Excellencies, distinguished delegates,
Ladies and gentlemen,
It is my pleasure to extend a warm welcome to all participants in the Asia-Pacific Business Forum (APBF) 2020. The theme of the Forum is “The Future of Global Value Chains and Implications for small and medium enterprises”.
Sustainable connectivity, both trade and transport, has been an indispensable driver of the Asia-Pacific region’s pursuit of the Sustainable Development Goals (SDGs). With the active involvement of the small- and medium-sized enterprises (SMEs)—bedrock of real economy—it is vital for governments to revisit the advantage of international markets and regional value chains.
The COVID-19 pandemic and its socio-economic impacts are changing the policy architecture in Asia and the Pacific. During the past three quarters of 2020, several key economic and trade sectors, including labour-intensive manufacturing sectors and businesses that rely mainly on supply chains have been hardest hit in this crisis.
According to latest data, about 62 per cent of regional exports take place through value chains, which account for about 15 per cent of the Asia-Pacific GDP. These value chains are enabling countries to achieve faster growth through expanding their business expansions across diversified markets.
Excellencies, Ladies and gentlemen,
I would like to highlight two focus areas to work further on the value chains and its implications for SMEs within the current regional context.
First, let us emphasize the importance of multilateralism, regional cooperation for value chains. The world has become more interconnected, and global trade and investment have surged significantly allowing for the development success of the Asia-Pacific region.
With the increase in trade, investment and businesses opportunities, a wide network of global and regional value chains has enabled cost-effective and efficient production and trading processes. Through active participation in these supply chains, SMEs in developing countries, have become one of the most reliable economic growth drivers, especially in our region.
Apart from the ongoing trade tensions, the management of the pandemic is challenging the future of business and regional value chains. This has resulted in severe negative impacts on the SMEs to keep their businesses afloat.
Furthermore, climate change, including the frequent occurrence and severity of hurricanes and typhoons along with persistent droughts and flooding are affecting millions of people linked to SMEs.
Second, we must focus on the role of business in addressing the challenges and potentials of value chains. Let us strengthen and expand global and regional value chains that can drive business and job opportunities.
The current crisis has necessitated the importance of reshoring and consolidation of hubs and architecture of the value chains in our region. By raising business resilience, SMEs will be in a better position to participate in value chains and offer new investment opportunities.
Notably, trade and supply chains have continued to function during this pandemic, as customs and other government institutions actively worked to streamline the procedures and turned to contactless and paperless trade.
It was evident that SMEs survived the crisis due to their agility to speedily move towards digital business operations. For example, businesses in textile, apparel, footwear, transport, and other sectors have almost entirely converted to digital operation.
The future of value chains therefore is promising. The SMEs in our region are in the fore front of attracting international investment with their growing expansion. By adopting new business practices and digital platforms, these value chains are becoming more adaptable to changing conditions.
In the sustainable recovery phase, the governments and business must work together to ensure resilient and sustainable value chains.
Let me focus on several policy issues and directions for your further deliberations and consideration.
First, ensure the development of modern and sustainable technologies in all fields, especially in the digital, medical, renewable energy and agricultural areas. Governments need to provide the appropriate supporting policy and regulatory frameworks to allow for an effective and efficient collaboration within public-private investment mechanisms.
Second, promote resilience and sustainability along all supply chains. While government can promote responsible business practices, businesses leading these supply chains need to demand sustainability for raising resilience and competitiveness.
Third, encourage participation of women-led and managed SMEs across value chains in our region. Governments can provide the appropriate legal framework to facilitate doing business and catalyse women’s entrepreneurship.
Fourth, enhance sustainable regional connectivity in trade, transport, energy and ICT. Through ESCAP’s intergovernmental agreements and frameworks such as the Asian Highway Network and the Trans-Asian Railway Network, member States and business participants have leveraged the cross-border connectivity in overcoming barriers to border closures and other logistical challenges.
I recognize a continued commitment of our member States to work together and open borders for health, business and economic activities.
It’s very encouraging to note that Bangladesh and China have completed their domestic ratification process of the Framework Agreement on Facilitating Cross-Border Paperless Trade, while Mongolia formally acceded to the Asia-Pacific Trade Agreement. These concrete policy steps will further steer the value chains and SMEs to contribute fully towards sustainable recovery from this pandemic.
Going forward, I am pleased to inform you that the ESCAP Sustainable Business Network (ESBN) is open to involve new members to further enrich this active and dynamic community of business leaders and participants.
ESCAP is fully committed, along with all UN family, to working closely with member States, the private sector and all stakeholders for building back better.
As we mark the 75th anniversary of the United Nations, I urge the private sector to adopt sustainability as the guiding principle for advancing the 2030 Agenda for Sustainable Development in Asia and the Pacific.
I would like to wish all of you a very successful APBF 2020. Thank you very much.