Asia needs more clout in global financial system

14 October 2014

Source: New Straits Times, The (Malaysia)
Source type: Newspaper
Published on: 28 Oct 2008

TWELVE years after its inception, the Asia-Europe Meeting (ASEM) starting here tomorrow will have something meaty to chew on -- the financial meltdown that has crippled huge financial institutions in the United States and Europe, and still threatens to take the world down with it. This overwhelming issue could perhaps save ASEM from becoming just another inter-regional forum without real bite, as it has slowly become with each successive summit -- failing to produce substantive cooperation in politics, economy and the socio-cultural sector for which it was originally set up.

Although Asia has so far largely been untouched by the financial tsunami in the West, it cannot wait on the sidelines for the big boys in the US and Europe to decide how to put the financial system back in thegroove. To do so could be suicidal as developed countries have not proven that they have the interests of the rest of the world at heart when seeking solutions.

Asia has already learnt one tough lesson from its own crisis in the late 1990s and no Asian country would want to go begging to the International Monetary Fund for help, as Iceland has done this time.The French, who currently hold the European Union presidency, have been pressing for a new global financial order to replace the Bretton Woods agreement sealed in the 1940s, and the US has agreed to havesuch talks after its presidential elections in two weeks' time.

Now is therefore the time for Asia to press home the need for better Asian representation (read developing nations) in the talks, as so far only Japan will be in the talks. French President Nicolas Sarkozy, to hiscredit, has asked for China and India to be included for a more representative solution and, hopefully, a better international financial regulator than both the IMF and World Bank which have often forced USmedicine on ailing Third World countries.

Thus when Prime Minister Datuk Seri Abdullah Ahmad Badawi begins his series of meetings prior to and even during breaks within ASEM proper, he will have his work cut out.

Abdullah, who arrived late last night, will have his first opportunity to share his ideas at the Asean leaders working dinner tonight.

Tomorrow morning, the Asean+3 breakfast meeting will give Abdullah and his Southeast Asian colleagues the opportunity to share with three important North Asian colleagues their concerns.

As Japan, and possibly China, will be involved in the talks by the leading economies for a new financial order, strong articulation of what must be done to ensure developing countries (mostly Asians) are notsucked into the financial turmoil created by the US needs to be voiced out at the meeting.

China, had in the 1997 East Asian financial crisis, proven itself to be a friend of its developing neighbours, and Asean can no doubt count on that support again.

South Korea, the third country at the breakfast table this morning, knows what it is like to get the poisoned help from the IMF. This time South Korea is, again, one of the few Asian countries to be affected by thefinancial crisis sweeping through the US and Europe, and can therefore be expected to have empathy and share the concerns of its Asean partners.

After breakfast, Abdullah will have a series of bilateral meetings with his counterparts from, among others, Thailand, the Philippines, Pakistan and possibly Chinese Premier Wen Jiabao, the ASEM host.

ASEM will begin tomorrow afternoon, followed by plenary sessions on Saturday. So pressing and urgent is the need to discuss the financial crisis that more bilateral meetings are still being arranged for the primeminister, in between the plenary sessions and before Abdullah leaves for home after the official closing of ASEM at 3pm on Saturday.

Malaysian Ambassador to China Datuk Syed Norulzaman Syed Kamarulzaman, at a briefing for Malaysian media covering ASEM, agreed that although other issues, including sustainable development, would bediscussed, it would be proposals to contain the financial meltdown that would take centrestage. He cautioned, however, that the more than 40 leaders of Asian and European countries attending ASEM might not be able to agree on a statement on the financial situation.

Syed Norulzaman said the leaders were, however, expected to spend a lot of time and energy to discuss the crisis and come up with concrete proposals that European and Asian heads of government would be ableto bring to the table when discussing with the US a new global financial system on Nov 15.

By Lee Ah Chai in Beijing