As Ministers from across the Asia Pacific gather in Jeju, South Korea this week for the Asia Pacific Economic Cooperation (APEC) Ministers Responsible for Trade (MRT) meeting, they will be torn in two different directions: to meet with U.S. Trade Representative Jamieson Greer and make their case for reduced ‘reciprocal’ tariffs and exemptions from U.S. tariff hikes on autos, steel, and other products coming down the line; and, at the same time, work with the other trade minsters to achieve deeper trade and economic integration. In some ways, this is almost like operating in two different worlds, but countries have little choice in these tumultuous times but to push all the buttons to advance their national interests.

With the U.S. having just announced a trade deal with the UK and a de-escalation in trade tensions with China, many countries in Asia will be queueing up to secure a time for face-to-face discussions with Ambassador Greer. The central objective of such discussions will be to reach some sort of ‘deal’ which will lessen the blow to their economy from the U.S.’ new unilateral tariff regime.

Since the Trump administration took office, Asia-Pacific countries have been trying to adjust to the new U.S. approach to global trade. The U.S. is pivoting even further away from its leadership in the global rules-based system and instead looking to impose, and then potentially negotiate, individual tariff rates with countries around the world.  Asia-Pacific nations, like many around the globe, are facing ongoing uncertainty and, in many cases, considerable economic consequences.

Ministers from some APEC economies, including Japan, South Korea, the Philippines, Indonesia and Vietnam, have been in Washington D.C. in recent weeks to pursue tariff discussions with the U.S.  With Ambassador Greer’s attendance at APEC MRT, this forum presents a valuable opportunity for countries to press their case directly with the USTR. This is especially the case for those countries whose trade minister hasn’t yet made the trek to Washington, such as Australia, Singapore and New Zealand. Indeed, a key part of the value of attending these types of international meetings for small and medium-sized countries is the chance to meet with the other ministers, especially the big players, on the sidelines, build critical relationships, and advance important bilateral issues.

At the same time, countries will want to make sure that any deal that they reach with the U.S. does not undermine their other key objective—shoring up the rules-based system and expanding and deepening economic integration with their other partners. APEC trade ministers have traditionally made commitments to maintain open markets, foster fair competition, and promote regional economic integration as core APEC objectives. As host, South Korea will add its priorities to the agenda. With innovation being at the top of its list, we should expect the APEC MRT agenda to include a timely discussion of how best to harness the potential of technology, and in particular AI, to facilitate trade.  APEC members, for example, can rally together to accelerate work on developing practical and workable international rules on digital trade, whether this be through upgrading the digital chapters in their existing free trade agreements (FTAs), concluding the new ASEAN digital trade agreement, or expanding membership of plurilateral agreements like the Digital Economy Partnership Agreement.

South Korea has also highlighted the importance of strengthening connections within the Asia-Pacific region. This paves the way for trade ministers to lay out specific actions to deepen regional supply chains and make them more resilient. APEC members have been at the forefront of the trend in the last two decades towards increasing export growth and integration via bilateral and plurilateral FTAs—ASEAN FTA, RCEP, CPTPP, Pacific Alliance to name just a few. And while diversification and supply chain resilience are themes that have been bandied around trade ministries for some time now, this has taken on more urgency as traditional markets are compromised and supply chains are faced with ever-increasing challenges. Recent comments from the EU, Singapore and New Zealand, for example, about their openness to considering how the EU can plug into the Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP) are welcome. Singapore’s agreement with the Pacific Alliance entering into force earlier this month is a further example of the expansion of regional agreements to new parts of the globe and the knitting of different regions, and therefore supply chains, together.

Furthermore, South Korea has included addressing the demographic challenge that the region faces as one of its APEC priorities. This issue is of importance to a range of economies as concerns about ageing populations and the declining birth rates grow exponentially. The meetings in Jeju provide an opportunity for trade ministers to consider, for example, how increased labor mobility, as well as freeing up trade in advanced medical goods and services, could help address this challenge.

As APEC trade ministers converge to discuss the future of trade this week, they will feel two competing forces are pulling at them. On the one hand, there is pressure to meet U.S. demands to secure tariff reduction, including requests that seem out of step with global trade rules.  At the same time, as they convene as a group, they will look for solutions to regional challenges, including supply chain resiliency, technology developments, and demographic trends. All eyes will be on how the United States squares the circle with its bilateral tariff policy and the multilateral APEC agenda.