Eduardo Pedrosa

Secretary General

Pacific Economic Cooperation Council

The views expressed here are his own and do not necessarily

reflect those of the PECC nor its members.

ABAC Digital and Innovation Working

Group

Workshop on Building a Supportive Regional AI Environment: Next Steps for APEC30 July 2020, 0800

PECC Task Force on

APEC Post 2020

• First 30 years of APEC’s existence have seen dramatic

increases in prosperity

– Underpinned by substantial expansions in trade and

investment flows.

• As 2020 approaches both APEC, as an institution, and its

region find themselves at a critical and decisive juncture.

– Existential challenges of environmental sustainability and

climate change;

– Rapid technological change with both the potential to

contribute to an acceleration of the spread of prosperity,

but the potential also to intensify social strains and

current tendencies toward fragmentation;

– Growing scepticism in some sections of Asia-Pacific

societies toward the value of openness and

interconnectedness threaten to undermine political

support for regional economic cooperation.

Impact of the Covid-19 Crisis on

Economic Growth

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2019 6 months 12 months 18 months 24 months 36 months

Asia

-Pacif

ic G

row

th I

ndex

Average Asia-Pacific Weighted Growth

Question: Please give an assessment of the impact the COVID-19 crisis will have on your economy over the

following time periods compared to last year. Average weighted growth based perception survey.

Asia-Pacific Strategies for the Global Trading

System: Digital Trade and Artificial

Intelligence

• Artificial intelligence can bring unprecedented economic

and social benefits

• AI is revolutionizing the ways we live and work but also

fueling anxieties and ethical concerns

• Different models of data regulation

• International cooperation in such areas goes beyond

trade policy, and includes collaboration on regulatory

issues as well as finance in fora such as the OECD and

G20.

• Recommended need for further setting international

standards and promotion of inter-operability

APEC should take a lead to avoid the

fragmentation of the digital economy

-4% -5% -4% -3%-11%

-3% -4% -3% -2%

79%75%

83% 81%74%

81%

69%

85%81%

-20%

0%

20%

40%

60%

80%

100%

Disagree Agree

Question: Please indicate your level of agreement with the following statements regarding the digital economy.

Region-wide views on key

propositions

-4% -3% -5% -5% -5% -6%

81% 79% 78%73% 73% 70%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Capacity

Building to

appropriately

regulate

emerging

technologies

Common

approach for

the protection

of privacy

Competition

policy

Cross-border

data flows

Common

priorities and

responses by

members

Artificial

intelligence (AI)

and other path-

breaking

technologies

Coherent

approach to

taxation in the

digital age

Disagree Agree

Agreement across stakeholders and sub-regions on the need for

APEC to develop common priorities and responses to

pathbreaking technologies including Artificial Intelligence

20%

20%

25%

18%

16%

25%

26%

13%

18%

49%

47%

43%

53%

53%

50%

40%

50%

48%

24%

24%

27%

24%

19%

19%

25%

32%

29%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

All

Business

Government

Non-government

North America

Northeast Asia

Oceania

Pacific South America

Southeast Asia

Strongly Disagree Disagree Neither Disagree nor Agree Agree Strongly agree Don’t know

Question: APEC should develop common priorities and responses by members on critical issues associated with

related technologies such as artificial intelligence (AI), robotics, block-chain, and quantum computing, as well as

other path-breaking technologies

Impact of Technological Change on

Employment Size and Skills Mismatch

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

-80% -60% -40% -20% 0% 20% 40% 60% 80%

Short

age o

r S

urp

lus o

f W

ork

ers

Impact of Technological Change on the Number of Jobs

Northwest Quadrant:

Fewer Jobs and Surplus

of Workers

North-East Quadrant:

More Jobs and Surplus of

Workers

South-West quadrant:

Fewer Jobs and

Shortage of Workers

South-East quadrant

More Jobs and Shortage

of Workers

State of the Region Report 2018

Transition of Jobs into the 4th

Industrial Revolution

Northwest Quadrant

• Clerical Support Workers

• Personal services and sales workers (shopping

sales assistant, waiters)

• Building and Related Trades, Metal, Machinery

and Related Trade, Electrical and Electronic

Trades Workers

• Handicraft and Printing Workers

• Food Processing, Woodworking, Garment and

Other Craft and Related Trades Workers

(butchers, tailors)

• Plant and Machine Operators and Assemblers

(including train engine drivers, car and other

transport drivers, trucks, mobile and fixed plant

operators, ship deck crews)

• Cleaners and Helpers

• Laborers in Mining, Construction, Manufacturing

and Transport

• Food Preparation Assistants & Agricultural,

Forestry and Fishery Laborers

• Street and Related Sales and Services Workers

Southeast Quadrant

• Chief Executives, Senior Officials and Legislators,

Administrative and Commercial Managers

• Production and Specialized Services Managers

• Science and Engineering Professionals

• Health Professionals (doctors, nurses, dentists)

• Teaching Professionals

• Information and Communications Technology

Professionals

• Science and Engineering Associate Professionals

• Health Associate Professionals (eg medical and

pharmaceutical technicians)

• Information and Communications Technicians

• Ship and Aircraft Controllers and Technicians (eg

ships’ engineers, deck officers and pilots, traffic

controllers, air traffic safety electronics

technicians)

• Childcare Workers (eg childcare, teachers' aides)

• Elderly care workers

• Protective Services Workers (police, fireman,

security guards)

COMMON CHALLENGE BUT DETAILS

VARY FROM ECONOMY TO ECONOMY: DEMOGRAPHIC STRUCTURE,

LEVEL OF EDUCATION, etc

Current Developments

• Joint Statement Initiative on Ecommerce

(WTO)

• Business engagement? Yes this is a trade issue

but cross-over and coherence with other groups

(it’s complex!)

– US-Japan Agreement

– EU-Japan Agreement

– Regional Comprehensive Economic Partnership

– G20 DFFT, Osaka Track

– ASEAN Framework on Digital Data Governance

– Digital Economy Partnership Agreement

– Singapore-Australia Digital Economy Agreement

Impact of Covid-19 Crisis:

Video Conferencing

y = 15.79x + 3.53R² = 0.95

0.0

10.0

20.0

30.0

40.0

50.0

60.0

0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5

4.3 4.7 5 4.7 5.5 7

.7

7.6

7.1 7.3 8

.4

11

.6

32

.5

47

.6

55

.8

51

.8

52

.1

0

10

20

30

40

50

60

4/J

an

11

/Jan

18

/Jan

25

/Jan

1/F

eb

8/F

eb

15

/Feb

22

/Feb

29

/Feb

7/M

ar

14

/Mar

21

/Mar

28

/Mar

4/A

pr

11

/Ap

r

18

/Ap

r

Glo

bal

Wee

kly

Do

wn

load

s o

f V

ideo

con

fere

nci

ng

Ap

ps

Global Weekly Downloads of Videoconferencing Apps

Where can APEC make a

difference?

• Covid-19 Crisis: Pessimism – Chance to Rethink What Matters Implement the

APEC Roadmap on Internet and Digital Economy

– Why AI and Growth? Artificial Intelligence could add US13 trillion to the

world economy annually

• APEC’s core value proposition: dialogue mechanism

– Where are we now?

• Understanding of key concepts:

– DEPA

– CPTPP

– BRI

– DFFT

– JSI

BUT where in APEC should this conversation take place? Are these purely trade

policy (CTI) or they better framed as international regulatory cooperation (EC),

sectoral coherence (FMP)?

– Social strains risk gains?

• Education policy

• Other tools? FMP, EC, Tel WG.