This practical chapter describes the APEC project approval and evaluation process, and the roles of the Budget and Management Committee (BMC) and the APEC Secretariat in the project cycle. It explores weaknesses in these procedures and institutions and concludes with various policy recommendations to enhance the efficiency and transparency of APEC decision-making and to bolster project quality and impact.

Background: The APEC-Funded Project Cycle

Most APEC-funded projects consist of workshops and conferences, short-term capacity-building training sessions, construction of databases, surveys, and policy-oriented research and publications. APEC is not in the business of financing large-scale, brick and mortar projects. A significant percentage of APEC funding is allocated to participant travel and per diem and to consultant fees. Few APEC projects receive more than US$300,000, and most receive considerably less. Yet, projects are vitally important to many APEC fora, embodying their objectives and making concrete their agendas.

There are two sources of project funding (which together make up the “APEC Central Fund”): the Operational Account, which is funded from APEC member economy annual contributions; and the Trade and Investment Liberalization and Facilitation or TILF Special Account, which to date has received funding only from Japan. Each year, the Operational Account allocates about US$2 million and the TILF Special Account up to 500 million yen, or an annual total of US$5–6 million in project funding.

The project approval process, similar in most respects for both accounts, is as follows:

1. 1. The proposed project manager (“overseer”) and APEC member economy sponsor or sponsors initiate discussion within an appropriate APEC forum (for example, a Committee or Working Group, or with increasing frequency within the Senior Officials’ Meeting or SOM). Most project overseers are themselves government officials, although occasionally an academic or independent expert with close ties to his/her government can play that role.

2. 2. Project documentation is cumbersome and project overseers may work closely with the professional staff member (PSM) at the APEC Secretariat assigned to that subject or forum. Nevertheless, project submissions often do not fully conform to the detailed format requirements laid out in the official Guidebook on APEC Projects (available on the APEC Secretariat website). These discrepancies may be due to the many obligatory clearances, the time pressures imposed by the various deadlines in the project cycle, and the permutations of the requirements themselves.