The Real Value of APEC

Lima was in a state of excitement during the third week of November. Nearly half the country's GDP and global trade was negotiated during that week in the Peruvian capital as the annual summit of the Asia-Pacific Economic Cooperation (APEC) unfolded. The event brought together some of the world's most powerful political leaders including US President George W. Bush (although his leadership is now more symbolic than real as he nears the end of his administration) along with the presidents of China, Ju Hintao, and Russia, Dmitri Medvédev, as well as a handful of CEOs and business leaders from around the globe who - because of the current scenario - are anxiously awaiting a beacon to guide the way through the global recession that has touched us all.
As part of the excitement, local press has speculated increasingly about what the APEC summit will mean for Peru. Most of the speculation comes down to investment plans that are expected to be finalized because of the gathering. Some projections are hard to believe, like the one by Lima's chamber of commerce which anticipates making investments of US$100bn.
Enthusiasm is a positive thing and it is even understandable that a communications strategy would be focused on tangible results (and it's possible there are few things more tangible than one million dollars), but it is necessary to be cautious with the expectations that these types of announcements generate. The realities are much more complicated than a press release. A downpour of investments doesn't happen overnight. One cautionary tale recalls the days prior to the APEC summit in Santiago, Chile in 2004, when China's president travelled through several Latin American countries announcing investments of (again) over US$100bn. Thus far only a fraction of those investments have been carried out.
Does the lack of concrete and tangible results mean that APEC is just another useless exercise like so many other international initiatives? Absolutely not. Although progress has been slow at the summit and agreements have not instantaneously translated to a deluge of millions of investment dollars, these steps are opening the path - one step at a time, as the Chinese saying goes - toward the possible formation of the largest free trade area in the world.
Although there are still no guarantees that this goal can be reached, the process has served to simplify trade agreements between the 21 economies that make up APEC. And although these agreements have combined to form a rather chaotic mass of interrelationships that APEC members refer to as the "spaghetti bowl", the agreements have been a very positive step for the economies that signed them. The free trade agreement between Chile and China would have been more difficult outside the framework of APEC. The same goes for Chile's free trade agreement with Japan or the treaties that Peru is negotiating with China and South Korea.
Beyond that, APEC is possibly the most effective example of global integration that has taken hold in the three Latin American countries involved in the forum: Mexico, Peru and Chile. Within APEC, these economies are directly involved in the process of building up a trade region with an international presence that can only improve its momentum with the passing of years. It's a matter of being in the right place at the right time.
Hopefully the ambitious announcements for multi-million dollar investments that are expected to germinate from APEC will not turn into yet another example of frustrated hopes, causing public opinion over the coming months or year to look less favorably upon a summit that still has a lot to contribute to development in Latin America.