1. Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013

2. Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 2 1994 (Bogor)  Leaders’ Declaration – Bogor Goal 2007 (Adelaide)  TMM5 Joint Ministerial Statement 1995 (Osaka)  Leaders’ Declaration – Osaka Action Agenda  Free and open trade and investment in the Asia- Pacific region  Trade and investment liberalization  Trade and Investment Facilitation  To consider timetable for progressive removal of regulatory constraints;  To identify the remaining areas requiring attention by member economies to meet the Bogor Goals;  To proceed the roadmap work by developing a specific action plan  Policy Item 4: Cargo Preference  Policy Item 5: Restrictions Applying to Specific Trades 2005 (Washington)  Maritime Initiative (Facilitation of International Shipping Project(2000-2004))

3. Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 3 2008 (Lima)  Leaders’ Declaration 2009 (Manila)  TMM6 Joint Ministerial Statement 2008 (Manila) 30 th TPT-WG 2008 (Lima)  31 th TPT-WG  Liberalization and facilitation of transport services 2011 (Australia) 34 th TPT-WG  Cargo Preference and Restrictions Applying to Specific Trades  To modify and resubmit proposal in initial stage  Korea took on the role of champion for the Policy Item 5, “Restrictions Applying to Specific Trades”  Korea additionally took on the role of champion for the Policy Item 4, “Cargo Preference” and indicated that it will include both policy items in a single project proposal to be submitted for consideration by the MEG at TPT-WG32  Welcome progress made by member economies towards the Bogor Goals of free and open trade and investment in the Asia-Pacific region

4. Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 4 2012 (Thailand) 35 th TPT-WG 2013 (Vietnam)  37 th TPT-WG  The modified proposal has been approved  To help undertake the two APEC Policy Items, Cargo Preference (Policy Item 4) and Restrictions Applying to Specific Trades (Policy Item 5) with a view to achieve the Bogor Goals 19 June 2013  Contract was made  Presented full proposal  Service Provider : KMI  Project Overseer : MOF

5. With liberalization and privatization, cargo preference measures have been significantly reduced in recent times Restrictions applying to the specific trades have also been greatly reduced over the last two decades This mitigation may find its reason in the emphasis of the necessity to increase national shipping competitiveness and to ensure transport security of strategic cargoes, notwithstanding the fact that the core of shipping liberalization lies in a shipper’s right to choose a carrier Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 5

6. 6 Cargo Preference?Some Cases of Cargo Preference YES Indonesia – Reservation of Government and State owned enterprise import cargoes, which must be carried by Indonesian-flag vessels Philippines – Cargo owned by Government or purchased with public funds or under Government guarantee requires a waiver to move on non- Philippine vessels Thailand – Residual restrictions are limited to Government controlled cargo but there is provision for a waiver where no Thai vessel is available Vietnam – Implements 40/40/20 cargo sharing formula of the UNCTAD Code of Conduct for Liner Conferences, although Vietnamese vessels (as of 2004) account for only around 20% of Vietnam’s foreign trade NO Brunei Darussalam, Malaysia, Myanmar, Singapore, etc Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013

7. 7 Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 OEM Trade Plant Trade Consignment Export Trade Trades related to food safety, animal health, planet health - Mad cow disease - Mexican restrictions on Thai milled rice (to avoid the introduction of pests)

8. The consultant study will include findings of existing cargo preference measures and restrictions applying to the specific trades -Arguments for and against retaining restrictive practices(benefit, disadvantage, adequacy, fairness, etc) -Characteristics and contributory effect of commercial barriers on trades -The MEG would consider, from these findings, a need to carry out a further study to analyze and develop a comprehensive policy approach that would best reflect the concerns of the APEC member economies Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 8

9. 9 Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 The understanding of current regulatory and market conditions would benefit for each APEC member economy - Governments and maritime policy administrator - Shipping companies - Port agencies and enterprises - Shippers (e.g. importers and exporters) - APEC Economies

10. 10 Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 PhaseDeliverableDue Date Phase 1 Information gathering Completion of the first economy site visit to Manila and Beijing August 2013 Completion of the second economy site visit to and Singapore and Jakarta September 2013 Phase 2 Fact finding/Verification, Reporting Completion of the interim report October 2013 Phase 3 Finalize/Submit Completion of the final report plus publication and mass distribution of the approved final report as instructed by the Project Overseer December 2013 Propose the extension of the project to June 2014

11. 11 Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 Phase 2 Fact finding & Verification Reporting  Phase 1: Information gathering  During this phase the consultant will  (a) collect information on restrictions applied to the specific trades and cargo preference that existed previously and still exist within the APEC region by literature review, survey, and (if necessary) direct interviews with governments, shipping and freight industries, and etc.  (b) conduct field surveys to investigate current status associated with cargo preference and specific trades. - China(Beijing), Philippine(Manila) as co-sponsoring economies - Singapore, Indonesia(Jakarta) as activity cargo trading economies Phase 1 Information gathering

12. 12 Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 Phase 2 Fact finding & Verification Reporting Phase 1 Information gathering  Phase 2: Fact finding and Verification, Report  During the second phase, the consultant will liaise with shipping lines or operators during their research and analysis to cross-check the current status  Also the government agencies of APEC economies responsible for maritime transport and competition policy would provide their views and feedback to be incorporated into the finding and evaluation  Meetings, questionnaires, interviews and etc would be widely made in order to best reflect the existing restrictions and cargo preference for the expected stakeholders

13. 13 Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013 The MEG would consider, from these findings, a need to carry out a further study to analyze and develop a comprehensive policy approach for the APEC member economies During the further study, the consultant will conduct an analysis on advantages and disadvantages of the existing restrictions and cargo preference The analysis will also include references to the international maritime regulations such as found in WTO and case studies of EU’s maritime integration policy and ASEAN’s single shipping market efforts

14. THANK YOU FOR YOUR ATTENTION Thirty Eight APEC Transportation Working Group Meeting, Bali, Indonesia 1 – 5 July 2013