We have a power line up here of policy officials that cover not only those two organizations but issues beyond that, so I think we'll try to take advantage of their great expertise here. We're going to let each of them make a few opening remarks, and then I'll ask them a few questions, and then I'll open the floor to all of you. So let me just go down the line first, and I'm not going to do the full introductions because you have the biographies there, but to my immediate left, your right is Mr. Shigahiro Tanaka, who is the Director General for the Multilateral Trade System Department at the Ministry of Economy, Trade and Industry, or METI in Japan. Tanaka-san has been in his job only a couple of months, I think, in this particular job, but he's a long-experienced expert in a range of trade issues, including APEC, which he's worked on a couple of times, most recently as the APEC senior official from METI, until very recently. So he is going to be able to talk about a lot of issues that will be of interest. Were you also the East Asia Summit senior economic official for METI, effectively? Well, yeah, basically. Okay, so effectively he was also very involved in the East Asia Summit, so I don't think that's mentioned in his biography, but so Tanaka-san, we're delighted to have you. So Tanaka-san is Bob Wong, who is the newly arrived senior official for APEC, but Bob is a well-known figure, especially in this room and this building, because he served here as a visiting fellow a couple of years ago before he went out to Beijing to be the Deputy Chief of Mission at our embassy in Beijing. Bob is a longtime Asia Hand at the State Department, and we've worked together before, and I'm delighted to have him back in Washington and with us here at CSIS. And then next to Bob is Aero Aujaro, who is the Deputy Assistant USTR for APEC and localization barriers to trade, which is I think the longest title we have here today. But all very, and we didn't even spell out APEC, which would have made it even longer. But all important issues over there at USTR, she can talk, I'm actually interested. I hope she will talk about the localization issues in particular, because that's a sort of new function for Aero and for a new area of focus for USTR. I mean, it's been there for a long time, but as a particular area of focus. Aero and I worked very closely together when I was at the White House on the US APEC year in 2011, and I'm delighted to have her here with us to talk about this year's APEC summit and US objectives there. And finally, last but not least, Michael Kaplan, former colleague of mine at the US Treasury Department. He's still there. He's the Director for South and Southeast Asia. And he's also the senior financial official in APEC. There is an APEC finance minister's process that Michael is in charge of, and he will talk to you about that. But Michael, I'm also going to test him as well, because he follows broader issues in the region, including, of course, the macroeconomy, the macroeconomic and growth situation in this part of the world. It's a subject of great interest in the international economic circles these days. So that's our panel. They're all terrific, and we'll bring a little bit different angle each of them to this conversation. So with no further ado, I'm going to let Tanaka-san begin. Thanks. Well, thank you very much. And I would like to thank the CSIS for hosting this meeting. And I'm very honored to be here to speak before you. As was introduced, my present portfolio does not necessarily focus on Asia, but since I was working on APEC and ASEAN-related matters for some time, I think I'll be speaking on this issue, I'll be quite brief. But since there are so many distinguished people who will be speaking on APEC, I think I'll rather focus on the ASEAN side when I speak. Plus processes, including the East Asian Summit in my presentation. First, Japan has been a long and consistent supporter of the ASEAN integration. And we see the notion of ASEAN centrality as a key in approaching this Asian architecture issue. We see the East Asian Summit and all the other ASEAN-related forums as a forum which is necessary in achieving stability in the region. We see them as the main role of these forums as being to minimize the economic impact of political and security uncertainties in the region. Although we know that events in the South China Sea and other disputes may have posed challenges, we think that the closeness of the security issues and the economic and the business environment in the region makes it absolutely necessary that we have these kind of forums in place. One question that comes to my mind is, with the strengthening or dealing with the economic agendas, and these forums will help alleviate the tensions or increase stability in the region. I think our answer is an unequivocal yes, and I think the history of the East Asian Summit itself is proof of this. If we see the agendas or what has been discussed in the past East Asian Summit meetings, I find some of the priority areas that they have identified which comes from which is like energy and environment, finance, disaster management, education, global health issues, pandemic diseases, and ASEAN connectivity. Well, all sorts of economic and business-related agendas. And of these, first I would like to highlight the connectivity, the agenda. Actually, this ASEAN connectivity agenda was added to the EAS priority areas in 2011. In this context, reference was made to contributions from ARIA, ERIA, a short abbreviation of Economic Research Institute of ASEAN in East Asia. This is actually a think tank that was established in 2008 in Jakarta. And this is a very important asset for ASEAN. And it works basically as a think tank in providing the intellectual inputs, not only the field of economic policy, but also other important issues related to ASEAN integration. And they have been working very hard with the ASEAN Summit processes in coming up with what they call the Comprehensive Asia Development Plans or Master Plans on Asian ASEAN connectivity. And on these issues, what exactly is, do they mean by connectivity? There are three aspects. One is physical connectivity, which basically is about the infrastructure side. And then comes the institutional connectivity, which is about mutually recognizing standards or providing single windows for government regulations or achieving free flow of investment or service movements throughout the region. And the third is the people-to-people connectivity. What they actually mean has been discussed in the ASEAN process by several ministerial meetings. But one of the ministerial meetings, which is called the EAS Economic Ministers Meeting, has just held their meeting in Burnai and has announced to formalize their process to deal with these kind of issues. They've actually agreed to address issues on the connectivity side. And first, they have pointed out that they would like to focus on the business connectivity, meaning a mere physical connectivity is not enough to really raise the economic level of this region. And by using the word business connectivity, their intention is to address development of supporting industries, or leading to a broad and stable supply chain network throughout this region. They also are placing a lot of importance on institutional connectivity, including on the regulatory cooperation, which again is, of course, will have a huge business impact. The second thing that I would like to emphasize is that these East Asian Summit processes and also all the ASEAN plus processes have helped, has worked as a vehicle for promoting economic integration in East Asia. Actually, they have worked as an incubator for regional FTAs, as APIC has in relation to TPP. Until 2011, there were a huge discussion among the ASEAN plus forums as to which way they should go, meaning whether ASEAN plus six route is better, or ASEAN plus three, meaning ASEAN, Japan, Korea, and China only would suffice in terms of creating a new FTA. Finally, the agreement was to formally launch what is now called an RCEP, Regional Comprehensive Economic Partnership, which was agreed upon and formally launched in November last year. Of course, this is something that is in a sense competing, but also with TPP. But on the other, we see it as more and more an effort that is needed to help each other, boost each other, and eventually lead to a more cohesive free trade area throughout the Asia-Pacific. The situation for the RCEP is that since the formal launch last year, they have had several negotiating sessions, and their goal is to have a conclusion by 2015. And so that's the other aspect of this East Asian corporations. And the third thing is that I think one of the key goals of these meetings is to keep on supporting the realization of the ASEAN Economic Community, which also they have the goal of achieving this by the year 2015. Here again, it is very helpful and will ensure that this process will continue to be healthy and provide a very stable business environment by the involvement of the countries like the United States or Japan or the others. And I think that is another very important aspect that we have to look upon. I would like to just briefly, to our end, refer to some of the special features of the East Asian Summit. First, this EAS is one of the few forums where Cambodia and Laos or Myanmar can be treated or dealt with in the multilateral context. So far, these countries are not yet members of APEC, for example. And also, EAS is a forum which includes India as its partner. So the role of engaging India in the policymaking in this region is also another very crucial role for the East Asian Summit process. And when I compare the East Asian Summit process with the other forums, for example, there is what we call the ASEAN Plus 3. And actually, this forum still remains to be very active with its own institutional mechanism. So although there are some overlapping areas that they deal with, you also have to be mindful of the fact that there are still several competing forums in this region. But EAS is still the only forum in which India and China both play a very important role. And we see this as another added value of the EAS process. And under EAS, although it's still a very young process, it is not as developed as APEC or other forums. It doesn't have so many ministerial meetings as the others. But also, they do hold back-to-back meetings of ministerials of different configurations. And so my experience tells me that there are all sorts of ways to deal with these settings in a more efficient manner. And I think that's the kind of role that EAS can play in terms of contributing to this overall Asian architecture, especially in light of the business or the economic perspective. I think I'll stop here for an initial presentation. Thank you. Thank you so much, Tanaka-san. That was very helpful, especially to those folks who don't follow the EAS and RCEP and the economic dimensions of EAS in particular, which isn't as big a focus here in Washington. I'm going to ask about that later. OK. Thank you. As Matt said in his introduction, I am newly arrived. In fact, I arrived last night. No, actually, I've been on this job for three weeks now, full weeks. But I just went on this whirlwind tour of Asia back to Tokyo and Bali and Jakarta and so on. I just arrived last night. So if I say anything that doesn't make any sense, please just assume it was because of my just having arrived. But anyway, since I'm very new at this, let me just give you a brief comments about how I see APEC in particular. Tanaka-san I met in Tokyo had talked about ASEAN already. And let me just tell you a little bit about how I see APEC, both in terms of its architecture, in terms of the Asian region, as well as in terms of its priorities. I have on my left, of course, Arrow from USTR who's going to talk a lot in details about the trade and investment side of APEC. So I'll focus more on other sides of APEC beyond that. I guess my first impression, what strikes me most about this job, about APEC in particular, I guess, is the fact that, and this is really reinforced to me on this trip, it's not so much about the breadth of APEC, which is, of course, as you know, 50% of the GDP of the world, four continents, if you include Australia as a continent too, of course. And it was very, very wide, top three countries, economies in the world, and so on. But beyond that, what really strikes me, apart from the breadth, is the depth of APEC. And I think what I would call the organic nature of APEC. Depth, I mean, for example, there are about 200 meetings every year, apparently, in APEC. I just went to one of them, two of them. There are about 200 of them. And actually, most of them are not the ones you think of. Most of you, of course, and most of the public look at the leaders meeting where the presidents all arrive and wear different costumes. And then you might see some ministerials here or there. But really, actually, I found out that, obviously, about 95% of them are actually at working levels of officials from 21 economies working with each other on a wide range of issues, from health, food. I went to the Women in the Economy Forum, anti-corruption, SMEs, and so on. It's the depth of the organization is such that you have, again, a very deep-rooted foundation and habits of cooperation and working on different issues among these different economies. And I think that's really quite impressive, because it's partly an educational process. It's partly a relationship development process. And it's just a process of getting to work with each other on all these different issues. So I think the depth part is something I think is very important. The other one I mentioned is, of course, organic nature of APEC. By that, I mean, if you look at APEC when it started in, I guess, officially in 89 and then 93 and on, most of these economies already had existing trade and investment ties. And all APEC did, really, as it got them together, was really simply to institutionalize and to expand and deepen these ties and improve these ties. So it's organic in the sense that it's not an artificial creation where you have, I mean, G20 is fine, but it's all from all over. You bring people together, countries together that really actually don't necessarily interact on a daily basis with each other. Whereas you have in APEC, the supply chain already established and when it was formed. In fact, by 1989, it was already quite a lot of this. And APEC simply means it is meant essentially to institutionalize these different ties and then deepen them and working further on them. And so I think from that perspective, this foundation is very sturdy because, again, that's why we have so much business private sector involvement in it. I met at every stop with APEC members in Japan, in Jakarta. This morning, I met with our APEC member, Bart Peterson with Eli Lilly, so much economic interest because they already have these very practical ties that they really do value a lot. And so APEC simply works to bring in the private sector with the public sector. And every single meeting we have, for example, the leaders week coming up will have an APEC forum that essentially goes many, many days, you'll have the CEO summit, and then you'll have the leaders and the ministers. So the organic nature of this organization is such that it really does meet the very practical needs of business community throughout the 21 economies. So I think that's important to note that I think some organizations may not have. Now, briefly on priorities, I think clearly we still remain very much focused on the market opening, trade and investment liberalization as the primary focus of APEC and what it's trying to do. I think right now the attention may be on TPP. I know TPP is not really the APEC process anymore, but it came out of APEC members, the P4. And after and whenever it's completed, I think the effort will be to try to expand it to other APEC members as well as economies outside of APEC. So it's a very important focus that we continue to emphasize. And I think it came out of APEC partially because people got together and decided, some within APEC decided to move ahead of the others because APEC, as you know, all of you know, it's a consensus sort of organization. And so out of that, people decided to move ahead in terms of liberalizing trade and they got together and of course moved towards TPP. And so I hope, and that will continue to be the focus I think for many years to come in terms of its expansion and into other members. Apart from that, I think, you know, as I see it at least in terms of my own responsibilities, clearly you could open up the markets, you can lower tariffs, you could do different things, but none of that is really effective unless you have the environment in which the opening can actually take effect. In other words, capacity to building. You've got to have officials who know what they're doing. You've got to have customs officials. You've got to have health officials, et cetera, who know what to do. And so I think capacity building from my perspective is a very, very important part of what we do in APEC. And not just opening, not just lowering tariffs, but actually getting people who are working level people who actually have to implement a lot of these policies know how to do it. So the business facilitation issues. For example, you know, one of the big successes that APEC had with Arrow and others last year was to actually finalize the EGS, you know, the environmental goods and services list and so on. Once you've done that, you've targeted 2015 to complete it, then how do you actually implement it? How do you actually reduce the non-tariff barriers involved in the EGS import-export trade? Well, you have to, we now are then building a capacity, we're now doing a capacity building program to actually go to each of these economies to make sure that everybody understands what the agreement says, how to implement it, and actually get things done. So I think similarly we're, I know that USTR and we and are all working on the supply chain connectivity that Tanaka-san says also, you know, obviously is the focus of ASEAN. And there again, we're trying to get, you know, I sort of, I went hat in hand to Japan, to Taiwan, Taipei, Chinese Taipei representatives to ask them to all support and to contribute to a fund to actually deal with the various choke points that we've seen in terms of the supply chain throughout this region. And again, that's capacity building. The last thing I'll say is that I think there's gonna be increasingly greater focus on the sustainability issue, meaning how to sustain this growth, how to sustain trade and investment that's been opened up. And that involves, for example, women in the economy, and which is a very valuable source of growth for many economies. Or I think after this next week I go back out to the region and we'll be attending an anti-corruption and transparency workshop. And I think we're gonna, in 2014 perhaps and on we're gonna start focusing on the legal framework within which all of these economies interact. As you know, we have problems throughout the region in China, in Indonesia, other places with corruption issues. And so we're gonna start in Bangkok with this act, anti-corruption and transparency. We hopefully will in 2014 in China begin to focus more on this. And it's a very, very long-term process to sustain the social and legal environment that is needed to make business work. So I see my job as essentially rolling up my sleeves, nothing very dramatic, but really working on a lot of these issues of food security, women in the economy, anti-corruption, legal issues and so on. And I think that in the long term, I know that, I guess I come from an academic background and in some ways when I look at what APEC is doing, it's reminded me of the European Coal and Steel Community that was created in 1951 when I was born. So I'm very old. And then that was followed by the common market in 58 and then eventually by the EU. So I see the integration part of it as quite an important achievement and of course focused now on economics, but in the long term, I think the impact of that on the region will be tremendous. So thanks. Thank you, Bob. That was a great overview. And I think you stress the breadth and depth of APEC. I hope you haven't made the mistake that I made a couple of years ago when I got back into APEC and asked for a chart that shows all of the working groups and committees and other things of APEC because it doesn't fit on an A4 piece of paper. You have to tape things together on the wall. And it's easy to be cynical about that, but actually, I mean, I think just to emphasize the point, it really is unique that APEC has this ability to bring together officials from customs agencies and health agencies and energy and agriculture agencies together at a working level to work and try to do the pick and shovel work of improving economic integration. And I don't think there's, I know, there's no other organization in the world that does it and certainly not one that has the leader's political level above that to help drive that process. So I think APEC is very important, but anyway, I didn't mean to editorialize, but just to sympathize in a way. You said it much better. All right, Aira. Well, hopefully I can find a third way to say it that will be even better than that. But so I think this is a great time to be having this discussion because as you know, we're ramping up right now for the leaders meeting in Bali. And this is a pretty important year for APEC in carrying over some strategy that the US has for that organization. I mean, when we hosted APEC in 2011, we took very seriously what Bob has talked about in terms of the success of the technical level work at APEC. When we bring the regulators together or we bring other trade officials together year after year after year, it really does promote coherence in the region. But the question was, are we really using that top level leaders, ministers process as effectively as we can to elevate some of that work and make sure that we're resolving practical issues that impact our companies in the region? And the answer was we could do a better job. And we could focus more at that top level on solving practical problems. And actually what we said in 2011 as Matt will recall is to get stuff done. We could really get stuff done at the leaders and ministers level. That's the PG version. Get something else done was the official. But I have to say that saying get stuff done has really resonated. I heard Ambassador Froman use it this morning in another context. So it's definitely something that has stuck with us. And so in 2011, we were successful at achieving some practical results that we carried on into 2012. Bob alluded to our commitment to reduce tariffs on environmental goods. This is the first time in years that any organization has actually made a tariff commitment like this. It's the first time we've ever been able to come up with a list of environmental goods. We've gone way beyond what we were able to do in the WTO. And the reason we were successful in that space and in others is because we took the technical work that we'd been doing for years on environmental goods and combined it with the political pressure of leaders and ministers to produce a result that was easy to understand and would have real benefits for the region. Not only in terms of trade, but also in terms of all of our green growth goals. So leaving, we left 2011 and 2012 and now we're into 2013. I mean, we were very pleased with the Russia host year and that they also took a very practical and substantive approach to their year. They advanced specific issues that they thought were important for the region for example, they established a new public private group on innovation and they looked at commercialization of innovative technologies and other things that they think are really important for economic growth. And we supported their focus on the substance. They stayed away from having a lot of vision statements for how APEC can work 50 years from now and just focused on the here and now and solving practical problems. And that's what we also hope to do in the Indonesia year. And so when I say it's an important year for APEC, it's important because we need to see the focus on practical issues and resolving problems continue if this organization is going to be able to produce more results like the environmental goods result from last year. So having said that, I guess it'll be no surprise to you that we've set out some, some specific trade and investment goals that we'd like to achieve and I'll go through those. We've welcomed the themes that Indonesia has put forward. Every year there's a new host of APEC and they set out their own themes. Indonesia's are intaining the Bogor goals, sustainable growth with equity and promoting connectivity. You'll note that their connectivity theme is also being dealt with in the ES and so you can see how through members there's some synergies between those groups. But what we at USTR have focused on is mainly the theme of attaining the Bogor goals and what can we really do to accomplish that? For those of you who don't know, the Bogor goals are free and open trade and investment in the region for developed economies by 2010, so we've passed that and for all economies by 2020. So I'll just focus on our sort of top level priorities for Indonesia but that will give you a sense of the kinds of practical things that we're trying to achieve. I mean, Bob already talked a little bit about our major supply chain ask for leaders when we go to Bali, which is to establish a dedicated fund to enhance supply chain performance through targeted and focused capacity building. I mean, APEC has made a lot of commitments on supply chain over the years but we've set a goal of improving supply chain performance by 10% by 2015. In order to achieve that, we're really gonna need to ramp up activity. We're gonna need more money and more resources and we're gonna need to bring experts to individual economies to solve specific and practical problems and that's what the supply chain fund is meant to achieve. We are also taking a look at APEC doing more work on localization. Specifically, we launched an agenda last year to look at the harmful effects of local content requirements and to figure out a way that APEC contribute to addressing those measures. I know a lot of private sector folks in the United States at least are very concerned about the proliferation of those measures around the world. We are also at USTR, which is why my title got a little bit longer in the past year. But in APEC, what we're looking to do this year is to agree on a model for how to promote job creation and competitiveness and economic growth without resorting to those kinds of trade distorting measures. This is a very positive contribution that APEC can make by giving some high level capacity building to economies on what they can do to create jobs besides things that are gonna distort trade and ultimately hurt them in the long run. APEC also has a long agenda on regulatory coherence. We started that at a higher level in our host year. This year we're looking to take that forward. We are continuing to work with economies to ensure that they have internal coordination of regulatory work. They're assessing the impact of regulations and they're conducting public consultations. But we're also gonna ask them to start using some more specific tools such as establishing single online locations for regulatory information, regulatory planning and periodic regulatory reviews. So this is all pretty wonky stuff but very, very important for the success of trade and investment in the region to promote regulatory coherence. We're also looking to advance work on to make sure that the innovation policies that APEC economies put in place are nondiscriminatory market driven. And as Bob mentioned, we are continuing our work to help APEC economies implement that environmental goods tariff commitment as well as to address non-tariff measures on related to environmental goods and services. And so the final priority that I'll mention is we're getting close to the ninth WTO ministerial meeting, which is also gonna be hosted by Indonesia and Bali in December. We think that the APEC Bali meetings will actually be a very good opportunity for the APEC ministers to come together and hopefully provide some political impetus to a successful result of the MC9 that definitely includes a binding trade facilitation agreement. And we also hope that APEC ministers and leaders will put a lot of pressure on their counterparts to finish an expanded information technology agreement in Bali. So I guess the last thing that I would just say in conclusion two things about APEC and what all this practical work means. First of all, we think that APEC's ability to focus on solving real problems in creative and innovative ways because it's a non-binding organization makes a pretty significant contribution to binding negotiations like the TPP. Some of our main priorities in TPP originated in APEC and we are also helping APEC economies who are not members of the TPP negotiations to understand what those, what kinds of issues would be addressed there and to prepare them for one day being able to sign on to those negotiations. And so that in that sense, APEC is playing a very powerful role in trade and investment issues outside its own agreement, its own meetings. And then finally, we are still very much committed to the bogor goals of achieving free trade and investment, free and open trade and investment by 2020. I mean that when that goal was first established, I think a lot of people thought, well, that's a long time from now 2020 and it's really not that long now. And the definition of what free and open trade and investment means expands every day. But it's been a very useful organizing tool for APEC and I think for all of us who are interested in promoting trade and investment in the region. So thank you. Thank you, Aero. I understand much better what we're trying to get out of this year and going forward. So that's extremely helpful and I wanna come back and ask you about next year, but we'll come back. Michael. Yeah. Thank you very much for inviting me and I'm extremely gratified to see that there's such a broad interest in this topic. We know as well as was said that APEC is very deep and very broad. It can sometimes be hard to get your hand on what's going on and I'm very happy to give my input from a treasury side, which I think was alluded to, doesn't have the highest profile in the sense of what's going on in the leaders process, what's going on in the ministerial process, but yet does retain for the finance ministry is a very important part in international collaboration and for the treasury department. It's a very important vehicle for us to engage with Asia as well as the pan Pacific, but it's what we think about APEC is especially focused on what's happening in Asia. Now I can continue the theme that was set up before about the utility of APEC being for a broader consultation, making sure that we're on the same wavelength as our other economies and then the practical aspects of how these economies get together and work on common issues. So our finance ministerial will be next week and the practical, I'll start with the easy parts in a sense that the practical outcomes that we're doing are very much a follow through from some of the ideas that the United States put on the table when we had to host here back in 2011. We're working on things like infrastructure financing and this is like the development of public private partnerships for infrastructure, which is a way for us to share knowledge and us to learn what's happening in the region as a number of these countries are struggling to get private infrastructure, both infrastructure in general and private infrastructure off the ground. I mean, sort of working on a theme for the last couple of years, which is a statement that we know that there are deep pools of capital in the world and we know that that capital would like to go to things like toll roads and fast growing emerging markets. And we know that these same emerging markets are stretched on their budgets and would like to have that private capital. So it seems like a match made in heaven and yet many times these deals don't happen. And there's some general principles that you can talk about amongst different countries and there's some practical issues that are very country specific, how the Philippines deals with it is very different than Malaysia, which is useful to collaborate amongst the different groups of experts. And if there was not APEC, then there would be an absence of this kind of cooperation. So that's one important thing. There's another theme this year which is called financial inclusion. Again, it's something the United States takes very seriously and a number of emerging markets that are APEC members also, it's like number one on what their leaders talk about, the need to address some of the poverty issues and development issues by providing credit to residents and to SMEs that didn't have it before. And there's a huge potential for learning from each other, although conditions in the United States are of course quite different than they are in Peru or in Indonesia. There's a surprising amount of commonalities and a good opportunity for learning together. So this is the way that the Treasury and the other Treasuries in the region sort of collaborate on a practical, fruitful, technical way. On the bigger picture, APEC is still the channel that we see for collaboration on a macroeconomic and global financial policy. And I can put APEC against G20, people know that the G20 has existed for some time and it became the main vehicle for international collaboration for the global financial crisis. And if you think APEC does not have Europeans in it and the ministerial consultations are for finance ministers, they're not finance ministers in central banks. So it leads to a different focus in the nature of these consultations where for better or worse, no Europe means that there hasn't been the intense focus of G20 on ensuring that Europe grows out of its problems of the last few years. The dialogue in APEC has been more free to focus on sustainable growth in the region, what the Treasury Department's called rebalancing. It's a bit different than what Scott Marciel called the rebalancing in Asia. But rebalancing in countries current accounts, we're concerned about the accumulation of reserves, the right valuation for currencies as they relate to foreign trade and issues like this. So APEC provides us a really good opportunity at the finance level to delve into those issues in more detail. And next week, this is going to be very much a theme for the consultations to be held. Of course, we were to think back to the last year's conversations and how the world was at the time and think about how we are today. It's a useful and a necessary opportunity for the finance ministers, the heads of delegation to check in with each other. So I know Matt is trying to think of some zinger questions for me about the growth issues, but I'll just sort of highlight some factors.  People are still wondering about how far it will slow down. What is the nature of its stabilization? That has a huge impact on countries in Southeast Asia. It has a huge impact, of course, on our own economy and on Latin America. Commodity prices, for example, in line with Chinese slowdown, have fallen very significantly. So if you are a commodity exporter, you are in Indonesia, you are in Malaysia, you are in Latin America, then this is going to have, it's going to have, it has had and will have a significant impact on your current account and on your growth, right? The latest news is that economies that are more advanced, the United States, Japan, Europe also are doing a bit better than they were doing before.  So there's definitely a change in the theme of the conversation. Last year, a few years before that, it was APEC was the place where you had to be because that's where the growth is. That's where the young people are. That's the dynamism in the global economy. You have to put your money there. And to the extent that it's still true, the latest news is it's a bit less true than it was before. And so we've seen a number of market dynamics in Southeast Asia, for example, where investors are reevaluating whether or not that story that they had, sort of the theme of the way they were thought about global growth, whether or not that's still intact. And if it's not intact, what does it mean? So whether or not countries are dependent on foreign capital or not, whether or not they are dependent on exports or not, there's a process now that's going on in markets about how investors should think about these issues. And finance ministers, when they get together to have these conversations, you can bet that that's going to be front and center on their plate for discussion. And so APEC continues to provide this vehicle for the United States to engage and to engage in Asia as an open architecture concept. It's not the ASEAN plus three, which doesn't include the United States and doesn't include members that are not in the ASEAN plus three. It's an opportunity for us to go there. We get to talk to them directly and they get to hear from us directly, both at the level of the heads of delegation and the ministers, and then we have meetings during the year to share our perspectives. And so it's a very rich avenue for collaboration. Treasury is not a program agency, so people want to ask what is the rebalance to Asia or what is the pivot to Asia? What does it have to do with economics? You know, we don't come with many new deliverables on the Treasury side. Our answer to this says, well, have you noticed we're doing the Trans-Pacific Partnership? That's sort of a big deal. And we like to remind people that the United States FDI in Asia is bigger than China, Japan, Australia, combined. We're still huge. The stock of our economic stake in that region is enormous. And so APIC provides us the vehicle where we continue to have these important policy consultations with the region and advance the United States' economic interest. So I can finish there. Okay, thank you very much, Michael. And I now realize I'm not gonna be able to ask all the questions I wanna ask, including the ones I promised to ask. So hopefully some others in the audience are gonna pick up on some of this. But I think we just got a lot of rich food for thought there. And I wanna start by asking a question really of everybody, but maybe starting with Tanaka-san, Michael have a view on this. I mean, we've all been talking fairly comfortably about the notion of doing APEC over here and doing EAS over there and doing G20 in a third place. But it feels kind of to an outsider, like this is pretty messy. And it feels as though, especially if you've got OCD tendencies that there ought to be some way to sort of bring this stuff together and make it a little neater. I mean, I guess the question is, are there in a practical sense Tanaka-san when you're doing work in APEC and EAS back to back, places where the two forums are doing things differently, incompatibly, where you have to sort of say, well, gosh, we don't know which way we should go with these things and where there might be some room for trying to make all of this a little more efficient and cleaner? Well, I don't think there's any clear cut answers to these type of questions. I think in reality, what I sense when I was doing these kind of things in several forums was that since the task was so big and there was so many things that had to be done before we were too worried about overlaps of any efforts, I always felt that we were still lacking in terms of research and everything and how we can tackle all of these things. And as a matter of fact, I think coordination in each government and also with other governments is done much more than people believe them to be actually taking place. And also as long as we shared the basic directions or the goals, I don't think that seriously brings about problems. But of course, we always have to be mindful that kind of inconsistencies or some sort of clashes among the forums could happen. So we have to watch out. But my experience was not so serious in that regard in my case. Tensions between these different groups that not just, I mean, there's clearly a capacity tension particularly for the US government with the sequester and things. And I actually was going to read out some fun facts about USTR's budget and how much it's been. The sequestration savings, the sequestration savings at the USTR on a monthly basis are less than it costs to purchase a Taco Bell franchise in Maryland, according to the Center for American Progress. So it's sort of trivial what is being cut and yet it's really impacting their work because they can't travel, they can't attend these different things. So they're clearly capacity issues and if people want to speak to that, they can. But I really was interested more kind of from a policy perspective, whether they're conflicts when you go into these different groupings. Yeah, I mean, I'll just answer really briefly. I think our main concern at USTR in that regard is that if you spread out the conversation on certain topics to sort of too broadly, I mean, if you spread it out broadly, there's both benefits and downside to it. I think the benefit is that you reach more people and so you can kind of influence more people in a policy direction, but the downside is that you might water down any one individual activity. And so when we look at the various agendas, we do try to eliminate duplication to the extent we can, but I would agree with Tanaka-san that it's not been so far a significant problem for us. We keep a very close watch on it. Sorry, thank you, Ernie. Which is maybe the more positive side of this question, which is the positive repercussions or overlap or spillovers that one organization may have on another. And I'm wondering in particular with TPP, at least possibly within reach this year or very soon thereafter, there's sort of a feeling that it's starting to, in fact, other parts of the architecture discussions, like bilateral FTAs between Korea and China. We heard some reference to the Koreans saying the Chinese are taking a somewhat more sort of a higher standard approach to that negotiation. China is now interested in doing a high standard bit with the United States. I wanted again to not put the burden on Tanaka-san again, but when you're now working on the EU, Japan, FTA, is some of your, now that you're in TPP and working on standards there, higher standards there, is that having an effect on what your negotiating position is with the EU? Or in our set, that was the other one. I mean, is the conversation sort of changing because of the dynamics in the TPP in particular? Well, I think the short answer is yes. We're living in an era of mega FTAs, EU, Japan, TPIP, TPP, TPP, RCEP. Of course, not all negotiations are achieving or trying to aim at the same kind of level of liberalization, but still it's clear that all these negotiations are sort of boosting each other, helping each other in a sense. And actually, I've seen more positive, size of positive effects of movements of any negotiation on the others, especially TPP, since it seems to be very close to its goal compared to the others. I'm sure that, and I have also felt literally that it has put a very positive pressure on the other negotiations, and especially on things that are being negotiated among the developed world. I think more and more, I see more and more convergence of agendas or the way that we want these negotiations to achieve being more aligned with one against the other. That's what I feel. Can I add something? Yeah, sure. On this point, I understand that, of course, you have RCEP with the ASEAN plus six and then you have TPP, but on this point, I think not only is it just a matter of pressure, but I think the fact that you have so many FTAs and RTAs running around the field, it's sort of good to actually also, and the Chinese have actually sort of talked to me about this in very general terms, of looking at best practices in some ways, you could call it that way. In other words, you look at transparency and how TPP deals with certain services sectors or other kinds of sectors, agricultural sectors or whatnot, then you might talk about how RCEP approaches that or how chorus does that. So comparison of notes, you might say on how these negotiations, transparency essentially, on how these processes deal with different issues can be actually synergetic in terms of informing others as to and future FTAs in terms of how to proceed on these issues, what to worry about and how to do it. So I think something positive actually can come out of it, although obviously there are lots of these things running around. Michael, in that regard, let me make you uncomfortable by asking about the EAS finance agenda because Treasury has, or the United States government has chosen not to really engage in that, although I guess you did deliver the Secretary once, twice now to an EAS finance ministers meeting. But I would think that there would be some value, even if, I understand capacity constraints again, so that may be a real issue, but in substantive terms, I would think there would be some value in your engaging on the finance agenda and helping to make some of those positive spillovers as it were from other efforts you're doing in the G20 or APEC finance ministers or other places, when within the EAS there is this ASEAN plus three kind of effort as well and not all of that, as you say, you're not part of that, you might want to help be part of that conversation indirectly by engaging more on the EAS finance agenda. How do you answer that? Well, thank you. But it doesn't make me uncomfortable at all. I think I can come back to a point that you were raising before about the overlap between the different forum that are out there and whether or not agencies have enough bandwidth to do all this stuff. When I was speaking, I mentioned the difference between APEC and the G20 was the fact that there were no Europeans, in that case there were no central banks. And the creation of the East Asia Summit, which was done primarily for sort of political or political security issues, the special focus there makes sense, but in which way would the East Asia Summit for finance be different than APEC? This is the challenge that we have. In theory, we think it's great, it sounds great, right? But in practice, I've identified the kind of conversation that we'll be having at APEC next week, in which way would the East Asia Summit discussion be different? So we would add India, we would add the small ASEAN members who are not currently in APEC, we would lose Latin America, Canada, I think. So there would be a different conversation, would it be that different of a conversation? There would be something there. And in fact, we're not by any stretch opposed to the East Asia Summit. I think you were characterizing why don't we engage much more. Because we really sit down and say, given our limitations, the time it takes to do these things, the actual outcome which we can accomplish, and what we're trying to do in these fora, is it really there? We have given a lot of thought as of other members in the East Asia Summit in that community, that group of countries, what can we do to make this a really value-added enterprise that would justify the finance ministers getting on planes again? And we're still thinking actively about that. But if there's another meeting, then we're not opposed to that meeting, we're just trying to think, how does this really work? Okay, just one more question that I'll open to the floor, which is starting with Bob, but then, Aero, I want your thoughts in Tanaka-san as well. So China's hosting APEC next year. China has actually traditionally been in these forums pretty constructive as a host because it wants to show that it can manage an event that people not only think has nice pictures with people in shirts, but actually gets things done. So what are your expectations? Bob, before you left, were they already starting to talk about their APEC year? Do you have any sense of what they want to accomplish? And more specifically, Aero, what would we like to see China do next year? And let me make one mic before I, because I want to have another chance to speak, just another advertisement for our paper that Scott Miller alluded to at the beginning of the session this morning, if you weren't here, this paper, working paper, which we're soliciting comments and input on, on enhancing value chains and agenda for APEC next year, which Scott and his panel coming up is gonna talk more about, so I won't get into it, but I just wanted to throw that ad out there. I won't go into details, but the first thing actually the Chinese told me before I left Beijing was that they were actually very interested in the topic we were just discussing, which is they call it convergence. I know Aero will cringe when we call it convergence, but the convergence between TPP and RCEPT. Now you take away the word convergence, what they're interested in, the number one thing is, just to look at the two and just say, see essentially, as all of you know, the initial reaction to the TPP by China was that they thought this was excluding China, this was a Cold War, this was this and that, but they've come around at least to the fact that they actually are looking at this and saying, maybe there's something to be learned from what's going on, and of course they're working on RCEPT as well, which is a very difficult process too, but I think that's one of the things they discussed as something they'd like to focus on in 2014. The other thing that is sort of unique, the other two are not that unique, connectivity, sustained growth, that's what we've been doing, so nothing really new there, but apart from that, they're sort of looking now at what they call oceans ministerial, which is focusing a little bit on some of the maritime issues that would include transportation, mining, conservation, whatnot, so we're looking at this possible proposal and see whether or not, oh, and health, okay, it's just that health too. That's for you now. Oh okay, and so, but this is the side of it, and health is of course an issue that they're very interested in having had SARS in 203, a lot of problems there in China with food safety and whatnot, so clearly another focus. What I'd like to focus on, again, you probably got already a sense of that, is anti-corruption in the legal system. I would really like to push that in China in 2014. I haven't discussed it with my counterparts yet, my interagency, but I think the sort of building of a solid, sort of more solid legal system in China and within the APEC community should be a priority that we can get started in 2014. Thanks, well I guess the first thing I would say is that we would like China to continue with the approach that we've been taking in APEC over the past few years, and to try to achieve some practical results on trade and investment. I mean, that is our number one priority. What specific practical results will achieve, I think will have to be worked out between, you know, among all the APEC economies, and certainly we wanna work closely with China to figure out specific asks of APEC that fit within what China itself is interested in, and some of the things that they've talked about, you know, that they have a specific interest in that we've seen over the past couple of months include, as Bob said, they really wanna look at transparency and RTAs, FTAs. APEC has been doing, has had an agenda on this over the past few years, and I think they want to ramp that up, and we're supportive about, you know, having more transparency, and I think Bob's right that that is a shift for them, and we welcome it. They also wanna look at global value chains, so listen very carefully to the next panel, because I think maybe they'll give some good ideas for what we can funnel to the Chinese. They've made a proposal on, you know, related to investment. We don't know much details about that, but it's not surprising to us that they're interested in that topic, and then we're just, you know, there's obviously a supply chain will have to be a really big focus, because, you know, we're successful in getting a trade facilitation agreement in the WTO, or coming upon APEC's own goal of enhancing supply chain performance. We're looking for APEC to do bigger things, and I think the Chinese are really supportive of that. So bottom line, to continue the practical effects, in areas that mean something for all of our stakeholders would be what we want. Okay, thanks. And, you know, I should have said that, and I guess it was alluded to by several people, but that this issue with APEC of having a host, a new host every year, which is, you know, broadly a good thing does pose challenges in terms of keeping the existing agenda moving forward and reinforcing the things that were done. So it works best, say what we, you know, we got in 2011 on environmental goods and services, which was the basic commitment to lower tariffs by 2015, and then the Russians took that forward and came up with a list of products that would be subject to that. I mean, and there are other examples in regulatory convergence and innovation and others that have been talked about. That's a really critical balance that you have to get of putting in new ideas, and you want hosts to do that, and inevitably they'll want to, but you want to carry forward the good work that's been done already, and so I certainly hope the Chinese are gonna do that. Okay, I've taken more than my share of the time. Let me open the floor to questions. As usual, wait for the microphone. Please identify yourself and ask a question. There's a hand right there. I think, I thank you. I'm Melinda St. Louis from Public Citizen. My question is related to what many of the panelists spoke about, the TPP being an important priority for APEC and in the coming years for other countries to be able to join it. My question is specifically, though, about what the timeline for the conclusion of the current negotiations, understanding that it's been laid out for the end of the year, and how current controversial issues could be resolved for that, and particularly since Japan has just was only at the table for one round, full round so far, and since there, we have officials from Japan and the US here. Specifically, the question, one question I would have, is about the thorny issue of the five sacred commodities that have been laid out by the Japanese majority LDP party. And so the question is, is it likely that the US would allow Japan to exclude rice, wheat and barley, pork and beef sugar, and dairy from TPP tariff reductions? And if not, if Prime Minister Abe is likely to contradict those conditions to seal a deal. Thank you. Sir, US answer, or both. You want to start tonight with that, and then Arrow can boldly try. Well, fortunately or unfortunately, I'm not directly in charge of TPP, so I'll have to limit my comments to just what's been already spoken officially. Japan has participated in TPP and is clearly a strong supporter of the success, and that's it. Well, I know what you want to hear, but unfortunately, I have no ability to add anything or distract anything from what I just said. I hope it's going to be concluded satisfactorily. Thank you. I'm going to say the same thing. I'm sure that my colleague at USTR, Barbara Weizel, would be more than happy to, and as Wendy Cutler would be happy to answer those questions. I'm going to say that TPP leaders instructed negotiators to try to finish the deal this year, but we're gonna, you know, the substance of the negotiation will drive the timeline, and obviously, all key issues will need to be resolved in order to conclude. We, you know, it is very tempting to do TPP here, but we're sort of focused in a different direction. We do have a series that Ernie and Scott run on TPP, and so stay tuned, because we will have those questions and hopefully answers for you soon. Other questions? Yes, ma'am. Very much. I go back to the point that Mr. Wang brought. Identify yourself. Yes, this is Jinning Wen with Voice of Vietnamese Americans. I go back to the point that Mr. Wang brought up about anti-corruption. You said that would be the main focus in 2014. Actually, it would be the main focus for anything we want to do forward. Anti-corruption and the legal framework. Where do you see we are now, and what you're hoping to achieve in Southeast Asia, especially in Vietnam, what can we do to support you in that mission? I actually, I was being a little presumptuous because we haven't really talked inter-agency and with the Chinese yet, so I don't know. Of course, normally the host country is the country or economy, sorry. Host economy is the one that really mainly shape things, of course, working with the rest of us. But I think, first of all, I think the anti-corruption theme is gonna be actually fairly popular in China, interestingly, because as you know, there's things going on in China that are very interesting domestically. But, and also we now have more and more cases, for example, of foreign, so-called foreign bribery cases where foreign companies have been charged, sometimes detained, put in prison. So I think one of the themes that we'll move forward on if we do is probably the whole question of foreign and domestic bribery as a theme that we can discuss in China and begin to at least look at the cases and then look at proper sort of business ethics. We've already actually been working on that already with the SME working group where we have SME working on business ethics and then we'll probably try to expand that. But I think the first focus will be, my guess, on these kinds of cases. But again, beyond that, I really don't know because I haven't really developed it, but I'm just basically of the belief that for any sustainable economic development, you have to have the proper legal system. And it works well with the good regulatory practices as well, but beyond that, without that it's not sustainable in the future. So I think that's something we need to work on. Ernie Bauer with CSIS, in an earlier panel, we talked about the link between economic integration and security. How do you guys think about that? Would you agree with the premise that the security panel came up with, which was that it's absolutely fundamental, that link? And then in that sense, how can you, is overlapping architecture just fine? So I think you've made the case that APEC is doing great things at a technical and sort of tactical level. Is APEC strategic? Shouldn't APEC include all of the ASEAN members in India? If that's the geo-strategic footprint? And I hate to go back to this. And we heard other views this morning, but I'd like to hear from your panel's point of view. I guess my question for the Americans would be, can we sit out of RCEP? Or should there be a way to have the Americans at the table at RCEP? And shouldn't anyone who's in the EAS be able to have some linkage and sort of eyes in and a channel if they so wanted to join TPP? Several questions embedded in there. Some of them I think we're touching on, but I don't know. Tanakhstein, you mentioned the link between economics and security, and do others want to sort of emphasize that? And Bob, you might also pick up on the membership question, which is a sensitive one, or a tricky one. It's not sensitive. It's just, it's tricky. Either of you want to take a stab? Sure. Well, actually I want to sort of answer the first one as well, just very quickly. I've already alluded to that, because I, in my own sort of simple vision, is I see APEC as a, not just, again, clearly very important, market opening, trade investment, but all of that is for some purpose. Prosperity, of course, and then gradually integration. And so when I see APEC 50 years from now, I do see APC, Asia Pacific Community. Now I'm not gonna be around to see it, but that's what I see. And so I think the answer is clearly the implications of security as well. Because when you meet together, you work together on all these different issues at the working level, at the higher level, at some point, conflicts over territorial issues become, you don't just go ahead and kill each other right away. Okay, I mean, it does, it is, I think it is a strategic view of mine that this is what's happening. But that was my answer on that. On the membership, I think I'll let Arrow do that. I mean, let me press Arrow also, just to not, no, I mean, I'm trying to deflect it. I'm trying to deflect it in a way. I mean, the membership, you can address that how you want. But I mean, I think the RCEP question is a real one too, which is why can't the US engage more in the RCEP conversation on the trade side and the finance side, I sort of touched on with Michael, but I'd welcome further thoughts on that. Well, first of all, on membership of APEC. I guess the question about whether or not you need members is dependent on what you really wanna do with APEC. And our focus in APEC is to sort of strengthen and deepen the existing regional economic integration rather than trying to broaden it. We think APEC, the way it stands now, is a really unique organization where you can take on cutting edge issues. All the members have demonstrated to one extent or another their commitment to free and open trade and investment, and therefore it's a very useful organization for us. If you were to look to open membership, you've got about a dozen additional countries that would like to become APEC economies, that changes the nature of the organization significantly, and then we lose something very valuable to us. And I think Bob's right that we're trying to resolve and address barriers to trade and investment, but we're also trying to promote economic growth and prosperity. And then we did, even our own host here, talk about how a vision for an Asia-Pacific community is out there, but we think that you need to deepen before you broaden. The question of RCEP, this isn't, our focus is on getting a TPP agreement negotiated. We think that bringing, we think that all of these agreements can exist out there. They're not mutually exclusive. All of our members, members of APEC and the WTO, some are members of Pacific Alliance, some are working on RCEP. We're focused on a high-quality agreement in TPP, and we think that that is the best way to put our energies forward, so. Go ahead and move from University of Virginia. I would like to know your perspective on the financial architecture in East Asia. Given that, I think I see the three factors happening now, which may actually affect the economic stability in emerging market in Southeast Asia. Now, one is like the tempering of US physical stimulus, and another one is the potential China's economic slowdown, and also the rising China's currency, let me be, alternative international currency now in Asia. So, I would like to know how would the US and Japan to deal with in managing the potential of another, you know, rising instability on the financial aspect. Given that, we all know that the EAS was the product of the regional financial crisis in 1997, so I would like to know your perspective on the promoting the financial integration or, you know, architecture in East Asia. Thank you. Michael, you wanna try at that? There were a few things embedded in that as well. I mean, there are questions of, I mean, I think one question is about financial, how you see financial stability right now in the region, and whether US tapering or China's slowdown or other factors are creating new risks there, or India and Indonesia, as Goldman calls it, there are struggles. Is that creating new, and then that sort of one part is it creating new instabilities and risks, and then what is the agenda for financial integration and reform going forward? I think those were kind of... Well, thanks, and I tried to get at this in part in the comments that I made. So, I'd like to say that there's new risks, per se, but there's certainly market risks, and certainly markets are falling in different parts of the world, and it's an issue that the policy makers are clearly worried about, and this is what we'll be discussing when we go next week. So, the topics that are out there and the purpose of the architecture that we have, whether it's G20 or whether or not it's APEC, is to allow the policy makers to engage with each other, to make sure that they have open lines of communication and understanding of facts and each other's perspectives, which is one of the main utilities of having these kinds of meetings. In terms of financial integration, I mean, as a matter of perspective, we think that's a good thing. We think that a number of these countries in Southeast Asia or Asia more generally have clearly benefited from a free flow of capital, open investment. This is, I think, almost a matter of faith for us. And I would end by saying that in contrast to the emerging market crisis of the late 90s, one of the positive things you can see is that most of those economies are much stronger than they were at the time. You don't see countries spending their reserves dramatically to defend over valued exchange rates, for example. Buffers are stronger than they were. Fiscal positions are stronger than they were in a relative sense. So, while much of this region, Southeast Asia, in particular Latin America, is coming off of very, very good times in terms of the easy availability of capital, these are issues that if the policy makers are watching and thinking concretely what they should do, they should be able to manage through. So, we all have to collaborate closely together, and I'm sure that we will. Great, again, another topic for another CSS conference. We need to do something on this whole set of questions. Okay, well, I'm gonna end it there, but I'm gonna end again with an ad or an editorial on a subject that is related to stuff that we got done in 2011. You three aren't responsible for this, but when you talk to your colleagues at the Customs and Border Patrol or Homeland Security folks, and maybe they're watching online, I want you to tell them that when we, the CEO summit in Hawaii in 2011, the president was applauded three times when he got on the stage and when he left the stage, and when he said that he had just signed the legislation enacting the APEC business travel card, and he got a huge round of applause from the business community in the room, and we're here two years later, and that card has still not been issued because the implementing regs have not been passed, and everybody in this room has a stake in it because you can claim you're a business person, get this card, and you get free, I mean, you get diplomat treatment entering any APEC economy and don't have to wait in line. So, tell your CPB colleagues that they need to get those implementing regs done. We need some capacity building. All right, sounds like it. All right, thank you all very much, and the next panel will follow.