ASEAN members urged to consider differences

JAKARTA (JP): Minister for Investment Sanyoto Sastrowardoyo said yesterday ASEAN should consider its members' economic differences when admitting Cambodia, Laos, and Myanmar as new members.

"There are challenges and opportunities for us when ASEAN membership has been expanded with the inclusion of three other prospective members, namely Cambodia, Laos and Myanmar," he said.

Sanyoto, who is also the chairman of the Investment Coordinating Board, was speaking at a three-day seminar called "Enhancement of Trade and Investment Cooperation in Southeast Asia: Challenges and Opportunities towards ASEAN-10 and Beyond".

ASEAN secretariat and the United Nations Economic Social Commission for Asia and the Pacific organized the seminar.

ASEAN groups Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. Cambodia, Laos and Myanmar are expected to join in the middle of this year.

Sanyoto said that to cope with the challenges and opportunities ASEAN members should lay down a long term strategy with some basic elements.

The basic elements should include ASEAN's continuing efforts to provide a stable macroeconomic environment, improve its efficiency and competitiveness, and place more emphasis on human resource development, he said.

He said ASEAN should prioritize investment in basic infrastructure with a view to spreading out development more evenly into less developed regions.

"Since public sector resources in most ASEAN member countries might still be limited, the private sector should be given a greater role in the provision of social infrastructure, such as education, health care and economic infrastructure," he said.

ASEAN should be also committed to more equitable and fair development strategies, including reducing poverty by providing direct assistance to people with limited access to economic opportunities.

U Nyan Lynn, the seminar's participant from Myanmar, said an expanded ASEAN would pose new challenges.

"The existence of differences in the level of economic development, political and social systems and the integration of new members in a brief time span naturally calls for greater accommodation and understanding based on equality and mutual respect," he said.

He said most ASEAN countries were becoming increasingly industrialized and had integrated into global trade, investment and financial systems.

But Cambodia, Laos and Myanmar remained agricultural countries in search of contacts, markets, investment capital, skills and technology necessary for their level of development, he said.

"Once ASEAN becomes ASEAN-10, the Association must not be divided by economic cleavages. The nations and people of ASEAN must strive to make economic development a part of the common regional goal and they must be prepared to engage in the task of helping to resolve one another's structural problems," he said.

Nguyen Thanh Trung, a member of the Vietnamese delegation to the seminar, said ASEAN's spirit was important.

"Amid the current process of globalization, competition was unavoidable among countries of the world. But for us in ASEAN the more important thing is the ASEAN spirit, that is to cooperate, coordinate, and benefit each other," he said.

Investment

Talking about investment Sanyoto quoted the United Nations' 1996 world investment report which stated ASEAN nations were among the world's few developing countries which could attract substantial foreign direct investment (FDI).

The ASEAN region, one of the fastest growing economies in the world, absorbed about US$20 billion, or more than 30 percent of FDI into South, East, and Southeast Asia in 1995.

Within ASEAN Indonesia, Malaysia and Singapore had the largest FDI worth $4.5 billion, $5.8 billion, and $5.3 billion respectively.

But capital inflows to the three prospective member countries -- Cambodia, Laos and Myanmar -- was just $165 million or 0.83 percent of the capital inflows to existing ASEAN members.

World FDI in 1995 totaled $315 billion, up almost 40 percent on the previous year.

Although the capital inflow into developing countries in 1995 increased 14.5 percent to $100 billion, its share of world capital inflow fell from 38.5 percent in 1994 to 31.6 percent in 1995.

But FDI to developed countries in 1995 was $203 billion, a 64.5 percent rise from the previous year. (bnt)