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Finance Ministers: APEC economies on the right track

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Finance Ministers: APEC economies on the right track Issued by APEC Finance Ministers' Meeting - 20 September 2013

“Many economies appear to be on the right track in reducing their budget deficits but the region

still faces considerable economic challenges to achieve a return to robust and sustainable

growth,” said Indonesia’s Finance Minister Chatib Basri on Friday.

He delivered his report to APEC Finance Ministers on Thursday and Friday when they met on the

island of Bali to discuss ways to improve the Asia-Pacific region’s resilience and strengthen the

economic fundamentals for future growth in the face of challenging global macroeconomic and

financial circumstances.

Ministers expressed concern about unacceptably high unemployment in some economies, highly

volatile capital flows and slower growth than was expected.

“The challenges in the global economy are more than any one economy can handle by

themselves,” said Minister Basri as he set the stage for the meeting. “The big challenge for us all

is to remain vigilant in managing the risks, continuing reform momentum, and most importantly,

maintaining the openness and dynamism in the region.”

“The world is now looking to see whether the APEC region, given its size and the role it plays in

the global economy, can demonstrate its capacity to recover from economic fluctuations, and

support the global economy by sustaining its own growth momentum.”

Ministers heard from the APEC Secretariat which provided a perspective on the macroeconomic

environment in the region and its impact on trade finance.

“The APEC region has weathered the global financial crisis reasonably well but there have been

significant impacts from adjusting to spillovers from policies put in place by the biggest

economies,” offered Dr Alan Bollard, the APEC Secretariat’s Executive Director. “We’re starting

to see capital flows, asset prices and exchange rate moves normalize but that process can be

quite rocky for small open economies.”

“A survey by the APEC Policy Support Unit points to some changing trends in trade finance but

generally it’s looked much more robust than when there was a severe contraction for the region,

which contributed to the huge trade slowdown a few years ago,” Dr Bollard said in his report.

The World Bank Group reported that the global economy appeared to be moving into a new

phase, in which output in advanced economies was firming, but probably not as strongly as many


"Developing economy growth appears to be slowing, including in the Asia Pacific region," said Sri

Mulyani Indrawati, Managing Director of the World Bank Group, when she briefed ministers this

morning. "For many APEC economies, the balance of risk is once again on the upside."

"Economies in the Asia-Pacific region need to make structural reform a priority in order to extend

their growth potential, which remains one or two percentage points below pre-crisis levels," Sri

Mulyani noted.

Ministers are also discussing how the region may proceed to enhance infrastructure

development and the impact of the global financial crisis on its availability and the importance of

financial inclusion.

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