In this webinar, Dr Denis Hew and Dr Akhmad Bayhaqi discussed findings from the latest APEC Regional Trends Analysis (ARTA)—the flagship publication of the APEC Policy Support Unit (PSU). With Dr Jayant Menon as discussant.
SINGAPORE APEC STUDY CENTRE WEBINAR
Thursday, 15 July 2021 – The APEC Policy Support Unit (PSU) recently published the latest (May 2021) version of its flagship publication – the APEC Regional Trends Analysis (ARTA). The report not only sheds light on the COVID-19 induced growth contraction in the region in 2020, but also highlights a number of ways to aid the economic recovery process, while offering insights on future uncertainties facing the APEC member states. To discuss the findings of the publication in greater detail, the Singapore APEC Study Centre at the ISEAS – Yusof Ishak Institute organised a webinar titled “Asia-Pacific Economic Cooperation (APEC): Making Recovery Inclusive, and Bolstering Supply Chains” featuring Dr Denis Hew (Director of PSU) and Dr Akhmad Bayhaqi (Senior Analyst at PSU) as the key speakers. Dr Jayant Menon (Visiting Senior Fellow at ISEAS) was the main discussant.
Dr Denis Hew began his presentation by underscoring the better-than-expected but uneven growth pattern observed in APEC economies last year. While the overall contraction stood at 1.9 per cent, a few members were able to return to positive territory by the end of 2020 and others plunged deeper into recession. Based on the latest estimates, an economic recovery of 6.3 per cent is expected in 2021, with moderate growth in 2022-23. The rebound can be attributed to: 1) rise in trade and economic activity; 2) pent-up demand; 3) increase in vaccination rates; and 4) continued fiscal and monetary support measures. The pace of recovery will vary across the region and among different sectors, with inflationary pressures expected to remain manageable, Dr Hew added.
In order to manage the uncertainties arising from COVID resurgence, it is important to focus on inclusive strategies, including: 1) higher and sustained public health spending; 2) greater investment in human capital development and digital transformation; 3) renewed emphasis on green investments and technology; and 4) greater commitment towards regional cooperation.
Directing the audience’s attention to the specific ARTA chapter on supply chains, Dr Akhmad Bayhaqi presented some important statistics on how the pandemic has disrupted global production networks through a “ripple effect”. Given that APEC represents 60 per cent of global manufacturing hubs, COVID-19 has necessitated that firms coordinate and supervise complex production activities from a distance. Once the crisis subsides, APEC economies must invest together in developing resilient supply chains that are: 1) robust; 2) agile; and 3) flexible. This can be done by modifying the supply chains through re-shoring and near-shoring, just-in-case inventory management, and improving visibility.
On the topic of enhanced regional cooperation, Dr Bayhaqi mentioned that all countries in the grouping should: 1) promote digitalisation and supply chain visibility; 2) improve trade facilitation; 3) redouble structural reform efforts; and 4) boost regional cooperation on trade, connectivity and economic openness.
Carrying the discussion forward, Dr Jayant Menon shared recent figures related to the impact of the pandemic on APEC economies. Like Dr Hew, he too pointed out the uneven growth forecasts for ASEAN and its major trade partners in APEC. The silver lining, however, was that Asia’s trade in 2020 had fallen less than global trade due to strong demand in health supplies and electronics.
Through a series of questions, Dr Menon then explored a number of key issues such as: the effect of prolonged economic shutdowns; the rise of anti-globalisation sentiments; the importance of self-reliance, particularly in key sectors; and old and new geopolitical challenges facing global economies.
The webinar was 90 minutes long, and was attended by an audience of 81 people, including research scholars, students, policymakers and the general public. The speakers also answered their questions on an array of topics, including: the pandemic impact on services trade; digital transformation strategy for developing economies; expected outcomes from the APEC leaders meeting in July; and investment strategies for supply chain resilience.