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East Asia pushes forward fledgling economic bloc |
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July 27, 2000
BANGKOK (AP) - Foreign ministers from the Association of Southeast Asian Nations plus Japan, China and South Korea were holding their first ever formal joint meeting Wednesday, pushing forward plans for an East Asian economic bloc. It marked the latest step toward stronger pan-Asian regionalism in the aftermath of the financial crisis that struck in 1997 and exposed the weakness of international financial institutions and the reluctance of the West to come to Asia's rescue. Leaders of ASEAN's 10 member states and the three Northeast Asian powers agreed late last year to advance cooperation and lay foundations for a new pillar of the global economy to rival the European Union and the North American Free-Trade Area. "The two parts of Asia, the Southeast and the Northeast, can no longer live apart in isolation of each other," Foreign Minister Surin Pitsuwan of Thailand said Tuesday. Earlier this year, ASEAN Plus Three, as the grouping has become known, announced in Chiang Mai, Thailand, the creation of a system to rescue each other's currencies in case of new financial crises. Trade ministers meeting in Myanmar meanwhile mooted the idea of expanding the planned ASEAN Free Trade Area, which is to eliminate most tariffs by 2002, in some sectors. First proposed by Malaysian Prime Minister Mahathir Mohamad a decade ago, but opposed by the United States for fear it would split the Asia-Pacific into east and west, an East Asian bloc is increasingly seen as a positive for the global economy and for stability of financial markets. The aggregate economy and external trade of East Asia is already about as large as those of the United States and European Union, according to Fred Bergsten, director of the Washington-based Institute for International Economics, writing in the July 15 edition of The Economist magazine. The region's collective purchasing power - dlrs 9,431 billion in 1997 - actually surpassed both the E.U. and the United States, Bergsten said. Alexander Downer, Australia's foreign minister, said Wednesday that while ASEAN Plus Three is at an "embryonic" stage, it was "an enormously positive step." For the Asia-Pacific region to prosper, after enduring conflict for much of the 20th century, it was essential to expand cooperation between countries - something that Australia could eventually be part of. "If we are invited to participate in it, we will be happy to do so," Downer told reporters. Southeast Asian policymakers hope the cooperation will stimulate economic development in ASEAN, which includes some of Asia's richest and poorest nations. ASEAN comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. The budding bloc has been cemented by Japan's financial support to Southeast Asian countries during the crisis and help in developing human resources and information technology. Kobsak Chutikul, director of economic affairs at the Thai Foreign Ministry, said the currency rescue program could be the beginning of an Asian Monetary Fund. The idea was mooted by Japan three years ago after the crisis struck, but was knocked down by Washington, which saw it as a challenge to the International Monetary Fund. The IMF became deeply unpopular in Asia after its own rescue programs made conditions in some stricken countries worse. Boosters hope that ASEAN Plus Three can eventually evolve into something more cohesive along the lines of the European Union, but acknowledge that remains decades off. "In a region encompassing nearly a third of humanity, it's an enormous undertaking," Kobsak said. "It took Europe 30-40 years to achieve a single currency and free trade area," Kobsak said. "It may take us half that time." |