APEC Project Database

Project Title

Services and Structural Reform

Project Year

2025

Project Number

GOS_202_2025A

Project Session

Session 2

Project Type

Standard

Project Status

Project in Implementation

Project No.

GOS_202_2025A

Project Title

Services and Structural Reform

Project Status

Project in Implementation

Fund Account

APEC Support Fund

Sub-fund

ASF: Enhanced APEC Agenda on Structural Reform (EAASR)

Project Year

2025

Project Session

Session 2

APEC Funding

121,605

Co-funding Amount

Total Project Value

121,605

Sponsoring Forum

Group on Services (GOS)

Topics

Services Trade; Structural Reform

Committee

Committee on Trade and Investment (CTI)

Other Fora Involved

Economic Committee (EC)

Other Non-APEC Stakeholders Involved

Proposing Economy(ies)

Australia

Co-Sponsoring Economies

New Zealand; Peru; United States

Expected Start Date

01/04/2026

Expected Completion Date

30/06/2027

Project Proponent Name 1

Christopher Findlay

Job Title 1

Honorary Professor

Organization 1

Australian National University

Telephone 1

+61-2 62612433

Email 1

christopher.findlay@anu.edu.au

Project Proponent Name 2

Maria Kusunoki

Job Title 2

Assistant Director, APEC Division

Organization 2

Ministry of Foreign Affairs, Japan

Telephone 2

+81-3 5501-8342

Email 2

maria.kusunoki@mofa.go.jp

Declaration

Christopher Findlay and Maria Kusunoki

Project Summary

Note: This Project is a joint proposal by Australia and Japan, with GOS as the lead forum and EC as a co-proposing forum. Due to internal APEC system limitations, the co-Project Overseers (co-POs) will be listed as a "main PO" and an "alternate PO"; however, both are serving as co-POs, sharing the full roles and responsibilities of POs.

Through a series of collaborative meetings, the project will examine trends in services sector growth, trade, and investment; evaluate the impacts of new technologies; and discuss policy frameworks that integrate services sector reforms as a catalyst for development, innovation, and economic resilience. Expanded coverage of services in the structural reform agenda supports APEC’s objectives by recognizing the sector’s critical role in employment generation, productivity gains, and global competitiveness, particularly as economies diversify beyond manufacturing-led development.

＊Key project outputs include Research Report assessing current conditions and identifying reform opportunities in each participating economy, all linked to the Individual Action Plans (IAPs) that underpin APEC’s structural reform efforts. These will include attention to the scope to reduce restrictions on trade and investment in services, alongside other elements of structural reform.

＊Based on the Research Report, Hybrid (in-person and online) Workshop will be conducted, exchanging knowledge, information and experience on the subject matter. The results of the discussions will provide input to Policy Paper.

＊Policy Paper will provide sector-specific recommendations and a draft proposal for each participating economy's IAP submission. The final compilation of these studies, alongside a policy brief, will serve as a practical model for strengthening the integration of services sector issues in structural reform processes—demonstrating how increased services coverage can deliver sustained and inclusive growth.

Relevance

Region

The APEC region has a significant services-based economy, with services contributing to over two-thirds of collective GDP. Most APEC economies rely heavily on services, with the sector making up more than half of GDP and employment. This structural feature is also observed globally, across both developed and developing economies.

As income levels rise, the share of services in GDP increases. The transition to services is happening at lower income levels, and the rate of this transition is accelerating. This shift has implications for economic development, with policy attention increasingly drawn to questions around how to manage the process. As the sector size increases, its role in productivity growth also rises. It contribution to trade and as a host of foreign investment further expands. Its role in growth, in other words, becomes more important.

Joint work to date involving the EC and the GOS has argued that key drivers of services sector performance include not only its openness but also the quality of the infrastructure in which it operates, its access to human capital, the drivers of innovation and the quality of regulation. All of these are elements of the structural reform agenda. There is a close association of services competitiveness and the implementation of that agenda.

This project brings together a core group of researchers and officials from selected APEC developing economies to reinforce the APEC Structural Reform agenda, with an explicit emphasis on enhancing the coverage of services sectors thereby adding to its contribution to growth.

In relation to the structural reform agenda, economies flag their intentions in their Individual Action Plans. Given the size and scope of the services sector, some prioritisation is important. The objective of the project is to develop and apply a methodology for priorities in structural reform in relation to services and then to show how economies would document their priorities in the draft proposals for possible future inclusions in their economy's Individual Action Plans (IAPs) that accompany the Structural Reform agenda in APEC.

As services sector has grown to be a key economic driver in the APEC region, globally barriers to services trade have persisted across APEC economies and sectors, and new restrictions continue to be ntroduced. These barriers impose costs on services trade that impede the ability of economies to access services as competitiveness-enhancing inputs and to increase services exports.

Addressing these barriers are complex and time-consuming. They involve coordination across ministries and considerable consultation with the private sector –which are isparate and not uniform in messaging like other sectors such as manufacturing or agriculture. This situation has contributed to a lack of heterogeneity of policies and regulations across the APEC region.

The most recent regional trends analysis by the PSU shows services trade has moderated, dragged down by declining travel flows and contractions in major sectors amid elevated uncertainty. Services export growth slowed to 6 percent in the first quarter of 2025 from 11 percent a year earlier.

Work by the OECD provides further evidence of the value of progress on structural reform with attention to services. OECD analysis indicates that streamlining services regulations in APEC economies could reduce trade costs by an average of 7% across sectors within 3–5 years, with especially high reductions in highly regulated sectors:

*Commercial banking: 22% reduction in trade costs

*Telecommunications: 14% reduction

*Insurance: 11% reduction

*Computer services: 7% reduction

*Engineering and architecture: 6% reduction each

Most barriers could be eliminated entirely in computer, certain professional, sound recording, telecoms, and financial services. These gains amount to hundreds of billions of US dollars annually in possible trade cost savings for the region.

Eligibility and Fund Priorities

The project will focus on identifying developmental needs and building the capacity of individuals and institutions charged with the responsibility of undertaking structural reforms. It meets the eligibility criteria and guidelines for the Enhanced APEC Agenda on Structural Reform (EAASR) Sub-fund particularly by seeking to create an enabling environment for open, transparent, and competitive markets.

Capacity Building

A network of academics and policy officers who are based in APEC developing economies will be invited to participate. We will initially reach out to China, Indonesia, Malaysia, Papua New Guinea, Philippines, Thailand and Viet Nam (the Core Group, hereinafter). Each economy would have two participants, one a researcher and the other an official with some responsibility for reporting to the APEC Structural Reform agenda. This will be the core group tasked with research and reporting (academic) and advising on policy (policy officials). Australia and Japan will lead oversight of the project and provide guidance on subject matter as well as expertise.

This findings of the network will be discussed at two meetings and one workshop. The workshop will be open to the Group on Services and Economic Committee and the meetings will be comprising of just the core group.

We will also invite interested international economic organisations such as the World Bank and OECD to assist with data collection and analysis, and share learning.

Through the implementation of the project, this collaboration will deepen expertise in the region on the importance of liberalisation in services to economic development and growth.

The insights and findings from the study will be also disseminated through APEC meetings (such as EC, CTI and GOS), the Pacific Economic Cooperation Council (PECC), and APEC Business Advisory Council (ABAC), as well as reporting out to all PECC, ABAC and APEC economies and all interested stakeholders in the APEC region.

Objectives

The main objective of the project is to develop evidence based action plans to structural reform of the services sector for the APEC region. This will be achieved through desktop research, economic modelling and regulatory analysis. Datasets such as the APEC Index, the OECD Services Trade Restrictiveness Index, the World Bank Services Trade Restrictions Database and the WTO’s Services Trade Policy Database will inform the analysis. Partnerships between policy officers and academic institutions will also determine the outputs.

Key project outputs include a set of sectoral policy papers assessing current conditions and identifying reform opportunities in each participating economy, all linked to the Individual Action Plans (IAPs) that underpin APEC’s structural reform efforts.

These will include attention to the scope to reduce restrictions on trade and investment in services, alongside

other elements of structural reform.

Alignment

Beneficiaries and Outputs

Output

1) Research Report

A research will be conducted to build strong foundation and reference for the capacity building activity including the Hybrid Workshop, and the development of the Policy Paper. As part of the research methodology, online meetings/workshops with core group (as mentioned in 1c.Capacity Building), field surveys (tentative) and/or interview will be conduted, in addition to literature review/desk study.

The Research Report may consist of policy analysis of services sectors in the seven target economies. Possible topics of this report include: the role of services sectors for development; the evolving nature of services sectors with new technologies, the implications for the manufacturing sector in Asia, the relationship between services reform and structural reform, a model of competitiveness in the services sector based industrial policy.

2) Workshop

he results of research (or draft Research Report) will be presented at the Hybrid Workshop that will gain exchanges of knowledge, information and experience on the subject matter. The discussions and policy recommendations from this Workshop will be beneficial for development of Policy Paper.

The draft agenda of the Workshop;

* Session 1. The role of services sectors for development (e.g. employment, innovation, foreign currency earnings)

- Session 2. The role of education and services sectors

- Session 3. Services sectors development in archipelago economies

- (Other sessions can be organized according to various economy-specific conditions, already renowned/established subsectors, etc.)

- Final Session. Key findings and Discussion

- Disseminate the survey forms

Pre-event meeting (virtual, first core group meeting, costs of hosting and participation are self-funded) will be held in October 2026. To build strong foundation and reference for the capacity building activity including the Hybrid Workshop, and the development of the Policy Paper, the OECD and the World Bank will be invited to speak on its report “Services Unbound: Digital Technologies and Policy Reform in East Asia and the Pacific”.

The draft agenda of the meeting:

- Session 1. The EAASR/SEAASR and the ASCR to enhance economic growth

- Session 2. The OECD and the World Bank Report on Indonesia

- Session 3. The World Bank Report on “Digital Technologies and Policy Reform in East Asia and the Pacific”

- Session 4. The framework of Independent Action Plan (IAP)

Post-event meeting (virtual, second core group meeting - virtual: costs of participation are self funded) will be held in April 2027 (one month after the hybrid workshop) and be organized for participants (the core group) present drafts of the economy papers and have a peer review. The drafts will assess the situation in each sector chosen for the economy, including current policy. Economies will consider the recommendations and how the current policy and the recommendations could be reflected in their Individual Action Plans that accompany the structural reform agenda in APEC.

The cost for holding these virtual meetings (Pre-event and Post-evet) will be under self-funding, except for development of training materials.

3) Final Paper (Project Summary Report and Policy Paper)

Final Paper (Project Summary Report and Policy Paper) will be edited for content and style. The Project Summary Report and the Policy Paper are intended as separate documents.

. Each Economy Paper will have a draft proposal for possible future inclusion in their economy's Individual Action Plan summarising the recommendations (=expected future actions) for the economies and their significance (at least 15 pages including the draft proposals). The papers will be collected in a volume and uploaded separately on the Economic Committee and the Group on Services Website (subject to further advice).

The IAP material is a proposal only for further consideration by officials.

The Project Summary Report will be prepared by the Contractor to surmarise the overall research and analysis, the main messages and the main lessens (at least 10 pages excluding the annexes). It may be uploaded on the EC-GOS website as well.

Outcome

(1) Research report will serve as a strong basis for capacity building activities at the Hybrid Workshop as well as input to develop the Policy Paper.

(2) The Hybrid Workshop and two core group meetings enhance participants’ knowledge on the formulation of their IAP. Online meetings will be held with the core group which include participants from China, Indonesia, Malaysia, Philippines, Thailand, Viet Nam and PNG and the group to work with Australia and Japan to review trends in services sector growth and trade and investment in services in each economy.

(3) Policy Paper provides sector-specific recommendations and a draft proposals for possible future inclusion in their economy's IAP. They will serve as a practical model for strengthening the integration of services sector issues in structural reform processes—demonstrating how increased services coverage can deliver sustained and inclusive growth outcomes across the APEC region.

4) It will develop a comprehensive policy brief which will consider the role of services sectors for development, the relationship between services reform and structural reform and a model of competitiveness in the services sector based industrial policy. The project will also develop a number of economy specific papers which aim to guide policy makers through the complex web of reform and deregulation.

Beneficiaries

(1) The primary beneficiaries of the project are the policy makers who are involved in formulation work of their IAPs. Secondary beneficiaries are the wider research and policy community with interests in these issues. The project will focus on the following seven economies , and will aim for benefit from this project, are Viet Nam, The Philippines, China, Papua New Guinea, Malaysia, Thailand, Indonesia for the said exercise.

(2) All participants (officials and researchers (those with interests in international economic policy)) to the Hybrid Workshop will also benefit from the exercise of the core group by exchanging experiences to identify the priority areas for their service development.

(3) The secondary beneficiaries will be officials of APEC economies who did not participate in the workshop and other readers. They will also benefit from the APEC publication documents produced by this project.

Dissemination

(1) The Final Paper will be uploaded in the APEC website (GOS and EC). It is a formal APEC publication.

(2) Press release for the workshop will be made through the channels of APEC website, Ministry of Foreign Affairs of

Japan, Department of Affairs and Trade of Australia, LinkedIn, and researcher's own website.

(3) The final Paper (comprising of Policy Paper and Project Summary Report) will be an APEC publication.

Gender

Please see Project Proposal in Supporting Documents folder.

Work Plan

Please see Project Proposal in Supporting Documents folder.

Risks

Please see Project Proposal in Supporting Documents folder.

Monitoring and Evaluation

Please see Project Proposal in Supporting Documents folder.

Linkages

(1) This project aims to organize a multi-economy workshop and accompanying seminars, which enriches the discussion on implementing the APEC structural reform agenda.

(2) It plans to engage in cross disciplinary cooperation between the EC and GOS.

Sustainability

(1) The subject of this project, Service and Structural Reform, has been the mainstream agenda of primarily in EC and in GOS with actionable commitments in the Individual Action Plans (IAPs) that underpin SEAASR/EAASR.

(2) SEAASR/EAASR requires continuous attention and review depending on the development of the regional economy, especially in Service, and will be dealt within GOS.

Direct Labour

Please see Project Proposal in Supporting Documents folder.

Are there any supporting document attached?

Yes

Project No.
Project Title
Project Status
Fund Account
Sub-fund
Project Year
Project Session
APEC Funding
Co-funding Amount
Total Project Value
Sponsoring Forum
Topics
Committee
Other Fora Involved
Other Non-APEC Stakeholders Involved
Proposing Economy(ies)
Co-Sponsoring Economies
Expected Start Date
Expected Completion Date
Project Proponent Name 1
Job Title 1
Organization 1
Telephone 1
Email 1
Project Proponent Name 2
Job Title 2
Organization 2
Telephone 2
Email 2
Declaration
Project Summary
Relevance
Objectives
Alignment
Beneficiaries and Outputs
Dissemination
Gender
Work Plan
Risks
Monitoring and Evaluation
Linkages
Sustainability
Direct Labour
Are there any supporting document attached?
hdFldAdmin
Project Number
Previous Fora
Secretariat Comments
Reprogramming Notes
Consolidated QAF
Endorsement By Fora
PD Sign Off
Batch
Forum Priority
Committee Ranking Category
Committee Priority
PDM Priority
Priority Within Funding Category
Monitoring Report Received
Completion Report Received
PMU Field 1
PMU Field 2
PMU Field 3
On Behalf Of
Proposal Status
Originating Sub-Forum
APAS_ID
Approval Status
Attachments

Content Type: Standard Proposal