Malaysia, Thailand ready to deal with China<\/p>\n
Deutsche Presse-Agentur, Singapore<\/p>\n
South Korea, Malaysia and Thailand look well placed to deal
\nwith the economic threat from China, but Indonesia, the
\nPhilippines and Vietnam raise the most concern, a research report
\nsaid on Wednesday.<\/p>\n
The problems are not insurmountable for the three in the final
\ncategory, provided the countries act fast, said Steve Brice,
\nStandard Chartered Bank's chief economist for Southeast Asia.<\/p>\n
\"They need confronting without delay,\" said Brice. \"The longer
\nthe delay, the greater the sub-optimal outcome for these
\ncountries will be.\"<\/p>\n
Singapore, Hong Kong, India and Taiwan are in a tighter
\nsituation than South Korea, Malaysia and Thailand, he said, but
\nare nevertheless likely to deal with the threat.<\/p>\n
Countries have four options: move up the value-added chain,
\nimprove the business environment, reduce costs or devalue their
\ncurrencies, the report said.<\/p>\n
Moving up the value-added chain is the most desirable route as
\nit not only avoids direct competition with China, but also
\nresults in finding a niche for the country in terms of China's
\nincreasing demand for high-tech products, Brice said.<\/p>\n
World Bank data shows high-tech exports make up as much as 70
\npercent of Singapore's exports, against a low of 15-20 percent
\nfor Indonesia and the Philippines.<\/p>\n
\"The good thing for Taiwan and Singapore is that they are
\nsignificantly ahead of China in the value-added chain with
\nSingapore expected to open two top-of-the-end semiconductor
\nplants in 2003 while Taiwan already has such plants,\" he added.<\/p>\n
While Hong Kong is well-positioned to capitalize on China's
\ngrowth, the report said the competitive forces unleashed by
\nChina's development are also forcing the Special Administrative
\nRegion to move up the value-added chain fast.<\/p>\n
\"The economic transformation is putting a lot of strain on the
\nless competitive segments of the community,\" it noted.<\/p>\n
Thailand looks relatively well-protected given its competitive
\nauto sector, Brice said. There are also signs it would be able to
\ncompete in higher-end consumer electronic goods.<\/p>\n
Indonesia and the Philippines were identified as the most
\nworrying countries, requiring strong leadership to deal with the
\nfrustrations faced by businessmen.<\/p>\n
This is unlikely until the current leaders emerge stronger
\nfrom the next elections, the report said.<\/p>",
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"sponsor": "Okusi Associates",
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