agreement with the European Union and
free trade agreements (FTA) with around 20
countries. These countries include Norway,
Switzerland, Iceland, Lichtenstein, Macedonia,
Bosnia-Herzegovina, Albania, Israel, Palestine,
Morocco, Tunisia, Egypt, Syria, Georgia, Serbia,
Montenegro, Chile, Jordan, Mauritius and the
Republic of Korea. Additionally, the FTA signed
with Lebanon is in ratification process. FTAs are
important in developing foreign trade with the
neighboring countries, ensuring exporters
compete at more advantageous or at least under
equal circumstances with other countries
exporters and increasing bilateral investments.
Meanwhile, there are 21 countries and 5 blocks
that Turkey has started FTA negotiations;
(Ukraine, Colombia, Ecuador, Malaysia, Kosovo,
Moldova, Dem. Rep. of Congo, Ghana, Cameroon,
Seychelles, the Gulf Cooperation Council, Libya,
MERCOSUR and Faroe Islands) or has launched
initiatives to start negotiations (Canada, Japan,
India, Indonesia, Vietnam, other ASEAN countries,
Peru, Central America Community, other
Africa-Caribbean countries, Algeria, Mexico and
Republic of South Africa).
Turkey as an investment hub
With its competitive business environment and
skilled labor force, Turkey ofers many
advantages for global manufacturing companies.
Global manufacturing companies are well
cognizant of that too, for example, Foxconn,
The APEC Publication 2013
COUNTRY NUMBER OF FOREIGN
COMPANIES IN TURKEY
AUSTRALIA 145
BRUNEI 1
CANADA 236
CHILE 9
CHINA 476
HONG KONG 52
INDONESIA 8
JAPAN 158
MALAYSIA 29
MEXICO 9
NEW ZEALAND 16
PERU 2
PHILIPPINES 11
RUSSIA 1457
SINGAPORE 64
SOUTH KOREA 226
TAIWAN 17
THAILAND 16
USA 1275
VIETNAM 1
Total 4208
LIKE INVESTORS FROM THE OTHER COUNTRIES,
INVESTORS FROM THE APEC MEMBER COUNTRIES ARE
ALSO USING TURKEY AS A HUB FOR THEIR INVESTMENTS
AND BUSINESS OPERATIONS IN THE REGION.
Nusa Dua / Bali. Indonesia 2013 45
Feature / Investment in Georgia
Editorial by: Alexander Botting, Diplomatic Courier Guest Contributor
The APEC Publication 2013
THOUGHT LEADERSHIP
Foreign
Investment
in Georgia:
Opportunities
Abound
W
HILE GEORGIAS influence in
the South Caucasus region is
largely dwarfed by that of its
energy-rich neighbor, Azerbaijan,
positive relations between the two countries
have ensured that Georgia has benefitted from
significant inflows of foreign investment. Owing
to recent political and military conflicts with
Russia, however, levels of FDI in Georgia remain
significantly below what they should be.
For the past 9 years, Georgia has been led
by President Mikhail SaakashviliGeorgias
charismatic and combative President.
Saakashvili won in 2004 with 96% of the vote
and even his most ardent opponents would
be hard-pressed to say that Georgia has not
benefitted from his leadership, with GDP
growing from $14 billion to $26.2 billion.
Nevertheless, his eagerness to raise tensions
with Russia and his unwillingness to combat
corruption have eroded popular support
for his Presidency over this time.
As a result, Bidzina Ivanishivilis Georgia
Dream party won the 2012 Parliamentary
elections, on a platform which emphasized
the need to end the endemic corruption of the
Saaskashvili government and improve relations
with Russia.
From an outsiders standpoint, the maturity
with which the original transition was handled
was more important than the election results.
By handing over power peacefully to the
opposition, Saakashvili assuaged one of the
greatest fears of foreign governments and >
Georgia ranks 9th out of 185 countries in the World Banks
Doing Business Rankings, yet levels of Foreign Direct
Investment (FDI) remain signifcantly below what they
should be, at $1 billion. Having overseen a peaceful transition
of power and with relations with Russia improving, Bidzina
Ivanishvilis government has set an ambitious goal of
doubling FDI by the end of the year. With major investment
funds already looking to invest in energy, agriculture and
transportation, however, they are on track to achieve
meet their target.
Nusa Dua / Bali. Indonesia 2013 47
The APEC Publication 2013
Feature / Investment in Georgia
48 theapecceosummit.com
>investors whether stability could be
maintained while respecting the democratic
wishes of the Georgian people.
If Georgia does continue along its positive
path towards development, it is likely that
this will be Saakashvilis most valuable
contribution to his country.
Georgias Investment Environment
Georgia currently ranks 9th out of 185 countries
in the World Banks Ease of Doing Business
rankingsahead of all but 3 members of the
G20. This is a remarkable achievement for a
country which emerged from the state-run
economy of the Soviet Union less than 22
years ago.
What makes Georgia particularly attractive to
foreign investors, however, is its high ranking
on the criteria of Protecting Investors ahead
of many of the success stories for international
investors such as Chile, Saudi Arabia and
Taiwan. Perhaps more surprisingly, it ranks
above many major developed countries such
as Japan, Norway and Sweden in this category.
Investment under Georgia Dream
Having made his billions in post-Communist
Russia, questions were raised as to Ivanishvilis
commitment to maintaining a free market
economy underpinned by the rule of law.
In addition, Saakashvili has attemtped to
characterize his eagerness to rebuild economic
and political ties with Russia as a potential
threat to the Georgian people.
As we have seen over his short time in
power, however, such statements are a flagrant
misrepresentation of Ivanishvilis intentions.
Economic best practices have continued
unabated and he has spent more time courting
western governments and investors than
those in Russia.
There is little reason to doubt Ivanishvilis
motives for attempting to thaw relations
with Russia. Given the size of its economy,
developing bilateral trade with Russia is a no-
brainer and will bring substantial benefits for
the Georgian economy. Georgians are not in a
position to choose their neighbors and would
be foolish not to establish trade links with the
major economic power in their region.
Moreover, a major reason for the positive
political and economic climate in Georgia is
the desire of the Georgian people to emulate
the systems of their Western allies. Were any
government to reverse this progress, they could
expect to be sharply rebuked for it by the
electorate in subsequent elections.
In Georgias Past, a Vision of their Future
The current government showed its
commitment to developing foreign investment
by establishing a national investment authority,
charged with doubling Georgias FDI this year,
to $2 billion. While this is an ambitious goal,
it is by no means unrealistic with a number of
investors already taking a significant interest.
Moreover, rhe focus of this investment
will largely be within sectors where Georgia
has a proven track record of success: energy,
agriculture and transportation.
Hydroelectric Energy
Despite significant government investment
in hydropower since its independence,
Georgia still only utilizes only a small
proportion of its potential.
With significant domestic demand, as well
as persistent energy shortages in neighboring
Turkey, the privatization of this sector has
caught the interest of a number of major foreign
investors. At this years Davos forum, Indias
Tata Group agreed to invest in the $600 million
Adjaristskali hydropower plant. They are
unlikely to be alone.
Traditional Energy
At its peak, Georgia produced 20,000 barrels
of oil per day, mostly drilled from the upper
Jurassic formation. Owing to mismanagement
under the Soviet Union, however, this level has
been almost entirely drained. As such, any new
drills would need to target other levels.
Georgias complex geological formations have
in the past discouraged large scale investment
in its energy sector. Successful attempts at
drilling similar geological formations in the
Baltics, however, have emboldened would-be
investors. Moreover, with the potential to sell
GEORGIA CURRENTLY RANKS 9TH
OUT OF 185 COUNTRIES IN THE WORLD
BANKS EASE OF DOING BUSINESS
RANKINGSAHEAD OF ALL BUT 3
MEMBERS OF THE G20.
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 49
THOUGHT LEADERSHIP
the resulting oil into European markets at over
$100 per barrel, there are substantial incentives
with which to offset any perceived risk.
Agriculture
The Georgian government has put the
agricultural sector at the top of its list of areas
for investment and has accompanied its rhetoric
with financial incentives for investors.
Beyond the need for increased domestic meat
production, the agricultural product with the
best potential for export is wine. Georgia first
started producing wine around 8000 years ago,
making it the longest known producer in the
world. The quality of its Saperavi and Tsinandali
wines, in particular, has lead to a significant
growth in regional and international exports.
With Ivanishvili having also secured approval
for exports to Russia there is substantial room
for growth in Georgias wine production.
Transportation
Georgias greatest inheritance from its Soviet
days was a comprehensive modern system
of roads and railways. Moreover, Georgias
location at the axis of East and West makes it
an ideal hub for the transit of goods from Asia
to Europe.
While the maintenance of this infrastructure
has suffered a little from under investment
over recent years, rising levels of trade between
Europe and Asia are providing the necessary
incentives for investment. With more pipelines
from Azerbaijan to Europe also being planned,
Georgia looks set to establish itself as a major
regional hub.
Biography
Alexander Botting works for a Washing-
ton, DC-based international government
afairs frm, where he provides political
and business consultancy services to
clients from the Europe and Eurasia
regions. Prior to this, Mr. Botting worked
as a Political Risk Analyst for a private in-
vestment fund and as an Equity Research
Intern for Fidelity Worldwide Investment.
Mr. Botting received his B.A. in Politics and
International Studies from the University
of Warwick and is studying for a Masters
in Political Management at George Wash-
ington University, where he has been
awarded an Academic Fellowship.
50 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Soneva Fushi
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THOUGHT LEADERSHIP
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As is the Soneva way, all this is ofered while
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the heart is Eco Centro, proving ground for the
sustainable culture Soneva extols, where
everything from the suns rays the island is part
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Serious goals for sustainability do not repress
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Pleasure goes hand in hand with respect for the
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Snorkelling the house reef in the company of the
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The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 51
Contact Information: Reservations-fushi@soneva.com www.soneva.com
The APEC Publication 2013
Feature / Global Action Platform
Editorial by: Dr. Scott T. Massey
52 theapecceosummit.com
F
ROM PROTESTS IN BRAZIL and
Europe over rising costs, to the
bankruptcy of Detroit, to sluggish
growth in the US and EU, and the
potential slowing and rebalancing of the
Chinese economy, there remain clear challenges
to stimulating and sustaining a new round of
economic growth in the Asian-Pacific region
and the world. The diverse challenges, like
those just mentioned (among many others that
could be listed) may appear disconnected, but
in fact, are not. Instead, the various economic
challenges we face are interconnected
A World of
Abundance
symptoms of an underlying economic dynamic.
Simply put, the world now faces an
intensified need to create sustainable prosperity
built on platforms of opportunity open to every
person. The combination of globalization,
mobile technology, free markets, global capital
markets, and the increased speed of competition
and change have created vast new opportunities
for corporations and individuals, but this perfect
storm of change has also disrupted economic
systems close to home in which a majority of
the worlds population lives. Because of this,
and as the human population grows toward
nine billion, it is now urgent to put strategies
in place that re-localize economies and
create new growth at the regional level,
like the new growth vegetation in an old
growth forest.
In short, to move beyond the current spiral
of economic crises, we need to take steps to
create sustainable, shared, long-term prosperity;
and to do this, we need to build dynamic
innovation hubs in regions all around the
world. Regionally based innovation hubs are
the new engines of prosperity and platforms for
expanding, broad-based economic opportunity.
One new global effort to move toward this
goal has been recently launched. In November
2012, four hundred leaders from ten nations,
representing the corporate, research,
government, finance, media, foundation, and
NGO sectors convened at the Global South
Summit in Nashville, Tennessee USA. The goal
of this international gathering was to begin
framing an agenda for abundance with a focus
on three interconnected issuesfood, health,
and prosperity. At the conclusion of the
inaugural Summit, an integrated approach to
these three issues was defined as an urgent
priority needing attention over the coming
three to five years.
Building a Global Action Platform to Create Abundance
Through Innovation in Food, Health and Prosperity.
The APEC Publication 2013
THOUGHT LEADERSHIP
THE GLOBAL ACTION PLATFORM
HAS BEEN CREATED AS A MECHANISM
TO CONNECT AND ALIGN EFFORTS
TO CREATE ABUNDANCE THROUGH
INNOVATION.
Why Food, Health and Prosperity?
Founding leaders in this new global initiative
started with an economic concern--how to
advance sustainable economic growth and
prosperity for a growing world population. The
organizers found strong interest in mobilizing
cross sector leadership to find new paths and
models for economic development aimed at
sustainable prosperity. Further, it became clear
that the growing global challenges of food and
healthbasics for human capitalhad to be
addressed while developing ways to expand
shared prosperity.
This vision of an economic future of
sustainable growth and expanding opportunity
for everyone requires a special lens. To balance
growth, sustainability, and opportunity leaders
identified a need for an adaptable model and
tools, a nimble, neutral infrastructure well-
suited for the fast-emerging, complex
conditions of the 21st century.
The elements of this model include industry
clusters, disruptive innovations, regional
economies, platforms for collaboration,
and strategy for competitiveness. New
technologies, the Internet, pervasive
knowledge/training, and mobile devices
are also key to the mix.
A Vision of Abundance
Instead of a focus on scarcity and conflict,
this new initiative focuses on the creation of
abundance as the central organizing idea. How
can we focus economic activity in regional
innovation hubs to expand opportunity and
unleash innovation? How can the whole human
population flourishwhile also allowing the
environment and ecosystems that make
life possible also flourish?
Key drivers for innovation and prosperity are
food and health. If economic growth requires
a broad base of talented, innovative people
working together, then food and health are
critical. In fact, food and health are baseline
measures of the asset strength of the major
economic driver of todays economyhuman
capital.
Between the current state of affairs for
healthcare and a major transformation of health
systems lie thorny issues of realigning financial
incentives while managing the demographic
shifts toward an older population with greater
health needs and while integrating large new
populations to modern healthcare. As with
economic and food issues, time is running out to
address changes in healthcare; and under this
pressure there is a growing sense of urgency to
find transformative healthcare solutions
and new financial models.
In terms of food, while the world currently
produces enough food to feed everyone on the
planet, the logistics and political consensus are
missing to distribute what is produced. Food
reserves have not been replenished since the
2010 drought, which puts the world on the
brink of food shortages. Disputes are raging
over the role of genetically modified foods, the
composition of a healthy, nutritious diet, and the
role of government to enforce diet, food policies,
food safety, and governments role in funding
research and food relief efforts.
Building a Global Action Plan
The challenge the world faces now is to frame
long term solutions and innovations that have
the capacity and promise to create abundant
food, health, and prosperity for everyone on
the planet. Solutions are simultaneously local,
regional and global. In short, solutions require
local cross-sector leaders to imagine, to explore
and to specifyhow innovation can create
abundance, and how we can efficiently and
much more effectively connect and network
invested leaders, research institutions and
innovators to collaborate in fulfilling the
promise of abundance.
The Global Action Platform has been created
as a mechanism to connect and align efforts to
create abundance through innovation. The
Platform is built around four interconnected
functions: Convene, Challenge, Connect, and
Communicate. Through the Platform, an
integrated series of financial investments,
tied to leadership summits, action plans, and
global multimedia communications are being
implemented over the next five years.
Innovation for Abundance
The future welfare of both human beings and the
planet depend on a distinctly human resource
innovation. Our emerging economies demand
more timely solutions, access to innovation,
improved efficiencies and high impact results.
On this there is broad consensus. In order for
societies to be innovative, people must be able
to thrive; they need food, health, and the tools
and systems of innovation that produce
sustainable prosperity.
As we strive to achieve sustainable, shared
prosperity, leaders and innovators will need to
collaborate together to create a shared platform
for clear, more efficient decision-making and
informed actions to guide our future. With
wa growing network of university-business-
government-NGO-media partners, the Global
Action Platform aims to become a primary
distribution channel and change agent for
a world of abundance.
Nusa Dua / Bali. Indonesia 2013 53
The APEC Publication 2013
Feature / Energy Policy
Editorial by: Dr. Richard Rousseau, Diplomatic Courier Contributor
Russias
Energy
Policy
D
ISQUIET OVER EUROPES
reliance on energy from Russia
has intensied efforts to nd new
suppliers. The politicization of
energy security in Europe has diverted parties
from the threat posed by a continued reliance
on hydrocarbons.
In January 2009, the supply of energy to
a number of European states was disrupted
following a price dispute between Ukraine
and Russia. Although Vladimir Putin,
president at the time, claimed that Russia
would not behave as an energy superpower,
the Kremlins decision to suspend gas
supplies to Ukraine increased European
anxiety over Moscows willingness to use
energy as a tool in foreign policy.
As the worlds leading supplier of natural
gas between 2003 and 2009the U.S.
surpassed Russia as worlds leading producer
in 2010and the seventh largest supplier of
oil, Russia occupies a formidable position
as an energy exporter. In contrast, many
of the surrounding states of the European
Union and the former Soviet Union are major
importers of Russian energy. The media
coverage of this gas crisis highlighted the
growing politicization of energy security
within the region and on the international
level. However, the focus on Europes access
to a reliable (and relatively cheap) supply
of energy, coupled with growing Russian
adventurism, obscures the threat that a
continued reliance on hydrocarbons has on
the future of international energy security.
Russias growing international prominence
is inextricably linked to its natural energy
resources. Rapid increases in oil and gas
prices in the mid-2000s enabled Russia to
progress from a position of near nancial
collapse in 1998 to successive years of
economic growth. The growing demand
for Russian energy has been helped by the
countrys position outside the Organisation
for Petroleum Exporting Countries (OPEC)
and the Middle East, where ongoing conict
undermines the reliability of supply. Europe
currently relies on Russia for more than
40 percent of its gas and a third of its oil
suppliesgures that are expected to increase.
Meanwhile China imports approximately 10
percent of its gas from its northern neighbour.
Yet, there are key differences between
eastern and western Europe in their
dependency on Russian energy. Although
the total amount of gas consumed by the
Eastern European states is relatively small
in comparison to that of Germany or Italy,
they are much more dependent on
Russia for their supply.
Ukraine is particularly vulnerable to
As the worlds leading supplier of natural gas between
2003 and 2009the U.S. surpassed Russia as worlds leading
producer in 2010and the seventh largest supplier of oil,
Russia occupies a formidable position as an energy exporter.
Expanding
Influence
The APEC Publication 2013
THOUGHT LEADERSHIP
disruptions from Russia. Not only is it a pivotal
state in the transit of gas towards Europe,
accounting for approximately 80 percent of
supply (even though this is bound to decrease
in the mid and long term, as new transit routes
are put into service) it is also dependent on
Russian gas for its own energy needs and the
revenues generated from transit fees. Although
the Kremlin always cites commercial reasons
for the suspension of oil and gas to clients,
there is growing concern in the West that
Europes and Asias energy dependency is
increasingly being used by Moscow as a
tool to exert political pressure to bring
commercial partners to heel.
A Case for Diversication
The prospect of a Russian stranglehold on
Europes energy supply has strengthened the
case for diversication of the energy supply in
Europe. While there are efforts to circumvent
Russia, the long lead-in to viable alternative
energy sources and constructing supporting
infrastructure will see continued reliance on
Russia for the immediate future.
Securing the future of Europes energy
supply is complicated by the tenuous nature
of Moscows relations with transit countries.
This was highlighted by the Russian invasion
of Georgia in August 2008, where security
of oil and gas transit pipelines came under
the spotlight. Georgias transit pipelines are
of particular importance to Europe as they
represent the only route that does not cross
Russia or Iran. However, these transit states,
as well as the oil-rich Central Asian states of
Kazakhstan, Azerbaijan, Turkmenistan, and
Uzbekistan, fall within what Russian foreign
policy has identied as a sphere of inuence.
Numerous U.S. and Chinese ofcials visit to
these countries signal Americas and Chinas
deep interest in the energy security of the
region. It reinforces the perception expressed
by former Russian Minister of Defence
Anatoly Serdyukov that the U.S. and China
are looking to muscle in on energy and
mineral resources in the former Soviet
countries of Central Asia.
A New Energy Charter for Europe
In addressing Europes energy needs, the EU
has continued to push for the liberalization
of energy markets and Russias ratication
of the Energy Charter Treaty (ECT) and the
Transit Protocol. Even though Russia signed
the treaty in 1994, it ofcially opted out of
it on October 18, 2009 and informed the
depository that it did not intend to become a
Contracting Party to the Energy Charter Treaty
or the Protocol on Energy Efciency and
Related Environmental Aspects. It argued that
ratifying it would undermine the countrys
national interest, and acceding to the Transit
Protocol would allow Central Asian states
access to Russias gas and oil transit pipeline
network without any agreement with
Moscow. Former Russian President Dmitry
Medvedev called for the negotiation of a new
energy charter for Europe, one that would
focus not only on consumers of energy, but
also on producers and transit countries.
While Europe is dependent on Russian
energy exports, Russias national budget
is reliant on revenue raised from the sale
of its oil and gas to Europe. With evidence
suggesting that Russias resources are
reaching their peak, the bilateral agreement
between Moscow and China to secure a
signicant increase in oil trading volumes
has underscored a growing concern regarding
Russias over-extension and future energy
capacity. The country also faces a growing
domestic demand for energy, while the
doubling of the gas price over the last 10
years has placed an additional burden on
lower-income families.
Internationally, the soaring cost of energy
and the move towards reducing greenhouse
gas emissions has resulted in increased
nancial support for the research and
development of alternative energy sources,
including renewable sources like solar, wind,
and hydropower. With signicant fossil
fuel reserves, there has been little investor
incentive to fund nance studies to develop
technology and diversify energy sources
within the Russian federation, leaving
the economy dangerously dependent on
hydrocarbons.>
Nusa Dua / Bali. Indonesia 2013 55
The APEC Publication 2013
Feature / Energy Policy
56 theapecceosummit.com
>The global nancial crisis has taken a
toll on revenue from energy exports. In a
presentation to the 2009 UN Conference on
Trade and Development (UNCTAD), Ivan
Korolev, Deputy Director of the Institute of
World Economy and International Relations,
Academy of Science of the Russian Federation,
indicated that Russias growth rate for 2009
was at. During the next three years growth
in Russia also lower than expected. This is
linked to a dependence on the export price
of hydrocarbons, which account for 70 to 80
percent of all export earnings. In addition
to its impact on the state budget, Tatiana
Mitrova, Head of Global Energy at Skolovovo
Energy Centre, told at the Russia Forum in
early 2012 that the nancial crisis, and the
rapid depreciation in oil prices, has reduced
the resources available for investment in
energy infrastructure modernization projects
and the development of new oil and gas
elds.
In response to oil prices falling from a
high above $140 a barrel in July 2008, and in
an effort to ensure its own energy security,
Moscow has indicated a willingness to work
closely with OPEC in an effort to stabilise
the market. The Kremlin has also been at
the forefront of plans to form a gas cartel
modelled after OPEC, but so far to no avail.
To this end, Moscow has been in talks with
Iran and Qatarand if the three joined forces
they would control more than half of the
worlds natural gas resources.
Through Gazprom, the Russian energy
giant, Russia is expanding its energy network
internationally. Indeed, there are indications
that the state-run monopoly has set out to
acquire a share of Africas energy assets
(including nuclear), with the opening of its
rst African ofce in Algeria in June 2008.
Following this was a urry of meetings with a
number of countries, including Angola, Egypt,
Namibia, Nigeria, and South Africa. Before
the Libyan civil war and Western military
intervention, Gazprom had offered to buy all
of Libyas spare oil and gas exports. It equally
expressed an interest in buying exploration
licences in Nigeria, as well as the building of
gas pipelines between Nigeria and Algeria and
Europe and Libya.
Internationally, oil and gas have been the
fundamental drivers of economic growth and
development. As these hydrocarbons become
increasingly scarce, competition for energy
resources in Russia and the Central Asian
region will result in rising tension between
both the energy exporting and energy
importing states. This is reected in the
new Foreign Policy Concept of the Russian
Federation signed by Putin on February 12,
2013. The document establishes the basis of
Russias external action at least until 2018,
with a focus on the importance of access to
energy resources globally and the potential for
military conict. It replaces the one endorsed
by Dmitry Medvedev in July 2008.
By placing access to hydrocarbons at the
centre of the federations energy security,
Russia will continue to remain dependent
on fossil fuel, not only for its energy but as
a source of revenue. The sustainability of
this approach needs further consideration,
especially in light of the decreasing price of
energy resources and its subsequent impact
on the national budget, modernization
projects, and the exploration and
development of future gas and oil elds.
Although diplomatic efforts saw the
supply of gas restored to Ukraine and other
Eastern European countries, the European
Commission has prioritized the connection
Biography
Richard Rousseau is Associate
Professor and Chairman of the
Department of Political Science and
International Relations at Khazar
University in Baku, Azerbaijan.
His research, teaching and advisory
interests include Russian politics,
Eurasian geopolitics, international
political economy and globalization.
BY PLACING ACCESS TO
HYDROCARBONS AT THE CENTRE OF
THE FEDERATIONS ENERGY SECURITY,
RUSSIA WILL CONTINUE TO REMAIN
DEPENDENT ON FOSSIL FUEL, NOT
ONLY FOR ITS ENERGY BUT AS
A SOURCE OF REVENUE.
of the vulnerable Eastern European states of
Lithuania, Latvia, and Estonia to European
power grids, as well as the development of
the southern Gas Corridor.
Turning to alternative oil and gas exporting
countries may provide a short to medium-
term solution; however, Europes focus on
reducing its dependence on Russia diverts
attention from the regions continued
reliance on hydrocarbons. The southern
Gas Corridor may bypass Russia and Iran,
but by all indications Europe would remain
overly dependent on hydrocarbon energy
exports from a region that remains within
Russias sphere of inuence, although less of
a rm hold than previously. Rather than the
continuing prioritization of energy security
linked to the export and import of oil and
gas, the future of energy security for both
Europe and Russia lies in the diversication
of energy resources and in moving away from
a dependence on fossil fuels.
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The APEC Publication 2013
Feature / Global Trade
60 theapecceosummit.com
By: Manuel C. Menendez III
APECs 21 member economies, themselves powerhouse economic
players constituting the majority of the worlds GDP, have created a
unique opportunity for Small, Medium and Micro Enterprises.
APEC and Small, Medium
and Micro Enterprises
The APEC Publication 2013
Nusa Dua / Bali. Indonesia 2013 61
THOUGHT LEADERSHIP
S
INCE 1989, the Asia-Pacific
Economic Cooperation forum
has become a key venue for the
global dialogue on international
trade. Its 21 member economies,
themselves powerhouse economic
players constituting the majority of the
worlds GDP, have created in APEC a
unique opportunity for Small, Medium
and Micro Enterprises (SMMEs) to have
input in the shaping of an interdependent
Pacific economic structure. More than
50% of all private sector employees
earn their living in SMMEs, which have
generated an astounding of all new
private sector jobs in the United States
since 1981. Therefore, the leaders of
the APEC member economies are in
a powerful position to utilize the strength
of SMEs by allocating sufficient resources
and attention to this extremely productive
area and therefore encouraging
economic growth.
The Power of SMMEs
SMMEs, as a major driver of significant
economic progress and growth, are a
prime target for partnership by the
unique combination of leaders and
experts at APEC. The challenge, then,
for APEC member economies, is to
better integrate SMMEs into the global
economic dialogue. APEC members,
as some of the strongest players in
the world economy today, have the
economic wherewithal, global influence,
and wealth of expertise needed to best
make use of the power of SMMEs while
helping them to develop into the
economic dynamos they have proven
to be during both stable economic
conditions, as well as, having great
resiliency in times of economic crisis.
It behooves the leaders of the APEC
member economies to deeply consider
the potential benefits of stronger ties
with SMMEs.
APEC is one of the most uniquely
successful communication forums in
existence. In its own words, it exists
in part to develop and strengthen the
multilateral trading system between
members and to increase the
interdependence and prosperity of
member economies. Communication
has proven to be a great force for
achieving these goals, particularly
between member economies and
business leaders, who often benefit
greatly from wide-open channels of
communication with one another. The
leaders of the APEC member economies
would do well to reflect on how strong
ties and open communication between
member economies and SMMEs could
benefit both parties.
The diversity of interests present
in the Asia Pacific region can present
a challenge for those who wish to create
interdependence between nations.
SMMEs, being smaller and more
adaptable than larger firms, are in a
unique position to address the myriad
needs and interests of APEC member
economies by adapting to the specific
situation. Only the immense influence
of APEC member economies and their
leaders can open the gates for SMMEs to
efficiently address such unique interests
by making it easier for SMMEs leaders
to get involved at APEC, interfacing
with member economy leaders and large
business leaders alike. The formation of
the Small, Medium and Micro Enterprises
(SMMEs) & Entrepreneurship Working
Group of APECs Business Advisory
Council (ABAC) is a step in the right
direction but much more can be done
and should be done to enhance, expand
and make meaningful the SMMEs
partnership with APECone immediate
idea would be to devote ample time and
provide a platform to SMMEs to play
a larger role at the APEC CEO Summit
meetings.
As the Asia Pacific region endeavors
to secure the future, it would be
mistaken in ignoring the obvious
economic potential of SMMEs. As US
Secretary of State Hillary Clinton said at
APEC in 2011, this Summit just might
make the history books. But it will do so
only if we make history by empowering
our rhetoric with concrete action. The
leaders of APEC member economies and
industry experts alike can take further
concrete actions to benefit immensely
and mutually from a closer and more
robust partnership with Small, Medium
and Micro Enterprises (SMMEs) &
Entrepreneurs.
APEC IS ONE OF THE MOST UNIQUELY
SUCCESSFUL COMMUNICATION FORUMS
IN EXISTENCE.
Biography
Manuel Manny Menendez III
is former Director of Economic
& Business Development and
International Protocol Ofcer for
the City and County of Honolulu
and Founder & CEO of MCM
Group Holdings Ltd. 8M8
LLC an international advisory
service organization specializing
in business development,
government relations, trade
and investment focused on
the Asia Pacifc region with
special emphasis on the Peoples
Republic of China since 1978.
The APEC Publication 2013
Feature / Trans Pacifc Partnership
Editorial by: Akela Lacy, Diplomatic Courier Contributor
62 theapecceosummit.com
The proposed decreases in barriers to trade and foreign investment have a historically
exhibited tendency to food domestic markets with cheap foreign goods.
Rushing Backwards:
Why Hastening the
Trans Pacifc Partnership
Agreement Will Hurt Us
The APEC Publication 2013
THOUGHT LEADERSHIP
THERE
HAS BEEN A
GROWING GLOBAL
OPPOSITION TO
THE AGREEMENT
AS LEAKED
VERSIONS OF
THE DOCUMENT
REACH THE
PUBLIC
SPHERE.
F
ORMAL NEGOTIATIONS on the Trans
Pacific Partnership Agreement began in
2010 and as of 2013 officially include
Australia, Brunei Darussalam, Chile,
Malaysia, Mexico, New Zealand, Peru,
Singapore, the U.S. and Vietnam. There has
been a growing global opposition to the
agreement as leaked versions of the document
reach the public sphere, suggesting extreme
overhauls to corporate-domestic relationships
abroad and diminished power of democratic
publics to exercise their rights to provide input
for domestic policy. As other nations like Japan
and Malaysia begin the process of entering
these negotiations, their publics have also
expressed extreme concern at the requirements
facing their governments. President Obama has
expressed a desire to finalize negotiations by
2013, but there are provisions of the agreement
that deserve close reconsideration before then.
As the only non-governmental official
overseer of the APEC CEO Summits operating
process, Pacific Economic Cooperation Council
co-chair Jusuf Wanandi is forewarning of a
dilemma at this years meeting in Bali
stemming from debates over competing
regional trade agreements, mainly those
surrounding the Trans-Pacific Partnership (TPP).
Over the past few years the proposed
agreement has attracted international criticism
concerning lack of transparency surrounding its
negotiation and drafting, especially in Japans
agricultural and food safety sectors and most
recently in the U.S. Congress; earlier in June
Senator Elizabeth Warren (D-Mass.) sent a letter
to the newly-elected U.S. Trade Representative
Michael Frohman asking if in his term he
would disclose a copy of the sweeping
regulatory agreement to the public.
Senator Warren is one on a long list
of actors in the U.S. including public health
organizations, public interest lawyers, state
leaders and representatives alike who are
vocalizing concern about the potentially
negative effects that the TPP could have on
domestic industries and regulatory policies in
participant nations. Those critiquing the
agreement are doing so from allegedly leaked
documents and therefore unconfirmed sources,
but abridged versions of the agreement that
have been confirmed and released to global
businesses and state leaders as well as certain
members of Congress deserve a thoughtful and
critical assessment in terms of their stipulations
which extend far beyond the traditionally
simplified definition of trade.
Nations participating in TPP negotiations
are expected upon its finalization to conform
to domestic policy standards governed by
those members leading the discussions. This
requirement, though aimed at economic
reinvigoration, instead effectively circumvents
the people of countries in negotiation from
exercising their democratic rights to have
a say in domestic policy. The TPPs projected
structuring would give transnational
corporations the power to sue national
governments in countries where they operate
for non-compliance with regulatory provisions
mandated by the country from which the
company operates. A foreign company
operating overseas would have the legal
option and the power to overturn domestically
agreed-upon policies in order to operate in a
more efficient and lucrative manner. These
corporate-nation suits would be tried in
international tribunals with the power to
override domestic environmental, health, and
intellectual property regulations to further the
interests of foreign corporations.
Beyond these somewhat morally-founded
concerns, there are also those more basically
grounded in economics. In theory the Trans
Pacific Partnership Agreement has the potential
to cement the emerging and mutually beneficial
trade bloc between Australia, Brunei
Darussalam, Chile, Malaysia, Mexico, New
Zealand, Peru, Singapore, the U.S., and
Vietnam. However the proposed decreases in
barriers to trade and foreign investment
have a historically exhibited tendency to flood
domestic markets with cheap foreign goods,
decreasing demand for domestically produced
goods and threatening jobs at home.
These consequences may not necessarily be
expressly intended by the powers in negotiation,
but they cannot be ignored. Although the TPPs
publicized aims are to eliminatie barriers to
trade in order to further integrate economies in
the largest proposed trade bloc in the world, its
provisions for conformity to a certain standard
of policies amount to a somewhat misguided
one-size-fits-all approach to economic
integration. Although similar free trade
agreements in the past have increased
participant nations GDPs with foreign
investment, there is also evidence of job
displacement, decrease in national investment,
and socioeconomic inequality perpetuated
by a shift of demand from labor-intensive goods
to capital-intensive goods decreasing wages
for laborers and increasing profit for those
already gaining it.
And then there are the copyright issues.
Given recent public dismay with online privacy
breaches and federal disposition towards the
issue in the U.S., the TTP provisions for
intellectual property are surprisingly and a
bit disproportionately strict. Many critics of the
TPP agreement contend that pharmaceutical,>
Nusa Dua / Bali. Indonesia 2013 63
The APEC Publication 2013
Feature / Trans Pacifc Partnership
64 theapecceosummit.com
>computer and entertainment companies will
benefit more from the pact than the publics of
participating nations. The TPPs intellectual
property provisions would require member
nations to adopt many strict copyright laws
and effectively criminalize minor infractions
with jail time rather than liability to the
copyright owner. It would also give internet
service providers (ISPs) the ability to track
even blurred instances of user copyright
infringement with a three-strike test, allowing
the ISP to bar the customer from service after
three recorded violations.
Given the modernly lowered barriers
to content sharing and a general public
desensitization to exactly what behavior counts
as infringement and what is considered legal
for one-time use versus repeated illegal
reproduction, these provisions allow for
extremely disproportionate responses to
minor violations of inextricably complicated
laws imposed by foreign governments.
These intellectual property laws also extend
beyond the sphere of internet usage and privacy
into the pharmaceutical world, producing
relevant concerns for public health. If member
nations are required to conform to a standard
set of copyright laws based on the domestic
protectionist policies of leading negotiators, they
are effectively barring their own domestic
pharmaceutical companies from reproducing
drugs at appropriate prices for their consumer
bases and relegating the publics only choice to
expensive and therefore out of reach drugs
produced by foreign companies. Both the UN
Development Program and UNAIDS have issued
reports urging global powers not to joing the
TTP under these terms, specifying financing
policies and intellectual property standards
that inflate the price of medications
granting pharmaceutical companies long-term
monopolies on livesaving medications which
leave poor citizensdenied [of] lifesaving
treatments (Zach Carter, Huffington Post).
Those invovled in TPP negotiations are
calling for a finalized agreement by the end
of this year. Given the ever-growing public
concern over the pacts implications for
democratic practices, individual internet use
and global access to medicine, there seems to
be an evident need for further deliberation.
The last thing our global community needs
is a rushed agreement that will set the educated
and affluent further and further apart from
those struggling to survive. Upon their election
our leaders accepted responsibility to do what
is best for the people; rushing TPP is not
the answer.
UPON THEIR
ELECTION
OUR LEADERS
ACCEPTED
RESPONSIBILITY
TO DO WHAT IS
BEST FOR THE
PEOPLE; RUSHING
TPP IS NOT THE
ANSWER.
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The APEC Publication 2013
News / Regulatory Practices
Story by: Irvina Falah
68 theapecceosummit.com
A
PEC ECONOMIES are taking
steps towards reducing technical
barriers to trade by monitoring
and improving the implementation
of good regulatory practices, according to a
number of public and private sector experts.
Regulatory officials and business
representatives shared experiences and
explored ways to enhance internal policy
coordination, regulatory impact assessment
and public consultation during an APEC
conference that concluded on Thursday
in Medan.
Regulatory cooperation has become
an important area of focus for APEC
economies, said Professor Bambang
Prasetya, the Chairman of Indonesias
National Standardization Agency.
Support for Good Regulatory
Practices in APEC will Foster Growth
It is a self-fulfilling paradigm that better
regulation and the improved alignment of
regulatory practices will bring economies
closer together and foster increased growth.
Professor Prasetya noted that this
approach can help to ensure effective
regulation while minimizing the burden
on manufacturers and industries across
the Asia-Pacific region.
It is important to reduce duplicative
testing and certification which can add
time and other costs to the export of goods,
said Tony Sinambela, the Director of
Standardisation at Indonesias Ministry
of Industry. He cited an APEC mutual
recognition arrangement on conformity
assessment of electrical and electronic
equipment as an example of APECs work
to drive sectoral growth through measures that
support increased regulatory convergence.
Private sector representatives described
the importance of efforts to facilitate an
improved approach to regulation and the
scope of its potential benefits.
Good regulatory practice is the primary
route to safer products without adding
unnecessary costs or creating barriers to
trade, said Al Kaufman, Senior Vice
President of Technical Affairs at the US-
based Toy Industry Association. Ultimately,
consumers are the ones who benefit from
a wider variety of safe products at
cheaper prices.
Delegates updated one another on the
baseline survey of actions taken by APEC
economies to implement and advance
regulatory convergence and cooperation.
The vision of a seamless regional
economy has been taking shape over the
last few years through the specific initiatives
underway within APEC to implement good
regulatory practices, said T.A.R. Hanafiah,
Chair of APEC Subcommittee on Standards
and Conformance.
APEC economies work to address good
regulatory practices is vital to advancing our
broader agenda to lift trade and investment
barriers, and move us towards a more
integrated and prosperous region, he
concluded.
The conclusion of the 7th APEC
Conference on Good Regulatory Practices
sets the stage for aseries of meetings of
APEC standards officials in Medan that
will continue through Saturday.
PRIVATE SECTOR REPRESENTATIVES
DESCRIBED THE IMPORTANCE OF
EFFORTS TO FACILITATE AN IMPROVED
APPROACH TO REGULATION AND THE
SCOPE OF ITS POTENTIAL BENEFITS.
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The APEC Publication 2013
News / Border Entry
Story by: Irvina Falah
70 theapecceosummit.com
A
PEC MEMBER ECONOMIES are
making air travel easier for the
increasing number of passengers
in the region. Further improvements
to a scheme that expedites travel and border
entry for businesspeople across the 21 APEC
economies was the focal point of discussions
by immigration and security officials who
met on Monday in Medan.
The APEC Business Travel Card is a
globally unique initiative designed to
encourage business growth within the APEC
region, said Agnieszka Holland, Convenor
of the APEC Business Mobility Group. The
Business Mobility Group is committed to
expanding and improving the scheme.
Our goal is to simplify things as much
as possible for those who conduct business
between Asia-Pacific economies, Holland
explained. This means seeking out
opportunities to improve efficiency and
service for businesspeople.
Through a single application, the
APEC Business Travel Card, or ABTC, scheme
offers businesspeople a three-year, multiple,
short-stay entry and express lane access
at key immigration checkpoints in Asia
Pacific economies.
The development of the scheme is a
component of APECs broader efforts to
APEC Economies are Improving
Border Entry for Air Travelers
build greater connectivity in the region
to drive growth.
Strong regional growth of the scheme and
commitment of participating economies make
this initiative a scheme of choice for regional
business, Holland said. This is evidenced
by the ascension of Russia to full membership
on 1 June 2013 and the continued work of
Canada and the United States towards full
membership.
Collectively, APEC officials continue to
engage in a dialogue on emergency response
travel facilitation for personnel and equipment
in the Asia-Pacific Region in times of disaster.
We need to consider working in partnership
with the aviation industry to optimize
emerging technologies such as advanced
passenger information or automated border
control systems, Holland noted.
Partnerships in enhancing our collective
capabilities will ultimately help us to
achieve faster, smoother travel and allow
us to continue to expand benefits to
increasing numbers of businesspeople,
she concluded.
OUR GOAL IS TO SIMPLIFY THINGS
AS MUCH AS POSSIBLE FOR THOSE
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ASIA-PACIFIC ECONOMIES.
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2013
9/11/2013
At Caterpillar, we believe trade
liberalization and infrastructure
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corporate and product identity used herein, are trademarks of Caterpillar and may not be used without permission.
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THOUGHT LEADERSHIP
The APEC Publication 2013
News / Service Sectors
Story by: Irvina Falah
T
HE PROJECTED GAINS of opening
services sectors are almost twice as
big as the gains from the liberalization
of merchandise trade. The potential
benefits for the Asia-Pacific region were
examined by APEC Senior Officials, business
representatives and academics during an APEC
a services dialogue this week in Surabaya.
Liberalizing services could stimulate
growth, create jobs, make small and medium
enterprises more competitive and lower prices
for consumers, speakers explained. By
lowering business costs, it was noted that
freer services sectors could also enhance
companies ability to export and compete in
international markets. Discussion of these
issues helped to set the tone for the opening
of the APEC Senior Officials meeting here on
Thursday and Friday.
More open services sectors are critical
to enhancing economic growth, said
Ambassador Yuri Thamrin, Chair of the APEC
Senior Officials Meeting, which is tasked
with pushing forward member economies
agenda for ensuring a resilient Asia-Pacific.
A better understanding of the challenges
and opportunities in further expanding trade
in services through public-private dialogue
can help to identify practical ways forward.
Trade in commercial services increases
around seven percent annually among APEC
economies, noted Ambassador Thamrin. But
unlike manufacturing in the region, restrictions
remain in some sectors such as energy,
transportation and telecommunications.
Structural reforms in these sectors alone
could generate about US$175 billion in
savings a year, according to research by the
Opening the Services Sector Ofers
Big Gains, Say APEC Ofcials
APEC Policy Support Unit.
Services are critical to achieving the Bogor
Goals to achieve accelerated, balanced and
equitable economic growth not only in the
Asia-Pacific region, but throughout the world,
said Dr Djisman Simandjuntak, of the Pacific
Economic Cooperation Council, which is an
official APEC observer.
There is now substantial evidence that
regulatory clarity and a competitive
environment will lead to big benefits for
consumers. For example, the reduction of
freight rates by 20 percent and the reduction
of electricity prices by 23 percent, he noted.
APEC economies engagement with the
private sector is playing a role in their work
to promote structural reform.
Regulatory reform and the opening up of
services brings huge benefits to economies
and more importantly, to consumers, said
Anthony Nightingale of the APEC Business
Advisory Council.
We are very pleased that APEC is devoting
increased attention to this vital sector of
economic activity, he added. By putting our
heads together with leaders in government,
we can come up with ideas and initiatives
that can help to address such issues
constructively.
STRUCTURAL REFORMS IN THESE
SECTORS ALONE COULD GENERATE
ABOUT US$175 BILLION IN SAVINGS A
YEAR, ACCORDING TO RESEARCH BY
THE APEC POLICY SUPPORT UNIT.
Nusa Dua / Bali. Indonesia 2013 75
76 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Bali Tourism
Balinese Hindus are famous for their
spectacular celebrations of life, which combine
artistry and spirituality in unforgettable display
of devotion. The Balinese believe that their gods
love beauty, and their religious rituals are feasts for
the senses as well as the soul, earning Bali its
name as the island of the Gods.
One of the most important principles in
Balinese culture is the harmony between
humans, nature and divinity. The island itself is
considered to be a spiritual inheritance, and
Balinese takes pride in conserving it culturally
and ecologically as a sacred trust for generations
to come. Visitors are invited to share in the wonder
of nature by witnessing the majestic grandeur of
Balis mountain landscape, the lust green of its fertile
rice fields and the unspoiled richness of its ocean
world. Bali also boasts a wealth of modern
tourism facilities, from luxurious resort and
villas to professional travel and transportation
services to high-quality, well-managed attractions.
With something for everyone, Bali is an ideal
vacation choice for family fun, honeymoon
romance, youth tourism, adventure travel
and cultural artistic explorations. >
The island of inspiration
Perhaps no place else on earth holds as magical
an attraction as Bali. Generations of travelers
have come to our island on journeys of discovery,
stepping back in time to where the pace is easy
and the spirit of life is nourished. On this
legendary island, the best of many worlds blend,
creating a colorful kaleidoscope of culture, art
and adventure. Bali is Indonesias only majority-
Hindu island. Its tradition of social harmony
ensures that it remains safe and friendly to
visitors. The Balinese grace is legendary, and it is
this special island charm that ensures a warm
welcome for guests from around the world.
Bali is renowned for having maintained its
traditional culture against the sweeping tides of
the modern world. In many parts of the island, life
goes on as it has for centuries, with rhythms of
ritual, creativity and culture still serving as a
community compass. Here the arts are woven
into everyday life, making Bali a world center of
music, dance, visual arts and of course, shopping!
Bali also preserves another important
tradition: the fine art of relaxation. Whether
one chooses to laze on a palm-fringed beach or
sink into the serenity of one of the islands
spas, a Bali vacation is a sure cure for a
stress-laden life.
One of the most popular tourist destinations in the world, Bali is often voted as the worlds
best island by readers of international travel magazines from across the globe. It is no wonder
that many people are still intrigued to find out in depth about the uniqueness of Balinese
culture. Life in Bali is always related to a philosophy of Tri Hita Karana or a tripartite concept
that encompasses the spiritual relationship between humans and God, the communal
relationship amongst human beings and the ever-giving understanding between humans and
their environment. The rapid growth of development in tourism has had a big impact on and
influences the Balinese lifestyle. Interestingly, Balinese culture is still as what it was, growing
along with the globalization. This makes the island diferent, when compared to many other
tourism destinations around the world.
Bali: Welcome
to Paradise
Bali Tourism Promotion Board directs all of Balis tourism
promotion. A think tank of the Government of Bali Province,
the board functions as a coordinator to seamlessly orchestrate
the private and public sectors efforts to promote Bali as a
tourism destination of the world.
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78 theapecceosummit.com
The APEC Publication 2013
Sponsored Feature / Bali Tourism
History
Bali has a long chain of history from the
pre-historic era to modern, global civilization
era. With a dynamic characteristic indicating
selectivity and flexibility, the Balinese culture
initially reflects a configuration of an expressive
culture dominated by religious, solidarity and
aesthetic values. Nowadays, it develops along
with the adoption of foreign values especially
in the aspects of the economic, science and
technology, as a result of the global
modernization.
In general, the history of Bali is divided into
three diferent eras including the pre-historic,
the Hindu-Buddhist era and the modern culture.
The pre-historic marked the oldest and simplest
way of life, an era of hunting and food-stuf
gathering, verified by the discovery of several tools
and hunting equipments. In the following era there
were also building construction system and a
particular communication system. These were just
proofs of the existence and further development
of Balinese culture. The Balinese culture flourished
that nowadays one can indicate a perfect bond
between religion, tradition and culture to become
the identity of the Balinese community.
The Dutch seamen were the first Europeans to
arrive on Bali and started to introduce western
culture in 1597, though they had not discovered
any appealing aspect until 1800s. Around 1846 the
Dutch returned with colonization in their minds,
having established a strong political base as
majority of the Indonesian islands were under
their control since the 1700s. The military
campaign embarked from the northern coast
of Bali. With the help of Sasak people of Lombok,
by 1911, all Balinese principalities were under the
Dutch control.
The sense of Indonesian nationalism began
to grow after the World War I, with the young
generation declaring the national language in
1928, known as Bahasa Indonesia. During the
height of World War II the Japanese arrived,
expelling the Dutch and ruled the country for
about 3.5 years, which ended later in 1945
when Indonesia declared independence led
by its very first president, Sukarno. Yet the
new-born nation was only recognized by the
international community as an independent
country in 1949.
FAST FACT
Bali is one of the thousands of islands that
together constitute the Republic of
Indonesia. Because of its unique features,
Bali has become a primary destination for
tourists from all over the world, who have
chosen to travel to the Asian tropics.
GEOGRAPHICAL
The province of Bali is situated between
80340 - 85048 of the south latitude, and
1142553 - 1154240 of the east meridian.
The west border is marked by Bali Strait,
separating the island from Java Island and
Java Sea while Lombok Strait lies along the
eastern part of Bali, separating the island
from the Lombok island. Then the
Indonesian Ocean and Java Sea each lies on
the south and north of Bali. The mountain
that stretches out from west to east uniquely
divides the island into two.
AREA
The island of Bali is approximately 153 km
wide and 112 km north to south (95 by 69
miles, respectively), with a surface area
of 5,632 km.
POPULATION
Based on 2000 survey on Balis population,
the island had 3,146,999 citizens.
Capital: Denpasar.
People: Balinese (89%), Javanese (7%),
Baliaga (1%), Madurese (1%).
ONE OF THE MOST POPULAR
TOURIST DESTINATIONS IN THE WORLD,
BALI IS OFTEN VOTED AS THE WORLDS
BEST ISLAND BY READERS OF INTER-
NATIONAL TRAVEL MAGAZINES FROM
ACROSS THE GLOBE.
The APEC Publication 2013
Feature / Public Data
Editorial by: Akela Lacy, Diplomatic Courier Contributor
82 theapecceosummit.com
All along the
Watchtower:
Our data is public,
should we get over it?
The APEC Publication 2013
THOUGHT LEADERSHIP
A
LLSTATES SENIOR VICE PRESIDENT of Public Relations Marci Kaminsky
opened the floor at the Newseums Knight Conference Center for a discussion
on Transparency in the New Economy by reassuring the audience that the talk
was planned in advance of the recent privacy debacles concerning the IRS and
the NSA. The irony of the lectures scheduling serves as a reminder that the issue of
privacy in a technology-driven world, although more or less physically intangible, gains
momentum and yields real repercussions for Americans every day.
In a capstone to illustrate the growing importance of the issue of privacy, the headlining
debut of Heartland Monitors 17th quarterly poll disclosed a prevailing discomfort among
Americans about information sharing, as well as the lag time in innovation between
increasingly smarter technology and adequately stringent privacy measures. In presenting
the data, Edward Reilly, global CEO of Strategic Communications at FTI Consulting,
highlighted a key finding of a negative gut reaction to big data among 1000 respondents
surveyed between May 29th and June 2nd of 2013just 4 days before the controversial
release of Edward Snowdens report on the governments PRISM program in The
Washington Post and the Guardian.>
Nusa Dua / Bali. Indonesia 2013 83
technology-privacy relations, Edward Reilly
reviewed the major points from the Heartland
Monitors Poll XVII. Reilly reported findings
of mostly negative reactions to information
collection, and major concern with the amount
and type of information used. Survey questions
aimed to measure whether respondents felt a
positive or negative impact from Big Data;
whether they felt comfortable or concerned
regarding collection of personal information;
and their levels of trust in different institutions
and organizations. Throughout all
categories. older generations exhibited
more pronounced concern.
Considering the explosive response to
recent revelations on the governments PRISM
program, the data interestingly showed sparing
concern among respondents with regard to
phone calls, e-mail, and internet use
respondents ranked this their fourth concern.
Information concerning children was ranked
third; personal financial information second;
and home address and social security number
ranked as top most concerning in regard to
privacy. If Americans were relatively unconcerned
about collection of information shared online
mere days before PRISM became common
knowledge, is our response to revelations about
the program now warranted or nave?
When asked about trust in organizations and
their activity in collection and use of data,
respondents displayed trust in employers, law
The APEC Publication 2013
Feature / Public Data
84 theapecceosummit.com
>A Toolbox for Data Control
Before Reilly presented the headline polling
data, Ronald Brownstein, Editorial Director
at Atlantic Media, facilitated two one-on-one
interviews with the Honorable Jon Leibowitz,
Former Chairman of the Federal Trade
Commission, and Representative Marsha
Blackburn (R-TN). Brown elicited their
perspectives on privacy from two ends of
the debate: that of those who tackle privacy
law-breakers in the FTC, and that of those
who struggle to initially create those laws
in Congress.
Leibowitz focused on the need for
companies to begin designing products that give
consumers more control over their information
from the start, citing Microsoft and Mozilla as
two actors on the frontier of a new competition
in privacy and touting browsers with a default
do-not-track setting. Upon being asked how
organizations and institutions in the world of
digital media can most effectively maintain
customer bases amidst dropping levels of
confidence and increasing sensitivity to
information sharing, Leibowitz encouraged
incorporation of this new privacy-by-design as a
top priority. For the former FTC Chairman, the
commercial sector has more to worry about in
this realm than the government sector, an
observation later supported by the
Heartland Monitors poll data.
Representative Blackburn spoke from a
different end of the spectrum, presenting her
solution to concerns through a Secure IT Act,
which supports added layers of federal security
rather than company-based reform. Straying
from Leibowitzs critique of the middleman
institutional design, she laid responsibility
instead at the feet of consumers and
government actors to not only make responsible
decisions, but also to create meaningful
legislation to protect information from the
outside in. Blackburn continually emphasized
the importance of protecting the virtual you
in the digital world with what she called her
toolbox for data control and privacy,
encouraging the public to understand their
rights and autonomy in forming relationships
and sharing information with certain
organizations, online or not. Blackburn made
an important point that we as individuals have
the power to make choices about whom we
form relationships or share information with,
and to remember these mindful choices when
our information shows up somewhere we
may not have intended it to.
Before PRSIM Revelations, Internet
Monitoring Lowest Concern
After hearing from Leibowitz and Blackburn
on prescriptions for maladies of todays
The APEC Publication 2013
enforcement, and healthcare providersthose
institutions which provide direct services.
Least trusted were media outlets and social
media platforms, while financial institutions,
health insurance companies, cell phone
providers. and the government were trusted
but also perceived as most active in collection
and use of personal data. The IRS notably
fell just outside of this active but trusted
category.
Given the data, it is reasonable to assess that
the country has a solid sense of who has access
to our information and when it is being used.
There are differences in level of concern about
these activities among different generations, but
most everyone agrees that we lack control over
THOUGHT LEADERSHIP
WHATEVER THE MOTIVE,
OUR INFORMATION IS BEING USED
SOMEWHERE, BY SOMEONEAND
WE ARE PARTIALLY COMPLICIT.
them. We are well aware of our own
vulnerability to be collected on when we are
online, but we are ambivalent on whether or
not the added ease of life is worth a breach of
what Marcia Kaminsky called our fundamental
right to privacy. The surveys particular
question on this ease-risk balance actually
revealed a 47/47 percent split among
Americans, with younger respondents leaning
more toward the benefits and older respondents
feeling more threat.
Your Data Being Used
Somewhere, by Someone
We know what is going on when we go online,
but we do not really know if that means we
should change it. Perhaps the most surprising
and maybe even reassuringstatistic of
the day showed an overwhelming 79 percent
of Americans believe that the recent IRS scandal
is only a reflection of a typical or ongoing
practice among various administrations on
each side of the political bar. Only 16 percent
really thought it was a first time occurrence.
It seems that we have a practical tolerance
for a certain level of surveillance at an
organizational level, but a hypersensitivity
to reports of constant collection of mass
data by the government through consumer
services like Verizon and Google. Perhaps
it is the idea of the behavior that scares
us more.
We have though, for the most part, already
objectively come to understand that privacy
can never truly be all-encompassing in todays
reality. Whatever the motive, our information
is being used somewhere, by someone
and we are partially complicit. The question
now rests in our wherewithal to take some
responsibility for what we have already put out
into the public domain, and whether or not the
government will choose balanced parameters
and standards for accountability.
Nusa Dua / Bali. Indonesia 2013 85
The APEC Publication 2013
Feature / Global Unrest
Editorial by: Vahram Ayvazyan, Diplomatic Courier Guest Contributor
86 theapecceosummit.com
Recent public upheavals in Brazil and Turkey; the ouster of
Mohamed Morsi; riots by Muslim Brotherhood supporters in
Egyptit all begs the question: why do people protest?
R
ECENT PUBLIC UPHEAVALS in Brazil
and Turkey; the ouster of Mohamed
Morsi; riots by Muslim Brotherhood
supporters in Egyptit all begs the
question: why do people protest? People tend
to form groups of more developed organisms
societies which have governing bodies. But
today modern societies everywhere are rapidly
maturing both in political and economic terms
everywhere on Earth, and oppression is no
longer good business. The modern individual
is educated enough desire a more reliable
society, and the new middle classes will work
to replace failed government with more
robust ones.
Today, efficacy is the challenge, as Tony
Blair puts it vis--vis recent protests in Cairo.
When governments do not deliver, people
protest, but 17 million people in the street is
not the same thing as an election. However,
it is an incredible manifestation of people
power. I am a strong supporter of democracy,
Blair continued. But democratic government
Why do
people
protest
alone does not guarantee effective government.
When governments do not deliver, people
protest. They dont want to wait for an election.
In fact, as Turkey and Brazil show, people may
protest even when, by any objective measure,
their countries have made huge progress.
It is clear what people in the developing world
want from their governments: better conditions,
good infrastructure, human rights, etc. Brazils
case is particularly interesting, as the country is
the second largest developing economy in the
world after China. However, the Rousseff
administration is failing to improve critical
infrastructure and the business environment. On
the World Banks Ease of Doing Business Index,
Brazil is ranked 130 out of a total of 185
countries. Inflation is on the rise, and the cost of
living is absurdly high for a developing nation.
This isnt Turkey, I dont think well see daily or
even weekly protests in the near future, but with
the election next year and the World Cup, that
could change. People wont lack for reasons to
protest. says Rafael Cortez to TIME.>
The APEC Publication 2013
THOUGHT LEADERSHIP
IT IS CLEAR WHAT PEOPLE IN
THE DEVELOPING WORLD WANT
FROM THEIR GOVERNMENTS: BETTER
CONDITIONS, GOOD INFRASTRUCTURE,
HUMAN RIGHTS.
Nusa Dua / Bali. Indonesia 2013 87
The APEC Publication 2013
Feature / Global Unrest
is no longer tolerating a vertical government-
society structure, and are using technology to
share knowledge and strategies.
It is another question whether people who
protest eventually succeed in their endeavors.
As Sheri Berman explains, The fundamental
mistake most commentators on the Arab Spring
make is underestimating the scale, scope, and
perniciousness of authoritarianism. Tyranny is
more than a type of political order; it is an
economic and social system as well, one that
permeates most aspects of a countrys life and
has deep roots in a vast array of formal and
informal institutions. Change requires time
and a strong will. Years, and even generations,
are required for firm changes in traditionally
non-democratic societies. A new way of
thinking will eventually change not only
the minds of the governed but also of the
govermnent. For a positive large-scale change
in society, a revolution in peoples minds
is a prerequisite.
88 theapecceosummit.com
Biography
Vahram Ayvazyan is a 2012 graduate
of the Genocide and Human Rights
University Program at the International
Institute for Genocide and Human Rights
Studies in Toronto. He can be found on
Twitter @VahramAyvazyan.
>As the populations of developing countries
continue to growing, outstripping the ability of
governments to provide, we are witnessing an
unprecedented increase in demands of their
governments. About 96 percent of population
growth today is occurring in developing
countries, and Asia accounts for 54 percent of
that growth. This growth gives rise to many
tough issues such as employment, delivery of
basic services to citizens, infrastructure, and
education, but it also creates many
opportunities for emerging markets in business,
innovation, and investments. As the population
grows, the emerging middle class also grows,
thus challenging the foundations of old regimes
in developing world as the historically driving
force for sociopolitical and economic reforms.
This population growth has important effects
on global trade. In 2010, emerging markets
represented 36 percent of global GDP, the
majority of global oil and steel consumption, 46
percent of world retail sales, 52 percent of all
motor vehicle purchases, and 82 percent of
mobile phone subscriptions. According to the
International Monetary Fund (IMF), the
emerging markets share of GDP will rise to 55
percent by 2018. The U.S. National Intelligence
Council singled out the growth of this global
middle class from these markets as a tectonic
shift, valued at a $30 trillion market
opportunity by McKinsey. It is an open secret
that economic wealth brings political leverage
with it. For example, by 2020 the number of
middle-class and affluent Indonesians may
double to more than 141 million, so an
Indonesian Spring in near future could
be a possible scenario.
The role of urbanization is highly significant
in forming a general protest mood in
societies. Usually, a large middle classe willing
to protest is found in large cities, as recent
protests in Cairo, Rio de Janeiro, Sao Paulo,
Istanbul, Moscow, and elsewhere will show. A
recent study by Jeremy Wallace of Ohio State
University on the interdependence between
urbanization and regime changes shows that
[f]or the 237 regimes with urban concentration
levels above the mean level in the data, the
mean duration is 8.6 years and the annual
regime death rate is 9.2 percent. For the 198
regimes characterized by low levels of urban
concentration, the incidence rate is only 5.6
percent and the mean duration is 12.4 years.
Regimes with capital cities that dominate the
urban landscape fail nearly four years sooner
and face 60 percent greater death rates.
Information is more accessible to the vast
majority of city dwellers; technological
advancements open new horizons for
innovative ideas; and already-established
infrastructure and transportation ease peoples
movements. That is why the city is the right
place to protest.
Finally, the role of social media and
ICT boom are of paramount importance as
people interact over social media networks. For
example, Twitter users in the Arab world almost
doubled, from 2 million to 3.7 million, in the
past year as Arabic-language tweets ballooned.
With more than 55 million active Arab users of
Facebook and 3.7 million of Twitter, social
media is already playing a growing role in
formal and informal education, on-demand
training, and in-capacity building, said Fadi
Salem, the director of the governance and
innovation program at Dubai School of
Government and co-author of the latest Arab
Social Media Report. The emerging middle class
ABOUT 96
PERCENT OF
POPULATION
GROWTH TODAY
IS OCCURRING
IN DEVELOPING
COUNTRIES.
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The APEC Publication 2013
Feature / Nigerian Oil
Editorial by: Dr. Orji Uzor Kalu, Diplomatic Courier Guest Contributor
90 theapecceosummit.com
W
E HARBOR A BEVY of natural
resources that should draw
reverence in the international
community and earn the admiration of our
esteemed colleagues within the nations of the
BRIC. This would-be envy might even lead to
resentment, were it not for the oft-unspoken
reality that precautions are seemingly in place
at home and abroad to ensure our highest
peaks in sustainable development are not met.
Though there is much to be accomplished
in fortifying our national infrastructure and
in fostering a climate of political unity, crude
oil theft no longer occupies a low rung on
the priority ladder for reform in Nigeria.
This widespread larceny, occurring through
various innovative and even entrepreneurial
methods, collectively tarnishes our GDP as
well as our reputation as an able host for
energy procurement, renement and export.
Today, Nigerian oil is absurdly exported in
crude form from the shores of West Africa,
shipped for distillation and then imported
back to us. One reason why this is the case?
Because today, almost three years since
amnesty was agreed to with Niger Delta
militants, crude oil theft, commonly referred
to as bunkering, is on the rise again. >
The oil
crisis in
Nigeria
As we bear witness to a
steadfast rise of the rest
within the global marketplace,
Nigeria has proven to be
not simply geopolitically
ambitious, but also boasts a
competitive advantage
early in the contest.
The APEC Publication 2013
THOUGHT LEADERSHIP
Nusa Dua / Bali. Indonesia 2013 91
The majority of the theft is on a larger
scale however, when coordinated groups of
workers tap into oil infrastructure, siphoning
crude into barges before transporting the
oil onto larger crafts for rening in volatile
rewood distilleries offshore.
The complicity of security ofcials and
often even executive political authorities
means that there is little will to nd a lasting
solution. Although the government allocated
a portion of the budget to regenerating the
Niger Delta after the amnesty agreement,
many local politicians have not delivered
on their promised jobs, roads, schools and
hospitals. Unemployment has therefore not
fallen and has begotten further poverty
and crime.
President Goodluck Jonathans
administration has pledged to crack down
on oil theft but this ambitious initiative so
too has failed to bear fruit. No sooner is
one hole on a pipeline shut or one illegal
distillery closed down than two others arise
in their place. Over a three-week period, the
Navy blocked 600 illegal distilleries, only to
nd that 400 new ones had been established
around them.
While I do laud the Joint Task Force (JTF)
and indeed the current administrations
own efforts to deal with oil theft, I believe
that we will continue to see limited success
in the ght until we secure the support of
forward-thinking international businesses,
business men and women that have the
innovative minds to realize that Nigeria
presents unprecedented opportunities that
are, yes, complex, but at the same time,
too worthwhile to pass up as a result of
misplaced fears or stereotypes.
But there is another viable solution to
prosperitybuilding a major renery industry
in-country is vital for Nigerias future.
Many would challenge the notion that
Nigerians can together foster an infrastructure
conducive to deterring corruption, adhering
to best practices and effectively rening
autonomously. However, I am an example
of but one entrepreneur who was able
to succeed by staking his bets not on
what most people do but rather on the
right thing to do.
If we rened our own oil we would not
be at the mercy of import prices and fuel
subsidy scams. If neighboring communities
were regenerated we would reduce criminal
activity. If people had jobs they would
not be stealing.
Nigeria has two reneries in the Port
Harcourt area, for example, but neither runs
close to full capacity. And whilst I support
steps undertaken by everyone interested in
investing in rening my own SLOK Group
are currently exploring options - I am
aware that similar efforts have been wrecked to
protect the interests of powerful fuel importers.
It is a scandal that, for all of these reasons,
our nation has to import more than three-
quarters of its own fuel despite being the
continents biggest producer, serving to
douse the hopes of many for a new
Nigerian century.
If we fail to invest in our rening sector,
if we fail to effectively deter massive theft,
if we fail to provide jobs and if we fail to
advance our local communities then we will
only increase insecurity in the Delta region
and perpetuate Nigerias reputation as a
nation abundant in potential however
mired in mismanagement.
The APEC Publication 2013
Feature / Nigerian Oil
92 theapecceosummit.com
>Shell, the biggest operator in the region,
has said that Nigeria loses over $1.6billion
annually to oil theftthat equates to
approximately 150,000 barrels per day stolen
from Nigeria. The international ramications
are indeed immediately obvious; earlier
this year, increasing oil thefts prompted
multinational corporationsincluding Shell,
AGIP and Enito close down outright in
certain parts of the country.
Although the illegal reners only make
up for a small portion of the theft, their
environmental impact is also vast. The
destructive methods of the thieves have
helped to further ruin shing habitats and
contaminate water and arable lands already
degraded by decades of oil production
in the area.
SHELL, THE BIGGEST OPERATOR IN
THE REGION, HAS SAID THAT NIGERIA
LOSES OVER $1.6BILLION ANNUALLY
TO OIL THEFT.
For those who havent been to
Brisbane for a few years or are yet to
visit, allow me to introduce our city:
Brisbane is Australias new world city
- unashamedly ambitious, embracing
the digital age and hot-housing an
entrepreneurial culture.
Unburdened by pretension or an
age-old history that can weigh down
traditional mega cities, Brisbane is
synonymous with opportunity.
Were the closest Australian capital
city on the eastern seaboard to Asia
and weve set a course to become
an economic powerhouse in the Asia
Pacific Region. We were recently
named one of the Top 10 Asian Cities
of the Future by the London Financial
Times fDi Magazine.
In fact, were regularly singled out as a
city to watch with our optimal location,
growing depth of talent, innovation and
diverse economic growth potential.
Brisbane is a major hub for large resource
and energy companies, a significant
centre for research and innovation, and
the engine room of much of Australias
continued economic growth, in defiance of
the global downturn of the past five years.
The 2013 World Bank Doing Business
Annual Report, named Australia one of
the most business friendly countries
in the world and Brisbane was recently
rated as on par with Zurich and Moscow
as a global innovation leader as part of
the 2thinknow Innovative Cities Index.
Our investment opportunity growth
industries include: biotechnology,
aviation, food and agribusiness, hotels,
manufacturing and construction.
Brisbanes population of two million is
on the rise. With one in four residents
born overseas and a median age of 35,
we are a young, innovative, bold and
multicultural city.
Our $US118 billion economy is
predicted to almost double to $US223
billion by 2031.
Highly-qualified professionals are our
workforces largest single employment
category. Many investors are attracted
by the quality of our skills-base and
our world-class universities, including
The University of Queensland
which regularly rates in the top 100
universities in the world.
Over the past 10 years Queensland has
pursued a research and development
agenda that has driven hundreds
of millions of dollars of investment
in the research sector and allowed
the creation of significant research
institutes attracting prime talent.
The work of their scientists and
researchers is further bolstered by
several new science precincts that have
attracted international collaborations
from industry and research institutes.
Brisbanes three major universities
have important international research
links across areas including climate
change, developing treatments for
cancer and other diseases, clean coal
technology, nanotechnology, renewable
energy, infrastructure, emergency
services, community development, the
environment and agriculture.
Many of the 72,000 international
students who attend Brisbane
institutions each year stay on
to embrace local employment
opportunities.
We enjoy an enviably relaxed lifestyle
in a sub-tropical climate with year-
round sunshine, the world- renowned
beaches of both the Gold and Sunshine
Coast within an hours drive south and
north and the Great Barrier Reef within
our state of Queensland.
Brisbanes lifestyle and international
appeal is enriched by a burgeoning
local arts and music scene.
Our South Bank precinct includes the
southern hemispheres largest gallery
of modern art: GOMA as well as our
world-class Brisbane Convention and
Exhibition Centre.
We are a city with a lifestyle obsession,
global ambitions and a contagious
energy and entrepreneurial spirit that
lubricates the business environment.
This, coupled with a single local council
that governs the entire city and a
strong economic development focus,
is giving Brisbane a bright glow on the
international radar.
Brisbane is casual but caring,
progressive but green, successful but
unpretentious.
We cant wait to show you around.
Australias new world city ready
to welcome you in 2014
By the Lord Mayor of Brisbane, Graham Quirk
Australias sub-tropical capital, Brisbane,
is looking forward to throwing open its doors
to the world at the 2014 G20 Leaders Summit.
BRISBANE FACTS

Brisbane is Australias New World City,
with a $US118 billion economy.

London Financial Times fDi Magazine
named Brisbane is one of the
Top 10 Asian Cities of the Future.

Brisbanes economy benefits from
a strong mining and energy sector,
servicing many countries with coal
and other commodities.

Brisbanes economic growth is fuelled
by a competitive base for doing business,
trade and innovation.

A population of 2 million call Brisbane
home with a median age of 35.

Brisbane is a multicultural society with
one in four residents born overseas.

The population is expected to reach
3.9 million by 2056.








G2 0 LEADERS SUMMI T
Brisbane, host of 2014s gathering of world leaders.
CHOOSEBRI SBANE. COM
With 4000 delegates converging on Brisbane for the
worlds premier forum of global economic cooperation
in 2014, the stage is set for collaborative decision-
making and what a stage it is. Brisbane has a unique,
natural beauty, sub-tropical climate, state-of-the-art
facilities and recent infrastructure growth, making it
an attractive place to do business. Cultural attractions
abound and a welcoming multicultural society makes
this new world city the ideal place for business leaders
to make decisions that affect the world.
The APEC Publication 2013
Feature / Trans Pacifc Partnership
Editorial by: Ryan Burkhart, Diplomatic Courier Contributor
96 theapecceosummit.com
TPP has become the capstone of the U.S. rebalance
to the Asia-Pacifc and will be the largest free trade
agreement (FTA) in the world.
I
N LATE 2009, U.S. President Barack Obama
announced the United States intention to
participate in the Trans Pacific Partnership
(TPP) negotiations. The TPP has become
the capstone of the U.S. rebalance to the
Asia-Pacific and will be the largest free trade
agreement (FTA) in the world. The TPP will
set a new a standard for FTAs and consists of 11
member states. However, the worlds second
largest economy, China, has not been a part of
the negotiations. There have been voices calling
for Chinas inclusion and also exclusion. After
the informal U.S.-China summit in Sunnylands,
both leaders recognized the need for continued
cooperation and economic integration. But is
the time right for China to join the talks? Both
the U.S. and China have goals and objectives
that will prevent China from joining the TPP in
the short term, but both countries should strive
for further trade liberalization and economic
integration.
The 17th round of TPP negotiations
concluded in May and the 18th round has been
for late July 2013. According to a Congressional
Research Service (CRS) Report for Congress,
U.S. negotiators describe and envision the TPP
as a comprehensive and high-standard FTA that
aims to liberalize trade in nearly all goods and
services and include commitments beyond
those currently established in the World Trade
Organization (WTO). U.S. representatives
intend the rules being negotiated to be more
rigorous than similar rules in the WTO. TPP
negotiations include controversial rules that
cover intellectual property rights, regulatory
coherence, environmental standards, labor,
and state-owned enterprises. If agreed upon
and implemented, there will be majoring
restructuring of economies by some
member states.
The TPP is central to several strategic U.S.
goals. Primarily, it is the manifestation of the
Obama Administrations rebalance to the
region and could undergird the existing security
alliance structure in the Asia-Pacific. Also, the
The U.S., China,
and the Trans
Pacifc Partnership
The APEC Publication 2013
THOUGHT LEADERSHIP
GIVEN THE
U.S. PREFERENCE
FOR QUICK
COMPLETION, IT
WOULD BE UNWISE
FOR CHINA TO
ATTEMPT TO
JOIN AT THIS
LATE STAGE OF
NEGOTIATIONS.
TPP allows the U.S. to play a major role in
developing new rules on emerging trade issues,
across the rapidly developing region.
After Tokyo announced it would join the TPP
trade talks, Beijing indicated it would study the
possibility of joining as well. Beijing is at an
immediate disadvantage of joining simply
because of how many negotiations have already
occurred. Of the 29 chapters being negotiated,
many have been agreed upon by the U.S. and
other member states. Much of the TPP talks
have occurred behind closed-doors. Also, the
U.S. hopes to conclude the TPP by the October
2013 APEC summit in Indonesia. Given the U.S.
preference for quick completion, it would be
unwise for China to attempt to join at this late
stage of negotiations. China cannot make an
accurate assessment of the immediate and
potential wide-ranging impact of the TPP.
After the disastrous effects of shock therapy
economic policies in the Former Soviet Union
(FSU) states, the Chinese Communist Party
(CCP) decided that slow and gradual reform
economic reform was the best bath for China.
Once again, the TPP will be a high standard
FTA. TPP negotiated issues such as regulatory
coherence, state-owned enterprises, labor
issues, and intellectual property would have
a huge effect on the economy. Further, lowering
trade barriers will expose nascent Chinese
industries to global competition. However,
these standards should be an economic
goal for Chinese leadership.
After completing domestic reforms to join the
WTO, China experienced enormous economic
success. China has been active in creating and
joining many FTAs, but none will have the
vertical and horizontal cross-cutting rules the
TPP could have. However, domestic economic
and trade liberalization will be necessary.
Chinas involvement in the TPP would
similarly create many opportunities.
China does have political reasons not to join
the TPP. First of all, much of the rules and
regulations would benefit American companies.
Also, many prominent voices in China perceive
the TPP as an American effort to contain
Chinas rise.
After the shirtsleeve summit, both U.S.
and Chinese leaders recognized that cooperation
is extremely necessary for the future of
Sino-American relations. Some have even
called for increased economic integration in
order to create mutually assured economic
destruction. Regardless, the U.S. should be
transparent as possible with the TPP and invite
China to observe the next round of talks.
Furthermore, Chinese leaders should prime
their economy to eventually join the TPP or
similar trade agreement in the future.
Nusa Dua / Bali. Indonesia 2013 97
APEC Thought..pdf 2013.9.5 5:1:55 PM

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