Philippine treasurer asks finance officials from Asia-Pacific economies to endorse Cebu Action Plan
A Philippine official yesterday encouraged Asia-Pacific Economic Cooperation (APEC) ministers to endorse the Cebu Action Plan and cited the factors that can make it a viable roadmap to make the region more financially inclusive and resilient.
National treasurer Roberto B. Tan emphasized the importance of advancing financial integration, enhancing fiscal reforms and transparency, creating means to safeguard economies from natural disasters, addressing the need for more infrastructure developments and stressing the private sector’s key role in implementing these infrastructure developments.
These are the pillars of the Cebu Action Plan, a 10-year roadmap that is expected to be launched at the APEC Finance Ministers’ Meeting today at the Shangri-La’s Mactan Resort and Spa.
Tan said financial integration is seen as a viable vehicle that drives an intensive intra-regional trade and investment.
“We will discuss how we can forward financial integration in the region to make economic growth more inclusive,” Tan said during his opening speech yesterday.
He cited the 57 percent global production of the region, which is fueled by the region’s strong trade and investment linkages across the APEC-member economies.
He also said that intra-regional trade between APEC economies is estimated to be 46 percent of the world trade today.
He said advancing financial integration can help boost more trading activities in the region.
“For example, the geographical fragmentation of the supply chain presents vast opportunities for SMEs (Small and Medium Enterprises) to increase participation in the regional and global trade. Lowering the cost of sending remittances and expanding financial literacy also promotes financial integration,” he said.
The importance of fiscal reforms and transparency was also emphasized to increase the economic gains of the region.
“We will discuss how we can plug the holes in the proverbial leaky fiscal bucket and how we can manage fiscal resources more efficiently. Fiscal reforms and transparency will not only help ensure fiscal sustainability but will also make fiscal policy more effective, efficient and responsive,” Tan said.
INFRA PROJECTS
Aside from that, Tan also touched on the need for more infrastructure projects to support the target economic growth in the region and the private sector’s role to unlock finance for infrastructure developments.
“While our growth has also come with unprecedented infrastructure developments, there are still significant gaps. The ADB (Asian Development Bank) estimates that the region needs annual financing of $800 billion for infrastructure development,” he said.
He cited the public-private partnership mode of financing as a viable option for these projects.
He, however, said that it is also important to identify “bankable” projects and develop capital markets.
“As we have a final version of the Cebu Action Plan, we take stock on the gains of our common efforts and we also reflect on the strategies and long-term issues. First, we consider how the region can take advantage of opportunities to sustain and support the robust economic growth and how the region can address challenges that may undermine our gains,” he said.
Another important factor in the Cebu Action Plan is the creation of safeguards for economies against shocks to fiscal resources from natural disasters and other unpredictable events.
He said this is important because of the particular risk to disasters and natural calamities of APEC members due to their location along the Pacific Ring of Fire.