46th Session of the APO Governing Body
8–10 June 2004, Yogyakarta, Indonesia
Annual Report of the Secretary-General
by Takashi Tajima,
APO Secretary-General
Dr.
Jung-Chiou Hwang, Acting APO Chairman and APO Alternate
Director for the Republic of China;
Mr. Brian Singh, the first Vice Chairman and APO Director
for Fiji and Mr. Lakshmi Chand, the second Vice Chairman
and APO Director for India,
Mr. Kirnadi, APO Director for Indonesia and Director
General, Directorate General of Manpower Development
and Domestic Placement, Ministry of Manpower and Transmigration;
Distinguished Delegates, Advisers, Observers and Guests,
Ladies and Gentlemen:
It is my great pleasure to welcome all of you to
the 46th Session of the APO Governing Body. First
of all, on behalf of all member countries and on behalf
of the APO Secretariat, I would like to express my
heartfelt appreciation to the Government of Indonesia
for hosting this important meeting. We are honored
to have His Highness Paku Alam IX, Vice Governor of
Province of Yogyakarta Special Region and His Excellency
Dorodjatun Kuntjoro-Jakti, Coordinating Minister for
Economy grace the inaugural session with their presence,
and would like to thank Mr. Kirnadi, APO Director
for Indonesia, for his warm words of welcome and kind
support. I would also like to acknowledge with sincere
thanks the excellent arrangements made for the meeting
by the able staff of the Directorate of Productivity
Development, NPO Indonesia, and for the warm hospitality
extended to all of us.
Before going on to my report, let me also extend
our hearty welcome on behalf of all member countries
to Cambodia, which is joining the APO family as its
20th member. I hope that Cambodia will lose no time
in embarking on a national productivity movement,
in which fellow member countries are ready to share
their accumulated experiences.
The 2003 economy in Asia and the Pacific region showed
a mixed performance. While newly industrializing economies
suffered from economic stagnation, ASEAN and SAARC
countries generally achieved relatively high and vigorous
growth rates. The dynamic growth of the People’s
Republic of China and the positive signs of economic
recovery in Japan after the long recession will be
key factors making Asian economies sustainable in
the years to come. The APO, which has undertaken a
wide variety of activities for the enhancement of
productivity in the industry, agriculture, and service
sectors, has made a significant contribution to the
rapid socio-economic development of the region. Our
mission is closely linked with changes in the external
environment, such as the current wave of globalization.
Most member countries have strived to take globalization
not as a threat but as an opportunity for creating
new businesses by taking advantage of the freer flow
of capital, goods and services, manpower, and information
across national borders. Globalization has reconfirmed
the significance of networking within the APO family
so as to deal effectively with various issues of a
multinational nature by concerted efforts among member
countries. Well aware of the speed and dynamism of
globalization, we have laid out a three-pillared vision
to set forth a clear direction for the productivity
movement. Those pillars are strengthening of competitiveness,
harmonization of productivity increases with environmental
protection, and maintenance of social fairness. This
vision has been translated into action programs that
form the five thrust areas of knowledge management
(KM), strengthening of small and medium enterprises
(SMEs), Green Productivity (GP), integrated community
development (ICD), and development of NPOs (DON.)
Each of these initiatives has been designed to improve
the APO’s services to member countries.
The 2003 Annual Report, which was circulated for
your kind approval, provides a comprehensive account
of APO activities undertaken last year. Today I am
pleased to highlight the major achievements of program
activities during 2003 and their future perspectives
and also share with you some thoughts on APO policies,
strategies, and directions in response to the changing
environment and needs of member countries.
I. Program Activities
1. Knowledge Management
Knowledge management (KM) is now in its fourth year
as an APO thrust area and has been adopted by a growing
number of business corporations in member countries
as a corporate strategy to achieve higher productivity
and competitiveness. NPOs are also making significant
headway in incorporating KM as one of their core competencies.
In Thailand and Vietnam, for example, the respective
NPOs offer courses and consultancy services to domestic
clients so that they can carve out new markets through
the creation of innovative products and services.
Future challenges in KM are the expansion of its
applications beyond large corporations and organizations
to, among others, SMEs. The bottleneck here is the
lingering impression that the successful application
of KM is synonymous with and conditioned on the availability
of an IT platform. This does not necessarily hold
true, in light of the Japanese experience. Future
KM activities will address its applications among
SMEs and handicraft and community-based industries
in a non-IT environment, all of which represent the
typical conditions and realities of a large segment
of economies in Asia and the Pacific. Yet another
challenge to KM is how to measure its actual impact
on business performance. Toward that end, future projects
will also look into measurement methodologies and
techniques, hopefully leading to the development of
Asian standards.
2. Small and Medium Enterprises
The APO continues to assume an active role in improving
the productivity and competitiveness of SMEs. Today’s
economic situation, where change and speed are the
keys to remaining agile and innovative, has placed
intense pressure on SMEs. We have adopted a three-pronged
approach to build up their competitiveness, namely:
introducing new ideas, techniques, and strategies
for more robust operations; facilitating the formation
of strategic alliances and networking; and promoting
demonstration effects. The first approach is accomplished
through the exchange of views and experiences among
small entrepreneurs. In 2003, APO projects covered
such topics as technological innovations, microfinancing,
and entrepreneurship. In this endeavor, it is worth
noting that the APO has deliberately targeted specific
groups who might otherwise be eclipsed, such as women
entrepreneurs. The main vehicle for fostering synergy
among SMEs is the APO Venture Business Forum held
annually in Osaka, which is the cradle of venture
business and entrepreneurship development in Japan.
Last year we organized the fourth forum, with the
primary intent of facilitating cross-border business
matching among SMEs. As in previous years, the forum
was a mega-event that attracted more than 20,000 participants.
Further, more than 120 business-matching opportunities
were offered. Complementing these activities, demonstration
projects on strengthening SMEs’ competitiveness
were successfully implemented in 2003 in Nepal and
Iran. The APO Demonstration Company program is increasingly
accepted by NPOs as it provides powerful and inspiring
productivity improvement showcases.
The APO will remain committed to assisting SMEs to
be innovative and competitive. Bearing in mind our
determination to deal with SME issues since the APO’s
inception, we are looking at ways to deliver new programs
by sharing resources with other multilateral agencies,
national governments, local administrations, and NGOs
so as to generate greater synergy through cooperation
and coordination with them.
3. Green Productivity
During 2003, green productivity (GP) activities continued
to expand and deepen while focusing on the four priority
areas. These include greening supply chains, resource
and waste management, APO Type II Partnership Initiatives,
and such specialized areas as occupational and environmental
health and safety and ISO14001. I would like to highlight
some of the main activities under these priority areas.
The greening of supply chains was accelerated with
the establishment of the GP Advisory Committee (GPAC)
in Japan. Business leaders from more than 40 excellent
Japanese firms sit on the committee. Chaired by Mr.
Yoichi Morishita, Chairman of Matsushita Electric
Industrial Co., Ltd., its role is to advise the APO
on how to link businesses for greening supply chains.
The four main activities identified include: (a) compiling
an eco-products database; (b) organizing an eco-products
exhibition in Kuala Lumpur from 2 to 4 September 2004;
(c) organizing study missions on eco-businesses; and
(d) implementing demonstration projects on greening
supply chains. Programs related to resource and waste
management were organized under Categories B and C,
which include energy efficiency and greenhouse gas
emission reduction, solid waste management, GP-ICD,
and GP education. Some of the projects have been implemented
in collaboration with other international organizations.
The energy efficiency project is receiving assistance
from the UN Environment Programme, while GP projects
for schools and universities will be conducted with
support from the United Nations University. I would
like to stress the importance of the direct involvement
of the business sector to ensure the successful promotion
and implementation of GP. Establishment of the GPAC
of Japan and collaboration with the Federation of
Malaysian Manufacturers are good illustrations of
the participation of leading business corporations
in our GP activities.
I have a firm conviction that GP should remain a
leading movement in the region for future generations.
The declaration of 2004 as the APO Year of GP is significant
from this viewpoint. I thank you all for creating
this historic milestone for the APO. Everyone shares
the view that Asia is now the manufacturing center
of the world. In order to retain this status, competitiveness
in global markets needs to be increased, for which
to secure eco-friendliness of products by greening
the supply chains will definitely be required as a
decisive factor in the very new future.
4. Agriculture and Integrated Community Development
Our Agriculture Program has addressed three major
concerns resulting from the rapidly changing global
environment in agriculture and rural development.
The first concern is the need to improve the competitiveness
of agriculture, for which a number of projects were
organized in 2003, including the development of entrepreneurship
among small farmers and rural women; improvement of
the efficiency of marketing particularly through the
application of information and communication technology;
and enhancement of safety and quality of foods, among
others. The second was the promotion of efficient
and sustainable utilization of agricultural resources.
Such projects as the role of rural women in resource
management and the development of sustainable aquaculture
were implemented. The third concern is the need to
bolster local capacities for community development
to alleviate rural poverty. Rural life improvement
and community-level infrastructure were some of the
projects implemented to respond to this concern. ICD
as a thrust area of the APO has been playing a role
in enhancing the quality of life of local communities.
The successful implementation of GP-ICD demonstration
projects in Vietnam has sent an encouraging signal
to fellow member countries to emulate. We will make
all-out efforts to transfer the valuable Vietnamese
experience to other members.
To cope with the impact of globalization, we should
continue to strengthen the institutional capacity
of member countries for enhancing the competitiveness
of agro-industries, promoting sustainable approaches
to agriculture, and implementing community-level improvement
programs. Rural entrepreneurship, management tools,
and improved marketing will be promoted, particularly
for SMEs, to generate greater value addition. With
regard to sustainable approaches to agriculture, the
optimum use of resources will be stressed. To strengthen
local capacities, a renewed mindset through participatory
and collaborative processes will be emphasized in
community-level improvement programs.
I am pleased to note, with deep appreciation, that
a special fund from the Japanese Ministry of Agriculture,
Forestry and Fisheries will be made available from
this year. This will greatly help strengthen our Agriculture
Program, primarily for the less developed member countries.
5. Development of NPOs
Strengthening of the NPOs remains a primary mission
with cardinal importance, for which both multi-country
as well as in-country specially tailored programs
have been put in place. The multi-country programs,
which address the common needs and requirements of
both advanced and developing NPOs, offer a unique
opportunity to cross-fertilize innovative ideas and
experiences among NPOs. In 2003, the projects offered
included Enhancing NPOs’ Core Competence and
Best Practices among NPOs. In addition, an APO Liaison
Officers’ meeting was held at the Secretariat
which proved immensely fruitful as a venue of effective
dialogue between NPO officers and Secretariat staff.
It was decided to organize this meeting on a regular
basis.
The in-country programs are designed to meet the
specific needs of individual NPOs to reinforce their
institutional capacity and capability. Facilitating
a mentoring system between NPOs and expanding their
alliances and networking were the focal points of
various projects. The national roundtable productivity
conferences held in Indonesia and Laos vividly demonstrated
the value of these focal points, and those conferences
resulted in road maps for the productivity movement
in the two countries.
The challenge confronting NPOs pertains to the need
to secure support from all stakeholders in society.
In reality, however, they are in mixed positions ranging
from highly advanced to less developed institutions.
The vitalization of the NPOs should therefore remain
a top priority for us to tackle in the years ahead.
The newly designed APO Fellowship Program intends
mainly to facilitate NPOs’ institution building.
I want to stress once again that the basic spirit
of mutual cooperation among NPOs should remain an
unshakable tenet.
6. IT, Information, and Public Relations
IT remains an important tool allowing the APO Secretariat
to continue to improve its operational efficiency
and cost-effectiveness. Such IT platforms as the APO
Web site, APO intranet, and APOnet are now in full
operation. In 2003, the APO e-Forum was added as a
new platform through which participants could establish
networks among themselves for the continuous sharing
of information and experience. Last year, the first
Web-based conference on "Sustainable Investment
Global Network for Asia: SIGN3 Asia" was organized
in collaboration with other SIGN3 partners. This was
followed by an e-learning training course on ISO 9001:2000
that used the APOnet as a platform. These programs
demonstrated that the Internet offers a cost-effective
way for delivering training programs. The Secretariat
is determined to harness IT to improve its operations,
facilitate the sharing of information among staff
members as well as between NPOs and the Secretariat,
and organize e-learning projects. Starting from this
year, NPOs can apply for technical expert services
(TES) online.
The APO Asia-Pacific Productivity Data and Analysis
remains a major focus of our program activities. The
2003 edition was released in January this year. Every
endeavor is being made to build this core competence
of the APO into a volume that is valuable to policymakers
and business leaders in their strategic thinking,
policy formulation, and socio-economic planning. I
wish to thank the Directors for helping us select
competent national experts for this project who, I
am confident, will contribute to upgrading further
the reliability and quality of the publication.
II. Policies and Strategies
The last Governing Body Meeting held in Fiji undertook
intensive discussion of the APO’s policies and
strategies that had an important bearing on its future
activities. Today I wish to draw your kind attention
to major issues raised during the meeting and report
to you the actions taken and the results achieved.
First, the shift of program focus from Category A
to B and C was a unanimous decision among the Directors.
While the ratio for 2003 programs was far from satisfactory
as it was 70% for Category A, 15% for B, and 15% for
Category C, the ratio for 2004 will improve to 49%
for A, 24% for B, and 27% for C in terms of budgetary
allocation. Furthermore, as shown in the Two-Year
Plan 2005 and 2006, the number of Category B and C
projects in 2005 and 2006 will constitute 55% and
56%, respectively.
Second, we have made substantial improvement in cost
savings in terms of both administration and operations.
Let me cite some figures. The use of discount air
tickets saved us US$950,000 in 2003 compared with
2002, thanks to the cooperation of the NPOs. In addition,
considerable savings in telephone bills, postage and
mailing, and publications have been made with the
introduction of the APOnet, e-books, Web-based projects,
and other IT-based activities. Here I would like to
stress the importance of the immense benefits in quality
aspects derived from the use of IT, although it is
difficult to quantify them in an explicit way. Furthermore,
staff expenses and office rent are expected to be
reduced by $260,000 (28 million yen) and $430,000
(46 million yen), respectively, in 2004. We will keep
a firm grip on costs in future as well to meet your
expectations.
Third, a review of the APO salary scale has been
commissioned to the Hay Group Ltd., an internationally
reputed consultant, which has prepared a set of recommendations
including the adoption of a new method of salary adjustment.
The report was submitted to the Directors for perusal.
The last item relates to the local implementation
costs, which are closely linked to our cost-saving
efforts. I regret to report to you that member countries’
contribution in this regard has in general shown a
declining trend over the years. May I request all
member countries to kindly secure the necessary funds
to host APO projects.
At the time of the WSM held in Colombo last February,
a couple of new proposals were submitted by the delegates
in order not only to raise the profile and visibility
of the APO and NPOs but also to rejuvenate their functions
and activities. One was to designate a yearly event
of the APO just as the UN designated this year as
the International Year of Rice. The WSM suggested
marking 2004 as the APO Year of Green Productivity
with a view to unveiling a variety of GP-specific
activities this year. I appreciate the kind consent
by the Directors to that proposal given through correspondence.
The other proposal, introduced by the JPC-SED, was
to establish the APO Organizational Excellence Award.
This proposal was also submitted to Directors in advance
for perusal. While both APO Regional and National
Awards, which have already been established, are given
to individuals who have made outstanding contributions
to the cause of increasing productivity, the newly
proposed award intends to give due recognition to
business corporations and organizations including
public administration that have significant achievements
in productivity improvement. I hope that this proposal
will also be studied by Directors at this meeting
with a forward-looking manner.
The APO works through its network of NPOs in member
countries. Within this network, the proactive participation
and initiative of all NPOs in sharing their expertise
and resources for the common good of the organization
remain vital. In this highly networked global society,
however, the APO must constantly look beyond its boundaries
to establish alliances with national and other international
organizations in fulfilling its mission and goals.
The last GBM suggested that strategic partnerships
be further strengthened at the global level. In this
regard, let me express my appreciation to the UN,
International Labour Organization, UN Environment
Programme, Food and Agriculture Organization, UN Economic
and Social Council for Asia and the Pacific, UN Volunteers,
Asian Development Bank, Food and Fertilizer Technology
Center for the Asian and Pacific Region, Organization
for Economic Cooperation and Development, Colombo
Plan Secretariat, UBIFrance, State of Hawaii, Regional
Institute of Environmental Technology (Singapore),
and European Partners for the Environment. I look
forward to cementing further the relationships forged
over the years and forming new partnerships to spread
the gospel of productivity more widely.
This will be my final attendance at the Governing
Body Meeting. The APO has experienced reforms and
changes in many ways during my tenure over the past
six years to respond to the rapidly changing global
situation and to cope with new challenges in serving
the needs of member countries. First, I would like
to point to the considerable improvement in accountability,
openness, and transparency of the Secretariat, which
is a great tribute to the professionalism of all Secretariat
staff. Second, the publication of the APO Productivity
Data and Analysis was launched in 200l to fulfill
our responsibility as the leading productivity organization
in the region. Third, IT application has gained momentum
with the introduction of an intranet, extranet, and
Web-based projects that have contributed immensely
to the speed and cost-effectiveness of APO activities.
Fourth, we formulated the three-pillared vision of
APO activities when we celebrated the 40th anniversary
to show clearly the direction in which we should proceed.
Fifth, we have continued to update the thrust areas
not only to meet the changing needs of the times and
of member countries but also to utilize our limited
resources in the most efficient and effective way.
Sixth, the Secretariat has been instrumental in the
revitalization of NPOs in such countries as Pakistan,
Sri Lanka, and Indonesia so that they could play a
leading role in promoting the productivity movement
at the national level. Seventh, the scope and reach
of collaboration with other international organizations
and the private sector have intensified the synergistic
effects of our activities and increased our visibility
globally. Participation in the WSSD in 2002 as well
as organization of Eco-Products International Fair
and Venture Forum Kansai are cases in point. Last
but not least, I feel honored to share the pleasure
with all Directors that Lao PDR in 2002 and Cambodia
in 2004 became the 19th and 20th new APO members,
respectively.
Ladies and gentlemen, the transformation of the APO
I have attempted to outline shows steady and dynamic
progress over the years. Needless to say, this is
due mainly to the unflinching commitment of member
countries to the productivity movement and the firm
shared conviction that productivity will make our
tomorrow better than today. I have no doubt that we
have a promising future as long as we can maintain
the bedrock spirit of the APO, that is, the spirit
of mutual cooperation and trust among member countries.
With my departure from the APO coming closer, I wish
to express my heartfelt appreciation to all of you
for your prudent guidance, valuable cooperation, and
kind support extended to me. It has been the greatest
honor and privilege of my life to serve the APO as
Secretary-General.
Thank you.
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