This challenging scenario is a time for APEC economies to relook the trade policy response to ensure that it supports health systems across the region.
Taking into account that the trade policy is a tool for fighting the pandemic, Director of the APEC Policy Support Unit Denis Hew suggested that it is time for countries to lift export bans and lower barriers on medical goods.
"Saving lives is, of course, the most pressing priority right now. Finding innovative economic solutions to this dilemma cannot wait until the lockdowns are lifted and the health crisis abates," Hew noted in a written statement issued by the APEC Policy Support Unit and received here on Thursday.
The private sector has urged APEC to do more. In late March, the APEC Business Advisory Council, representing Asia-Pacific’s business community, wrote to Prime Minister Muhyiddin Yassin of Malaysia, the APEC chair for 2020, to seek region-wide collaboration to combat the health impacts and mitigate the economic consequences of the pandemic.
The business community called for multilateral action to help contain the spread of COVID-19 through driving information exchange, aligning health systems, and enabling travel for essential health workers to the required locations.
"Notably, the council pointed to gaps in the trade policy that, if addressed, would greatly contribute to managing the health crisis. They highlighted that restrictions still exist in terms of the export of medical equipment, medicines, and basic protective items, which are both critical and in severe shortage," Hew explained.
To this end, he believes that it may now be an opportune time for economies to consider eliminating or reducing tariffs on life-saving products, including face masks, hand soaps, sanitizers, and other personal protective equipment.
APEC represents 40.8 percent (US$404.5 billion) of the global import value of these essential medical goods and 28.8 percent (US$271.8 billion) of the global exports. More importantly, APEC economies occupy several of the top spots on the lists of importers and exporters of these items.
Such sector-specific tariff reductions are not new to APEC. Employing the ground-breaking APEC environmental goods initiative as a model, members could agree to an APEC-wide standstill and eventually phased elimination of all tariffs on such vital medical goods.
Furthermore, recognizing the role that APEC can play in this crisis, economies could commit to refraining from implementing trade-restrictive measures on such products even after the pandemic abates and maintain open supply lines.
APEC has been known to be an incubator of innovative good ideas that have influenced other multinational bodies — its environmental goods initiative, for instance, eventually figured into discussions in the World Trade Organisation (WTO).
Such a timely and life-saving trade liberalization initiative would send a positive signal to the rest of the world and contribute in steering the global response to the pandemic in the right direction. Related news: APEC faces output loss of US$2.1 trillion owing to COVID-19
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