Apec 2021: World leaders address Covid recovery challenge

Chinese President Xi Jinping warned against relapsing into “Cold War” divisions and talk show superstar Stephen Colbert lightened the mood with an attempt at “New Zealand dialect”.

It might have been a virtual event this year but the Apec 2021 CEO Summit wasn’t short of firepower or substance.

Prime Minister Jacinda Ardern welcomed delegates who had logged in to the summit from across the 21 Apec member nations.

Thousands of business leaders are attending the two-day summit, logging in online not just for the main panel events but for extensive networking opportunities via a groundbreaking portal of informal hangouts and live meeting rooms.

Covid forced 2020 hosts Malaysia to scale it back significantly last year.

But despite the setback with the Delta outbreak, local organisers were determined to make it happen this year.

Apec organisers have stuck with plans for the event today and tomorrow, with the venue at Auckland’s Aotea Centre effectively becoming a live broadcast studio for the fully virtual event.

The CEO summit is a separate event to the main Apec leaders summit.

Both Ardern and Australian PM Scott Morrison took the opportunity to talk up the strong pandemic response of their respective nations and the ongoing strength of their economies.

OECD Secretary-General Mathias Cormann also talked up the relatively rapid rate of economic recovery this year.

“Extensive policy support combined with the relatively rapid development and deployment of the vaccines and the accelerating digital transformation of economies was all contributing to a more optimistic outlook,” he said.

The OECD was now projecting global GDP to grow 5.7 per cent this year and 4.5 per cent next year.

However he acknowledged the uneven nature of the recovery.

Trade would be “the central engine” for the recovery, he said.

“All the trading nations have an interest in strengthening the rules-based system, with the World Trade Organisation at its centre.”

But former Reserve Bank Governor and Apec executive director Alan Bollard laid out the Covid damage to the regional economy in stark terms.

“It’s a confusing period,” he said. “We know we’re in economic recovery but Covid has hitApec very hard.”

Asia Pacific trade research published this week suggested that more than one trillion dollars worth of income had been lost during the pandemic.

“Compared to the Global Financial Crisis the Covid downturn has been faster, deep although possibly shorter,” he said.

Economists were still struggling to understand this recovery, which was “full of contradictions”, he said.

The Apec region was recording record growth of 10 per cent in the latest quarter, yet only a year ago it was in deep recession at negative 5 per cent, “a record contraction”.

Goods trade was increasing but services trade was still in recession. Domestic investment was strong but foreign direct investment was at 20-year lows, he said.

“Costs are pushing up but central banks are saying it’s not inflation, wages are going up but productivity is stagnant. Jobs are being displaced but skill shortages are being reported everywhere.”

Former Prime Minister Helen Clark warned that the latest World Health Organisation data showed that the slow and inequitable vaccine rollout was likely to delay the world’s Covid recovery by at least a full year.

While official numbers were approaching 5 million deaths, she noted an Economist Intelligence Unit report which estimated that the actual toll was nearer to 17.9 million.

“It’s a disaster,” she said.

There were three reasons for the failure to control the pandemic she said.

They were: poor application of public health advice by governments, the inequitable rollout of vaccines and the rise of disinformation and fake news hampering that rollout.

Things would never be the same again, she said.

But neither should we lose sleep over some of the changes we would have to accept.

Things like vaccine passports weren’t actually new as anyone who had travelled to Africa recently knew, she said.

Earlier, President Xi called for unity and co-operation to confront the “once in a century challenge” of Covid-19.

He emphasised the need to maintain a free-trade environment and strong multi-lateral agreement to drive innovation and the green technology the world would need for economic recovery.

However his speech did come with a warning to Apec members that: “Attempts to draw ideological lines or form small circles on geopolitical grounds are bound to fail,” he said.

“The Asia-Pacific region cannot and should not relapse into the confrontation and division of the Cold War era.”

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