ASEAN draws up aggressive plans for foreign funds

ASEAN draws up aggressive plans for foreign funds

KUALA LUMPUR (AFP): Southeast Asian countries agreed here yesterday to woo foreign funds by liberalizing investment rules and working closely together, a Malaysian official said.

The heads of state-owned investment agencies within the Association of Southeast Asian Nations (ASEAN) agreed to set up a meeting of senior officials to draw up an action plan, he said.

"The senior officials will assist the heads on developing meaningful and practical measures in the areas of investment cooperation and promotion," Zainal Abidin, chairman of the Malaysian Industrial Development Authority, told a media conference.

After two days of talks in Glenmarie, suburban Kuala Lumpur, the ASEAN investment chiefs said the senior officials would draw up a report to be presented for approval by ASEAN finance ministers in Jakarta in September.

ASEAN officials have voiced concern over the drop in the regional grouping's share of total foreign direct investment to Asia from 62 percent to 31 percent between 1991 and 1994.

Finance ministers of ASEAN, which groups Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, in April drew up a regional initiative on investment called the ASEAN Investment Area.

The investment chiefs said they would investigate ways of improving regional investment cooperation, promotion and intra- ASEAN investment to boost the ASEAN Investment Area scheme.

Zainal told media the senior ASEAN officials would also look into joint promotions to attract foreign direct investment in hi- technology industries.

Other areas would include greater transparency of the regional grouping's investment rules, joint training programs for ASEAN investment officials and greater cooperation on the exchange of investment data.

The investment chiefs supported revisions to a 1987 ASEAN pact on promotion and investment protection, saying these changes would be adopted in the form of a protocol by the economic ministers in September.

The more developed ASEAN members could relocate labor- intensive industries such as textile and footwear to less- developed member countries such as Vietnam, one head of an investment agency said.

The more developed partners could then concentrate on attracting investors to set up more hi-technology industries, said the agency chief, who declined to be named.

However, he said it would be easier to promote and cooperate in investment programs than to liberalize investment rules.

"There is a lot to be worked out," the official said, including whether all industries in ASEAN countries would be accorded similar privileges to those accorded to domestic companies.