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Speeches: New Frontiers in Understanding and Addressing Corruption

(As delivered)

International Anti-Corruption Day

Opening

Thank you very much for the kind introduction, Sarah. It is a pleasure to be here today.

Just eleven years ago, the UN General Assembly designated this calendar date as International Anti-Corruption Day.

International and national anti-corruption efforts have moved dramatically and have seen a lot of progress in a short time – particularly in the establishment of international norms. But we must do more.

Today, I’d like to explain why anti-corruption remains a priority – and a national security concern for the U.S. government – and to outline how we can combat corruption in a more tailored, integrated, and effective way.

I should also explain my own perspective is a bit unique. The “J” U/S handles policy and programs on issues such as terrorism, refugees, security sector reform, human rights, and preventing conflict. Part of what makes us, “J” different is our focus on how U.S. foreign policy affects people as much as we look at foreign policy as pertains to governments. And corruption is an issue that gravely affects global citizens, in addition to undermining the international economy, regional security and good governance. So our J perspective starts from the premise that corruption is a populist scourge, and that securing human rights and personal safety and opportunity for all necessarily entails combating corruption. The more I understand about the challenges that J bureaus and offices face in their work, the more clearly I see corruption as an endemic threat that weaves throughout what would otherwise be disparate efforts, eroding the trust, efficiency, and justice that healthy societies require.

We all know corruption is bad. I’ll disaggregate three different negative effects: 1) its impact on human development; 2) on economic vibrancy; and 3) on security. As the Under Secretary for Civilian Security, I will highlight insecurity as perhaps corruption’s most underappreciated feature (although one that Sarah Chayes is doing much to highlight).

The Problem of Corruption

Human Development and Human Rights Impact

When politicians steal public funds rather than spend them appropriately, schools go without books, patients go without medicine, merchants go without bridges and roads.

The African Union estimates that one-quarter of Africa’s GDP is lost every year due to corruption – dramatically increasing levels of poverty in an already heartbreakingly poor region.

In just the health sector, World Bank surveys show that in some countries up to 80 percent of non-salary funds never reach local facilities. Then, when crises like Ebola hit, there is little institutional capability to address it.

Graft frays the fabric of the social contract, undermining attempts by government to assert legitimacy or establish democracy.

Corruption is also the glue that holds many authoritarian regimes together, giving rulers the ability to divide spoils, and the opportunity to out the “dirt” on cronies when convenient or if they turn disloyal.

Corruption leaves average citizens vulnerable.

When their rights are effectively are up for sale, laws to protect people – to halt human trafficking, hate crimes, and gender-based violence – go unenforced.

We see this, for example, in the Democratic Republic of the Congo, where victims of crime, including sexual violence, have little access to the justice system and, even when they do, they often find that perpetrators are likely to simply “buy” their way out of prosecution. The U.S. government is supporting mobile courts in the DRC to make justice more accessible in rural areas, but this intervention will not be able to succeed if corruption in the court system persists.

Economic Impact

The impact of corruption on growth, competition, and innovation is similarly well documented.

When companies have to pay bribes to cut through red tape it actually incentivizes the creation of more red tape, slowing transaction times and raising business expenses.

In fact, the World Economic Forum estimates that around the world, corruption adds an average of up to 10% to the cost of doing business.

Corruption has a particularly harmful effect on the many American companies that play by the rules, supported by robust enforcement here at home.

When our businesses go to compete overseas, corruption robs them of a level playing field.

If a public procurement decision in Russia is made not on the basis of merit but on the basis of bribery, then our companies will either stay home or lose the bid.

That affects our economy and puts pressure on our businesses to cut corners.

It also means that the Russian consumer loses out – receiving a substandard product because the contractor spent overhead on a bribe instead of on workmanship. “Shared prosperity,” the goal of the international economic system in its truest form, requires a shared commitment to transparent rule-based economies that work in the best interest of citizens, the United States and our partners overseas.

Part of this commitment is about protecting our own financial systems from harboring stolen assets. Proceeds of corruption are often sheltered in banks or shell corporations in Western Europe and the U.S. These ill-gotten gains frequently are used to prop up unaccountable regimes or finance terrorism.

We are working with our partners, especially at the G20, to guarantee that our financial systems are not havens for stolen assets. It has become easier to trace how corruption erodes democracy and eats away at prosperity.

We now have several tools, such as the World Bank and UN measures of corruption’s impact on development, the U.S. State Department’s annual Human Rights Reports, NGOs like Transparency International that document corruption’s impact on freedom and accountability, and institutions like the OECD that quantify corruption’s impact on business.

But corruption has other impacts, perhaps more difficult to measure but no less insidious.

Security Impact

It turns out that corruption is even more dangerous than we thought.

Corruption alienates and angers citizens, which can cause them to lose faith in the state, or, worse, fuel insurgencies and violent extremism.

Examples abound. In Afghanistan, the Taliban continues to exploit public discontent with corruption to garner support.

In Iraq, disillusionment with the government – including its corruption – creates fertile soil for ISIL to exploit. Just last week, Iraqi Prime Minister al-Abadi discovered that 50,000 “ghost soldiers” were listed on the government payroll, costing Iraqis approximately $380 million a year.

Citizens feel betrayed by these scams, indirectly because their taxes and resources are enriching nominal “public servants” but also directly because they do not receive the security and protection they both finance and require.

Take the example of Nigeria, where corruption has hollowed out the national military, leaving soldiers underfed, underpaid, and unable to defend citizens against internal threats such as Boko Haram.

The cost is grave: In 2014 alone, Boko Haram has killed more than 4,000 people and displaced some 1.5 million. It has declared an Islamic Caliphate in northeast Nigeria and taken the reins of governance in some communities. While the United States is working with Nigerian partners to confront this threat and prevent atrocities,that work is much harder to do because of corruption’s corrosive effects on the military.

Transparency International has found that many countries have weak controls over defense procurement, risking similarly debilitating outcomes.

The challenge of corruption cuts deeply across the security sector. For example, countless police turn the other way at checkpoints, and customs officials turn the other way at borders – all in exchange for bribes. This paves the way for drug cartels, terrorists, and other international security threats.

Consider that in the wake of the Westgate attack in Kenya, police arrested and detained suspected Al Shabab terrorists. But according to Human Rights Watch, suspects could quickly buy their release by paying a bribe of approximately $100.

In this way, corruption can enable local threats that have broader implications for security around the globe.

Corruption also complicates post-conflict peacebuilding, because those who profited from the war economy are best placed to win political power and, through corruption, continue serving their narrow interests. Ukraine provides another illustration of how corruption can both increase instability risks and cripple the state’s ability to respond to those risks.

The Maidan Movement was driven in part by resentment of a kleptocratic regime parading around in democratic trappings. Corruption had drained service delivery, scared off investment, and crippled the justice system. Businesses and even foreign countries had for years bought and bribed their way into political influence over Ukrainian legislative and procurement decisions.

And as public frustration boiled, Russian interference escalated.

Security institutions that were needed to fend off Russian aggression struggled to mount an adequate defense. They had been weakened by years of graft, rendering them ineffective.

Nigeria and Ukraine are not just cautionary tales – they are wakeup calls for the international community. That is why our embassies in two dozen countries in central and Eastern Europe are currently drafting action plans for supporting and cooperating on anti-corruption reform in their host country.

Corruption is not just an affront to American values; Left unaddressed, corruption in distant lands can cut to the heart of our national security. Yet I’m unaware of any security organizations that systematically monitor corruption. The international community is only starting to grapple with the seriousness of corruption’s destabilizing security impact.

Preventing and Responding to Corruption

So that’s the disaggregation of three different impacts of corruption, and it’s clear that the challenge is extremely important. It’s also clear that addressing this challenge comprehensively is really tough. I think it’s worth underscoring both the range of tools that we have and some of the concrete impact that we can see as a result of our efforts.

At the State Department, our Bureau of International Narcotics and Law Enforcement works on corruption along with bureaus that handle economics, energy, and human rights, and together State collaborates with USAID, Treasury, the Department of Justice, Interior, and Commerce – each of which brings specialized tools to the table.

  • We leverage international conventions, pressing governments to implement the commitments they have made to combatting corruption.
  • We include anti-corruption provisions in free trade agreements and apply financial sanctions to protect U.S. markets from the stability and liability risks of harboring the proceeds of corruption.
  • We enforce the Foreign Corrupt Practices Act, which since 2009 has generated around $3 billion in penalties and convictions against more than 50 individuals, including high-level executives.
  • At the State Department, we use our visa sanction authority in a nonpolitical manner to deny entry to corrupt leaders. Recently, we denied visas to six Hungarian officials and their cronies due to corruption. This action also bolstered public concern, and on November 9th, the streets of Budapest filled with 10,000 protesters who called for the resignation of corrupt public officials.
  • We provide at least $600 million dollars a year to build the capacity of foreign governments to combat corruption, largely through strengthening law enforcement mechanisms.
  • We support independent civil society organizations so that they can press their governments to prevent and combat corruption, such as the Czech Republic, where 20 NGOs banded together to form an anti-corruption coalition, supported in part by a grant from the U.S. Embassy.
  • The United States is co-chairing the G-20 Anti-Corruption Working Group with Turkey, in an effort to drive a “race to the top” on issues like beneficial ownership, which would require companies to identify the actual person who owns or controls them, in line with the President’s recent proposed legislation on beneficial ownership.

We are also proud to have helped launch the Open Government Partnership in September 2011, bringing global civil society and governments from 65 countries together to strengthen their internal, vertical relationships of accountability between governments and their citizenry at home.

  • Two-thirds of these countries have included commitments to anti-corruption or whistleblower protection in the latest round of OGP National Action Plans, each of which were developed through a consultative process between governments and civil society.
  • And today we are helping prevent corruption in the oil, gas, and mining sectors by supporting the Extractive Industries Transparency Initiative and implementing our own commitments domestically.

Our efforts have impact.

  • We’ve supported the International Commission against Impunity in Guatemala, and three months ago, both the Director and Deputy Director of the Guatemalan Penitentiary System were arrested for receiving bribes in return for prisoner transfers. They later were charged with money laundering and corruption.
  • In Nigeria and Sierra Leone, we are supporting civil society and government leaders to participate in civic code-a-thon events that have generated new open government tools, such as an infographic in Nigeria that clearly explained, in simple terms, the proposed federal budget.
  • And in the country of Georgia, the government is following through on its OGP commitments to combat corruption by making political party financing transparent and developing an online system for government procurement.

These are just a few examples of the impact we are able to have. But given the complexity and entrenchment of corruption in many countries, the United States must become more focused, more creative, and more collaborative as we continue working to enhance our anti-corruption impact.

First, what does it mean to become more focused?

In the past year, the United States government has developed interagency mechanisms to foster better unity of effort across the different entities that are working on anti-corruption efforts so that we can come together to determine where we should be better prioritizing our anti-corruption resources toward countries where corruption poses a risk to U.S. interests, and where we are likely to have impact.

Applying this prioritized approach will require integrating a range of tools targeted at a range of actors – a comprehensive “soup-to-nuts” approach that hits enough nodes of corruption to generate real momentum for action.

For instance, in areas of Central America, one cannot just address police corruption without also looking at corruption in other elements of the justice system such as judges and prisons  and even politics.

Otherwise, “islands of integrity” that we build up in the police force will quickly be washed away by the tide of corruption in other parts of the ecosystem.

Applying a comprehensive approach to focus countries means continuing to mainstream consideration of corruption into all of our development and security programming, so that what we don’t necessarily identify as anti-corruption efforts are nonetheless reinforcing efforts that go by the name of anti-corruption. This approach was first laid out in USAID’s 2005 Anticorruption Strategy. We can do more to better implement that.

In Mozambique, USAID’s health program is increasing access to clean water – and as an example of what it means to layer your anti-corruption efforts, they are simultaneously building up civil society by putting community groups in charge of governing the wells. While it does not guarantee that there cannot be corruption, residents are better equipped to deliver community goods.

We will continue pressing for anti-corruption synergies across our efforts, including expanding consideration of corruption in our security partnerships.

Second, what does it mean to adopt creative approaches to anti-corruption? First, you have to tailor them to the local context. You can’t just take best practices and drop them into point B because they worked in point A. You also need to emphasize anti-corruption law enforcement by working on the prevention pieces, so that you’re not just relying on after-the-fact prosecution.

So, as you think about what it means to prevent corrupt acts in the broader web of commerce and government, consider such questions as what would make a DMV employee decide not to demand “a little extra” in exchange for a driver’s license?

It might be streamlining the process of getting a license, so there are fewer discretionary transactions to be tampered with in the first place. Estonia has pioneered this model, developing e-governance tools that made government operations more transparent and accountable to civil society, business the media and, most importantly, Estonian citizens.

Or creativity might demand that public employees are adequately compensated for their work at the outset.

If they can make ends meet from their salaries, they are less likely to demand a bribe.

But boosting transparency remains the cornerstone of prevention – helping people understand what the actual rules are so that they cannot be misled between what is actually a real fee, and what is a bribe demanded on the spot.

In Nepal, a wiki platform supported by the NGO the Accountability Lab crowd-sources information on topics like how to get a birth certificate or driver’s license to help ensure that Nepalis can demand proper procedures as they enter into transactions, and that government employees know they will be held accountable if they break the rules.

Websites like I_Paid_A_Bribe.com go one step further – enabling citizens in India to shed light on first-hand experiences of corruption to help track graft at local agencies.

Simple, transparent, procedures have a dual benefit. Not only dothey make government more efficient, they restrict opportunities for corruption.

Third, way in which I think the U.S. government will continue to evolve its anti-corruption efforts is through partnerships, both inside and outside government.

Tackling corruption demands support from civil society as well as multilateral partners simply because the problem is so complex and the solutions must be so long term. Therefore even as we work to boost anti-corruption programming funds at State and USAID, we are exploring how to increase collaboration with the private sector and multilateral development banks to expand our impact.

Also, in the coming year we plan to launch experimental “Anti-Corruption University” – an initiative that will involve exchanges between our diplomats and universities and NGOs around the world.

Because ultimately, no one nation can do this work alone.

All in all, we have a diverse toolkit that we are striving to apply more strategically. Yet, the biggest factor in the success or failure of U.S. efforts remains something largely out of our control, and that is the extent to which foreign government officials choose to support increased accountability or work to block it.

In the end, it remains a question of political will. Vice President Biden recently asked the question why Plan Colombia worked. He concluded that it was not just because the United States invested $9 billion dollars in it – or because Colombia invested $36 billion dollars in it. More fundamentally, it was about the political will that Colombia invested in that process, which included more transparent and accountable governance.

Political will means that those brought up on anti-corruption charges are the biggest violators, not just the biggest political rivals. The success of anti-corruption efforts in countries like China depends on ensuring that these efforts do not become politicized.

The central role of political will to the anti-corruption fight explains why it is so critical now to identify and support political openings when they emerge.

New leaders elected on a platform of anti-corruption reform can change the tide if they make good on their commitments, such as President Ghani in Aghanistan, President Jokowi in Indonesia, Prime Minister Modi in India. We will assess whether or not their efforts in office will meet their campaign pledges to boldly address corruption.

We must accelerate our partnerships with these reform-minded leaders when these strategic windows of opportunity open up.

The United States cannot create or control reformist leadership, but we can be ready to support it on behalf of people whose lives will be profoundly affected by the restoration of trust, efficiency, and justice.

Conclusion

Since the establishment of International Anti-Corruption Day in 2003, many international fora have emerged and many commitments have been made to fight graft.

The UN Convention Against Corruption now encompasses 173 countries.

Regional bodies like the African Union have affirmed the UN’s standards in conventions of their own.

In the Americas, the OAS’ peer review mechanism for the world’s first anti-corruption convention, the Inter American Convention Against Corruption, is now well regarded and respected.

Indeed, we have near-universal consensus on the norms for how governments should control corruption.

That is a very important step.

But it is easy to become self-congratulatory about laws and words.

The problem before us is addressing the implementation gap in applying these.

The impact of corruption on our own national security and the security of civilians around the world calls us to act. The United States will work with likeminded partners toward a more focused, creative, and collaborative approach to combating corruption.

I’d like to end with an adage from Liberia that has actually emerged in response to the description of collective action against corruption, and it sums up the international challenge well:

“One straw of a broom can easily snap when trying to clean up the dirt; but when all the straws of the broom work together, we can clean the house.”

Thank you for being here. I’ll now turn to Sarah Chayes and we can open the floor up for questions.

UN Pledging Conference sees new funds announced for fight against poverty

12 Nov 2014

18 countries commit 97 million dollars for UN Development Programme

New York City – 12 November 2014 – 26 UN Member States have pledged approximately US$ 650 million to go towards UN development work, mostly for 2015, with US$97 million destined for the United Nations Development Programme (UNDP).

Nick Hartmann, Director of UNDP’s Partnership Group, speaking at the Conference on behalf of UNDP Administrator Helen Clark, welcomed the announcements of funding for the organization’s ‘regular’ or ‘core’ resources, referring to non-earmarked funding that can be used at UNDP’s discretion to respond to emerging needs of countries.

Core funding was the “bedrock”, he said, of UNDP’s ability to sustain its multilateral and universal character, ensuring that resources and activities are available to support all eligible countries, with a distribution to primarily low-income and least developed countries.

Noting that many of UNDP’s contributors had gone to great lengths to maintain their funding despite a challenging financial environment, he nonetheless emphasized the “continuing downward trend” UNDP faces.

In spite of this, more Member States had begun contributing to UNDP, with the total number rising from 50 to 56 in 2013. This was a welcome development that UNDP would continue to nurture.

Additionally, non-core resources remained stable at US$3.98 billion in 2012 and US$3.93 billion in 2013.

Thanking Member States for their contribution, Hartmann pointed to UNDP’s responsibility as the custodian of funds entrusted to it. With this in mind, he noted that the organization had been ranked first amongst all bilateral and multilateral development agencies, as reflected in the independent Publish What You Fund’s Aid Transparency Index.

In tandem with non-core resources, Member States’ contributions last year allowed UNDP to target the world’s poorest and most vulnerable.

Some highlights of UNDP’s results in 2013 include:

• 43 million new voters registered in 68 supported countries. 96 million people voted in UNDP-assisted elections, 41% of which were women.
• Over 4 million people in 117 countries, 40 of which were affected by conflict, had improved access to justice and legal aid, 49% of which were women.
• 3.5 million people in 12 countries benefited from access to modern energy services from 2,900 rural energy enterprises.
• Carbon dioxide equivalent-emissions were reduced by 116–142 million tonnes, the equivalent of 30–37 coal fired power stations, in 32 countries.
• UNDP helped 25 countries establish or strengthen disaster early warning systems and has now assisted 45 countries with establishing disaster management agencies.
• Finally, 617,000 people benefited from emergency employment schemes established by UNDP; and over 193,000 small businesses were created with UNDP’s support in post-conflict countries.

Countries that announced pledges at the Conference were: Denmark, Netherlands, New Zealand, India, Luxembourg, Turkey, Russian Federation, Kuwait, Bangladesh, Singapore, Ethiopia, Indonesia, Vietnam, Mongolia, Samoa, Myanmar, Afghanistan and Djibouti.

Contact Information

Dylan Lowthian
Communications Analyst, UNDP Bureau of External Relations and Advocacy
Email: dylan.lowthian@undp.org
Tel: +1 (212) 906-5516

2014 Leaders’ Declaration

The White House

Office of the Press Secretary

For Immediate Release

November 11, 2014

The 22nd APEC Economic Leaders’ Declaration – Beijing Agenda for an Integrated, Innovative and Interconnected Asia-Pacific

1. We, the APEC Leaders, gathered by Yanqi Lake in Beijing for the 22nd APEC Economic Leaders’ Meeting. Under the theme of “Shaping the Future through Asia-Pacific Partnership”, we held substantial discussions on the priorities of advancing regional economic integration, promoting innovative development, economic reform and growth, and strengthening comprehensive connectivity and infrastructure development with a view to expanding and deepening Asia-Pacific regional economic cooperation, and attaining peace, stability, development and common prosperity of the Asia-Pacific.

2.The Asia-Pacific region has experienced a quarter of a century’s growth and development. APEC has not only made significant contributions to the region’s economic development, social progress and improvement of people’s livelihoods, but has also epitomized the great changes and rising strategic position of the Asia-Pacific. Through its unique approach featuring voluntary action, consensus, flexibility and pragmatism, APEC has successfully established a sound regional economic cooperation framework among member economies with remarkable diversity and at different stages of development. Adhering to the spirit of unity, mutual respect and trust, mutual assistance and win-win cooperation, we have been working to narrow the development gap among ourselves and have consistently promoted the robust, sustainable, balanced, inclusive and secure growth in the Asia-Pacific region and beyond.

3.After years of rapid development, the Asia-Pacific has become the most dynamic region of the world, and has never been as important as it is today in the global landscape. At present, the Asia-Pacific maintains a strong momentum of growth; it possesses an enormous potential and has a bright future. Yet it is also faced with risks and challenges.

4.We are at an important historical moment of building on past achievements and striving for new progress. We are committed to working together to shape the future through Asia-Pacific partnership, building an open economy in the Asia-Pacific featuring innovative development, interconnected growth, and shared interests, and consolidating the leading role of the Asia-Pacific in the world economy, with a goal of opening up new prospects for future cooperation and achieving common prosperity in the Asia-Pacific region.

5.To achieve the above-mentioned goals, we pledge to take the following actions:

I.  Advancing Regional Economic Integration

Pursuing Free and Open Trade and Investment

6.We reiterate the value, centrality and primacy of the multilateral trading system in promoting trade expansion, economic growth, job creation and sustainable development. We stand firmly together to strengthen the rules-based, transparent, non-discriminatory, open and inclusive multilateral trading system as embodied in the WTO.

7.We express our grave concern regarding the impasse in the implementation of the Trade Facilitation Agreement (TFA) which has resulted in stalemate and uncertainties over other Bali decisions. These developments have affected the credibility of the WTO negotiating function. In finding solutions to the implementation of the Bali decisions, APEC will exert creative leadership and energy together with all WTO members in unlocking this impasse, putting all Bali decisions back on track, and proceeding with the formulation of Post-Bali Work Program, as a key stepping stone to concluding the Doha Round.

8.We reaffirm our pledges against all forms of protectionism. We extend our standstill commitment through the end of 2018 and reaffirm our commitment to roll back protectionist and trade-distorting measures. We remain committed to exercise maximum restraint in implementing measures that may be consistent with WTO provisions but have a significant protectionist effect, and to promptly rectifying such measures, where implemented.

9.We acknowledge that bilateral, regional and plurilateral trade agreements can play an important role in complementing global trade liberalization initiatives. We will continue to work together to ensure that they contribute to strengthening the multilateral trading system. We underscore the importance of the negotiations to expand the product coverage of the Information Technology Agreement (ITA). A final ITA expansion outcome should be commercially significant, credible, pragmatic, balanced, and reflective of the dynamic technological developments in the information technology sector over the last 17 years, and contribute to the multilateral trading system. We welcome APEC’s leadership in advancing the negotiations and call for swift resumption and conclusion of plurilateral negotiations in Geneva. We welcome the launch of negotiations on Environmental Goods Agreement (EGA) in July 2014 in Geneva. We encourage participants of the above initiatives to seek expanded memberships.

10.We welcome the significant progress made toward achieving the Bogor Goals. We will make every effort to achieve the Bogor Goals by 2020. We also welcome the biennial Bogor Goals review this year. We urge all economies, particularly developed ones to deeply consider the conclusions of the Report on APEC’s 2010 Economies’ Progress towards the Bogor Goals and the 2012 and 2014 Bogor Goals Progress Report, and to take more concrete actions towards attaining the Bogor Goals.

11.Recognizing APEC has a critical role to play in shaping and nurturing regional economic integration, we agree that APEC should make more important and meaningful contributions as an incubator to translate the Free Trade Area of the Asia-Pacific (FTAAP) from a vision to reality. We reaffirm our commitment to the eventual FTAAP as a major instrument to further APEC’s regional economic integration agenda.

12.In this regard, we decide to kick off and advance the process in a comprehensive and systematic manner towards the eventual realization of the FTAAP, and endorse the Beijing Roadmap for APEC’s Contribution to the Realization of the FTAAP (Annex A). Through the implementation of this Roadmap, we decide to accelerate our efforts on realizing the FTAAP on the basis of the conclusion of the ongoing pathways, and affirm our commitment to the eventual realization of the FTAAP as early as possible by building on ongoing regional undertakings, which will contribute significantly to regional economic integration, sustained growth and common prosperity in the Asia-Pacific region. We instruct Ministers and officials to undertake the specific actions and report the outcomes to track the achievements.

13.We welcome the establishment of a Committee on Trade and Investment (CTI) Friends of the Chair Group on Strengthening Regional Economic Integration (REI) and Advancing FTAAP, and urge the Friends of the Chair Group to continue its work. We agree to launch a collective strategic study on issues related to the realization of the FTAAP, and instruct officials to undertake the study, consult stakeholders and report the result by the end of 2016.

14.We endorse the establishment of an APEC Information Sharing Mechanism on RTAs/FTAs. We highly commend the work on the implementation of the Action Plan Framework on Capacity Building Needs Initiatives (CBNI), and endorse the Action Plan Framework of the 2nd CBNI. We instruct officials to design targeted and tailor-made capacity building activities to narrow the gap of the capacities of APEC economies to facilitate the eventual realization of the FTAAP.

15.In addition to the above, we reaffirm the role of APEC in addressing next generation trade and investment issues and sectoral initiatives, and agree to accelerate “at the border” trade liberalization and facilitation efforts, improve the business environment “behind the border”, and enhance regional connectivity “across the border” to accumulate more building blocks for the realization of the FTAAP. Therefore, we:

— reaffirm our commitment to reduce applied tariffs to five percent or less by the end of 2015 on the list of environmental goods that we endorsed in 2012 in Vladivostok. We call upon all economies to redouble their efforts in order to realize the economic and environmental benefits. We will instruct officials to report progress in achieving this ground-breaking commitment at our meeting next year in the Philippines. We welcome the work on capacity building on Environmental Goods (EGs) commitment implementation;

— welcome the inaugural meeting of the APEC Public Private Partnership on Environmental Goods and Services (PPEGS) on renewable and clean energy trade and investment, and endorse the APEC Statement on Promoting Renewable and Clean Energy (RCE) Trade and Investment;

— welcome the progress onexploring products which could contribute to sustainable and inclusive growth as part of our concrete commitment to rural development and poverty alleviation;

— endorse the Action Agenda on Promoting Infrastructure Investment through Public-Private Partnership (PPP) and instruct officials to take concrete actions to strengthen cooperation on PPP to promote more robust and sustainable infrastructure investment and development in the APEC region;

— welcome the Case Studies on Sustainable Investment in the APEC Region and encourage officials to consider and draw experience and good practices from the nominated cases to promote sustainable cross-border investment;

— endorse the APEC Cross Border E-Commerce Innovation and Development Initiative and encourage economies to designate or establish Research Centers of Cross-border E-commerce Innovation and Development on a voluntary basis;

— recognize that the effective protection and enforcement of IPR including trade secrets incentivizes and facilitates innovation and foreign direct investment and the dissemination of technology through licensing and partnerships;

— endorse the APEC Action Agenda on Advertising Standards and Practice Development to promote alignment of advertising standards and reduce the cost of doing business across the region;

— endorse the Asia-Pacific Region Automotive Industry Sustainable Development Declaration and welcome the outcomes of the 2014 APEC Regulatory Cooperation Advancement Mechanism (ARCAM) Dialogue on Electric Vehicle Standards. We welcome the APEC Actions to Promote the Widespread Usage of Electric Vehicles.

Advancing Global Value Chain Development and Supply Chain Connectivity

16.Recognizing that Global Value Chains (GVCs) have become a dominant feature of the global economy and offer new prospects for growth, competitiveness and job creation for APEC economies at all levels of development, we endorse the APEC Strategic Blueprint for Promoting Global Value Chain Development and Cooperation (Annex B). We welcome the progress made in the measurement of Trade in Value Added (TiVA), services, SMEs and GVCs resilience, etc., and instruct officials to advance the work through the CTI Friends of the Chair Group on GVC to put forward new initiatives under the Strategic Blueprint in 2015 and beyond.

17.We endorse the Strategic Framework on Measurement of APEC TiVA under GVCs and the Action Plan on this Strategic Framework. We instruct the newly-formed technical group to work closely with the WTO, OECD, the World Bank, UNCTAD and other related international organizations, with an aim to complete the construction of the APEC TiVA Database by 2018.

18.We endorse the Terms of Reference of Promoting SME’s Integration into GVCs, and welcome the launch of the related activities. We instruct officials to make efforts in advancing this work.

19.We welcome the commitment of APEC economies to move forward with the implementation of the WTO Trade Facilitation Agreement, including the notification by many APEC developing economies of their category A TFA obligations. We welcome, as well, the progress this year in improving the performance of APEC supply chains through targeted, focused capacity building and technical assistance. In this regard, we applaud the establishment of the APEC Alliance for Supply Chain Connectivity, which will contribute to our goal in achieving a ten percent improvement of supply chain performance by the end of 2015 and our broader supply chain connectivity objectives. We encourage economies to increase the resources of the APEC Supply Chain Connectivity Sub-Fund to ensure that our capacity building and technical assistance projects succeed to meet our ten percent performance improvement goal and to further our trade facilitation objectives. 

20.We agree to establish the Asia-Pacific Model E-port Network (APMEN) and welcome the first batch of APEC Model E-ports nominated by the APEC economies. We endorse the Terms of Reference of the APMEN and agree to set up the APMEN operational center in the Shanghai Model E-port, and instruct officials to make further efforts to contribute to regional trade facilitation and supply chain connectivity.

21.We positively value the APEC High-level Roundtable on Green Development and its declaration, and agree to establish the APEC Cooperation Network on Green Supply Chain. We endorse the establishment of the first pilot center of APEC Cooperation Network on Green Supply Chain in Tianjin, China, and encourage other economics to establish the pilot centers and advance related work actively.

22.We endorse the APEC Customs 3M (Mutual Recognition of Control, Mutual Assistance of Enforcement and Mutual Sharing of Information) Strategic Framework. We instruct officials to further simplify and coordinate APEC customs procedures based on the 3M Framework to facilitate the development of regional trade. We encourage APEC members’ customs authorities to continue strengthening cooperation and coordination in pursuit of the 3M vision, to push forward comprehensive connectivity and make greater contributions to the sustainable development of trade and regional economic integration in the Asia-Pacific region.

23.We recognize that the use of standardized codes will enable information about traded goods to be easily understood and shared by all parties. We therefore encourage APEC economies to work with the private sector to promote further cooperation on global data standards and their wider use by developing pilot projects. 

24.We welcome the initiative on manufacturing related services in supply chains/value chains as a next generation trade and investment issue, and instruct officials to develop a plan of action in 2015.

Strengthening Economic and Technical Cooperation

25.We endorse the APEC Strategic Plan on Capacity Building to Promote Trade and Investment Agenda which adopts a strategic, goal-oriented and multi-year approach. We instruct officials to take the Strategic Plan as a guide to develop and implement more tailor-made capacity building programs that contribute to the core trade and investment liberalization and facilitation agenda of APEC.

26.We encourage economies, particularly developed economies, to provide more contributions to ECOTECH and capacity building, to achieve our goal of bridging development gaps, and help member economies to meet their APEC commitments and their economic growth objectives.

27.We welcome the initiative to upgrade the Asia Pacific Finance and Development Center (AFDC) to the Asia Pacific Finance and Development Institute (AFDI).

II. Promoting Innovative Development, Economic Reform and Growth

28.We realize that the prospects for the shared prosperity of APEC will depend on innovative development, economic reform and growth in the region, which are complementary and mutually reinforcing. We recognize that the Asia-Pacific region is at a crucial stage of economic transformation. We are committed to accelerating the pace of reform and innovation, and exploring new growth areas with the goal of bolstering the position of the Asia-Pacific as an engine for world economic growth. We agree to strengthen macroeconomic policy coordination with a view to forging policy synergy, and creating a sound policy environment for the robust, sustainable, balanced and inclusive economic growth in the region.

29.We endorse the APEC Accord on Innovative Development, Economic Reform and Growth (Annex C) which identifies Economic Reform, New Economy, Innovative Growth, Inclusive Support and Urbanization as the five pillars for promoting experience sharing, policy dialogue, capacity building and practical cooperation.

Economic Reform

30.To advance APEC’s economic reform agenda, we agree to hold the 2nd Ministerial Meeting on Structural Reform in 2015. Recognizing that many APEC developing economies are facing the challenge of the Middle-Income Trap (MIT), we agree to incorporate the issue of overcoming the MIT into the work program of the APEC Economic Committee.

31.To meet our objective of strengthening the implementation of good regulatory practices, we will further enhance communication, exchanges, and sharing of experiences, and foster anopen and transparentregulatory environment in our economies, according to individual economies’ needs and circumstances. We will endeavor to take new actions through the use of information technology and the Internet to improve our conduct of public consultations on proposed regulations.

32.We recognize the role of internationally recognized private international law instruments such as the Hague Conventions in facilitating cross-border trade and investment, enhancing ease of doing business, and fostering effective enforcement of contracts and efficient settlement of business disputes. We encourage wider use of these instruments which would contribute to APEC’s regional integration, connectivity and structural reform agenda.

New Economy

33.We recognize that New Economy represents the trend of economic growth and sustainable development in the Asia-Pacific region and beyond. We support the efforts to promote economic restructuring and upgrading in traditional industries, explore new and promising economic growth areas such as the Green Economy, the Blue Economy, and the Internet Economy, and promote green, circular, low-carbon and energy-efficient development.

34.We are encouraged by the progress of APEC’s ocean-related cooperation and welcome the Xiamen Declaration issued at the 4th APEC Oceans Ministerial Meeting this year, and instruct our Ministers and officials to fully implement the Declaration. We acknowledge the Xiamen Declaration’s statement on the Blue Economy. We welcome the APEC Marine Sustainable Development Report.  We encourage the Ocean and Fisheries Working Group to work with APEC fora to advance Blue Economy cooperation.

35.We recognize the role of the Internet Economy in promoting innovative development and empowering economic participation. We endorse the APEC Initiative of Cooperation to Promote the Internet Economy and instruct Ministers and officials to discuss the Internet Economy further, put forward proposals for actions, promote member economies’ cooperation on developing the Internet Economy and facilitate technological and policy exchanges among member economies, taking into account the need to bridge the digital divide.

36.We welcome the Beijing Declaration of the 2014 APEC Energy Ministerial Meeting. We welcome the establishment of the APEC Sustainable Energy Center in China. We recognize the importance of promoting diversified energy supplies, and market-based competition and pricing mechanisms that reflect demand and supply fundamentals as appropriate to each economy. We encourage member economies to take actions to eliminate trade protection and restrictive measures that may impede progress in renewable energy technologies and development of this sector, and we endorse the Energy Ministers’ aspirational goal to double the share of renewables including in power generation by 2030 in APEC’s energy mix. We affirm our commitment to rationalize and phase out inefficient fossil fuel subsidies that encourage wasteful consumption while still providing essential energy services. We acknowledge Peru and New Zealand for initiating voluntary peer reviews in 2014 of inefficient fossil fuel subsidies that cause wasteful consumption and sharing their best practices, and welcome the commitment from the Philippines to undergo a peer review in 2015. We encourage innovation, competition and cooperation to promote a sound and sustainable energy sector in the Asia-Pacific and to ensure its energy security, economic growth, poverty eradication and an appropriate response to climate change.

37.We emphasize the importance of efforts to ensure sustainable development in mining, including the development, processing, utilization, investment and trade in minerals, metals and related products and welcome Ministers’ views recognizing the important role of the Minamata Convention on Mercury.

38.We will continue our efforts to protect forest resources, combat illegal logging and associated trade, promote sustainable forest management, and work with relevant organizations, including the Asia-Pacific Network on Sustainable Forest Management and Rehabilitation (APFNet), to ensure the achievement of the aspirational goal on forests in the Sydney Declaration.

39.We commit to continue our efforts in combating wildlife trafficking. We will take steps to combat wildlife trafficking by enhancing international cooperation through Wildlife Enforcement Networks (WENs) and other existing mechanisms, reducing the supply of and demand for illegally traded wildlife, increasing public awareness and education related to wildlife trafficking and its impacts, and treating wildlife trafficking crimes seriously.

Innovative Growth

40.We recognize innovation as an important lever for economic growth and structural reform. We endorse the initiative on Toward Innovation-Driven Development. We commit to foster a pragmatic, efficient and vigorous partnership on science, technology and innovation. We agree to strengthen collaboration amongst government, academia, and private sector stakeholders to build science capacity, to promote an enabling environment for innovation and including by establishing training centers for the commercialization of research, and to enhance regional science and technology connectivity, with respect for intellectual property rights and trade secrets. 

41.We welcome the Nanjing Declaration on Promoting SMEs Innovative Development. We commit to strengthen our support, and provide an enabling environment for SMEs in innovation activities. We welcome efforts to strengthen SMEs’ cooperation in the Asia-Pacific region, involve SMEs in APEC production and supply chains, promote ethical business practices, as well as to empower their capacity to operate in an international market. We welcome member economies’ joint efforts and contribution to promote the APEC Accelerator Network and to invest in the early stage development of innovative SMEs.

Inclusive support

42.We recognize that inclusive support is essential to maintain growth and to deal with risks and potential fallout of reform, with an aim to provide a solid foundation for economic growth and to address the needs of vulnerable groups. We welcome the outcomes of the 6th Human Resources Development Ministerial Meeting and the Action Plan (2015-2018) on Promoting Quality Employment and Strengthening People-to-People Connectivity through Human Resources Development. We encourage APEC economies to give priority to stabilizing and expanding employment, implementing macroeconomic policies in favor of job creation, and strengthening capacity building for human resources development, vocational skills development and skill training for youth. We commend the 10-year achievement of the APEC Digital Opportunity Center initiative through our joint efforts and cooperation in bridging digital divides, strengthening human resource development and creating digital opportunities throughout the APEC region.

43.We recognize the pivotal role of women in the development and prosperity of the Asia-Pacific, and are committed to taking concrete policies and innovative measures to further enhance women’s economic empowerment and their access to markets and ICT technology, eliminate all barriers that hinder women’s economic participation, and ensure women’s equal opportunities, participation and benefit in innovative development, economic reform and growth. We welcome the recommendations from the Women and the Economy Forum, and commit to promote women entrepreneurship. We recognize the importance of data to measure progress in reducing barriers to women’s economic participation, and we welcome the establishment of the APEC Women and the Economy Dashboard as a tool to inform policy discussions. We support women’s leadership and recognize the importance of women’s entrepreneurship support services and networks. We encourage the formal development of an APEC-wide women’s entrepreneurship network to empower women entrepreneurs to start and grow businesses and increase their access to domestic and international markets.

44.We welcome recommendations from the 4th High Level Meeting on Health and the Economy and endorse the “Healthy Asia-Pacific 2020” initiative, which aims to achieve sustainable and high-performing health systems that will ensure people’s health, including physical and mental well-being, through the whole life-course by means of a whole-of-government, and whole-of-society approach with the collaboration of the entire Asia-Pacific region.

45.We commit to jointly tackle pandemic diseases, terrorism, natural disasters, climate change and other global challenges. In confronting the current Ebola Virus Disease epidemic, we are determined to intensify our cooperation and work shoulder to shoulder with African nations to help them effectively end this epidemic and prevent, detect, manage and respond to future outbreaks. We will continue to assist people in affected areas to overcome this crisis and build back their economies so we can win the battle against the disease.

46.We endorse the Beijing Declaration on APEC Food Security issued at the Third APEC Ministerial Meeting on Food Security. We welcome APEC Action Plan for Reducing Food Loss and Waste, the APEC Food Security Business Plan (2014-2020), and the APEC Food Security Roadmap toward 2020 (2014 version) and the Action Plan to Enhance Connectivity of APEC Food Standards and Safety Assurance.We note the G20’s work on food security in 2014. We call on APEC economies to seek common ground to build an open, inclusive, mutually-beneficial and all-win partnership for the long-term food security of the Asia-Pacific region. We will strengthen APEC agricultural science and technology innovation and cooperation to advance sustainable agricultural development and support sustainable fisheries.

47.We commend the ongoing efforts of the APEC Food Safety Cooperation Forum (FSCF) and its Partnership Training Institute Network (PTIN), which will help ensure the safety of food produced and traded in the APEC region by improving food safety regulatory systems, encouraging harmonization with international science-based standards, building capacity in areas that will facilitate trade, and enhancing communication and collaboration between industry and regulators to address emerging food safety issues. We welcome the APEC Food Safety Beijing Statement of the 2014 APEC High-Level Regulator Industry Dialogue on Food Safety.

48.We commend the strong resolve shown in fighting corruption, including through effective anti-corruption measures. We support the Beijing Declaration on Fighting Corruption and welcome the APEC Principles on the Prevention of Bribery and Enforcement of Anti-Bribery Laws, and APEC General Elements of Effective Voluntary Corporate Compliance Programs. We commit to work together against corruption and deny safe haven for corrupt officials and their illicitly-acquired assets. We are committed to strengthening cooperation and coordination on repatriation or extradition of corrupt officials as well as confiscation and recovery of corruption proceeds, and where appropriate, through the use of anti-corruption mechanisms and platforms such as the APEC Network of Anti-Corruption and Law Enforcement Agencies (ACT-NET).

49.We encourage further cooperation of member economies in disaster preparedness, risk reduction, response and post-disaster recovery, and cooperation in search and rescue, including through more robust networking among disaster management departments; following the APEC Guidelines on Appropriate Donations; improving supply chain resiliency; operationalizing the Trade Recovery Programme, reducing barriers to the movement of emergency responders and humanitarian relief across borders; increased data sharing; and application of science and technologies.

50.We reiterate our resolve to create a secure and resilient environment for economic activities and connectivity in the APEC region and continue concerted efforts to implement the APEC Consolidated Counter-Terrorism and Secure Trade Strategy.

Urbanization

51.We recognize that the Asia-Pacific is currently experiencing booming urbanization. We realize that sustained and healthy development of urbanization is conducive to promoting innovative growth and realizing robust, inclusive and sustainable development in the Asia-Pacific.

52.We commend the constructive work undertaken by APEC this year in promoting urbanization cooperation in the Asia-Pacific region, and endorse the APEC Cooperation Initiative for Jointly Establishing an Asia-Pacific Urbanization Partnership.

53.Recognizing the range of urbanization challenges and opportunities across APEC economies, we commit to collectively promote cooperation projects, and to further explore pathways to a new-type of urbanization and sustainable city development, featuring green, energy efficient, low-carbon and people-orientation.

III. Strengthening Comprehensive Connectivity and Infrastructure Development

54.We recognize that strengthening comprehensive connectivity and infrastructure development will help open up new sources of economic growth, promote cooperation and mutual assistance, and advance prosperity and the spirit of community in the Asia-Pacific region. We commend the achievements already made by APEC in connectivity and infrastructure development cooperation.

55.We endorse the APEC Connectivity Blueprint for 2015-2025 (Annex D). We are committed to implementing the APEC Connectivity Blueprint and achieving the overarching goal of strengthening physical, institutional and people-to-people connectivity by taking agreed actions and meeting agreed targets by 2025, with the objective of achieving a seamless and comprehensively connected and integrated Asia Pacific.

56.We commit to solve the financing bottleneck of infrastructure development. We commend the work and progress accomplished under the APEC Finance Ministers’ Process (FMP) in infrastructure investment and financing cooperation. We recognize, in particular, efforts in promoting PPP on Infrastructure, such as compiling demonstrative infrastructure PPP projects, advancing the work of the PPP Experts Advisory Panel, strengthening capacity building of Indonesia’s Pilot PPP Center, and carrying on capacity building project of PPP pilot demonstration and standard contract making. We welcome the Implementation Roadmap to Develop Successful Infrastructure PPP Projects in the APEC Region to guide APEC’s future work in this aspect. We welcome the establishment of the PPP Center in China as a center of excellence.

57. We encourage member economies to strengthen energy infrastructural development and connectivity, such as oil and natural gas pipelines and transmission networks, LNG terminals, smart grids and distributed energy systems on the basis of shared interest and mutual benefit.

58. We encourage all member economies to take effective measures to promote the mobility of business personnel, tourists, researchers, students and labor in the region.

59.We support initiatives and activities that further enhance the three dimensions of cross-border education cooperation found in the 2012 Leaders Declaration– mobility of students, researchers, and providers. We applaud the work that has been accomplished this year, including the establishment of the APEC Higher Education Research Center (AHERC); contributions to the APEC scholarships and internships initiative, which will encourage people-to-people exchange in our region; and promotion of virtual academic mobility by leveraging internet-based resources and innovative learning practices.

60. We support the target set at the 8th APEC Tourism Ministers’ Meeting of   making efforts to receive 800 million international tourist arrivals in APEC economies by 2025.

61. We appreciate the initiatives which will greatly improve connectivity and infrastructure in the Asia-Pacific region, help resolve the bottleneck of financing in this field, and promote regional economic integration and the common development of the Asia-Pacific.

IV. Looking Forward

62.With joint efforts of member economies, the Asia-Pacific has become the most dynamic region of the world with enormous growth potential. Never before has the world been more in need of a harmonious, stable and prosperous Asia-Pacific. We commit to working together to shape the future through Asia-Pacific partnership in the spirit of mutual respect and trust, inclusiveness, and win-win cooperation, and making a contribution to the long-term development and common prosperity of the region.

63.We commit to carry forward APEC reform, improve its cooperation mechanisms, and implement ambitious goals and blueprints, with the aim of enabling APEC to play a more active coordinating and leading role in the Asia-Pacific.

64.We commend the constructive role of the APEC Business Advisory Council (ABAC) in strengthening public-private partnership and promoting APEC cooperation in various fields.

65.We are committed to enhancing APEC synergy with other relevant international and regional cooperation organizations and fora through coordination and cooperation, as well as enabling APEC to play an increasingly important role in the global governance system.

66.We are satisfied with the positive, meaningful and fruitful achievements of this meeting and appreciate China’s tremendous and fruitful efforts to successfully host this meeting.

67.We are committed to supporting future hosts of APEC, including Peru, Viet Nam, Papua New Guinea, Chile, Malaysia, New Zealand and Thailand who are to host APEC in the years of 2016, 2017, 2018, 2019, 2020, 2021 and 2022 respectively.

68.We look forward to convening again during the Philippines’ hosting of APEC in 2015.

Asia-Pacific Economic Cooperation

11:00 A.M. EDT

THE WASHINGTON FOREIGN PRESS CENTER, WASHINGTON, D.C.

MR. WANG: Thank you, and thanks for the moon cake. Just kidding. Anyway, I just came back, as you know, from SOM3 in Beijing where we spent a total of actually almost two weeks, including a lot of sort of working group level meetings. And then – so after SOM3 we, as you know, will have a whole series of ministerials leading up to the leaders meeting in November. And so in fact right now in Xiamen they’re doing the oceans ministerial. So it’s a meeting at the ministerial level on oceans issues, and then there will be about six or seven ministerials. I’ll be going back to China in – this weekend. So I’m not sure where I am actually right now. But I’ll be going back to Beijing, and then there’s a human resource development ministerial in Hanoi, in Vietnam. So I go there to that ministerial, and then to the Philippines.

As you know, the Philippines is the host next year for APEC. So they’re very, very eager to begin to prepare for next year’s agenda and how we can follow through from this year. So I’ll be going to the Philippines and meeting with my counterparts there. And then after that I’m going to go to Hong Kong and have some meetings there, and then go to Macao for the tourism ministerial. So that’s September 13th – and then come back. So I’ll be on the road for about two weeks.

And following that, I’ll probably stay in Washington as much as I can, because we start preparing for the actual leaders meeting, and so there will be a lot of demands in terms of – obviously, President Obama is definitely going. That’s what I understand. And we probably will have not just President Obama, but of course, Secretary Kerry, as well as USTR Mike Froman. But this year we may even have, I understand, possibly – well, clearly – Commerce Secretary Pritzker, possibly Agricultural Secretary Vilsack, as well, and maybe one or two other secretaries. So it’ll be a fairly big delegation from the United States going to Beijing in November. So a lot of preparation.

But in the run-up to that we also have a finance ministerial, we’ll have an agricultural ministerial – I think both in Beijing – and then I’m not sure if you know the actual leaders schedule, but it begins in Beijing on the fifth and the sixth, which is the senior officials (SOM) meeting – the fifth and the sixth. And then Secretary Kerry and Mike Froman will do their ministerials – APEC ministerials – on the seventh and the eighth, and then the President and other leaders will arrive on the 10th – and basically it’s the 10th and 11th in Beijing.

And then I think, as you all know, I think President Obama will be staying behind in Beijing for a day on the 12th, after which he heads out to Burma for the EAS – the East Asia Summit – and then he heads to Brisbane in Australia for the G20 – the 15th and the 16th.

So that’s the general schedule of the coming couple months. Of course, I’m involved primarily in APEC, not in the EAS or the G20. Now let me just make a couple of comments about the substance of APEC as we’re moving towards the leaders week. And then I’ll try to leave a lot of time for questions that you all have.

Now on the substance, I think at my last briefing we talked about essentially the agenda for the APEC year from the Chinese perspective, and you have basically three pillars. The one – the first pillar is the trade and investment pillar, and then the second one is what the Chinese call the innovation, reform, and growth pillar. But in general, those are the set of issues that are related to how we sustain economic growth in the region. So issues of the environment, issues of food security, heath security, women empowerment, internet, urbanization, all of those issues that are important in sustaining growth – so not just growing but sustaining it in a way that would allow it to grow, obviously, in a healthy fashion. And the third pillar, as you all know, is the connectivity pillar. Essentially, there we have a whole set of issues related to trying to increase the flow of people and goods throughout the APEC economy, so including cross-border education, physical infrastructure, regulatory convergence, things of that nature. So that’s the third pillar.

And I’m happy to say that SOM3 is usually the most important SOM meeting, the senior official meeting, because it’s the last one before the leaders actually meet. So we really have to get everything together to make sure that we don’t have a lot of problems during the leaders week. We don’t want to spend a lot of time arguing over things, debating things at the last meeting. So this meeting is very important. And the U.S. had about 200 delegation members go to the SOM3, and when I say delegation I mean it fairly loosely. We had about a hundred from the private sector going, and then a hundred from the different agencies within the U.S. Government going. So as you know, it’s not just the State Department. We have people from Homeland Security; people from Agriculture; people from Commerce, of course; USTR, Transportation; et cetera. So a lot of – Department of Justice, because this year we focused a lot on anti-corruption, so we had people from there attend as well. And so a very big meeting.

And I’m happy to say that this year I can honestly say we really made good progress at the SOM3 meeting with the Chinese host. Very well organized. We made progress across the three pillars that I just talked about.

On the first pillar, let me just say that, as you all know already, the Chinese are very focused on the – on, of course, the large FTAAP, the free trade area of the Asia-Pacific. And so we had good discussions on that, and hopefully by the time our leaders get together, we should be able to actually launch the roadmap for FTAAP for the free trade area. We will have, essentially, the roadmap that would include a lot of events that we’ll be doing – activities we’ll be doing that would include information-sharing, it would include capacity-building, it would include, finally, an analytical study of how we’re going to move towards a free trade area of the Asia-Pacific, what we call FTAAP for short.

So that’s something, of course, the Chinese are very much focused on launching this year in Beijing. And again, we had good discussions, and I think we will have a good launch in November. And we did a few – quite a few other things in this trade investment area, including beginning to look at services, access to services market in the region within APEC – for example, manufacturing-related services that the Japanese and Australians both proposed and we cosponsored.

So we’re essentially – the point is that we’re moving away from – not away from, but from sort of focusing on goods, the liberalizations on tariffs and so on, to the services market. And that’s what we call a global supply chain. And we’re also looking at moving into the environmental services area – trying to open access to environmental services in each of these markets where we can actually expand the flow of services in this area.

And so in that area – again, there’s a long list – as most of you know, APEC is a very broad, broad sort of body of issues that we deal with. So apart from that, in the sustainable growth area, I think I spoke to a number of local press people in Beijing. And I actually arrived fairly early in Beijing because there was a very high level workshop on anticorruption. And the U.S. and China are working very closely together in this area. And also, there was the first meeting of the anticorruption and transparency network, and the ambassador, Ambassador Baucus attended that one. The minister for supervision, by the way, attended the first one – the high level workshop on anticorruption. Huang Shuxian, the minister of supervision, opened the meeting itself, and it was a very good meeting.

Again, I learned a lot personally from that meeting, where a lot of private sector companies, people – law enforcement officials from different economies spoke. And at the first meeting of the ACT network – this is a network of law enforcement officials, essentially – first meeting of this group. And Ambassador Baucus, our ambassador in Beijing, delivered opening remarks at that, as well as a number of others. And the Vice Minister for Supervision Fu Kui was there as well throughout the meeting.

So it was a very useful meeting because the whole purpose of this ACT-NET is to get all of the law enforcement officials who are involved in anti-bribery in the APEC region together to try to begin a process of information sharing among the different economies on bribery cases that essentially cross the border within APEC, and to also share best practices on how we do things, so that we can tackle this issue more seriously and more effectively, and also, essentially, to bring them together to also find out what the various regulations are within each economy. For example, the U.S. has a different set of laws and regulations regarding bribery cases, and also asset recovery regulations. So this would be a good chance for law enforcement officials to know about the particular regulations and rules in different economies. So this is the first step towards that, and so we hope that this will bring in greater cooperation.

But beyond this issue, we also touched on a whole range of issues, as I mentioned earlier. The U.S., for example, is still very much – from the year we hosted in 2011 – very much focused on trying to increase women-empowerment in the economy. In other words, how do we provide greater opportunities for women to access finance markets and to also be more involved in the higher levels of management within different companies in different countries?

This was, of course, also not just a U.S. initiative, but also very much led by Japan because, as you know, Abe and women-omics, is very, very concerned about sort of the aging Japanese society and how you have to utilize more the talents that you have within Japan, within your society, and how to essentially elevate and expand the role of women, which means you have to deal with sort of family friendly practices within companies. So the Japanese, for example, have a proposal where they will – they’ve asked all of different APEC economies to nominate five companies from each economy that have best practices in terms of how they promote and facilitate the role of women in their companies by producing family friendly policies on health, on healthcare, and so on.

So we focused on that as well in SOM3. Again, we also had, essentially, health security issues that we focused on. China, as a host, sponsored two particular sessions that I attended as well, that all the senior officials attended, and the internet economy was one of them. So the idea now is all of our societies are changing so quickly and the role of the internet is clearly very, very significant, so we invited people from Alibaba, Baidu. From the U.S. we invited Uber. Do you know what Uber is? Yeah, it’s sort of taxi cabs – not quite taxi cab, but it’s a service. And I actually never knew what Uber is until this summer. But the Uber person came, and they actually have now Uber service in China. So if you have a problem in China, you can go onto this – I guess whatever you have, an app that you have for Uber, but they’re expanding quite a bit.

And so the point there is that they were trying to show how internet can be used to really – as an innovation – to actually do a lot of things. For example, a lot of small businesses that cannot afford big buildings and cannot compete with the CEOs from big companies, can actually use the internet to really quickly link, organize, do business. And so it could also be used to service a lot of the vulnerable groups within societies that they have access to the internet. So a very, very, very useful seminar workshop with discussion afterwards.

And the Chinese also hosted another one on urbanization in this area. China, as you know, and a lot of other countries continue to urbanize. And so we had presentations from Korea, from Japan, from China on different ways of urbanizing in an environmentally friendly fashion, and how important it is to conserve energy, to design – plan the city in a way that would be efficient and healthy for urbanized growth. On the U.S. part, I spoke a little bit about how in the U.S., we already are fairly urban, but how, for example, in New York City, when you go now to New York City, you can find that even the older cities, there are different ways that businesses have started and communities and neighborhoods have started to make it more vibrant by essentially doing pedestrians’ walks and then urging businesses to get together to sort of make more vibrant different neighborhoods within an old city. And so there are many ways of dealing with urbanization, but it’s now a very major issue for a lot of countries. And so we’re trying to share best practices, trying to find out how we can work together to help urbanization proceed in a healthy fashion there. So those are some areas and if you have questions about this area, we can talk about it more later on.

In the last pillar, on connectivity, we talked, of course, about a number of issues in terms of infrastructure, physical infrastructure development, the need for investment in physical infrastructure. But mostly we spent almost a few hours on what we called a connectivity blueprint. So the senior officials earlier in the year asked the APEC secretariat to produce a blueprint on connectivity. In other words, how do we plan to move ahead to connect the APEC economies more closely together in all of these different areas? And underneath the connectivity blueprint, we have another three pillars.

And the three pillars are: physical; and the second one’s regulatory convergence – we’re trying to get regulations more uniform and more coordinated; and then people-to-people, so cross-border education, tourism, travel, the ABTC card, the APEC business travel card, and so on. So we discussed the blueprint at length and we set targets wherein, let’s say by 2025 – we haven’t decided on the actual date yet, but we set targets where we are trying to, let’s say, double the number of people-flow among the APEC economies, or tourism, cross-border education, trying to increase the number of cross-border students studying in different economies. And so we hopefully will be able to complete the blueprint and as a way of moving forward in terms of connectivity and produce this for the leaders week in November.

And let me just add one last thing. One of our major initiatives – one of the United States, supported by eight other economies – is to actually create what we call an APEC scholarship and internship initiative. And by this what we mean is that we’re getting a number of economies to cosponsor scholarships for students; for example, students from the developing APEC economies to be able to study in another economy on a scholarship if they can’t afford it. So I think we had a very good response. This proposal was made earlier and at SOM2 we had a very good response. For example, Chinese Taipei, I believe, will come up with some 20, 25 or so scholarships, where they will provide scholarships for people to go to Taiwan to study. And I know that China also will have quite a number of scholarships that they will be proposing at the end of the year in November.

Australia – very, very positive. They not only are trying to invite people to go to Australia to study on scholarships, but they’re also trying to encourage Australians, young Australians to go abroad to other parts of Asia, to learn more of the culture, learn the educational system, and so on. And in the U.S. we’re proposing to have a number of companies offer internships that will allow and help students from various APEC economies to come to the United States or to go to some of the companies in the region to intern in, let’s say for example in our case, the APEC members – Caterpillar, Eli Lilly, Qualcomm – will be offering sort of internships or scholarships to encourage, again, more cross-border education.

So I think I’ve gone on enough. Is it 10-15 minutes or so already?

MODERATOR: Yeah, it’s about 20.

MR. WANG: Yeah. So what I’ll do now is just turn to you for questions, and I’ll be glad to answer – and she’ll – she said she’ll select who – I don’t get to pick. Thanks. (Laughter.)

MODERATOR: So just remember, again, wait for the microphones and say who you are and your outlet, please. We’ll start with you.

QUESTION: Thank you, Dr. Wang. Yun Zou with China Central TV, CCTV. Well, my question is that during the senior official meeting, both China and United States has expressed your willingness to work together in fighting the corruption, but we all know that by no means that will be an easy task, because, as you just said, that different countries has their own different interpretation of corruption and also has their own legal system. So I’m just curious that under this agreement, what kind of rules will all the countries abide by and who will mainly chair this agreement? Thank you.

MR. WANG: Okay. Well, first of all, in terms of the actual organization itself, it’s not so much trying to arrive at one rule, because we all know that we have very different political, legal systems. It’s really more to try to understand what each country’s rules and regulations are, so by understanding that – for example, if you – let’s say you had somebody cross a border. If somebody, let’s say, left China or left U.S. to go somewhere else with illegal funds, whatnot, then what you’d need to know – for example, the Chinese officials need to know is if you want to get somebody back to China or their illegally-obtained funds, you need to know what U.S. regulations are, what kind of evidence is needed to be able to actually get that person back or to recover the funds.

So it’s not an attempt to make everybody have one rule or law, because that’s going to be impossible. But it’s more to understand what the requirements are. So in fact, from this meeting that we had of the ACT Net, we produced, to begin with, a directory of all of the offices and the people in charge of the offices in the different economies. So, for example, if you have – if someone went to Malaysia and you have a case in Malaysia, then you can open up the book, essentially, and you know who the responsible offices are and the people are, then you can contact them to begin with. And then we also are producing a guidebook on the asset recovery process. So then this guidebook will have in it, for example, the process or procedures in the United States for recovering assets that are essentially stolen from another country and in the United States. So that’s the purpose of the ACT Network, and it’s not to really come up with one rule.

The other thing, of course, is to exchange best practices. So one of the major goals is to really have cross-border cooperation on assets or people that go cross-border, but also it’s really to learn about how you do it within your own country as well. So in our own country, how we deal with bribery and how you deal with it in other systems. So one of the important things we hope – again, it’s not done yet, but by the end of the year – we hope to have our leaders endorse a set of – and this is more like what you were saying – actually endorse a set of principles on anti-bribery that is very similar, for example, to the ones in OECD. So OECD has anti-bribery principles in terms of making sure that there’s a way of detecting and responding to sort of bribery cases.

So hopefully by the end of the year we will actually have – the U.S. actually drafted a sort of APEC principles on anti-bribery and enforcement of anti-bribery laws. And so we’re hoping that that will then be adopted by the different economies, and this will be one set that APEC economies will then be able to subscribe to and agree to. So you’re welcome.

MODERATOR: Yes, right up here.

QUESTION: Thank you, Dr. Wang, for holding this press conference. Ching-Yi Chang, Shanghai Media Group. I’d like to know, does President Obama expect to sign bilateral investment agreement with China during his trip to Beijing? And also, is there any change of the view of the United States on China’s market economy status, especially after China establishes its free trade zone? Thank you.

MR. WANG: Sure. I honestly don’t really follow that very closely, the BIT. Actually, it’s not a BIA, it’s a BIT – Bilateral Investment Treaty – if it’s between China and the United States. I do know that they’re having about three or four meetings a year, either in Beijing or in the U.S., on the Bilateral Investment Treaty. But I don’t know at what state it is at this point. But my guess is – just in terms of my interaction with my China desk counterparts and all that, and USTR – is that it won’t be at APEC. It’s still a couple years down the line, is my guess, so it won’t be that fast.

But again, I may be wrong. But I don’t expect that we are coming anywhere close this year to actually completing it. We’re exchanging negative lists, for example. There’s a list that the Chinese have that I know is very long from the U.S. perspective, and so we’re still negotiating that. And so it’ll take a while.

Now on the question of market status, again, I know of that more from my job when I was a deputy chief of mission in Beijing. And so I’ve been following that negotiation as well as the BIT. And that one, I believe, we’re still a long way off. But again, I would defer to perhaps others who are more current on this. But I think at this point, if it continues, I think the target date is 2016. So obviously, what China does in terms of its Shanghai pilot zone and so on would help, but I think we’re still a long way off from actually coming up with a change in the sort of market status for China.

MODERATOR: Okay. Yeah, right up here.

MR. WANG: You should give a badge to the people in the back as well.

MODERATOR: I will. (Laughter.)

MR. WANG: We’ve got three people in front.

MODERATOR: Yes.

QUESTION: Thank you very – thank you. Thank you very much, Dr. Wang. My name is Atsushi Okudera from Asahi Shimbun, the Japanese newspaper. I’d like to ask about U.S.-China bilateral relationship. This is not a direct – the APEC meeting, but are you planning to have a bilateral meeting, summit meeting, between President Xi Jinping and President Obama before or after the APEC meeting? And if you have, what kind of style? As you know, Chinese Councilor Yang Jiechi last year announced United States and China has agreed next time they going to have a same time of – same style of —

MR. WANG: Sunnyland.

QUESTION: Freestyle – like Sunnyland. So this time are you going to have same kind of – same style of summit meeting in Beijing or other cities? And if you have, what is the point of this time’s summit meeting, particularly in terms of new model of major power relations? They – both country talking about lots of times, but we still don’t understand. It is not very clear. I know this is for avoiding conflict —

MR. WANG: Right.

QUESTION: — or talking very freely, frankly. But actually, there is lots of differences on South China Sea and East China Sea and cyber problem. So what is the point this time? Thanks.

MR. WANG: Okay. Yeah, as I mentioned at the very beginning, after the leaders meeting is finished, the 10th and 11th, President Obama will stay behind in Beijing on the 12th, and so that’s where the bilateral meetings will be held between China and the United States. Some of the questions you’ve asked actually are probably best answered by the Chinese. We don’t know exactly what the Chinese have planned for the 12th in terms of how they want to do the bilateral at this stage, so I think that’s still in the process of discussion.

But obviously, I’ve heard a lot of comments about how effective it is to actually have smaller meetings where you can actually talk about issues in a more personal way, and I think knowing President Obama’s style and, of course, from the U.S. point of view, we did Sunnyland, and so we think that that’s an effective way of doing things. But – and of course, the Chinese seem to be receptive to that, but exactly what they have planned, we don’t really know at this stage whether it’ll be Beijing, whether it’ll be outside somewhere else. But that’s something I think that the Chinese are discussing with us, but not yet decided, I believe.

And in terms of the actual – the goal and the great – the major power relationship, again – actually, that’s a term that the Chinese came up with, not the U.S. So I’m not sure whether we subscribe completely to the exact interpretation of that. It’s something that Xi Jinping had sort of discussed several times, announced several times. That’s what he wants. But to me, it really – I’m not sure what new style model we have, but to me, it’s really simple.

And essentially, between any two countries – not just China and the United States – is first of all, you have to expand the areas of cooperation as much as you can, whether it’s on trade or whether it’s people-to-people, cultural, whatever it is. So you expand as much as you can the positive side of the relationship. That’s one thing. And the second point is then you manage the differences, because you will have differences, and some more than others, but between China and the United States, we certainly have differences that – some of the things you cited on cyber, on a number of other issues. But – so I would say you try to manage them in a way that would not make it uncontrollable or unmanageable, I guess. So that’s the bottom line.

So we have quite a number of issues between U.S. and China, and so far I think we’ve been able to manage them. So I think the relationship between U.S. and China will essentially be one in which we continue to – on human rights, on cyber or whatever else – we continue to have differences. We need to manage those. And then on the other side, within APEC for example but beyond APEC, we have a lot of, like, CPE, the sort of people-to-people exchange. We’ll continue to expand it as much as possible, and hopefully, the positive side will, in the long term, win out. So that’s what I see as the power relationship that we have.

MODERATOR: The gentleman right here.

QUESTION: Thank you, Dr. Wang. Wait, hello? Yeah. Thank you, Dr. Wang. Xiaoyang Xia, reporter from Wen Hui daily, Shanghai, China. You mentioned that China as a host has set out three pillars for this year’s APEC. The question is: Does the U.S. quite agree with those pillars or themes? And do you have any differences? And what are U.S. priorities for this APEC which you want mostly to achieve?

And secondly, you mentioned under the third pillar the main – one of the main focus is the infrastructure building, and what’s your opinion or what’s U.S. position on the Chinese proposal for the establishment of a Asia Infrastructure Investment Bank? Thank you.

MR. WANG: Yeah. We have no problems at all with the three pillars that the Chinese have proposed because they’re fairly broad, so how can you disagree with trade and investment, or how can you disagree with sustainable growth and how can you disagree with connectivity?

The question, then, of course, underneath them will be working on all of these different issues that are sort of different priorities – some for the Chinese, some for the Japanese, Koreans, Vietnamese, et cetera, and ours. So no disagreement; we’ve been working very well under those three pillars. In terms of U.S. priorities, I mentioned already at some length the question of anticorruption, and I think that’s a joint priority for the U.S. and for China because – and not only that, actually. This priority is actually quite broad, because if you look around the APEC region, whether it’s Philippines, Vietnam, Indonesia, Mexico, Peru, corruption is a big problem. It’s a pervasive problem in all these economies.

And so the question is: How do you continue to sustain growth without dealing with this issue? Because it essentially produces unfair sort of disparity of wealth and no rule of law, so in the long term, you really have to deal with it. That’s why it’s a very high priority for the United States, and I think also for China, clearly, and for the other economies. So that’s a very high priority.

We’re also very concerned – I think especially Secretary Kerry and President Obama – about the environment. And I think China, Vietnam, Indonesia, others are also because, for example, rapid growth in China over the last 20 or 30 years has produced an environment which is really quite hazardous to your health in terms of air, in terms of water, food security – food safety, I should say, not so much food security but food safety. So we all know that you can grow very quickly, but to sustain it and to actually make it healthy for your own people, you have to really focus on the environmental impact of what you’re doing.

So for example, right now, as mentioned earlier, oceans – we’re having an oceans ministerial right now in Xiamen in China. And so beyond air and beyond water and so on, we’re going into the oceans, where so much of the ocean now has marine debris. So people throw things overboard when they’re in ships, they throw them from the land, they dump it out there, and it’s destroying a lot of the oceans that we have. And again, for the moment, we don’t know that, but in the long term, we’re going to rely on the ocean – the big Pacific Ocean and others. So we hope that we’ll be able to get countries within APEC at this point to begin to work on protected marine areas to begin with, and then sustainable fisheries – not to overfish, not to do illegal fishing or unregulated fishing, because if you were to do over-excessive fishing, then essentially you’re going to be drying out the resources that you need in the future. So the environmental issues are very important, and one of our major U.S. initiatives apart from the oceans – as you know, we did an Oceans Conference here, Kerry did one, inviting global members here. So we’re trying to use some of that – the action plan – we table it at – in SOM3, this action plan from the Oceans Conference. And we’re hoping to use some of that now in the oceans ministerial in Xiamen to try to get APEC to support these various principles.

And beyond the environment, I mentioned already that women is a very high priority for us, because again, we think it’s not only the right thing to do to include women in inclusive growth, but it’s also good for the economy, for your development to be able to utilize all the talent that you have within your society. And so that’s a very high priority for us. So in concrete terms, what the U.S. has done in this area is we tabled, for example, a study that we have done on trying to come up with indicators for women participation in the economy as a whole. So in other words, for example, how many women – what percentage of women are in management positions, what percentage of women have access to finance, what percent of women essentially have access to markets.

So we’re trying to come up with an indicator – we already have done the study; we have come up with 26 indicators. And what we’re trying to do now is get the economies next year to begin to measure exactly where women are in terms of participation in the economy. And once you have that measure as a baseline, then we’ll begin to set targets and see where we’re failing – in other words, why are women so – have no access to finance in certain countries, let’s say, and try to work on improving that. And we’ll set targets and to move ahead.

So we’ve done this study, we hope that this will endorsed – the indicators will be endorsed by the leaders, and then we will then hopefully have the leaders encourage all the economies to begin measuring, and then from there move on to targets in the coming years. And —

QUESTION: (Off-mike.)

MR. WANG: Yeah. The last one, on infrastructure – there a lot more priorities. I have about a list of ten priorities more. But let me just go directly to the infrastructure issue. I think most of you are aware of the Chinese proposal on the Asian Infrastructure Investment Bank. And we have been in touch with China and met with Chinese leaders – Jin Liqun will be, of course, the head of that bank, we understand. We’ve had discussions on that. And there we’ve been very clear about what our concerns are. And our concerns are just that this proposal for this AIIB, that they’re able to meet the various standards of other multilateral development banks – meaning essentially, to begin with, the projects should take into consideration safeguards on the environment.

So when you start an infrastructure project, you have to make sure that you look at the environmental impact of that project, or labor, and what kind of labor you use, what conditions under which they work. That’s one thing. Governance, transparency – meaning that if you’re in construction you’re talking about large sums of money. How should it be dealt with in terms of transparency, governance so there’s no corruption? We go back to the issue of corruption. So our main concerns are that, and we’ve conveyed these concerns to China, and we hope that they can be addressed.

QUESTION: Thank you. Kunihiko Yasue from Yomiuri Shimbun.

MR. WANG: Yeah. Just a little softer, but yeah.

QUESTION: As for FTAAP, Trans-Pacific Partnership is a part of FTAAP. And as to Trans-Pacific Partnership —

MR. WANG: TPP.

QUESTION: — President Obama in July said he hopes to get something which is public and the Congress can look at by the time he visit Asia in November. So are there any possibility or a plan that the latest meeting for TPP negotiation will be held in the sideline of APEC latest meeting like last year?

MR. WANG: Okay. Let me first correct you on one thing. I don’t think that APEC – I don’t think that there were TPP negotiations per se on the sidelines of APEC. There were meetings, but there were not negotiations. In other words, APEC, heads of APEC in Bali when I was there last year, for example, the TPP leaders got together for sort of a short discussion, but it was not a negotiation. So that’s a very different thing. On the TPP issue, obviously the key player in the United States is USTR. So we’re not actually negotiating within APEC or involving negotiations on TPP within APEC, as you know.

And so I don’t really know exactly what status it’s in right now. Obviously, last year in Bali we were hoping it could be completed by around that time. And obviously, we’re working very hard this year and understand good progress has been made, especially after the various meetings in Japan on market access. But again, on the specifics of the negotiations, I’m not really privy to it so I don’t know how far along it is. All I know is that every time I turn around to talk to Wendy and others they’re off somewhere – or Mike Froman – they’re off somewhere negotiating it or talking somewhere.

So all I can say is I think we’re making progress, but I don’t know what will happen by the end of the year.

MODERATOR: I’d like to offer an opportunity to New York. New York, can you hear me?

QUESTION: Yeah. This is Shen with China Business Network and from New York. And it is good morning, Dr. Wang.

MR. WANG: Good morning.

QUESTION: And you said President Obama and President Xi Jinping will hold a meeting during APEC like one last year. And what will be the possible topics that interest to leaders? And will the issues about the South China Sea and the Ukraine (ph) will be brought to the meeting? Thank you.

MR. WANG: Okay. I’m not sure if I understood everything you said clearly. Well, President Obama did not go to Bali last year, so I don’t know. They didn’t meet in Bali. I’m not sure if that’s what you said earlier, but in any case that’s not important.

I think within APEC, as far as I know, in the APEC context we will not be dealing with some of the political issues you talked about. At the bilateral I think these topics will probably come up. So on the 12th, I guess whatever differences we have or issues we have between China and the United States probably will come up, it’s my guess, at the bilateral on the 12th. But within APEC it’s not certainly part of the topic.

I’m not sure if I got your question entirely. I wanted to give you another chance to say something. (Laughter.)

QUESTION: Okay. I just want to say whether this topic whether the issue is about South China Sea and Ukraine (ph) would be brought to a meeting, and what would be the possible topics that interest to leaders?

MR. WANG: Possible targets that are interested to leaders?

QUESTION: Topics.

MR. WANG: Topics. Well, again, you want to separate APEC from the bilateral, and on the bilateral between China and the United States I think we – I can’t say exactly what they will say because it’s something that they will have to determine later on, but my guess is – all of us can guess what the topics would be. I mean, obviously, all of the differences between China and the United States on various issues will be raised, all of the sort of cooperative areas will also be raised.

So I would not be surprised certainly, and I can’t speak for the President, but I would not be surprised if South China Sea came up in a discussion because it is clearly an issue that both countries are concerned about managing, and I think it’s an important issue not just for China and the United States, but it’s an important issue for a lot of other countries in the region. And as for the other topics, again, it’s a wide range of topics. I think we all are aware of some of the range of topics that could be discussed. Human rights could be an issue as well. Trade issues would be important as well. You know we have a lot of trade issues. Cyber could be part of the topic. So I think you probably know better than I do the list of all of the issues that clearly both countries are concerned about today.

MODERATOR: Okay, start here.

QUESTION: Good morning, Dr. Wang. I’m from China, China News Service. I want to go back to the anti-corruption issue. And just now you mentioned that the APEC economies are doing guidebooks, some kind of guidebook to the anti-corruption. And are they going to publish this year, or it will take some year to discuss about the final version of that?

MR. WANG: Right.

QUESTION: Yeah. It will take —

MR. WANG: Yeah.

QUESTION: And besides that, besides the trying to understand each other’s legal system, and what kind of cooperation are they going to do during this anti-corruption issue action, that you call it? Okay, thank you, sir.

MR. WANG: Well, I think on the issue of the publication, actually the United States already has the publication, so we have a template for it. We already have our offices and also we have our asset recovery guidebook. So what we’re trying to do, probably next year, is to have all the APEC economies do the same thing. So clearly, it will not be done by November, but it will be something that will be essentially directed by the leaders for us to do in the coming year. So that’s the agenda for – I think for next year.

And I forgot the second part.

QUESTION: What else are you going to –

MR. WANG: Oh, yes. Yeah, apart from – okay. Beyond that, I think the whole point is I remember very clearly from one of the presentations at the high-level workshop that I attended and how people were talking about sort of cooperation between the law enforcement officials of one country with another, and one of the most important elements of this cooperation is trust. So in other words, you have to have some trust between the law enforcement officials of one country and another when they begin to exchange information or when they begin to try to get cooperation on specific cases. If there is no trust – and of course, trust is based partially on personal sort of relationships in terms of respect for the other person’s knowledge and respect for the other person’s integrity, but also for the system.

So I think one of the most important things we hope to come out of this network is that you begin to then have people meet more frequently – not just on specific cases, but let’s say on training courses so they’ll have a training course. China will be setting up a – what it calls a secretariat for this ACT network. It’s a small group for 2014-2015 and then maybe it’ll move on to other areas. But the idea is to set up a secretariat that would be able to organize training workshops where all of the law enforcement officials will come together and maybe in some area in some country and work together on learning best practices, how you do things, how I do things, and in that process also develop personal relationships among the different law enforcement officials to begin to understand each other. And in that sense, I think that will help facilitate actual progress on cases that actually occur.

MODERATOR: Hiroaki, and then I’ll go to you. These are probably the last two questions, guys. Go ahead.

QUESTION: Thank you. Thank you, Dr. Wang, for doing this. My name is Wada. I’m with Japan’s Mainichi – I’m with Mainichi newspaper.

DR. WANG: Mainichi. Mm-hmm.

QUESTION: And my question is about maritime territorial disputes in the bilateral meeting between the United States and China. What is the willingness of the Obama Administration to take up this particular issue? And you also talk about managing differences between the United States and China.

MR. WANG: Between who?

QUESTION: But after what happened off Hainan Island the other day, the interception by the Chinese of the U.S. Navy aircraft, what is the sense inside the Administration about the difficulty of managing the difference? Is that sense of difficulty is increasing, or is there any change? Thank you. These are my questions.

MR. WANG: Okay. Well, I think, again, let me just start by saying that this is not in my area, it’s not in my zone, so I’m not really dealing with that. So I want to make that very, very clear so nobody will think that I am actually speaking with authority on this issue. But all I’ll say is that I expect that all of the issues you raise will probably be discussed simply because they’re important issues. The more important the issues are, the more challenging they are, the more likely they’ll be discussed between our leaders, because they’re the ones who have to deal with these very serious problems. So all I’ll say on that then is that with the recent incident over the intercepts, whatever different versions of it – Chinese and American – I think, clearly, it’s something that we need to discuss. So my guess is that it’s already being discussed and that it will continue to be discussed if – at some point by our leaders.

So is it increasingly more difficult? Yeah, and that’s why you need to discuss it.

MODERATOR: Okay. Weihua.

QUESTION: Hi, thank you. Chen Weihua, China Daily. Yeah, I want to go – continue on that ACT network. Will that lead to deterrence for those Chinese – corrupt Chinese officials to seek safe haven in the U.S., Canada, or Australia, or will that lead to extradition and repatriation of those corruption – corrupt officials already here? So thank you.

MR. WANG: Right. Well, I think the goal, certainly, is to – on both sides, not just China and the United States but on all sides, the goal, of course, is to increase the possibility or the probability that illegally obtained funds or criminals who go across the border will be returned and will be treated according to the rule of law in whichever country they come from. So the goal of the entire thing is to increase that probability, and to increase that probability then the presumption is that each side has to understand what the requirements are for doing this.

And so by starting on this first step to try to understand laws and regulations of different sides, the kinds of evidence that’s needed that’s considered to be relevant information or relevant evidence that could be useful in court, that that first step will increase the probability that in the future people who escape to another country with illegal funds will be returned eventually to their country. So that’s the goal of it. Now, how fast that happens, when that happens, is another issue, but that is the goal. And obviously, if the Chinese were to better understand what kinds of evidence is needed, and if they can provide that to us or to any other country, then obviously, the chances that they will be repatriated or be brought back would be higher.

MODERATOR: All right. Do you want to take one more?

MR. WANG: Sure, I’ll take one, yeah.

QUESTION: Matt Field with —

MODERATOR: Wait just one second.

QUESTION: I’m sorry. Matt Field with NHK, Japan Broadcasting Corporation. Just on the corruption efforts, can you just clarify how many countries were involved in these corruption meetings you attended? Were there bilateral meetings just between the U.S. and China? And so can you imagine a day when the U.S. would be helping China track down corrupt officials here in the U.S. and sending them back to China? Thank you very much.

MR. WANG: Sure. No, it wasn’t bilateral. I didn’t count exactly who was there, but I would imagine almost all 21 economies were involved. It was open, certainly, to all 21 economies. And again, the first day was a workshop, a high-level – well, there are three – actually, three days of meetings. The first day was a working group meeting of the anti-corruption and transparency working group. That’s one day.

The second day that I mentioned Minister Huang Shuxian went is the high-level workshop on anti-bribery. And not only were there 21 economies all invited – and many did go, because I was there – they were also on the panel people from Indonesia, people from Malaysia, other people who were speaking on that panel. And also there was private sector, so companies like Siemens and so on actually made presentations. And from the United States, the SEC, Securities and Exchange Commission, had people there. Department of Justice had people there. And so it was a 21-member APEC discussion on anti-corruption.

And – oh, whether or not I can see a day when the United States will actually work with China to bring Chinese criminals back to China, I’ll say that we already do. Again, I worked in China for many years, and we already have a lot of cases where – whether it’s from China, from Americans sent back to the United States or Chinese sent back to China in some cases – fewer of those, probably. But we’ve – not just in the criminal cases, but other cases – we have cooperated. There were some cases where we have actually sent people back to China when I was deputy chief of mission in Beijing.

The question then is: How many of them? Of course, the Chinese would like more, obviously, so we are cooperating already. The question is: How much more cooperation can we have? And there we require, again, a better understanding of what kind of evidence we need for this to happen. And if it’s provided to us, then we’ll continue to cooperate. We have something called the JLG, the Joint Liaison Group, that meets several times a year. And that’s where we are already bilaterally exchanging information about each other’s practices as well as information on specific cases. And we also have what we call ILEA program, where we actually bring a lot of law enforcement officials to Bangkok where we have a training center, and that has included some Chinese in the past for the last 10-20 years. So we are working together already on this issue.

MODERATOR: All right. Well —

MR. WANG: One last one?

MODERATOR: All right.

QUESTION: Thank you very much. Hello, okay? My name is Inoue from Kyodo News of Japan. I’m just wondering whether you had any chance to discuss about cyber issue with your Chinese counterparts, because Chinese Government has denied the U.S. allegation about the cyber theft and they refuse to have working group on cyber issue during the S&ED. So I’m just wondering where you are on this issue.

MR. WANG: Okay, good. The simple answer is that within APEC we did not discuss this. It was not an APEC topic. But as you know, they had an S&ED recently and that’s where they were discussed. Now, obviously, I understand that at the Strategic Security Dialogue that it wasn’t an official topic but the two sides discussed it, how can we deal with this issue. But I was not involved in the S&ED so I don’t know to what extent they discussed it, but I know the topic was certainly raised in that context.

QUESTION: (Off-mike.)

MR. WANG: Yes, we have not discussed this issue through APEC. It’s a bilateral issue so it’s not an issue with Indonesia-U.S., Papua New Guinea. They’re not interested in this issue. So yeah, but that’s a bilateral issue.

MODERATOR: All right. Thank you, everyone. We’ll call this briefing concluded.

MR. WANG: And thank you very much for coming. Appreciate it.

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