Signage for the upcoming Asia-Pacific Economic Cooperation (APEC) China 2026 summit is seen in Shenzhen

APEC 2026: Let’s get back to the future on trade

Global trade rules are stuck, but a 1990s APEC model offers Australia a practical way to build trust and momentum.

5 November 20264 min read

Unlike fashion, and rock bands, global trade rules are not having a 90s revival. The World Trade Organisation, also a child of the 1990s, is hamstrung. Many regional trade agreements, which largely are based on its rules, are being ignored. Trust in institutions is being eroded. All are making it difficult to manage the myriad geopolitical, technological and demographic changes currently shaping the trade environment.

This should concern all Australians. As the WTO itself pointed out following the release of its 2026 Annual Report (Opens in new window), open medium-sized economies like Australia have most to lose when global rules don’t work. They matter. Trade means more jobs, lower costs, better competitiveness and prosperity.

But instead of wailing about the demise of what worked in the past, we need to turn our attention to what works for the future. APEC’s Pathfinder approach – first adopted in the 1990s – is a good model for incrementally building trust and making progress. We can begin this now, working with those who are willing to pilot practical initiatives in areas that matter most.

This year China is hosting APEC, with the region’s economic leaders meeting in November in Shenzhen to discuss regional trade, economic cooperation and shared priorities for sustainable growth. China’s focus (Opens in new window) this year has been on “Building an Asia-Pacific Community to Prosper Together”.While achieving consensus on outcomes at the official level will not be easy (Opens in new window), this should not deter action to shape a path forward.

Instead of wailing about the demise of what worked in the past, we need to turn our attention to what works for the future.

Behind the scenes, a huge amount of work has been undertaken by officials, business and academia on how to address many of the challenges confronting the trading system. In the mix are the impacts of artificial intelligence (AI), the implications of ageing populations, the importance of services in economic activity, progressing the green transition and operating in the digital economy. How to advance APEC’s vision for an eventual free trade area of the Asia Pacific (FTAAP) is also being explored (Opens in new window).

APEC’s work is undertaken collaboratively, among the 21 member economies. It focuses on sharing perspectives - listening, learning from others, incubating ideas and testing ways to translate them into practical actions. It is built on a model of trust and voluntary cooperation. It’s not perfect, but more of this – trusted relationships and collaborative solutions – is needed if we want to harness opportunities in an uncertain global trade environment, and lock in our future prosperity.

Officials, academia and businesses in Australia and China, and other willing economies, can work together to chart a path forward through pilot initiatives. The concept is not new in APEC. A voluntary “pathfinder initiative” model is already part of APEC's architecture. Willing parties can progress specific issues without requiring all APEC economies. These initiatives are open to others to participate on a voluntary basis. Over time, they can evolve and expand as more economies join and the benefits are demonstrated.

While not a replacement for the existing trade architecture, pathfinder initiatives can be a step toward one that is fit for the future, serving as building blocks toward convergence, addressing pressing challenges and building trust. Longer term they can contribute to APEC’s FTAAP vision. (Opens in new window)

But even launching pathfinder initiatives can have its own challenges. Bilateral pilot initiatives can be a good place to start.

Leaders of the 21-member Asia-Pacific Economic Cooperation forum linking arms as they pose for a group photo 13 September 1999 after a summit in New Zealand (Goh Chai Hin/AFP via Getty Images)

These ideas were explored during a recent dialogue held at RMIT University, as part of collaborative work of the Australian APEC Study Centre, the Australian Pacific Economic Cooperation Committee, the China APEC Study Centre at Nankai University and the China National Committee for Pacific Economic Cooperation. It built on earlier discussions (Opens in new window) among the community of the Pacific Economic Cooperation Council. (Opens in new window)

Here, Australian business leaders reiterated the need for approaches that address the specific challenges that businesses face daily in reaching and accessing markets; opaque and shifting compliance requirements, diverging professional and technical standards, fragmented product traceability requirements and a lack of predictability in how rules are applied and change over time. Overlapping trade agreements and how they fit together have also become a source of complexity, sometimes not worth the effort. Smaller firms are disproportionately affected, lacking the resources that larger companies have to address these sorts of challenges.

Some of these issues could be tackled through a small number of tangible, well-sequenced, pilot initiatives. Prospective areas could focus on greater alignment of technical standards for product traceability and authentication, such as those applicable to the green technology industry. They could create more streamlined, sector-specific temporary mobility pathways for skills and expertise, for example, to support infrastructure projects. They could map frameworks and commitments across trade agreements in areas that are relevant to SMEs, like digital services. Or explore new issues, such as the use of AI in health diagnostics.

Enabling initiatives like these among willing parties, embedding a business voice throughout their design and delivery, and committing to share lessons across the wider APEC membership are immediate and actionable steps that can be taken now.

These are small ways to help forge a path for the future trading system we all want and share – one that is prosperous, sustainable, and hopeful.

About the author

Kristen Bondietti

Kristen Bondietti is Associate Director at the Australian APEC Study Centre, RMIT University, where she leads the Centre's collaborative trade policy and research initiatives.

Topics

Trade & investment World Trade Organisation Australia China