New Economy does not obtain in economies where an open, frank and transparent stocktaking of policies is impossible. Policy reform and wise dispersal of limited funds for policy transformation would be aided by a more open cataloging and assessment of progress toward reforms in the four policy domains. Capacity building should reflect the imperative of making coherent progress on all policy domains concurrently. Aid agencies and organizations within and outside the APEC region might consider whether their outlays support reform in the policy domains that this Report illuminates. The New Economy is all about transformation.
Policies that ensure that the domestic environment is conducive to transformation and that individuals and businesses can take advantage of new opportunities are crucial. It is a big task to review these policies of adjustment—indeed worthy of another report. But this Report recognizes that policies to promote domestic adjustment are complementary and mutually supportive to policies that support the New Economy. Within the domain of trade and cross-border investment: The productivity gains promised by the New Economy depend in part on effective participation with the global economy. The technologies that underpin the New Economy have global origins and global reach.
Therefore, policies of trade and cross-border investment have immediate importance. Research suggests that reform and liberalization, particularly of services (telecommunications, financial sector, and distribution and logistics), are key to gaining the benefits of the New Economy. The absence of a multilateral trade round has undermined the climate for further collective liberalization in recent years. The findings in this study suggest that if APEC were looking to help prevent the widening of the productivity-related digital divide in the region, then promoting broader services liberalization and reform would be the best way.
Were APEC to endorse wrapping WTO’s “built-in agenda” for agriculture and services into a broader agenda for a New Round that includes complete liberalization of manufactures and extensive liberalization of cross- border investment, it would equal or surpass the value APEC provided in catalyzing the Information Technology Agreement. 2 Within APEC, because the incomplete fulfillment of existing commitments challenges further liberalization, the APEC forum should extend the institutionalization of transparency, monitoring, and assessment of commitments (e.g. e-IAPs and more extensive review as broached by members at SOM II/2001), which would support further liberalization.
This is a specific example of the policy catalog and stock-taking noted in general above. 2 The Report repeatedly argues for the reform and liberalization of services in this Report. This is not to imply that services are more important than goods in the New Economy. Rather, this emphasis reflects the fact that the benefits of open goods trade are already being realized in the world economy to a great, though incomplete, extent, whereas services opening is more incomplete. - 6-