The essential requirements of economic co-operation in the Asia-Pacific region are: openness in international economic policy and diplomatic approach; evolution in the practice of high-level consultation and cooperation; and non-discrimination in growing economic partnership among disparate polities (Yamazawa 1992).

The Pacific Economic Co-operation Council (PECC), established in 1980, was the first building block in the architecture of regional economic policy consultation. PECC — with its informal, tripartite structure, which includes participation at the official, industry and academic level — carried forward the process of fostering consultation and discussion of interests in regional co-operation through its trade policy forum and other task forces.

An important policy achievement which grew out of consultations within PECC was the development of Asia-Pacific support for the Uruguay Round of multilateral trade negotiations, and the facilitation of broader economic dialogue involving both China and Taiwan. PECC's semi-official processes also laid the groundwork for the next step in the development of outward-looking economic co-operation — the evolution of the Asia-Pacific Economic Co-operation (APEC) group. APEC, through the establishment of regular ministerial-level meetings, brought the process of economic co-operation into the political arena.

APEC was established at ministerial level in 1989, and has rapidly established itself as the main regional forum for discussion of trade liberalization and expansion.

APEC has fostered consistency between regional economic policy objectives and multilateral international economic policy goals — and sought to strengthen the GATT-based multilateral trading system.

APEC could pursue these objectives most effectively if it were able to set positive examples of successful trade liberalization and expansion. It is imperative that any joint economic or trade policy decisions by APEC be consistent with the fundamental principle of universal most-favoured nation treatment of all trading partners as set out in Article I of GATT. This contrasts with joint decisions that explicitly discriminate against non-participants, and seek to rationalize discrimination by reference to Article XXIV. Any attempt to negotiate an APEC-wide preferential trading agreement would be economically undesirable, given the trade and investment links of the East Asian and ASEAN economies outside the region, especially with the EC: it would also be destined to end in failure.