Finance Ministers of the Asia-Pacific Economic Cooperation (APEC) grouping have launched the Cebu Action Plan (CAP), a roadmap for a more sustainable financial future for the Asia-Pacific region.
Launched on 11 September at a meeting of the finance ministers in Cebu, CAP seeks to promote policies, rules and practices across APEC economies to support sustainable, inclusive, and balanced growth throughout the region. It is a voluntary and non-binding multi-year plan.
Enhancing financial resilience
CAP has four pillars: promoting financial integration; advancing fiscal reforms and transparency; enhancing financial resilience; and accelerating infrastructure development and financing.
In enhancing financial resilience, a joint statement by the Finance Ministers said: “In view of the high costs borne by many APEC economies due to natural disasters, we reiterate the importance of reinforcing our resilience. To this end, we will work collectively in bolstering our regions’ financial resilience through the development of innovative disaster risk financing and insurance mechanisms, and other risk transfer instruments available through the capital markets.”
APEC will commission the ADB and the OECD to jointly conduct a stock take and prepare a report on managing financial risks of disasters, and task the World Bank Group to conduct a study on options for regional disaster risk financing mechanisms, including risk pooling, among interested APEC economies.
“We also recognise the heightened role of capital markets in enhancing financial resiliency through the promotion of risk transfer, financing for MSMEs (Micro, Small and Medium Enterprises) and infrastructure in the APEC region.”
CAP will be submitted to APEC Economic Leaders who are scheduled to meet in November in Manila. APEC, established in 1989, is a regional economic forum encompassing 21 economies.