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Following is the full text of a speech delivered by the Principal Assistant Secretary for Information Technology and Broadcasting, Mr Geoffrey Woodhead on "Influence of APEC" at the fourth Asian Telecommunications Industry Exchange Forum today (Wednesday):

I am honoured to have been invited here today to talk on the topic of the influence of APEC.

There is a whole alphabet soup of organisations involved in economic relations and in telecommunications in the region. What is APEC and how do the deliberations of APEC influence developments in the region, particularly in telecommunications?

The Asia Pacific Economic Co-operation - to give APEC its full name, although I have often thought something is missing "Council", "Forum"? - was formed in 1989 in response to the growing inter-dependence among the economies of Asia-Pacific. It began as an informal dialogue group but has expanded to become the primary regional vehicle for promoting open trade and practical economic co-operation. There are at present 18 member economies in APEC - as in the World Trade Organisation members are referred to as economies not as countries.

Hong Kong became a member in 1991 at the same time as the People's Republic of China and Chinese Taipei. Under the terms of the arrangement whereby we became a member of APEC, we have, since reunification, been known as Hong Kong, China. As Hong Kong, China, we are a full member of APEC and participate throughout the full range of meetings from the annual Leaders Meeting down to relevant sub-groups and symposia.

APEC will be enlarged this year by the addition of three new members Peru, the Russian Federation and Vietnam. APEC tries to be inclusive and there are provisions for other economies and organisations to participate as Guests in a number of programme areas. So in the telecommunications field, Colombia is a Guest and the Asia Pacific Telecommunity is an official observer.

APEC Objectives

APEC is a consensus-building organisation encompassing economies of different scales and at different levels of development. In 1991, Members agreed to the following objectives for APEC :

- to sustain the growth and development of the region for the common good of its peoples and, in this way, to contribute to the growth and development of the world economy;

- to enhance the positive gains, both for the region and the world economy, resulting from increasing economic interdependence, to include encouraging the flow of goods, services, capital, and technology;

- to develop and strengthen the open multilateral trading system in the interest of Asia-Pacific and all other economies; and

- to reduce barriers to trade in goods and services among participants in a manner consistent with GATT principles, where applicable, and without detriment to other economies.

One characteristic which sets APEC aside from other international organisations is the integration into APEC of the work of the private sector. The Asia Pacific Business Advisory Council (ABAC) - another example of alphabet soup - exists to provide advice to APEC leaders and constitutes a reality check on proceedings. In the Telecommunications Working Group the private sector has an integral role in the Working Group's deliberalisations. We are also seeing representatives from consumer groups - both of business telecommunications users and more general users - in the Telecommunications Working Group. This provides a welcome additional dimension to our discussions.

Over the years which APEC has been operating a number of initiatives stand out. In 1994 at Bogor in Indonesia economic leaders agreed to a timetable to achieve the goal of free and open trade and investment in the region, no later than 2010 for the industrialised economies and 2020 for developing economies. To us in Hong Kong, this may seem no big deal but, in fact, it represented a considerable shift in opinion in the region towards liberalisation. This in turn contributed to a situation where in February 1997 in the WTO Agreement on Basic Telecommunications all APEC members who are WTO Members (that is, all except the People's Republic of China and Chinese Taipei) contributed offers on liberalisation of their telecoms markets.

Trade and investment liberalisation have been common themes for several years now in APEC together with economic co-operation initiatives. Through the mechanism of Action Plans to achieve the free trade objectives across the region and through Individual Action Plans APEC is attempting to realise its aims. The Individual Action Plans are important (but non-binding) commitments by economies on market opening. Economies are being quizzed on the Individual Action Plans and through this peer review encouraged to improve.

Over the past few years priority is being given to the development of activities which can assist Small and Medium Enterprises. This is important for Hong Kong for, as the Financial Secretary observed in a recent speech to an ABAC Roundtable on Electronic Commerce in this building just last week, Small and Medium Enterprises are Hong Kong's lifeblood. Important initiatives last year were related to simplifying customs procedures and providing better information on government procurement and investment regimes.

For this year of 1998, Malaysia takes the Chair of APEC. Its theme for the year is to build on economic and technical co-operation - particularly human resource development and harnessing the technologies of the future. In this connection, a Task Force on Electronic Commerce has been formed - of which more later. The ABAC meeting I mentioned just now was to provide a private sector input into that Task Force.

Telecommunications

But now turning to telecommunications in APEC. The Telecommunications Working Group (the TEL) was formed in 1990 to address human resource development, technology transfer and regional co-operation, and telecommunications standardisation. It meets twice a year, currently under the chairmanship of Canada, with Singapore as the vice-chair. The primary tasks for the TEL are to improve and strength the telecommunications and information infrastructure in the region, and to facilitate effective co-operation, free trade and investment in telecommunications in member economies.

The Ministers of the Telecommunications and Information Industry met in Seoul in 1995 and produced the Seoul Declaration on an Asia Pacific Information Infrastructure, containing ten core principles aimed at facilitating trade and investments. These are :

Objectives and Principles for the Asia Pacific Information Infrastructure included in the Seoul Declaration for the Asia Pacific Information Infrastructure (May 1995)

Objectives

1. Facilitating the construction and expansion of an interconnected and interoperable information infrastructure in the region;

2. Encouraging technical co-operation among member economies in the development of the infrastructure;

3. Promoting free and efficient flow of information;

4. Furthering the exchange and development of human resources; and

5. Encouraging the creation of a policy and regulatory environment favourable to the development of the Asia Pacific Information Infrastructure.

Guiding Principles

1. Encouraging member economies in the construction of domestic telecommunications and information infrastructure based on their own reality;

2. Promotion a competition driven environment;

3. Encouraging business/private sector investment and participation;

4. Creating a flexible policy and regulatory framework;

5. Intensifying co-operation among member economies;

6. Narrowing the infrastructure gap between the advanced and the developing economies;

7. Ensuring open and non-discriminatory access to public telecommunications networks for all information providers and users in accordance with domestic laws and regulations;

8. Ensuring universal provision of and access to public telecommunications services;

9. Promoting diversity of content, including cultural and linguistic diversity; and

10. Ensuring the protection of intellectual property rights, privacy and data security.

Next month in Singapore, there will be the third Ministerial Meeting of the Telecommunications and Information Industry. I am pleased that a representative from the Hong Kong Telecom Association will accompany Mr K C Kwong to this, his inaugural meeting. An important item on the agenda and one which is indicative of the practical bent of APEC is to endorse a Model Mutual Recognition Arrangement (MRA) whereby test results and later test certificates from recognised certifying agencies and laboratories will be recognised throughout the APEC member economies which agree to follow the MRA. As economies come on board this will provide benefits to our telecoms equipment exporters as red tape is reduced and products can be placed on the market more quickly. For our consumers there will be corresponding benefits in relation to products from other APEC economies. The final details of the MRA are being worked out as I write at a special meeting in Los Angeles - building on the work in which many of you participated in January this year in Hong Kong.

Electronic commerce

Electronic commerce is a significant topic of discussion in a number of APEC fora, but particularly in the TEL. At the last meeting of the TEL in Brunei Darussalam, there was a useful business-oriented forum on electronic commerce. One interesting overview of the regulatory and legal barriers to e-commerce concluded that such barriers were not all that high. Indeed to think of barriers might retard implementation and the pragmatic way to proceed was to utilise as best as possible the existing regulatory and legal framework of ordinary commerce. But there were two important issues for e-commerce users - and this was borne out at last week's ABAC roundtable on e-commerce - these were that of security and privacy. In this connection, one of the things we in Hong Kong will be considering is the establishment of Certification Authorities. The work of APEC in collecting and collating this information and bringing to our attention work and in other fora like OECD is invaluable to our consideration of these issues.

Because e-commerce straddles the interests of a large number of Working Groups and in order to take stock of the rapid developments in e-commerce so that its benefit can be shared across the region, APEC established in February 1998 for one year an Electronic Commerce Task Force. This Task Force is now in the information gathering mode and inviting papers from interested governments, trade bodies and companies on the issues as they see them. These papers and the information collected will be reviewed at a meeting in Kuching, Malaysia in mid-June, following which advice will be put together for presentation to ministers and leaders by the end of the year. A particular concern is how SMEs can benefit from e-commerce. I am pleased that in just the last weeks we have seen the announcement of private sector initiatives in e-commerce in Hong Kong to benefit SMEs.

Conclusion

APEC is developing to be a significant forum in the region in telecommunications. But the amount we can get out of APEC relates to the amount we put in. If we wish to influence events we must participate. In this connection, I would urge people in the telecoms industry to participate in the meetings of the Telecommunications Working Group. As usual, I will pass round information to the major telecoms carriers, the Hong Kong Telecom Association and interested parties about the next meeting which will be held from 7-10 September 1998 in Port Moresby, Papua New Guinea and in March 1999 in Japan. I look forward to more participants from Hong Kong, China in the work of the APEC TEL.

End/Wednesday, May 6, 1998

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