Businessmen have called for enhanced trade in services to accelerate economic activities and digital transformation for post pandemic recovery.
Tomas Alcantara, chairman of the APEC Business Advisory Council Philippines and the Public-Private Dialogue on Services, stressed at the virtual APEC Business Advisory Council (ABAC)-APSC Public-Private Dialogue that services can be used strategically to catalyze economic activities.
The APEC Services Competitiveness Roadmap, the cooperation framework of which was adopted during the Philippines’ APEC chairmanship in 2015, is undergoing mid-term review.
Under this masterplan, APEC set some targets to be achieved in 2025. These include reduction in restrictions to services trade and investment, increase the share of services exports, increase the growth in trade in services, and increase APEC’s share in global services trade.
Alcantara cited the services sector for its vital role in driving economic growth not just in our respective economies, but in the region as a whole. It accounts for around 60 percent of the APEC’s GDP and employs more than half of the workforce in most economies.
“Such a promising contribution to the economy, which can be further realized with enhanced trade in services,” he said.
Alcantara, however, admitted the serious challenges as services trade is declining. He cited the WTO Trade Report, which showed that the trade cost for services is double the cost for trade in goods.
In addition, a more recent study by the Organisation for Economic Co-operation and Development cited that 40 percent of these costs are due to regulations.
“Services can be used strategically to catalyze economic activities. The pandemic has accelerated the digital transformation of businesses, including services globally. We have seen digitalization of services from telework and fintech to virtual restaurants and digital marketplaces, which have kept economies and the flow of goods and services running amid COVID-19-induced lockdowns,” he said.
It is important to note, however, that the pandemic has redefined the future-of-work. As such, he said, economies and businesses must also leverage digital technology and innovation to train, re-skill and up-skill the current and future workforce.
“This is particularly important for the Philippines, whose resilient economy rests on a multimillion strong people - the young, talented and world-class workforce, of course including those in the business process management industry and the Filipinos in every part of the world. Leveraging APEC platform and engaging in international fora, such as the discussion on the WTO services domestic regulation, and the services-related provisions in bilateral and regional agreements will help maximize the gains of developing economies like the Philippines,” he said.
As such, the leader of ABAC Philippines urged for a whole-of-society and all-of-APEC approach, one with strong public-private collaboration.