APEC Economic Leaders’ Declaration in Los Cabos, Mexico

October 28, 2002

Leaders of the 21-member Asia-Pacific Economic Cooperation (APEC)

forum concluded their two-day meetings in Los Cabos, Mexico by

affirming their commitment to promote regional economic growth through

improved security, freer trade, structural reforms, and expanded use

of new technologies.

In an October 27 declaration, the leaders pledged to continue their

efforts to liberalize trade at the multilateral level, with a firm

statement of support for the new round of World Trade Organization

(WTO) talks launched in November 2001 in Doha, Qatar. Most notably,

they agreed that one of the objectives of the global negotiations

should be “the abolition of all forms of agricultural export

subsidies, and unjustifiable export prohibitions and restrictions.”

The declaration includes the leaders’ statement of support for the

early accession of Russia and Vietnam to the WTO.

The pursuit of open trade at the regional level continues as well,

with leaders pledging “to continue and accelerate” movement toward the

goals set at the 1994 APEC meetings in Bogor: the complete,

comprehensive elimination of tariffs and trade barriers in all sectors

by 2010 for developed economies and by 2020 for developing economies.

The leaders also endorsed the APEC Trade Facilitation Action Plan,

which will implement their existing commitment to cut transaction

costs by five percent in the APEC region by 2006. The plan includes

measures such as customs streamlining and the use of increased

transparency to attract new investment to region.

Underlining the importance of transparency in government and business,

the leaders issued a separate statement dealing exclusively with

transparency, in which they pledged to implement new transparency

standards for APEC, and directed that these be implemented “as soon as

possible, and in no case later than January 2005.”

A third statement, on trade and the digital economy, contains a set of

targets related to trade policies for the new global economy, the

leaders said.

The leaders also described terrorism as “a profound threat to our

vision” and committed to taking a series of concrete steps that will

protect and make more efficient the flows of trade, finance, and


Following is the text of the 10th APEC economic leaders’ declaration:

(begin text)


Los Cabos, Mexico

27 October 2002

We gathered in Los Cabos for the 10th annual APEC Economic Leaders’

Meeting to strengthen economic growth by implementing the APEC vision

of free, open and prosperous economies. We agreed on the importance of

fighting terrorism, which poses a profound threat to our vision. We

resolved to continue and accelerate progress towards the achievement

of the Bogor goals as a central element to deliver our ultimate goal

of equitable and shared prosperity, and concurred on the need to

maximize political support for the pursuit of free and open trade and


We acknowledged that APEC is engaged in the implementation of

important measures, consistent with the theme of this year’s meeting

“Expanding the Benefits of Cooperation for Economic Growth and

Development — Implementing the Vision.” We are determined to

translate our APEC vision into concrete benefits for the wider APEC

community through greater assessment, accountability and action. We

affirmed our commitment to a more inclusive world economy, notably

through our individual and joint efforts on micro-enterprises, access

to information, human capacity building, financing and health.

Implementing the APEC Vision of Free and Open Trade and Investment

We discussed the fundamental contribution of trade to economic growth,

and the need for APEC to strongly support the multilateral trading

system, while implementing our commitments.

— We called on Ministers to continue negotiations that will open

markets and enhance the multilateral trading system, foster economic

growth and poverty reduction particularly in developing economies,

promote sustainable development, improve disciplines, improve WTO

coherence with other institutions, and provide opportunities for all

citizens of the world.

— We welcomed the launch of new multilateral trade negotiations in

Doha and encouraged all economies to pursue substantive negotiations

in all areas of the Doha Development Agenda (DDA) by the agreed

timelines to ensure that the deadline of 1 January 2005 to conclude

such negotiations is met. We called for progress across all areas in

the lead-up to the 2003 WTO Fifth Ministerial Conference in Cancun.

— We agreed that these negotiations hold the prospect of real gains

for all economies, and particularly developing economies, in the areas

of agricultural reform, improved market access for goods and services,

and clarification and improvement of trade disciplines.

— We agreed that one of the objectives of the negotiations should be

the abolition of all forms of agricultural export subsidies, and

unjustifiable export prohibitions and restrictions.

— We also remain committed to on-going work in the negotiating group

on rules. Such negotiations are aimed at clarifying and improving

disciplines under the Agreements on the Implementation of Article VI

of the GATT 1994 and on Subsidies and Countervailing Measures, while

preserving the basic concepts, principles and effectiveness of these

agreements and their instruments and objectives.

— We agreed that APEC should further contribute to the DDA

negotiations by encouraging and coordinating confidence building

activities in all areas of the agenda, including investment,

competition, trade facilitation, transparency in government

procurement, and trade and environment.

— We welcomed work in APEC to ensure all economies develop the

capacity to participate effectively in the DDA negotiations. We

encouraged the WTO to build on APEC’s leadership towards more

effective and coherent programs and delivery of trade-related

technical assistance.

— We supported the early accession of Russia and Viet Nam to the WTO.

— We called for an exchange of views in APEC on regional and

bilateral trade agreements, noting that these agreements need to be

consistent with WTO rules and disciplines and APEC’s goals and


We discussed how to implement pro-growth policies in the Asia-Pacific

region. Last year we agreed on an updated vision for APEC in the

Shanghai Accord that stressed implementation of commitments to expand

trade and investment, broadened the basic mission to include new

economic developments, and underscored the need for economic and

technical cooperation.

We recognized the significant progress made during this year and

acknowledged the importance of the timely implementation of the

Shanghai Accord which will advance our commitment to achieve the Bogor

goals and support the multilateral trading system. Today, in Los

Cabos, we:

— Endorsed the APEC Trade Facilitation Action Plan which will

implement our commitment to cut transaction costs by five percent in

the APEC region by 2006. We recognized the significant economic and

trade benefits which can accrue from trade facilitation and took

special note of the Action Plan’s call for providing appropriate

capacity building assistance to developing economies. We directed our

Ministers to continue moving forward with the selection and

implementation of trade facilitating actions and measures and to

assess the benefits of associated transaction cost reductions.

— Adopted the attached Statement to Implement APEC Transparency

Standards, and directed that these standards be implemented as soon as

possible, and in no case later than January 2005. We agreed that

economies that may implement these standards earlier, under domestic

law or an international agreement, will accord their benefits

immediately to all APEC economies.

— Endorsed Pathfinder Initiatives on advance passenger information

systems; the revised Kyoto Convention on the Simplification and

Harmonization of Customs Procedures; electronic SPS [sanitary and

phyto-sanitary] certification (e-cert); electronic certificates of

origin; mutual recognition arrangement of conformity assessment on

electrical and electronic equipment parts II and III; and corporate


— Adopted the attached Statement to Implement the APEC Policies on

Trade and the Digital Economy, which contains a set of targets related

to trade policies for the New Economy, also as a pathfinder


— Urged all APEC members to consider participating in these

initiatives and instructed officials to continue to identify

pathfinder initiatives that will deliver real benefits to APEC


— Praised the strengthened Peer Review process of the Individual

Action Plans for monitoring our process to achieving the Bogor goals.

— Endorsed the broadened Osaka Action Agenda, which reflects our

strong commitment to the achievement of the Bogor goals, while

responding to changes in the global and regional economy.

Strengthening Economic Fundamentals

We discussed economic recovery and noted that uncertainties on the

strength and pace of the expansion still remain. In this context, it

is crucial to strengthen the soundness and efficiency of financial

systems, particularly through better credit culture and strengthening

of banking supervision, and to continue with broader structural,

regulatory and institutional reform, which complement open market

policies, promote sustained economic growth and good governance,

withstand economic shocks and create a better business environment for


— We welcomed the outcomes of the Ninth Finance Ministers’ Process.

We firmly believe that prudent and transparent fiscal management will

help maintain macroeconomic stability, lower interest rates and raise

economic growth.

— We resolved to work towards avoiding structural fiscal deficits and

enhancing the efficiency of public expenditure.

— We agreed to promote more openness, diversity, and competitiveness

in our financial markets, including through the development of

regional bond markets. In this connection, we commended the Finance

Ministers’ initiative to organize policy dialogues to identify

impediments to the development of securitization and credit guarantee

markets and to develop detailed action plans and report progress to

APEC Leaders in 2003.

— We recognized that adequate levels of savings are necessary for

economic stability and growth, and that it is essential to put in

place the institutional framework and structural reforms that allow

the most efficient allocation of savings so that both domestic and

foreign savings are channeled into productive investment.

— We resolved to strengthen trust in markets and investor confidence

by implementing measures to improve corporate governance standards and

practices in APEC member economies and promote the transparency of

policies affecting trade and investment. We recognized the need for

member economies to regularly review their corporate governance

practices to reflect the changing market environment.

— We welcomed the implementation of the e-APEC Strategy and called

for accelerated work to put in place sound macroeconomic policies, a

legal and regulatory regime that will stimulate investment and

technology development to promote e-business and broadband networks,

and programs to ensure that our people have access to the Internet and

the skills to use it.

— We endorsed the commitment of APEC Energy Ministers to energy

market reform and greater transparency to attract the significant

private investment needed to ensure that our region’s growth and

development goals are supported by adequate energy infrastructure.

— We acknowledged the importance of structural reform in achieving

trade and investment liberalization and facilitation and agreed to

further promote dialogue and work in this area.

Counter-Terrorism and Economic Growth

We discussed the challenge posed to the region’s security and

prosperity by terrorist organizations, noting the need to strengthen

security while maintaining the smooth flow of goods, capital and

people that has been key to the region’s economic growth. We welcomed

the efforts of member economies and APEC fora in response to the 2001

Leaders’ Statement on Counter-terrorism.

— We condemned in the strongest terms recent terrorist acts in the

APEC region, and reaffirmed our determination to enhance cooperation

on countering and responding to terrorism.

— We adopted the Los Cabos Statement on Fighting Terrorism and

Promoting Growth, in which we commit to taking a series of concrete

steps that will protect and make more efficient the flows of trade,

finance, and information.

— We called for the development of capacity building programs to

assure that all economies are able to implement all elements of the


— We also endorsed the strengthening of energy security in the region

under the mechanism of the APEC Energy Security Initiative, notably

the reporting of monthly oil data, which was highly commended by the

8th International Energy Forum, last September.

Towards Equitable and Shared Prosperity

We discussed APEC’s work on capacity building and economic and

technical cooperation. In order to enhance our accountability, we

instructed Ministers to improve the focus of our economic and

technical cooperation and capacity building objectives and ensure that

our actions are duly monitored and assessed, fully support APEC’s

trade and investment liberalization and facilitation goals and address

the challenges of globalization.

We agreed on the need to build partnerships with international

financial organizations and the private sector in the pursuit of APEC

capacity building and economic and technical cooperation objectives.

We acknowledged that it is essential to assess our work to ensure that

economic and technical cooperation and capacity building objectives

are effectively implemented. The involvement of the APEC Secretariat

in this work is fundamental, and we acknowledged the need to also

involve other APEC stakeholders in this work such as ABAC, Women

Leaders’ Network and the APEC Study Centers.

We commended the realization of the Dialogue on Globalization and

Shared Prosperity as a central effort to discuss the benefits and

challenges of globalization in a constructive manner.

— We noted the importance of addressing the social dimensions of

globalization and acknowledged the need for developing social safety

nets to minimize the costs of structural change.

— We recognized that globalization is the driving force of economic

progress and agreed on the need to aim our economic and technical

cooperation activities to empower people, as well as micro, small and

medium enterprises, through improved access to information, human

capacity building, financing and health care.

— We noted that Internet use in APEC had more than doubled since we

set our connectivity goal in Brunei in 2000. We reiterated our

commitment to realizing our goal of universal access by the year 2010

and we recognized the importance of focusing on further action on

connectivity for rural areas; micro, small and medium enterprises;

women; youth; and the disabled.

— We noted the contribution of the e-APEC Strategy, the Beijing

Initiative on Human Capacity Building and the APEC Human Capacity

Building Strategy for the New Economy as an effective response to the

need for transforming the digital divide into a digital opportunity.

We welcomed the expansion of cyber-education and called for more

activities aimed at improving teacher quality, promoting language

study and facilitating more use of distance learning. We also welcomed

significant progress in the revitalization of the APEC Education

Foundation and expansion of the Consortium for APEC Cyber Education


— We welcomed the outcomes of the Meeting of Ministers Responsible

for SMEs and noted the progress on the APEC Integrated Plan of Action

for the Development of SMEs (SPAN), including the incorporation of

micro-enterprises development issues. We also acknowledged the

substantial contribution of micro, small and medium enterprises to

trade and economic development in the APEC region. In this context, we

called on ministers and officials to develop programs to remove

obstacles inhibiting their growth, including as regional exporters.

— We welcomed the outcomes of the High Level Meeting on

Micro-enterprises and believe that attention to micro-enterprises is

key to making progress towards our objectives of gender equity,

economic growth, poverty alleviation, and the strengthening of social

safety nets. We welcomed the decision made by the Ministers

Responsible for SMEs to establish a sub-group for micro-enterprises

development. We call for coordination in developing the sub-group’s

action plan, taking into account the work being conducted by relevant

APEC fora and other APEC stakeholders.

— We agreed that micro-financing is crucial for the expansion of

micro-enterprises, and we praise efforts to develop and promote

market-based micro-finance to assure micro and small businesses and

entrepreneurs have access to capital. We agreed that government action

should create an enabling policy environment and a legal and

regulatory framework for the growth and expansion of sound and

sustainable micro-financing intermediaries, fostering their gradual

and full integration into the domestic financial system.

— We acknowledged that investing in health will benefit economic

growth, worker performance and productivity, and poverty alleviation.

We need to be more effective with our investment at every stage of the

health care process, including primary prevention against disease

risks, and focusing on most vulnerable populations.

— We instructed Ministers to build on work underway to establish a

regional public health surveillance network and an early warning

system to monitor and respond to critical disease outbreaks in the

region, and critical threats such as bio-terrorism.

— We directed Ministers to assist developing economies to build the

capacity to establish their own self-sustaining health-care services

accreditation regimes.

— We called for the establishment of a life-sciences innovation forum

comprising government, private sector, and academia representatives to

develop a strategic plan for life-sciences innovation in the region.

This should include, as a priority, addressing the challenges of risk

detection and prevention, treatment and cure of the communicable and

lifestyle diseases which afflict our people.

We pledged to accelerate the safe use of biotechnology products based

on sound science and welcomed the conclusion of the first Agricultural

Biotechnology Dialogue. We called for capacity building initiatives

that support our goals.

We recognized that a healthy environment and a focus on the quality of

life of our citizens are essential to sustainable economic growth. In

this regard, we welcomed the contribution of APEC Energy Ministers,

Ministers responsible for ocean related matters and other APEC fora to

the World Summit on Sustainable Development (WSSD). We agreed to

continue making valuable contribution and follow-up work to the WSSD.

We commended progress under the 21st Century Renewable Energy

Development Initiative, and noted the importance of oceans for food

security and sustainable economic development.

Reaching Out to our Communities

We discussed efforts to engage in meaningful dialogue with our

communities, particularly business people, women, and youth. We also

discussed the need to involve a larger community in APEC’s activities.

— We welcomed the work of Ministers in updating APEC guidelines on

non-member participation to make them more encouraging of genuine

engagement with our communities and directed Ministers to implement

the guidelines by ensuring APEC fora are proactive in identifying and

engaging outside organizations.

— We welcomed ABAC’s report on “Sharing Development to Reinforce

Global Security”. We place great value on ABAC’s contribution to the

APEC agenda and have instructed Ministers to consider the report

carefully. We noted that APEC is already pursuing a number of

initiatives identified by ABAC in areas such as counter-terrorism,

corporate governance, promotion of micro-enterprises development and

support for the WTO Doha Development Agenda.

— We endorsed APEC’s work on gender issues and welcomed the

recommendations of the Second Ministerial Meeting on Women. We

recognized the need to eliminate gender inequalities in social and

economic life, particularly recognizing the value of the multiple

roles that women play in the economy. We also recognized the unique

challenges globalization presents for women, including indigenous


— We welcomed the outcomes of the APEC Young Leaders’ and

Entrepreneurs Forum with Social Responsibility, which provided a

valuable opportunity for young entrepreneurs to discuss the

opportunities afforded by the new economy.

— We reaffirmed our belief in APEC’s fundamental principles,

including voluntarism, consensus-building, individual and collective

actions, flexibility, and open regionalism.

(end text)

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