A number of significant events affecting the relationship between the two largest economies of the world, namely the USA and the PRC, happened in March 2018.
On March 8, the White House announced that in order to protect national security, the United States imposed taxes on steel and aluminum import with rate of 25 per cent and 10 per cent respectively. The measures were critically met by a number of steel and aluminum supplying countries. These states required exemptions for their national producers. To date, American officials stressed that the new tax would not be imposed on steel and aluminum produced in the European Union, the Republic of Korea, Canada, Mexico, Brazil, Argentina and Australia. Thus, the new burden has not affected two-thirds of the US steel and aluminum imports. Nevertheless, the measures may cause significant damage to China's metallurgical industry.
On March 22, the tensions rose. Commenting on unconfirmed information about the new restrictive measures of Washington against Chinese economy, Foreign Ministry Spokesperson Hua Chunying stated that the PRC "firmly opposed the US' acts of unilateralism and trade protectionism".

In 2017 APEC Policy Support Unit released a number of analytical reports, e.g.:
1. APEC Economic Policy Report 2017: Structural Reform and Human Capital Development (a report by the Economic Committee)
The 2017 APEC Economic Policy Report on Structural Reform and Human Capital Development discusses issues and policies relating to skills development and labour markets in the APEC region. It analyses how generally positive economic changes—such as the growth and development process, trade and globalisation, or technological upgrading—can contribute to structural unemployment, and what can be done to mitigate any negative impacts of these changes.
The report includes case studies by Viet Nam and Indonesia that provide an analysis of their relevant structural reforms and their impact, and some lessons learned and challenges going forward. In addition, all APEC members contributed Individual Economy Reports highlighting the challenges, responses, and opportunities regarding structural reform and human capital development in their economies.
Full report
Fact sheet
2. APEC Regional Trends Analysis: Declining Labour Share and the Challenge of Inclusion
This issue of APEC Regional Trends Analysis discusses who gains from economic growth and how this growth could be made more inclusive. “Declining Labour Share and the Challenge of Inclusion” finds that the labour share of GDP—an indicator of inclusiveness in an economy—has been on a downward trend over the past two decades. Apart from domestic issues, it identifies technological change and globalisation as catalysts of change in global labour markets and declining labour shares. It presents some policy options that can assist workers to take advantage of new opportunities in a rapidly changing economy.
The next chapter on “APEC Grows Faster amid Global Policy Uncertainty” examines recent economic performance in the region. It finds that APEC is a driver of global growth with output in the region expanding by 3.9% in the first half of 2017. A rebound in trade contributed to this growth, as the value of merchandise exports increased by 10.4% and imports grew 11.9% in the first half of this year. While near-term growth expectations are positive, policy uncertainties on trade and liquidity present downside risks to future growth.
Full report
Infographic
3. APEC in Charts 2017
An annual PSU publication, APEC in Charts provides a graphical overview of the APEC region’s economic, trade and investment performance as well as in areas related to APEC 2017 theme.
Full report
4. APEC’s Bogor Goals Dashboard, 2017
The APEC’s Bogor Goals Dashboard, updated on a yearly basis, includes indicators gathered from respectable public sources for the period 2008-2016. It aims to provide easy-to-understand figures to track the advancement in areas critical to promoting greater regional economic integration, such as liberalization and facilitation of trade and investment. The intention is to display a set of harmonized indicators laying out the evolution across time of certain aspects of trade and investment liberalization and facilitation in quantitative terms.
Full report
5. APEC Services Competitiveness Roadmap Baseline Indicators
In 2016, APEC Leaders endorsed the APEC Services Competitiveness Roadmap (ASCR) and its accompanying Implementation Plan. The Roadmap contains APEC-wide actions and mutually agreed overarching targets to be achieved by 2025. The PSU, which has been tasked to facilitate the implementation and monitor progress of the ASCR, prepared baseline indicators to facilitate the mid-term review in 2021 and the final review in 2025. This report contains the PSU’s evaluation of the agreed overarching targets and the compilation of the 19 APEC-wide actions and their corresponding indicators using appropriate international benchmarks. Accompanying the report is a detailed database on the baseline indicators and measures.
Full report and database
6. Review of External Indicators to Monitor Progress for the APEC Supply-Chain Connectivity Framework Action Plan (SCFAP) II
This report reviews the potential aspirational targets for external indicators that are included in the monitoring framework of the APEC Supply-Chain Connectivity Framework Action Plan II 2017-2020 (or SCFAP II). The targets are defined both in terms of ‘APEC rate of improvement by 2020’ (percentage rate of improvement or change) as well as in terms of ‘APEC average level by 2020’ whenever appropriate. These targets however, should be viewed as aspirational for individual economies considering the diverse domestic environment and different stages of development across APEC. The level of progress to achieve the targets will also depend on the initial starting point of each individual economy. OECD average figures are provided to give a regional comparison perspective.
Full report
7. Study on the Application of Global Data Standards for Supply Chain Connectivity (Phase 2)
Phase 2 of the study on costs and benefits of applying Global Data Standards (GDS) in supply chains covers three pilot projects, namely: (1) asparagus from Peru to the US; (2) durian from Malaysia to China and Hong Kong, China; and (3) Tequila from Mexico to the US.
As identified following an evaluation of the pilot projects, adoption of GDS comes with both benefits and costs. Among the benefits are reduction of efforts and time spent on information search, greater visibility along the supply chain, and accurate and timely capture of data. There are costs involved too, such as from subscribing to GS1 service, obtaining equipment and software, carrying out data cleaning and adjustment, and training of staff. The study also identifies drivers and challenges of GDS adoption, and suggests a few approaches to explore the wider use of GDS in the APEC region.
Full report
Report from phase 1 of the study

In 2017 APEC Policy Support Unit released a number of analytical reports, e.g.:
1. “The APEC Women and the Economy Dashboard 2017”
The APEC Women and the Economy Dashboard provides a snapshot of the status of women in APEC by looking at a set of indicators that measure the progress of women’s participation in economic-related activities and inclusion in several aspects of life. The Dashboard comprises almost 80 indicators, classified into five areas the APEC Policy Partnership on Women and the Economy (PPWE) has identified as priorities, namely: 1) access to capital and assets; 2) access to markets; 3) skills, capacity-building and health; 4) leadership, voice and agency; and 5) innovation and technology.

According to Dr. Feng Shaolei, Sino-Russian bilateral cooperation and SREB-EEU “conjunction” are both interrelated and differentiated. For example, recently China has signed the Agreement on Deepening Cooperation on China-Europe Freight Rail Services with seven countries including Russia. This is a cooperation agreement among railway sectors in China, Russia, Belarus, Germany, Kazakhstan, Mongolia and Poland. This agreement will not only serve the “OBOR” Initiative, but also bring great opportunities to the EEU. On the basis of cooperation in previous years, this project will further promote economic development of and trade cooperation among nations along the railway. The signatories will work together to improve the railway infrastructure, establish an information exchange system for transportation safety, expand the scope of railway transportation services, speed up customs clearance and in addition to establishing joint working groups and expert groups to address different issues.

Led by robust growth in India, South Asia shows resilience in the face of turbulent international markets and remains the fastest-growing region in the world, with economic growth forecasted to gradually accelerate from 7.1 percent in 2016 to 7.3 percent in 2017, a World Bank report said.
According to the report, the region’s economic performance prospects remain strong due to its limited exposure to global turbulence, coupled with increasing investment activity.
However, there are also signs of fading tailwinds. Capital flows to the region have declined and remittances from oil exporting countries have started to weaken. Fuel and food prices remain low but are unlikely to keep falling. As a result overall output growth is slower than previously anticipated and inflation has recently been creeping up.
Given its weight in the region, India sets the pace for South Asia as a whole. Economic activity is expected to accelerate from 7.5 percent in FY2016 to 7.7 percent in FY2017 based on the expectation of strong private investment, a push in infrastructure spending, an improved investment climate, and deleveraged corporate and financial balance sheets.
The report’s analysis of fiscal policy across the region suggests that governments need to find a balanced path towards fiscal consolidation.
In Bangladesh, growth is stable and projected to rise due to increased government consumption and investment, a recovery in private investments, and an easing of regulatory and infrastructure constraints. The country should be cautious about trade and financial shocks. It should strive to boost private investment by reforming business regulations, mitigating infrastructure deficiencies and addressing financial sector weaknesses.
In India, GDP growth is expected to be 7.7 percent in 2017 compared to 7.5 percent in 2015 supported by a rebound in agriculture and stimulus from civil service pay reforms. However, delays in the adoption and implementation of key reforms could affect investor sentiment. Favorable overall trends mask important underlying divergences: between urban and agricultural households; between domestic and external demand; and between public and private capital expenditure, which should be addressed.
Sri Lanka’s economic growth is expected to grow at 5.3 percent in 2016 and 2017 driven by increased public investment and postponed investments in 2015. The challenging global environment has taken a toll on the economy with reduced exports and remittances; and significant capital outflows, leaving Sri Lanka with higher public debt, lower reserves and rising inflation.
Press-release at the Word Bank official web-site

Growth in developing East Asia and Pacific has remained resilient and is expected to ease only modestly during 2016-2018, according to a new World Bank report. This outlook is subject to elevated risks and countries should continue to prioritize monetary and fiscal policies that reduce vulnerabilities and strengthen credibility, while deepening structural reforms.
Growth in developing East Asia is expected to ease from 6.5% in 2015 to 6.3% in 2016 and 6.2% in 2017-2018. The forecast reflects China’s gradual shift to slower, more sustainable growth, expected to be 6.7% in 2016 and 6.5% in 2017, compared with 6.9% in 2015.
“Developing East Asia and Pacific continues to contribute strongly to global growth. The region accounted for almost two-fifths of global growth in 2015, more than twice the combined contribution of all other developing regions,” said Victoria Kwakwa, incoming World Bank East Asia and Pacific Regional Vice President. “The region has benefited from careful macroeconomic policies, including efforts to boost domestic revenue in some commodity-exporting countries. But sustaining growth amid challenging global conditions will require continued progress on structural reforms.”

Living standards have improved across the 21 APEC member economies on the back of trade-driven economic and social development, according to a new report. But further progress in the world’s most populous region will hinge on efforts to compensate for ebbing trade growth.
The APEC Policy Support Unit report points to gains in health, education and economic opportunities in APEC economies over the last quarter century, facilitated by their market integration and lowering of barriers to cross-border movement of people, trade and investment.
The report provides an analysis of the UNDP’s Human Development Index which measures people’s health and lifespans, knowledge levels, and standards of living in economies globally. It reveals improvements in all APEC economies which account for 3 billion people or 40 per cent of the world’s population.
APEC economies attained an average score of 0.80 in the latest Human Development Index, released in 2015, out of a maximum of 1 and minimum of 0. This is up from 0.69 in 1990—the year after they came together to form APEC to boost regional growth and prosperity via greater interconnectivity.
However, the region’s multi-year contraction in trade, undermined by continued uncertainty in the global economy, presents risks to continued progress in improving living standards.
Policies that open up cross-border education and career training; micro, small, and medium enterprise participation in regional supply chains; and women’s entrepreneurship are among the areas of increasing focus in APEC’s agenda to fuel quality growth and human development.
New measures will be taken forward when Trade Ministers from APEC economies convene on 17-18 May in Arequipa, Peru.
Press-release at the official APEC web-site

The authors of the issue explore China and the US rivalry in the region, Asian Infrastructure Investment Bank (AIIB) role in China’s emergence as a regional leader, traditional security alliances, nuclear security, trust deficits in East Asia, Korean Peninsula problem, as well as ASEAN security agenda. The edition also includes the book reviews on related security topics.
Spring 2016 edition at Global Asia web-site

KPMG’s new report - China Outlook 2016 finds that China’s inward and outward investment patterns are reflective of the country’s economic restructuring, and are likely to continue being so in 2016 and beyond, with opportunities increasingly found in those sectors and areas whose development will contribute towards China’s transition into a high value-added economy.
China’s transition from an investment- and export-led growth model to one driven by consumption and innovation has led to the emergence of a two-track economy. The first track, in basic manufacturing and traditional industries, is experiencing significant headwinds, while the second, in services, advanced manufacturing and consumer markets is exhibiting strong growth potential.