Leaders of the Asia-Pacific region agreed this week to cut trade tariffs to 5 per cent or less on 'environmental' goods, to help speed growth of 'green' industries.
In the final declaration by the 21 nations attending the Apec summit in Hawaii, the leaders also said that growth and job creation had weakened in many economies and that financial challenges in Europe had been contributing to worries.
'We meet at a time of uncertainty for the global economy,' they said in the declaration, citing concerns over sovereign debt in the euro zone and frequent natural disasters in the Asia-Pacific region.
Against the backdrop of a grim economic climate, the regional leaders ditched the Asia-Pacific Economic Co-operation forum's tradition of turning out in colourful local garb and went for sober neckties and dark suits. The leaders also skipped the ritual at last year's Apec summit, in Yokohama, Japan.
The leaders promised to work with each other at a time of uncertainties, pledging to fight protectionism, promote free trade and speed transition to a low-carbon economy, in order to 'create new sources of economic growth and employment'.
To promote 'green growth' in the region was one of the key agenda items of this year's summit. And a main focus was the proposed cut in tariffs on environmental goods - including solar, wind and other renewable energy technologies. Trade and foreign ministers failed to reach an agreement in an earlier meeting, leaving the issue to the countries' top leaders for further consideration.
At the end of the summit yesterday, the leaders struck a deal to cut tariffs to 5 per cent or less by 2015 on environmentally friendly goods, to be listed next year. 'We are resolved to reduce by the end of 2015 our applied tariff rates to 5 per cent or less, taking into account economies' economic circumstances, without prejudice to Apec economies' positions in the World Trade Organisation,' the declaration said.
China previously opposed lowering tariffs to below 5 per cent.
But Hao Hong, chief financial analyst with China International Capital's global strategy and equity research, said that while developed economies like the United States and Japan would benefit first from the move, as they have a competitive edge in these industries, developing economies like China would also benefit in the end since the decision would trigger investment in the area.
'It will help shift the growth momentum [from environmentally destructive manufacturing] to environmentally friendly industries and boost the restructuring of economic structure in China, as more resources will be directed to invest in what is called the green economy,' he said.
Hong added that he believed the central government would work out policies to encourage more investment in environmentally friendly industries and in production of such goods in coming years.
The declaration said: 'We are committed to advancing our shared green-growth objectives. We can and must address both the region's economic and environmental challenges by speeding the transition towards a global low-carbon economy in a way that enhances energy security and creates new sources of economic growth and employment.' The 'green growth' initiative aims to balance economic growth with measures to counter global warming.
Other steps that the leaders agreed concerning 'green growth' or environmental protection included reducing inefficient fossil-fuel subsidies that encourage wasteful consumption. Leaders also agreed to cut Apec's aggregate energy intensity - the amount of energy consumed per unit of gross domestic product - by at least 45 per cent by 2035 from 2005 levels. The previous target was a 25 per cent cut by 2030.
In the declaration, leaders also confirmed the need to reform unjustified and outdated regulations in the region and to take specific steps by 2013 in a bid to make business easier and create more jobs.
As part of the efforts, they will expand duty exemptions and streamline customs-clearance procedures for imports worth US$100 or less.
Immigration procedures will also be simplified to promote travel among member countries.
In other areas, the leaders agreed to help small and medium-sized companies in the region to participate in global business opportunities such as by streamlining trade-documentation requirements and other non-tariff barriers they face.