BASC Newsletter Fall 2007 BASC NEWS Getting past the teenage yearsAPEC

Like many confused teenagers, the Asia-Pacifi c Economic Cooperation (APEC) has wrestled with its raison d’etre. Should it continue to set aspirational goals that make it feel good but that have little chance of success? What kind of relationship should it have to older and younger institutions? And can it develop a healthy routine that allows it to succeed, but which isn’t very glamorous? Setting high aspirations is an essential part of growing up. In 1994, APEC decided on the Bogor goals of complete free trade and open investment in the Asia-Pacifi c by the year 2020 for all members and by 2010 for developed economies. But when it set these goals, APEC failed to provide a clear timetable or mechanism to achieve them. As corporate leaders know, setting a clear goal is important for developing a distinctive corporate culture. Yet such leaders also know that competitive success cannot come from having lofty aspirations or from short-term tactical thinking. Rather, corporate strategy entails developing a clear understanding of market positioning, an understanding of one’s competitive advantage, and a plan to organize oneself to execute strategy. In APEC’s case, every year has brought new issues to the forum. The latest are global warming and a Free Trade Area of the Asia Pacifi c (FTAAP). With respect to emissions, although leaders of APEC economies acknowledge that no real targets will be set, most have heartily endorsed some type of statement. Yet when the leading greenhouse gas emitters enthusiastically talk of a declaration on global warming—but are either exempt from the 1997 Kyoto Protocol or have refused to sign it—one might be forgiven for being slightly skeptical of their motives. The idea of a statement on an FTAAP again fi ts the aspirational approach. As the leaders of all major economies realize, and as a joint After APEC’s 18th birthday in Sydney, what will adulthood bring? Fall 2007, Volume 10 BASC News