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Sculptures seen on the street before the 31st Asia-Pacific Economic Cooperation Economic Leaders' Meeting on Nov. 12, 2024 in Lima, Peru.
Viewpoint: What to expect from this year’s APEC
Global leaders are descending upon Peru this week for the 2024 Asia-Pacific Economic Cooperation Forum amid an increasingly conflict-ridden world — and just a week after American voters reelected Donald Trump to the US presidency. The year’s meetings are focused on critical economic and environmental challenges, as well as the need to bolster bilateral and multilateral ties in the Asia-Pacific region. With outgoing President Joe Biden meeting up with Chinese President Xi Jinping at APEC, GZERO reached out to Eurasia Group expert Gabriela Vasquez Madueno for her take on what to watch at the event.
What is APEC, and why does it matter?
The Asia-Pacific Economic Cooperation, a forum of 21 economies from across the Pacific Rim focused on promoting sustainable economic growth, trade, and investment in the region, is convening its Leaders’ Meeting this week in Peru. The gathering brings together economies that represent nearly 40% of the world’s population, almost half of global trade, and approximately 60% of global GDP.
While APEC’s formal economic impact remains limited, it is still significant as a platform for diplomatic engagement and bilateral and multilateral cooperation. It provides space for growing economies such as Indonesia and Mexico and major powers like the United States and China to engage and collaborate on issues ranging from climate change and sustainable development to the digital economy.
APEC takes a consensus-based approach, which means all members have an equal voice, and it relies on voluntary commitments and capacity building – rather than treaties – to achieve its goals. So, again, its impact remains limited. APEC, however, is a useful forum to build consensus on topics that may, in the future, become binding commitments in other fora or in trade agreements. It’s also worth noting that APEC is one of few multilateral forums, apart from the WTO, where Taiwan is recognized as a separate economy. This unique status allows Taiwan to participate in global economic discussions and engage with other member economies, including China.
What are the themes for this year’s APEC meetings?
This year’s theme, “People, Business, Prosperity,” focuses on finding innovative solutions to the region’s most pressing challenges. Resilient growth has been a priority. The summit this week aims to promote inclusive and interconnected growth, address the informal economy by utilizing digital platforms for better economic integration, and prioritize resilient growth in the face of global challenges like climate change and food security.
Members are working to facilitate trade and investment in the region by contributing to the development of the Free Trade Area of the Asia-Pacific agenda. They have also defined low-carbon hydrogen policy frameworks to support regional energy transitions and initiatives to prevent and reduce food loss and waste. Participants are putting forward several initiatives to promote sustainable and resilient finance, as well as an exchange of policies aimed at utilizing digital platforms to integrate the informal economy and boost economic integration.
What are the main challenges of APEC?
The recent US election and the pending potential shift in foreign policy under Donald Trump has cast a long shadow on proceedings this week. As such, the US has taken a less active role in the present APEC event, as the next administration will prioritize bilateral discussions over multilateral ones. There will be little room for further integration considering the change of administration, as it is believed the Trump administration will prefer negotiating directly with individual states, rather than working through regional groups. Also, Trump’s threat of tariffs will cause APEC economies to fret.
This future shift creates uncertainties within the forum and potentially undermines its effectiveness in the coming years.
Additionally, the growing geopolitical rivalry between the US and China further complicates discussions and potentially impacts the overall agenda. Other member economies are finding themselves caught in the middle, forced to navigate the competing interests of these two major powers. Beijing, for its part, will use the summit to build its attraction among non-US member countries, some of which are feeling anxious about a Trump presidency, by offering unilateral concessions over tariffs and visas, among other measures.
So this event is a crucial test of the prospects for regional cooperation and global economic stability given today’s geopolitical tensions.
What to watch from this year’s APEC
The 2024 APEC Economic Leaders' Week is hosting several significant bilateral and multilateral meetings. Key leaders, including US President Joe Biden and Chinese President Xi Jinping, are going to be on hand for the event. Biden and Xi are set to meet at APEC, a White House source said Wednesday, and both men will then head to Brazil for the Group of 20 summit.
Xi’s inauguration of the $3.5 billion Chancay port – the largest project China has invested in Latin America in recent years – during his visit to Peru reflects China’s presence in the region. This poses a challenge for the White House in South America, where China's geopolitical influence has continued to grow. Xi, with Trump 2.0 looming, will likely emphasize Beijing’s ability to serve as the region’s free-trade champ, presenting China as a counterweight to the tariff controls being threatened by Trump.
All eyes will be on any potential meetings or informal conversations between US and Taiwanese officials, particularly between US President Joe Biden and high-level representatives from Taiwan, such as the head of TSMC.
In addition to political leaders, several prominent CEOs are in attendance at APEC. These include Jamie Dimon of JPMorgan Chase, Karan Bhatia of Google, and Shou Zi Chew of TikTok. The latter’s presence is particularly interesting given the ongoing risk of being federally banned in the US because of its resistance to selling itself.
We’ll be watching for any major developments or announcements from APEC – and for signs of the forum’s potential strength in the years to come.
Ecuador's President Daniel Noboa looks on as his wife Lavinia Valbonesi (not pictured) takes part in a referendum that asks voters to support mostly security-related questions to fight rising violence, in Guayaquil, Ecuador April 21, 2024.
Ecuador votes to get tough on drugs
Ecuadorians showed overwhelming support for a government crackdown on drug-related violence in referendums this weekend in what could become a regional trend. Quito won support for joint police-military patrols, extradition of wanted criminals, tighter gun control, and tougher punishments for murder and drug trafficking, among other measures.
Cocaine boom: Ecuador had long maintained a reputation for tranquility despite being sandwiched between the major cocaine production hubs of Colombia and Peru. Coke is in the midst of a major resurgence, according to the UN Office on Drugs and Crime, with seven straight years of growing use.
Consequently, traffickers are trying to ship more blow than ever to the US, and increasingly doing so through Ecuador’s conveniently located ports. With the drugs come weapons, money, and violence, tearing at the social fabric. In August of last year, presidential candidate Fernando Villavicencio was assassinated after receiving death threats from gang leader Jose Adolfo Macias, who later escaped prison.
Iron fist: Ecuador is far from alone in experiencing a surge in drug violence, and leaders in Latin America are looking at Salvadoran President Nayib Bukele’s “mano dura” (iron fist) crackdown as an example.
“Ecuadorian President Daniel Noboa took from the Bukele playbook in realizing that citizens are open to more draconian type measures,” says Eurasia Group associate Yael Sternberg, though she emphasized that the actual policies and problems are different.
If it pays off for Noboa like it has for Bukele, Sternberg says Chile is the country to watch next, with a growing crime issue and elections next year.
Oscar host Jimmy Kimmel appears on a billboard in Hollywood as preparations continue for the 96th Academy Awards Awards Los Angeles, California U.S., March 6, 2024.
Hard Numbers: Oscars go global, Congress does its job, Peru revives the Senate, Mauritania gets migration money
460,000,000,000: The House of Representatives on Wednesday passed a $460 billion spending bill, which is expected to clear the Senate in time to avoid a partial government shutdown this weekend. The bill keeps about a quarter of the government running through September, and legislators will now turn to the lion’s share of federal spending, which must be passed by March 23.
60: Peru will elect 60 new Senators after legislators passed a bill reviving the institution some 30 years after President Alberto Fujimori dissolved it and rewrote the constitution. Half the body will be elected by individual districts, while half will run nationwide races in elections scheduled for 2026.
210,000,000: The European Union has signed a €210 million ($229 million) deal with Mauritania that includes funds to prevent irregular migration from the Saharan nation into Europe. The money will help Mauritania patrol its waters for vessels carrying migrants to Spain’s Canary Islands and is part of a larger EU effort to work with African countries in tackling migration.
Ships are anchored near the construction site of a new Chinese mega port, in Chancay, Peru, as seen here in August 2023.
Hard Numbers: Chinese mega port to open in Peru, Bitcoin funds debut with a bang, Femicide alarm raised in Kenya, Germany’s East-West gender gaps
3.5 billion: A $3.5 billion Chinese state-owned port is set to open in Chancay, Peru, later this year, giving Beijing a direct gateway to Latin America’s bounteous natural resources – and cementing its status as the region’s largest trade partner. The port is expected to handle major volumes of copper and soy, and it could reduce shipping times to China by as much as two weeks for some of the region’s exporters.
1.9 billion: In the first few days after US regulators approved exchange-traded funds linked to Bitcoin, investors poured $1.9 billion into the new funds. The ETFs give people exposure to Bitcoin without having to actually own any. Some analysts think that as investor confidence in the funds grows, they could attract as much as $100 billion by year’s end.
4: At least four Kenyan women were killed in the first three weeks of the year, with at least two cases of them being targeted by gangs of men using dating apps to extort and rape their victims. The slayings follow a marked increase in femicide last year, in which at least 152 women were murdered (the real number is likely far higher according to experts), according to the NGO Femicide Count Kenya, which is calling on the government to investigate.
18: Women in Germany earn approximately 18% less than men, according to the latest data from the Federal Statistics Office, a stubborn plateau that has now held since 2020 after years of decreases. Experts largely attribute the persistent gap to women taking time away from work for childcare, which causes them to be overlooked for promotions or raises. Interestingly, the gap was less than half as broad in former East Germany, where women earned just 7% less than men.Peru's President Dina Boluarte
Political drama consumes Peru, per usual
Political turmoil – seemingly a national pastime in Peru – is again rearing its ugly head. Top prosecutor Patricia Benavides is blaming President Dina Boluarte – who came to power a year ago after President Pedro Castillo was removed from office by Congress – for a number of deaths at anti-government protests.
Benavides filed a constitutional complaint this week charging Boluarte and her prime minister with first-degree murder. The complaint was filed just hours after Benavides herself faced allegations of leading a corruption ring, which prompted the attorney general to fire the prosecutor who made the accusations. The president said she was astonished by the complaint against her and suggested Benavides was attempting to distract from the corruption allegations the prosecutor is facing.
An Afghan man works in a poppy field in Nangarhar province in 2016.
Hard Numbers: Afghans' fewer poppies, Trump's lead in key states, Lake Titicaca’s lower water level, New Delhi's smog, Japan's new frigates, Swifties' tents
95: Once the world’s top opium supplier, Afghanistan has slashed its cultivation of opium poppies by a whopping 95%, according to the UN Office on Drugs and Crime. The drop follows a Taliban edict banning opium cultivation.
5: Former President Donald Trump is leading in five of six battleground states in the run-up to the 2024 presidential election, according to new polls by The New York Times and Siena College. The numbers indicate that Biden is trailing among registered voters in Arizona, Georgia, Michigan, Nevada, and Pennsylvania. The president remains ahead in Wisconsin by the smallest of margins: two percentage points.
29: Over the past seven months, Lake Titicaca’s water level at the Peru-Bolivia border has fallen 29 inches to near-record lows. According to scientists, climate change is exacerbating this year’s El Nino phenomenon, layering heat on top of heat in South America’s largest freshwater lake.
471: In more bad environmental news, primary schools in New Delhi have been closed through Nov. 10 due to high pollution levels. On Sunday, the capital recorded an Air Quality Index reading of 471, a level considered hazardous.
12: The Japanese Ministry of Defense will acquire a total of 12 new Mogami class frigates over the next five years. The vessels will be used to defend the Senkaku/Diaoyu Islands in the East China Sea, which are controlled by Japan but also claimed by China and Taiwan.
5: Die-hard Taylor Swift fans have been camped out in tents for 5 months for a chance at front-row seats to the singer’s Eras Tour concerts in Buenos Aires on Nov. 9, 10, and 11. Some Bad Blood has been reported between the tent dwellers and locals who say the Swifties should get jobs rather than spend days waiting for their idol – but despite the potentially Delicate situation, fans appear able to Shake it Off.
A police officer gets his shoes shined as he and fellow officers stand outside the prosecutor's office before the arrival of Peru's President Dina Boluarte, in Lima, Peru March 7, 2023.
Hard Numbers: Peru declares crime emergency, EU cuts Somalia aid, Chinese weddings dwindle, McCarthy tests his majority, oil prices surge
160,200: Peruvian President Dina Boluarte declared a state of emergency in two districts of the capital, Lima, and one in the northern city of Talara amid a devastating wave of violent crime. Lima police collected 160,200 crime reports last year, up 33% from 2021, part of a larger spike in violence in South America.
7 million: The European Union has suspended funding for the World Food Program’s operations in Somalia, which last year amounted to over $7 million, after a United Nations investigation discovered widespread theft by local power brokers, armed groups, and even aid workers themselves. The graft has macabre costs: Somalia barely avoided a famine last year amid a drought that killed 43,000 people — half of them children under 5.
6.8 million: Love is decidedly not in the air in China, as the country registered just 6.8 million weddings in 2022, a drop of some 800,000 compared to 2021 and the lowest figure on record. Meanwhile, even those who are tying the knot are more hesitant to have children, a factor contributing to China’s first population decline in 60 years, and a major long term headache for policy planners in Beijing.
4: US House Speaker Kevin McCarthy is gambling that he can push through a temporary spending bill to avoid a government shutdown, despite fierce blowback from within his own GOP caucus. His margin is slim: he can afford to lose just only 4 GOP votes if he wants the measure to pass.
95: The price of oil hit $95 dollars per barrel, climbing some 26% for the quarter as Saudi Arabia and Russia have cut production to boost prices. Higher oil prices are likely to prop up inflation, complicating matters not only for households, but also for central bankers who had been hoping to ease off of interest rate hikes sooner than later.
A person wearing a protective suit sits in the Beijing Railway Station after China lifted its COVID-19 restrictions in Beijing, January 20, 2023.
Hard Numbers: China zeroes out zero, German tanks run low, Turkey jails a journalist, Greek train crash, police find ‘spiritual girlfriend’ in Peru
0 x 0: Remember China’s zero-Covid strategy? No you don’t, at least not if you’re the Chinese Communist Party, which is now aggressively zeroing out public mentions of the draconian lockdowns that kneecapped the country’s economy and provoked rare widespread protests against Xi Jinping. Here’s our own portrait of zero-Covid life from last spring.
62: Despite promising to give tanks to Kyiv, Germany and other NATO allies have struggled to rustle up enough of them — 62 to be precise — to fill two Ukrainian battalions worth. Part of the problem is that no one on the continent has planned for a major European land war in 30 years, so tanks, parts, and trainers are limited.
10: Turkey has sentenced a journalist to 10 months in prison for posting an unsubstantiated allegation that police officers and soldiers had sexually assaulted a young girl. This is the first jail term handed down under a new law meant to combat disinformation that critics fear will be used to stifle criticism of the government.
36: A train collision has killed at least 36 and injured dozens more near the city of Larissa in northern Greece. Railway employees reported that there were issues with electric coordination of traffic control, despite recent modernization of Greece’s railway system, which is operated by Italy’s state-owned railway company Ferrovie dello Stato Italiene.
1.5: The sentence you are about to read does not end the way you think it will: Police searching a delivery man who was acting drunk at a Peruvian archaeological site found in his backpack a 1.5-meter tall pre-hispanic mummy named “Juanita.” He said the mummy, which once belonged to his dad, lives with him as “a kind of spiritual girlfriend.” We love this LatAm remake of "Fin de Semana at Bernie’s.