This week Peru will receive the leaders of world powers, including the presidents of the United States, Joe Bidenand from China, Xi Jinpingas well as the heads of international institutions, such as Kristalina Georgievadirector of the International Monetary Fund. All this within the framework of the summit of the Asia Pacific Economic Cooperation Forum (APECfor its acronym in English).
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Although the 21 economies of APEC They work around three pillars, which are trade and investment liberalization, business facilitation, and economic and technical cooperation. In 1994, they established the Bogor Goals for the facilitation and liberalization of trade and investments. The deadline to meet these objectives was 2020.
Later, in the year of the pandemic (2020), the leaders of this group approved the so-called Vision APEC of Putrajaya 2040, which has three thematic axes: trade and investment; innovation and digitalization; and solid, balanced, safe and inclusive growth.
TRADE
The first of these axes is related to guaranteeing that the block Asia-Pacific continue to be the most dynamic and interconnected regional economy in the world. In that sense, its members are committed to working to achieve a free, open environment, where there is no discrimination. Furthermore, there is an agreement to respect the rules of the World Trade Organizationor (WTO) with the aim of achieving properly functioning multilateral trade that promotes the stability and predictability of international trade flows.
The former Minister of Foreign Trade and Tourism Juan Carlos Mathews He pointed out that this is the axis where Peru registers the greatest progress. It should be noted that, according to Mincetur data, Peru’s trade exchange with APEC member economies increased more than 10 times from 1998 to 2023, the year in which this bloc represented 67% of our country’s trade exchange with the world.
Only between January and August of this year, Peruvian exports to the forum countries amounted to US$30,901 million. Among the shipments that stood out for their growth in that period are silver concentrates, fish meal, natural gas naphtha and gold. In agriculture, sales of cocoa beans, coffee and blueberries stood out. Meanwhile, imports in the eight months amounted to US$20,927 million, mainly due to greater purchases of goods, such as crude oil, polymers, cell phones and flat steel.
“Of the 21 economies that make up APECwe have free trade agreements (FTA) with 14 of them and we are negotiating two more. This incorporates the priority of the issue of trade, the flow of tourism and the flow of investments as well. Progress is being made in that direction and Peru is always putting particular focus on this point,” he highlighted.
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INNOVATION
The innovation axis, as it is aimed at empowering people and companies to grow in a global and interconnected economy. According to the Putrajaya Vision, what will be fostered is an enabling environment that is market-driven and supported by a digital economy. In that sense, the agreement is to implement structural reforms and solid policies to promote this issue and improve productivity and dynamism.
There is also a commitment to strengthen digital infrastructure, reduce the gap and reinforce trust. Jorge Conde, director of the Innova ULima Entrepreneurship Center of the University of Lima, stated that one of APEC’s proposals to reduce the gap in innovation and digitalization is to improve digital connectivity, generally based on 5G, but in Peru there is still a pending job.
“In Peru there is the national fiber optic backbone network which, despite receiving an investment of more than US$700 million in 2022, still shows relatively slow growth and deployment, especially compared to countries like Brazil and Mexico,” he commented. .
Likewise, he pointed out that it is key to promote innovation through public research and development (R&D) policies. Currently, he specified that Peruvian investment in this matter is only 0.15% of the Gross Domestic Product (GDP), when the average in Latin America is 0.6%.
“The push for digital education has been one of the key areas of improvement in Peru. Initiatives such as the creation of the PerúEduca platform have represented progress by centralizing digital educational resources for students and teachers. However, this platform faces limitations in rural areas, mainly due to the poor connectivity that we already mentioned,” he added.
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ECONOMY
Within the axis of solid growth, it is proposed to guarantee that the region is resistant to crises, pandemics, among other shocks, so that benefits are provided to people and micro, small and medium-sized businesses. The need to promote economic, cooperation and growth policies that support global efforts to address all environmental challenges that arise is also established.
The former vice minister of Economy Carlos Casas considered that, although in Peru there has been progress in macroeconomic strengths and institutionality has been created, as well as a culture of respect for macro balances, this has not been enough to strengthen growth.
“What has been missing is the development of institutions and greater reforms that seek to improve the competitiveness of the economy, which is what creates sustained growth. This is a process of continuous improvement that should never end,” he assured.
However, he warned that in the country it was believed that everything had been achieved in economic matters, which caused this perception to now become the main limitation to growth.
“We are not late yet, but the effort, as time goes by, will have to be greater. Reforms in the State, input markets, effective policies to improve competitiveness and the development of institutions are key to returning to balanced growth,” Casas highlighted.
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