[Public Papers of the Presidents of the United States: George W. Bush (2001, Book II)]
[October 21, 2001]
[Pages 1278-1286]
[From the U.S. Government Publishing Office www.gpo.gov]



APEC Economic Leaders' Declaration, Shanghai, China
October 21, 2001

Meeting New Challenges in the New Century

    1. We, the Economic Leaders of APEC, gathered today in Shanghai for 
the first time in the twenty-first century. We are here to explore ways 
to meet the new challenges confronting us. Convinced of the great 
potential of the Asia-Pacific region, we have resolved to achieve common 
prosperity through broader participation and closer cooperation.
    2. Our meeting has taken place at a crucial juncture. The major 
world economies are experiencing a slowdown more severe than 
anticipated. Most economies in the Asia-Pacific region have experienced 
an economic downturn, with some emerging economies particularly affected 
by unfavorable external market conditions. In addition, the terrorist 
attack on the United States risks undermining some industries as well as 
consumer and investor confidence. In the long run, a major challenge for 
the Asia-Pacific community is to manage the profound changes brought 
forth by globalization and the New Economy and to benefit from the 
opportunities that abound.
    3. As the premier forum for regional economic cooperation in the 
Asia Pacific, APEC is well suited to play a leading role in helping its 
member economies embrace these opportunities and challenges. We wish to 
send a clear and strong message on the collective resolve of the Asia-
Pacific community to counter terrorism. We are determined to reverse the 
current economic downturn and maintain public confidence at a time of 
uncertainty by fighting protectionism and committing to the launch of 
the new WTO round at the upcoming WTO Ministerial Conference. These 
efforts are consonant with and contribute to the pursuit of the APEC 
vision of peace, harmony and common prosperity.

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    4. Inspired by such a vision, we are determined to work together for 
a more dynamic and prosperous Asia Pacific in the new century by 
promoting sustainable economic growth, sharing the benefits of 
globalization and the New Economy, and advancing Trade and Investment 
Liberalization and Facilitation (TILF). To this end, we reaffirm our 
commitment to achieving the Bogor Goals of free and open trade and 
investment in the Asia Pacific by 2010 for developed economies and 2020 
for developing economies. We have also charted the course for the 
development of APEC in its second decade and beyond by adopting the 
Shanghai Accord.

Promoting Sustainable Growth

    5. We affirm our unwavering confidence in the medium and long-term 
growth prospects for the Asia-Pacific region since the fundamentals of 
the region remain sound. As reforms and restructuring following the 
1997-1998 financial crisis take effect, many emerging economies are now 
in a much stronger position to cushion themselves against the impact of 
the economic slowdown and unexpected shocks.
    6. We undertake to adopt appropriate policies and measures to 
increase economic growth and resolve to enhance macroeconomic policy 
dialogue and cooperation not only to resume growth but also to build a 
stronger foundation for sustainable growth and broad-based development. 
It is important for all economies to take timely policy actions to 
strengthen markets and facilitate an early pick-up in global economic 
activity.
    7. In this context, we pledge to accelerate our domestic efforts to 
build capacity and deepen structural reform so as to strengthen the 
market fundamentals across the region. To this end, we emphasize the 
importance of sound economic policies and corporate governance as well 
as the important role and responsibility of governments in shaping the 
legal and regulatory framework that encourages competition and 
innovation, with an increased emphasis on capacity building. Developing 
the social safety net is a high priority, as it can make an important 
contribution to reducing the harmful effects of economic shocks on 
vulnerable groups. As noted in the 2001 Economic Outlook, enhancing 
financial efficiency is also essential to promoting growth. We thus 
welcome efforts made in these areas in APEC, including strengthening 
economic legal infrastructure, supervision of capital markets, corporate 
governance, and implementation of international financial standards, as 
exemplified by the work done through the Finance Ministers' process. We 
also welcome contributions by Pacific Economic Cooperation Council 
(PECC) in these areas. We direct responsible Ministers and Officials to 
build on their work.
    8. Recognizing the importance of promoting financial stability and 
crisis prevention, we stress the need to strengthen the international 
financial system. We urge continued efforts to enhance the effectiveness 
of mechanisms to prevent the recurrence of financial crisis. We welcome 
the important steps that have been taken to strengthen the international 
financial architecture including, for example, the review by the 
Financial Stability Forum of the effectiveness and the progress in 
implementing the recommendations from the Working Group on Offshore 
Financial Centers and Highly Leveraged Institutions. We emphasize the 
importance of ensuring that representation on the International Monetary 
Fund (IMF) Board and IMF quota/share allocation appropriately reflects 
the current world economy. While the IMF and other international 
financial institutions play a pivotal role, regional cooperation can 
also be very useful in complementing efforts by these institutions to 
promote financial stability. In this connection, we welcome the 
substantial progress in implementing the Chiang Mai Initiative to 
strengthen cooperative financing arrangements among the Association of

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Southeast Asian Nations (ASEAN) countries and China, Japan and the 
Republic of Korea. We also note the ongoing work in the Manila Framework 
Group. We support all these efforts and urge them to be strengthened.
    9. The current economic slowdown underlines, above all, the 
importance of APEC's work towards more open and stronger economies. We 
reaffirm our unyielding commitment to free and open trade and investment 
and resolve to work together to fight against protectionism in all 
forms. We render the strongest support for an open, equitable and rules-
based Multilateral Trading System, which is essential to sustain global 
economic growth. APEC must also stay on track with its own agenda on 
trade and investment and on capacity building.

Sharing the Benefits of Globalization and the New Economy

    10. We are convinced that globalization is a powerful vehicle that 
stimulates economic growth, and holds great promises for delivering 
higher living standards to people and improving social well-being for 
our communities. We acknowledge that the New Economy has broad potential 
to raise productivity, stimulate innovation in economic organization and 
entrepreneurship, and create and disseminate knowledge and wealth. 
However, the opportunities arising from these processes are not 
sufficiently shared among and even within economies. Hence the need to 
enable all individuals in our communities to benefit from them. We 
emphasize the importance of capacity building, both human and 
institutional, as a key answer to the challenges and opportunities of 
globalization and the New Economy. Capacity building constitutes a key 
element of the balanced approach essential to the success of APEC along 
with market opening and full participation.
    11. In this context, we reiterate that human capacity building (HCB) 
remains a central theme this year and the years ahead. We commend the 
success of the High-Level Meeting on Human Capacity Building, and 
welcome the Beijing Initiative as a comprehensive set of principles for 
human capacity building, which also provides opportunities for further 
work in the New Economy. We call on APEC fora and member economies to 
undertake follow-up activities in specific areas of their interest in 
the spirit of developed and developing economies complementing each 
other. We support the engagement of all key stakeholders in the region 
and, in particular, the establishment of the partnership of government, 
business, academic and training institutions for this purpose. We 
welcome the launch of the Consortium for APEC Cyber Education 
Cooperation initiated and sponsored by the APEC Education Foundation, 
the Human Capacity Building Promotion Program and the APEC Finance and 
Development Program. We also welcome the outcomes of the 4th Human 
Resources Development Ministerial meeting and support the Kumamoto 
Statement that makes a contribution to APEC Human Resources Development 
activities in the 21st Century as a basis for advancing social and 
economic development and the sharing of prosperity by our people.
    12. Reaffirming the importance of Economic and Technical Cooperation 
(Ecotech) in achieving equitable growth and sustainable development, we 
welcome the progress that APEC has made in advancing Ecotech goals and 
underscore that Trade and Investment Liberalization and Facilitation and 
Ecotech should be mutually reinforcing. We call for efforts to this end 
to be further strengthened. We commend the formulation and submission of 
Ecotech Action Plans by individual member economies as a major step 
forward for promoting sound and balanced development of APEC and ask 
Ministers and Officials to develop the exercise as lessons are learned.
    13. We also welcome the progress made in other areas of Ecotech. We 
endorse the

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APEC Strategy for Combating Infectious Disease and call on members and 
relevant fora to implement its recommendations.
    14. Given the importance of Small and Medium-sized Enterprises 
(SMEs) and micro-enterprises, we instruct Ministers and Officials to 
build on APEC's Integrated Plan of Action for SMEs and place special 
emphasis on micro-enterprises. In this context, we welcome the High 
Level Meeting on Micro-enterprises to be hosted by Mexico next year.
    15. Building on work done in Brunei last year, we have made further 
progress by formulating and delivering a long-term, forward-looking and 
more action-oriented e-APEC Strategy for the development of the New 
Economy through the promotion of information and communications 
technology (ICT) and its application in our region. The goal is to build 
APEC towards a digital society, with higher growth, increased learning 
and employment opportunities, improved public services and better 
qualities of life by taking advantage of advanced, reliable and secure 
ICT and networks and by promoting universal access. Such a society 
should bring equal opportunities and widely shared benefits for all 
member economies and individuals, including women, the disabled and 
others. We commend the crosscutting character of the e-APEC Strategy and 
urge APEC fora and member economies to implement the programs for 
collective and individual actions set out in the Strategy, as 
appropriate. Under the current circumstances, the early implementation 
of the Strategy will also support the revival of the ICT sector. We also 
welcome the progress in advancing e-commerce.
    16. In September 2002 many of us will be meeting in Johannesburg for 
the World Summit on Sustainable Development, to reinvigorate our 
commitment to sustainable development in pursuit of enhancing economic 
growth, promoting human and social development and protecting the 
environment as interdependent objectives. We will consider how APEC, 
which has undertaken a broad range of activities in this area, can 
contribute to the success of the World Summit and take forward the 
outcomes in its work program.
    17. We realize that there is an ongoing public debate on the 
benefits and costs of globalization. Such debates are healthy when they 
are informed by rigorous and comprehensive analysis of the impact of 
globalization. The time has come for APEC to come forward and lead the 
public debate in a constructive manner. We instruct Officials to convene 
an APEC Dialogue on Globalization and Shared Prosperity, focusing on, 
among other issues, structural adjustment and its impact. At the same 
time, APEC should reach out to business and other stakeholders to 
communicate APEC's objectives, activities and benefits to ensure that 
they participate in and benefit from the APEC process and globalization 
at large. In particular, we thank APEC Business Advisory Council (ABAC) 
for its report and value the interaction with the Council and other 
business representatives. We also direct our Ministers and Officials to 
develop and implement programs to give effect to the APEC Communications 
and Outreach Strategy as well as the conclusions of the Ad Hoc Group on 
APEC Interaction.
    18. Noting that sustainable growth in the APEC region also requires 
the ability to feed a growing and increasingly prosperous population, 
Leaders call for accelerated implementation of the APEC Food System 
initiative. Recognizing the benefits of biotechnology in improving 
productivity, increasing nutrition, and reducing the environmental 
impact of agricultural production, we reaffirm the importance of safe 
introduction and use of biotechnology products based on sound science. 
We also welcome the initiative to hold a policy-level dialogue on 
agricultural biotechnology and call for more related capacity building 
activities.

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    19. We take satisfaction at the significant progress made, through 
the leadership of the Ad Hoc Group on Gender Integration, in the 
capacity of APEC to address gender equity in its work. Our commitment to 
a wide distribution of the economic opportunities of our era requires 
the application of gender perspectives in APEC's work, we welcome the 
decision to hold a Second Ministerial Meeting on Women in Mexico in 
2002, as an opportunity to make further progress.

Supporting the Multilateral Trading System

    20. Trade and investment liberalization and facilitation hold 
another key to realizing our vision for reduced disparities and common 
prosperity. They have taken on increased importance at a time when rapid 
changes are reshaping the global marketplace. Hence, we commit to 
further efforts in advancing trade and investment liberalization and 
facilitation both within our region and globally.
    21. In November, a major decision will be taken at the Fourth WTO 
Ministerial Conference. Its outcome will have long-term implications for 
our future. Our choice is unmistakably for a stronger Multilateral 
Trading System with greater opportunities for all. We strongly support 
the launch of the WTO new round at the conference, recognizing that the 
current slowdown in the world economy has added to its urgency. We agree 
that, once launched, the new round should be concluded expeditiously.
    22. We emphasize the need for a balanced, sufficiently broad-based 
agenda, which is achievable. This is essential to the successful launch 
and conclusion of the New Round. We agree that the agenda for the New 
Round should include further trade liberalization, the strengthening of 
WTO rules, implementation issues, and reflect the interests and concerns 
of all members, especially those of the developing and least developed 
ones. We also agree that such an agenda should address the challenges in 
the 21st century and support the goal of sustainable development. This 
will help ensure that the prosperity flows from growing trade and 
investment is accessible and equitably distributed to all. In this 
context, we also emphasize the importance that the New Round be 
supported by all WTO members, and hence the need for effective 
implementation of special and differential treatment and for enhancing 
WTO's internal transparency.
    23. We reconfirm the commitment to the APEC-wide moratorium on the 
imposition of custom duties on electronic transmissions, and agree on 
its extension until the Fifth WTO Ministerial Conference, recognizing 
the importance of relevant WTO agreements for electronic commerce.
    24. We reaffirm the importance of APEC WTO-related capacity building 
activities which realize the objectives of the Strategic APEC Plan as a 
unique, substantial contribution to strengthening the Multilateral 
Trading System, and call for the accelerated implementation of the Plan 
to assist developing economies in implementing the WTO agreements.
    25. We applaud the conclusion of all negotiations on the terms for 
China's membership in the WTO as a historic development that not only 
helps make WTO a truly world organization but also reinforces the 
underpinnings for global economic cooperation. We urge that the decision 
on final approval of China's accession be taken at the upcoming 
Ministerial Conference. We also reiterate strong support for the final 
approval of the accession by Chinese Taipei at the Conference and the 
advancement of WTO accession by the Russian Federation and Viet Nam.
    26. We reaffirm that regional and bilateral trade agreements should 
serve as building blocks for multilateral liberalization in the WTO. We 
affirm that the existing and emerging regional trading agreements should 
therefore be consistent with WTO rules and disciplines. We also believe 
that these arrangements should be in line

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with APEC architecture and supportive of APEC's goals and principles. We 
note the initiatives on exchange of information in this regard.

Sharpening the Vision for the Future

    27. APEC has come a long way since its inception in 1989. So has the 
world around it. These changes have not in any way lessened the need for 
a vehicle of cooperation like APEC in our region. On the contrary, they 
have made it more compelling for us to remain fully committed to the 
APEC process, to the vision of a peaceful and prosperous Asia-Pacific 
community of diverse yet interdependent economies that has evolved from 
Seattle to Brunei, and above all, to the Bogor Goals. We also reaffirm 
our belief in the unique APEC Approach based on the fundamental 
principles of voluntarism, consensus-building, combination of individual 
and collective actions, flexibility, comprehensiveness and open 
regionalism, which has inspired and underpinned our successes.
    28. At the same time, we recognize that APEC must demonstrate its 
dynamism in advancing with the times by responding and adapting to 
changes in the global and regional economy. As it enters the second 
decade, it is important for APEC to enrich, update and sharpen its 
vision for the future. In this respect, we envision that APEC's 
objectives in the second decade are to make continuous progress in 
achieving the Bogor Goals; deepen the spirit of community by sharing the 
benefits of growth more widely and equitably; and build APEC into a 
closer, stronger partnership for regional economic cooperation.
    29. To this end, we announce today the Shanghai Accord as a 
strategic, forward agenda for the development of APEC in the coming 
years. The Accord not only gives voice to our common resolve to fulfill 
our commitments, it also stands as a template laying out some key steps 
to be taken to achieve our Goals and Objectives. Reflecting the 
diversity of APEC's membership, it incorporates trade and investment as 
well as economic and technical cooperation as two mutually supportive 
and reinforcing elements.
    30. In the Shanghai Accord, we commit to:

     Broadening APEC's vision for the future by identifying a 
            conceptual and policy framework to guide APEC in the new 
            century. Such a framework recognizes the changes entailed by 
            globalization and the New Economy and reflects the need to 
            extend the APEC agenda to cover reforms and capacity 
            building at both domestic and international levels;
     Clarifying APEC's roadmap for achieving the Bogor Goals on 
            schedule with a mid-term stocktake of the overall progress 
            in 2005, including by broadening and updating the Osaka 
            Action Agenda, adopting a pathfinder approach in advancing 
            selected APEC initiatives towards achieving the Bogor Goals, 
            promoting the adoption of appropriate trade policies for the 
            New Economy, following up on the APEC Trade Facilitation 
            Principles, pursuing greater transparency in economic 
            governance; and
     Strengthening APEC's implementation mechanism by 
            strengthening the Individual Action Plan Peer Review 
            process, reinforcing Ecotech and capacity building efforts.

    31. We direct our Ministers and Officials to follow up actively on 
the Accord. We have no doubt that with our concerted efforts the vision 
we set here will over time come to full fruition, culminating in a 
stable, secure and prosperous Asia-Pacific community.

Appendix 1 Shanghai Accord

I. Broadening the APEC Vision

    Globalization and the New Economy have transformed the global and 
regional economy significantly since the Bogor

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Goals, bringing forward extraordinary opportunities as well as 
challenges. APEC's vision needs to reflect these changes. While trade 
liberalization is at the core of APEC agenda, Leaders also agree that 
the Bogor Goals need to be placed within the context of an updated and 
expanded vision that addresses trade and investment liberalization and 
facilitation and economic and technical cooperation in an integrated 
manner to maximize the benefits for all economies in the region. One of 
the greatest challenges to materialize such a vision is to intensify the 
collective and individual actions that economies take at domestic and 
international levels on reforms and capacity building across a range of 
areas.
    The strategic goals of the Finance Ministers' Process should also be 
reflected in a broader vision for APEC, given the important role of 
sound macroeconomic policies, good economic governance, stable financial 
systems and greater economic interaction have in improving prosperity 
for the region.

II. Clarifying the Roadmap to Bogor

Broadening and updating the OAA
    Leaders applaud the work done this year on the Osaka Action Agenda 
(OAA), and recognize its importance in reflecting APEC's accomplishments 
and ability to respond to changes in our regional and global situation. 
Leaders agree that the OAA should be broadened to reflect fundamental 
changes in the global economy since Osaka, such as the development of 
new economy including through the implementation of relevant aspects of 
e-APEC Strategy, and Strengthening the Functioning of Markets. Leaders 
direct Ministers to follow this up. Officials should present an interim 
report at the 2002 Meeting of Ministers Responsible for Trade (MRT) and 
a full report at the 2002 APEC Ministerial Meeting (AMM) on their 
recommendations with regard to broadening the OAA.

Adopting a pathfinder approach in advancing some APEC initiatives
    Leaders reaffirm that those economies ready to initiate and 
implement a cooperative arrangement may proceed to do so, consistent 
with the Bogor Declaration. Leaders encourage the development of such 
``pathfinder initiatives' and agree that in adopting such an approach, 
APEC principles of voluntarism, comprehensiveness, consensus-based 
decision-making, flexibility, transparency, open regionalism and 
differentiated timetables for developed and developing economies should 
be observed. Use of `pathfinder initiatives' based on a group of members 
piloting the implementation of the initiatives, will invigorate progress 
towards the Bogor Goals and provide a framework to encourage broader 
participation through enhanced capacity building programmes. Leaders 
also agree that these initiatives should be transparent and open, with 
clearly defined objectives and framework for implementation to encourage 
the broadest participation by other APEC members when they are ready to 
join.

Promoting the adoption of appropriate trade policies for the New Economy
    Leaders recognize the importance of adopting appropriate trade 
policies to reflect the new context and encourage the development of the 
New Economy. As part of this effort, Leaders instruct officials to 
undertake by mid-2002 an exchange of appropriate trade policy 
information, such as information on the status of liberalization of 
services, and adherence to tariff and intellectual property regimes. On 
this basis, economies may develop targets by the Ministerial Meeting in 
2002. In this exercise, account should be taken of the implementation of 
relevant recommendations endorsed in the e-APEC Strategy. Given the 
diversity among member economies, Leaders agree that the development of 
the New Economy would also involve developing and implementing concrete 
capacity building programs to improve performance.


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Follow up on the Trade Facilitation Principles
    Leaders instruct Ministers to identify, by Ministerial Meeting in 
2002, concrete actions and measures to implement the APEC Trade 
Facilitation Principles by 2006 in close partnership with the private 
sector. The objective is to realize a significant reduction in the 
transaction costs by endeavoring to reduce them by 5 percent across the 
APEC region over the next 5 years. Leaders also instruct Ministers to 
explore the possibility of setting objective criteria on trade 
facilitation, taking fully into account the diversity among the members 
as well as progress achieved in respective economies so far. Leaders 
also agree that assistance programmes to help build the capacity of 
developing economies in trade facilitation is particularly important.

Adoption of transparency principles
    Leaders recognize the importance of transparency in economic 
governance. In this regard, APEC has developed, menus of options and 
principles in different areas that contain transparency provisions. 
Leaders direct Ministers to pursue the implementation of APEC's agreed 
transparency principles, taking into account economies' specific 
circumstances and report on the progress in their IAPs in 2002 and 
thereafter. Leaders also underline the importance of well-targeted 
assistance to help the developing economies make progress towards 
greater openness and transparency. Leaders note the importance of 
cooperation on e-government for achieving this objective.

III. Strengthening the Implementation Mechanism

Strengthening the IAP Peer Review Process
    Leaders welcome the decision by Ministers to strengthen the 
Individual Action Plan (IAP) peer review process, and encourage member 
economies to volunteer their IAPs for peer review on the basis of the 
new approach. Leaders also agree that upon completion of such a review 
cycle, involving all volunteer economies, a mid-term stocktake of the 
overall progress towards the Bogor Goals should be undertaken in 2005.

Strengthening Ecotech and capacity building efforts
    Leaders recognize that in addition to promoting sustainable 
development and narrowing disparity, Ecotech helps to enable all member 
economies to achieve prosperity through activities that both directly 
support trade and investment liberalization and facilitation and 
strengthen the competitiveness of our economies. Leaders applaud the 
efforts undertaken this year to update the OAA Part II and call for 
greater integration of Ecotech efforts with all APEC priority goals. 
Leaders underscore the need to give a strong impetus to ensuring the 
effective implementation of various Ecotech initiatives, especially 
crosscutting issues such as human capacity building.
    Leaders recognize the importance of substantially enhancing the 
profile of Ecotech and improving the coordination and management of 
Ecotech activities of all fora. In this context, Leaders welcome the 
review to be undertaken on the mandate and role of the SOM Subcommittee 
for Ecotech (ESC), and look forward to early progress. Leaders also 
recognize the need to encourage the incorporation of the priorities of 
micro, small and medium enterprises throughout the APEC agenda.
    Leaders agree to further develop Ecotech Action Plans (EAPs), as an 
instrument to gauge and encourage Ecotech activities, drawing from the 
experience and lessons learned in the pilot phase. Leaders also call on 
all members to take part in this exercise on a voluntary basis. Leaders 
agree that APEC should strengthen ties with bilateral, multilateral, and 
private funding entities with a view to minimizing duplication and 
maximizing the delivery of capacity building programs. Leaders instruct 
Ministers and officials to intensify

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Ecotech activities and report the progress to the Ministerial Meetings 
next year.

Note: The joint statement was made available by the Office of the Press 
Secretary but was not issued as a White House press release. An original 
was not available for verification of the content of this joint 
statement.