Global Industry Calls for Breakthrough on ITA Expansion at APEC Trade Meeting

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In a statement released today, more than 80 trade associations from around the world are calling on the trade ministers from the 21 Asia-Pacific Economic Cooperation (APEC) economies descending on Qingdao, China May 17-18 to reach a breakthrough in the negotiations to significantly expand product coverage of the Information Technology Agreement (ITA). Expansion of the agreement will create hundreds of thousands of new jobs and make the newest technologies more affordable and available to everyone.

Those negotiations made significant progress last year. Indeed, most negotiating parties were engaged in big end-game moves at what was supposed be the final round of talks in November in Geneva.  But China showed up with a super-sized list of “sensitive” products it did not want included in a final deal and was unwilling to meet the ambition level of virtually everyone else at the negotiating table.  After two weeks of frustrating meetings, the talks broke down.

Six months have passed since then and the signatories of the global industry statement are hoping this weekend’s APEC trade ministers meeting in China will be the action-forcing event to restart the negotiations in a manner that will lead to a strong conclusion. Specifically, the associations are urging the “APEC economies participating in the negotiations to exercise strong leadership, embrace the long-term benefits of ITA expansion, and limit product sensitivities so an ambitious outcome can be achieved as soon as possible.”

APEC and the ITA have been closely tied ever since the 1995 APEC ministers meeting in Singapore played a huge role in the establishment of the ITA. Similarly, APEC has been a big supporter of the next big step for trade in tech products – ITA expansion. To wit, in 2011, APEC leaders committed themselves to“playing a leadership role” in launching the ITA expansion negotiations.

More recently and more significantly, the APEC leaders last October explicitly called for a conclusion of the ITA negotiations by the time of the World Trade Organization ministerial meeting in December. Despite these high-level instructions from the APEC leaders, an ITA deal did not come together last fall as hoped. That was a big disappointment.

The APEC trade ministers now have an opportunity to follow through with what their leaders said should have been completed last year. With the exception of the European Union, all the big players in the ITA expansion talks will be represented at the APEC meeting in Qingdao.

The 64-million-dollar question is, will China, the odd-man-out in the negotiations in terms of ambition, “embrace the long-term benefits of ITA expansion” and match the ambitions of others at the negotiating table? 

China is the biggest importer and exporter of tech products and components in the world, meaning it stands to benefit enormously from an ambitious ITA expansion outcome.In fact, the benefits of ITA expansion to China are outlined in a new paper from the Information Technology & Innovation Foundation. China is also the official host economy for APEC this year and its trade minister, Hucheng Gao, will be presiding over the meetings this weekend in Qingdao.

Those meetings will be an opportunity for China to help get a big trade win for its own economy’s ability to innovate and grow, for APEC as an institution, as well as for the global economy.  Will China seize this opportunity?  We’ll know on Sunday.

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