Inside Out | Why this year will be a challenging one for APEC

You may be planning for Lunar New Year, but I am planning for San Francisco and the start of a new APEC year, and praying that the Year of the Fire Monkey does not play mischievous tricks.

After the past eight years working inside APEC on behalf of Hong Kong business, along with our APEC Business Advisory Council representatives, I confess that I fear 2016 is going to be one of the more challenging.

That is not the fault of Peru, the 2016 chair of the 21-economy APEC grouping around the Pacific. On the contrary, tiny Peru (its US$200 billion GDP makes it the fifth smallest economy in APEC) is among the liberalising inspirations of the Asia-Pacific region. Since it joined APEC in 1998, this will be the second time it has volunteered to chair – a commitment far beyond the call of duty, and a huge imposition on a tiny economy.

But the backdrop is challenging. First and worst is the tremulous state of the global economy: stock market crashes, falling oil prices, anxieties about China’s restructuring process, across-the-board falls in global commodity prices, and dramatically weakening currencies for many economies.

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Peru’s first priority – to encourage the process of regional economic integration, and facilitate liberalisation – will be so much more difficult against this awful economic backdrop. Protectionists and xenophobes are more confidently vocal today than at any point in the past 20 years.