When Maori meet, they hongi. They believe the age-old nose-pressing ritual has more meaning than a handshake or a kiss, bringing two people into close understanding as they share the breath of life. When 21 heads of government from the Asia-Pacific region gather in Auckland this week, they will hongi with six Maori leaders. Later, as they sit down to talk trade diplomacy against the backdrop of the New Zealand city's bustling harbor, the politicians will try to resuscitate the Asia Pacific Economic Cooperation forum.
That will take some work. A decade after it was founded, the organization seems further than ever from its goal of free trade and investment throughout the region, which accounts for 70% of world trade. "There's a perception APEC ran off the rails at last year's meeting in Kuala Lumpur," says New Zealand International Trade Minister Lockwood Smith. "People are saying New Zealand has to get it back on track."
Since national leaders joined their trade ministers at APEC gatherings in 1993, the forum has become an annual talkfest that offers leaders and bureaucrats--from the mighty U.S., China and Japan, to Mexico and Russia, to the islands of Papua New Guinea--the chance to schmooze in a club-like atmosphere. The APEC invitation might refer to "trade," but behind the scenes the meeting also allows leaders to cut deals, mend fences, build friendships. This year, the focus will be on the meeting of U.S. President Bill Clinton and Chinese President Jiang Zemin, who will meet for the first time since NATO accidentally bombed the Chinese embassy in Belgrade in May. The two will be free to discuss everything from China's possible admission to the World Trade Organization to its claims on Taiwan.
With APEC, the sideshows are usually more interesting than the main event. But many say this is a serious shortcoming in a group whose goal is economic reform. In 10 years, little has been achieved but grand official statements, tiny procedural victories and bold targets with distant and non-binding deadlines. "We are good on ideas and policies," says Bali Moniaga, assistant to the director of APEC affairs in the Indonesian Foreign Affairs department. "But when it comes to implementation, we are so slow."
For many countries, the forum is the Asia-Pacific community's best hope for a rosy economic future. "APEC strengthens our region dramatically, and more quickly than if we'd muddled along separately," says New Zealand Prime Minister Jenny Shipley. But in the wake of Asia's financial crisis, which saw many members backpedal on tariff reduction, can APEC regain its momentum? Shipley is clear on her ambitions for the meeting: she wants fellow leaders to reaffirm their commitment to free and open trade. Says Chau Tak-hay, Hong Kong's secretary for Trade and Industry: "We hope APEC will make an influential declaration to urge the WTO to launch a new round of broad-based multilateral talks." That would be a boost for the WTO talks to be held in Seattle in November, whose agenda includes eliminating as many trade barriers as possible, in areas from agriculture to e-commerce, by 2003.
APEC in New Zealand is, say observers, as much about symbolism and theater as it is about freer trade. Much of APEC's response to the November WTO talks has already been agreed upon, but the powerful U.S. delegation is leading a push to add further items, including a ban on e-commerce taxes. Within APEC, several members also want to open up air travel, end food subsidies, and make all markets more transparent and competitive. "There are no great leaps forward," says American APEC delegation member and Ambassador to New Zealand Josiah Beeman. "But we'll keep pushing for the fastest pace that can be sustained on trade liberalization."
For all the talk, motorcades and photo opportunities, New Zealand Trade Minister Smith says the forum is essentially about helping businesses get their products into more markets. Suppose you've made the world's best-tasting ice-cream and you're also the world's lowest-cost producer. Research shows that your product would sell well in the Asia-Pacific. If you think you're on a winner, Smith says, you're mistaken. First, you face tariffs in just about every market--from 65% in China to 300% in Canada. Next, there are different product standards, requiring you to use different recipes. Suppose you comply. When your shipments reach the target country, they must be accompanied by a detailed customs declaration. Even then, chances are they'll melt as a result of poor refrigeration and transport. You may not even be paid: in some countries, contract law is virtually unenforceable. "APEC," says Smith, "is designed to sort these problems out."