Government spent $26 million on Apec hosting prep before Covid forced the summit online

The Government had already spent more than $26 million on preparations for hosting Apec before the decision was made to make the annual meeting of world leaders a virtual summit.

And a former Foreign Affairs Minister says New Zealand is also losing out on the significant showcasing advantage it would have had, if the event were to have gone ahead in Auckland as planned.

APEC 2020 formally ended on Saturday morning (NZ time), following a virtual meeting between the leaders of the participating countries.

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The summit was “hosted” in Malaysia this year but because of Covid-19, the entire event was done online.

The Apec mantel now falls to New Zealand, which is hosting the summit next year.

“While this isn’t an in-person meeting, it will be one of the most important international events New Zealand will host in decades,” Prime Minister Jacinda Ardern said.

But, due to the logistics of organising such a significant event – which includes hosting world leaders from 21 different countries including the US, Australia, Japan and China – it takes years to prepare for the event.

A spokesperson from the Ministry of Foreign Affairs and Trade (Mfat) told the Herald that before the decision was made to hold a virtual summit, some $26.3m had been spent on preparations.

The overall budget of hosting the event is $46.13m.

Former Foreign Affairs Minister in the Key administration, Murray McCully, said a virtual Apec means the costs won’t be as high as if the event had gone ahead in person.

“Apec is a very expensive meeting to host – especially the leaders and ministers component. But let’s not forget also a raft of officials meetings that take place over a number of months.”

He said it also means that one of the biggest economic opportunities for the host nation, its ability to showcase itself to the world, has also more or less been lost.

“New Zealand is missing out on a huge showcasing opportunity, but it’s also no doubt going to be saving a significant budget,” he told the Herald.

“I suppose it’s sort of a double-edged sword.”

Foreign Affairs expert Stephen Jacobi said New Zealand would also miss out on the additional spending from all the visitors who would have otherwise been in New Zealand for Apec.

World leaders are accompanied by an entourage of aides, officials and ministers during their Apec summit trips – not to mention the host of reporters and extra security the event also draws.

“On the other hand, we don’t have to pay out a very large amount of money that would be required to host them in the right way,” Jacobi said.

“The Government is avoiding a very large bill at a time of economic stringency for New Zealand.”

But there are other non-economic costs to taking Apec fully online that need to be considered, Jacobi said.

“To move to virtual means we lose some of the human factor that goes into a big gathering of leaders and officials, ministers and business people.”

A major loss will be the informal “pull-aside” meetings between world leaders which usually occur at Apec.

“It won’t be quite the same,” Jacobi said, adding that these meetings will have to be replicated “in some way, shape or form”.

McCully agreed – “[Apec] is very much an occasion for meetings for counterparts holding informal meetings.”

But Ardern is confident that, despite New Zealand hosting a virtual summit, Apec will still be a success.

“Delivering an innovative and well-run virtual Apec will demonstrate New Zealand’s digital and creative capabilities, along with our commitment to continued and effective diplomacy,” she said.

“In a Covid-19 world – It is more important now than ever.”

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